Dynamite Blockchain Corp.

DYNAMITE BLOCKCHAIN CORP.
(formerly Cryptoblox Technologies Inc.)

CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEARS ENDED JANUARY 31, 2025 and 2024
(Expressed in Canadian dollars, unless otherwise noted)

SRCO Professional Corporation
Chartered Professional Accountants
Licensed Public Accountants
Park Place Corporate Centre
15 Wertheim Court, Suite 409
Richmond Hill, ON L4B 3H7, Canada
Tel: 905 882 9500 & 416 671 7292
Fax: 905 882 9580
Email: [email protected]
www.srco.ca

INDEPENDENT AUDITOR'S REPORT

To the Shareholders of Dynamite Blockchain Corp. (formerly Cryptoblox Technologies Inc.) Opinion

We have audited the consolidated financial statements of Dynamite Blockchain Corp. (formerly Cryptoblox Technologies Inc.) and its subsidiaries (the "Company"), which comprise the consolidated statement of financial position as at January 31, 2025, and the consolidated statements of loss and comprehensive loss, changes in shareholders' (deficit) equity, and cash flows for the year then ended, and notes to the consolidated financial statements, including material accounting policy information (collectively referred to as the "consolidated financial statements").

In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as at January 31, 2025, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB").

Basis for Opinion

We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company in accordance with the ethical requirements that are relevant to our audit of the consolidated financial statements in Canada, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter - Material Uncertainty Related to Going Concern

We draw attention to Note 1 in the consolidated financial statements, which indicates that the Company incurred a net loss during the year ended January 31, 2025 and, as of that date, had a negative working capital and a deficit. As stated in Note 1, these events or conditions, along with other matters as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt on the Company's ability to continue as a going concern. Our opinion is not modified in respect of this matter.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements for the year ended January 31, 2025. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. Except for the matter described in the Emphasis of Matter - Material Uncertainty Related to Going Concern section, we have determined there are no other key matters to communicate in our report.

Other Matter

The consolidated financial statements of the Company for the year ended January 31, 2024, were audited by another auditor who expressed an unmodified opinion on those statements on May 30, 2024.

(continues)

SRCO

Independent Auditor's Report to the Shareholders of Dynamite Blockchain Corp. (formerly Cryptoblox Technologies Inc.) (continued)

Other Information

Management is responsible for the other information. The other information comprises Management’s Discussion and Analysis but does not include the consolidated financial statements and our auditor's report thereon. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditor's report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS as issued by the IASB, and for such internal control as management determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, management is responsible for assessing the Company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company's financial reporting process.

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control.

(continues)

SRCO

Independent Auditor's Report to the Shareholders of Dynamite Blockchain Corp. (formerly Cryptoblox Technologies Inc.) (continued)

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements (continued)

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Company to cease to continue as a going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Company to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

The engagement partner on the audit resulting in this independent auditor's report is Sameer Parekh.

SRCO Professional Corporation

Richmond Hill, Canada
May 29, 2025

CHARTERED PROFESSIONAL ACCOUNTANTS
Authorized to practice public accounting by the
Chartered Professional Accountants of Ontario

DYNAMITE BLOCKCHAIN CORP.
(formerly Cryptoblox Technologies Inc.)
Consolidated Statements of Financial Position
(Expressed in Canadian dollars, unless otherwise noted)

| | Note | January 31, 2025
$ | January 31, 2024
$ |
| --- | --- | --- | --- |
| Assets | | | |
| Current assets | | | |
| Cash | | 5,108 | 3,276 |
| Loan receivable | 4 | - | 263,200 |
| GST receivable | | 4,055 | 413,381 |
| Deposits and prepaid expenses | 5 | - | 2,050,000 |
| Intangible asset - digital assets | 11 | 3,138 | - |
| Investment in securities | 6 | 1 | 1,725,484 |
| Total current assets | | 12,302 | 4,455,341 |
| Non-current assets | | | |
| Mining equipment | 9 | 1,034,688 | 332,500 |
| Investment in Kaspa Mining Limited | 7 | 1,000,000 | - |
| Intangible asset - license | 10 | - | 766,667 |
| Intangible asset - purchase contracts | 11 | - | 1,607,322 |
| Total non-current assets | | 2,034,688 | 2,706,489 |
| Total assets | | 2,046,990 | 7,161,830 |
| Liabilities and shareholders’ equity | | | |
| Current liabilities | | | |
| Accounts payable and accrued liabilities | 12 | 1,374,876 | 1,200,677 |
| Liability on purchase contracts | 11 | - | 1,607,322 |
| Obligation to issue shares | 11 | - | 1,216,921 |
| Due to related parties | 8 | 178,563 | 75,000 |
| Tax payable | | 4,332 | 4,332 |
| Loan payable | 13 | 321,711 | 40,256 |
| Promissory note | 14 | 400,000 | - |
| Total current Liabilities | | 2,279,482 | 4,144,508 |
| Long term liabilities | | | |
| Long term promissory note | 14 | 600,000 | - |
| Total liabilities | | 2,879,482 | 4,144,508 |
| Shareholders’ (deficit) equity | | | |
| Share capital | 15 | 51,998,399 | 50,670,490 |
| Equity reserves | | 1,098,662 | 666,902 |
| Accumulated other comprehensive loss | | (5,574) | (4,216) |
| Deficit | | (53,923,979) | (48,315,854) |
| Total shareholders’ (deficit) equity | | (832,492) | 3,017,322 |
| Total liabilities and shareholders’ (deficit) equity | | 2,046,990 | 7,161,830 |

Nature of operations and going concern (Note 1)
Subsequent events (Note 24)

Approved and authorized for issuance by the Board of Directors on May 29, 2025:

/s/ "Victor Hui-Fai Ho"
Victor Ho, Audit Committee Chair and Director

/s/ "Akshay Sood"
Akshay Sood, CEO and Director

(The accompanying notes are an integral part of these consolidated financial statements)

DYNAMITE BLOCKCHAIN CORP.

(formerly Cryptoblox Technologies Inc.)

Consolidated Statements of Loss and Other Comprehensive Loss

(Expressed in Canadian dollars, unless otherwise noted)

	Note	Year ended January 31, 2025	Year ended January 31, 2024
Revenue	$	3,138	$ -
Cost of sales – hosting cost		(1,477)	-
Gross profit		1,661	-
Operating expenses
Advertising		-	22
Amortization	10	200,000	33,333
Consulting fees		77,768	120,216
Depreciation	9	120,312	-
Foreign exchange loss		6,341	274
Interest expense	13	46,556	5,551
Management fees	8	220,000	75,000
Office and general		67,483	74,228
Professional fees		284,565	195,391
Share-based compensation	8, 17	495,010	182,060
Total operating expenses		1,518,035	686,075
Loss before other income		(1,516,374)	(686,075)
CEBA loan forgiveness income	13	-	16,846
Interest income	4	-	23,934
Derecognition of obligation to issue shares	11	1,216,921	-
Derecognition of payables	11	1,607,322	71,652
Write-off of GST receivable		(395,913)	-
Write-off of Loan receivable	4	(263,200)	-
Write-off of deposits and prepaid expenses	5	(2,050,000)	-
Gain on settlement of accounts payable	15	25,091	600,000
Gain on sale of investment	7	-	1,450,333
Loss on investment in associate	7	-	(69,330)
Loss on investment in securities	6	(1,725,483)	-
Impairment of mining equipment	11	(332,500)	-
Impairment of intangible assets	11,10	(2,173,989)	(960,278)
Impairment of goodwill	11	-	(2,660,847)
Net loss for the year		(5,608,125)	(2,213,765)
Other comprehensive loss		(1,358)	(59)
Net loss and comprehensive loss	$	(5,609,483)	$ (2,213,824)
Basic and diluted (loss) income per share	$	(0.05)	$ (0.03)
Weighted average number of shares outstanding		112,318,968	67,187,628

(The accompanying notes are an integral part of these consolidated financial statements)

DYNAMITE BLOCKCHAIN CORP.

(formerly Cryptoblox Technologies Inc.)

Consolidated Statements of Changes in Shareholders' (Deficit) Equity

(Expressed in Canadian dollars, unless otherwise noted)

	Notes	Number of Shares	Share Capital Amount $	Equity Reserve $	Accumulated Other Comprehensive Loss $	Deficit $	Total Shareholders' Equity (Deficit) $
Balance, January 31, 2023		53,863,144	47,796,278	584,842	(4,157)	(46,102,089)	2,274,874
Shares issued for Red Water Acquisition	11	11,828,080	1,774,212	-	-	-	1,774,212
Share issued for Crypto Green Acquisition	10	42,800,000	1,070,000	-	-	-	1,070,000
Share issuance cost in share	10	-	(70,000)	-	-	-	(70,000)
Share-based compensation expense	15, 17	714,286	100,000	82,060	-	-	182,060
Net loss		-	-	-	(59)	(2,213,765)	(2,213,824)
Balance, January 31, 2024		109,205,510	50,670,490	666,902	(4,216)	(48,315,854)	3,017,322
Shares issued for options exercise	15	1,150,000	138,000	(63,250)	-	-	74,750
Shares issued for accounts payable	15	109,090	34,909	-	-	-	34,909
settlement
Share issued for IceRiver Miners	9	11,550,000	1,155,000	-	-	-	1,155,000
Share-based compensation expense	17	-	-	495,010	-	-	495,010
Net loss		-	-	-	(1,358)	(5,608,125)	(5,609,483)
Balance, January 31, 2025		122,014,600	51,998,399	1,098,662	(5,574)	(53,923,979)	(832,492)

(The accompanying notes are an integral part of these consolidated financial statements)

DYNAMITE BLOCKCHAIN CORP.
(formerly Cryptoblox Technologies Inc.)
Consolidated Statements of Cash Flows
(Expressed in Canadian dollars)

| | Note | Year ended January 31, 2025
$ | Year ended January 31, 2024
$ |
| --- | --- | --- | --- |
| Operating activities | | | |
| Net loss | | (5,608,125) | (2,213,765) |
| Items not involving cash: | | | |
| Amortization | 10 | 200,000 | 33,333 |
| Depreciation | 9 | 120,312 | - |
| Intangible asset – digital assets | 11 | (3,138) | - |
| Share-based compensation | 8, 17 | 495,010 | 182,060 |
| Impairment of equipment | 11 | 332,500 | - |
| Impairment of intangibles | 10, 11 | 2,173,989 | 960,278 |
| Impairment of goodwill | 11 | - | 2,660,847 |
| Interest income | 4 | - | (23,934) |
| Interest expense | 13 | 46,556 | 5,196 |
| CEBA loan forgiveness income | 13 | - | (16,846) |
| Gain on derecognition of payable | 11 | (1,607,322) | (71,652) |
| Gain on derecognition of obligation to issue shares | 11 | (1,216,921) | - |
| Write-off of GST receivable | | 395,913 | - |
| Write-off of Loan receivable | 4 | 263,200 | - |
| Write-off of deposits and prepaid | 5 | 2,050,000 | - |
| Loss of investment in securities | 6 | 1,725,483 | - |
| Loss in investment in associate | 7 | - | 69,330 |
| Gain on sale of investment | 7 | - | (1,450,333) |
| Gain on settlement of accounts payable | 15 | (25,091) | (600,000) |
| Changes in non-cash working capital items: | | | |
| Accounts payable and accrued liabilities | | 193,932 | 331,326 |
| Due to related parties | | 194,501 | 63,292 |
| Accounts receivable | | - | 74,518 |
| GST receivable | | 13,079 | (21,998) |
| Net cash used in operating activities | | (256,122) | (18,348) |
| Financing activities | | | |
| CEBA loan payable | 13 | - | (40,000) |
| Loan payable | 13 | 245,500 | 40,000 |
| Proceeds from the exercise stock options | 15 | 13,812 | - |
| Net cash provided by financing activities | | 259,312 | - |
| Effect of foreign currency translation | | (1,358) | (59) |
| Increase (decrease) in cash | | 1,832 | (18,407) |
| Cash, beginning | | 3,276 | 21,683 |
| Cash, ending | | 5,108 | 3,276 |

Supplement Cash Flows (Note 19)

(The accompanying notes are an integral part of these consolidated financial statements)

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

1. Nature of Operations and Going Concern

Dynamite Blockchain Corp. (formerly CryptoBlox Technologies Inc.) (the "Company") was incorporated under the laws of British Columbia on January 16, 2015. The name of the Company changed to Dynamite Blockchain Corp. on November 26, 2024. The Company's shares are listed on the Canadian Securities Exchange (the "Exchange") under the symbol "KAS" (formerly BLOX). The Company's registered records office is 6th floor – 905 West Pender Street, Vancouver, BC V6C 1L6.

Dynamite Blockchain Corp. is a blockchain technology and infrastructure company.

On November 1, 2023, the Company completed a 10:1 consolidation of its total issued and outstanding shares. No fractional shares were issued. All fractional shares that resulted from the consolidation were rounded up or down to the nearest whole number. All share figures and references have been retroactively adjusted to reflect the share consolidation.

Going concern uncertainty

These consolidated financial statements have been prepared on a going concern basis, which assumes that the Company will continue to realize its assets and discharge its obligations and commitments in the normal course of operations. As at Jan 31, 2025, the Company incurred a net comprehensive loss of $5,609,483 for the year then ended (2024 - $2,213,824), had a working capital deficiency of $2,267,180 (2024 – working capital of $310,833) and has accumulated losses of $53,923,979 (2024 - $48,315,854) since its inception. The losses limit the Company's ability to fund its operations.

The Company expects to incur further losses in the development of its new business. The Company does not have sufficient cash to sustain operations for the next twelve months without additional financing. The Company's ability to continue as a going concern is dependent upon its ability to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management estimates that the Company will raise sufficient funds to maintain its operations and activities for the upcoming year. Although the Company has been successful in the past in raising funds to continue operations, there is no assurance it will be able to do so in the future.

These material uncertainties may cast significant doubt as to the Company's ability to continue as a going concern.

These consolidated financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary if the going concern assumption was deemed inappropriate. Such adjustments could be material.

2. Basis of Presentation

Statement of Compliance

These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") and interpretations of the IFRS Interpretations Committee as issued by the International Accounting Standards Board ("IASB") on a going concern basis. These audited consolidated financial statements were approved and authorized for issue by the Board of Directors on May 29, 2025.

Basis of Measurement

These consolidated financial statements have been prepared on an accrual basis and are based on the historical cost basis except for certain financial assets measured at fair value. The consolidated financial statements are presented in Canadian dollars, unless otherwise noted, which is the Company's functional currency. The functional currency of CryptoPlug Technologies Inc., Optimal CP Inc., and Red Water Acquisition Corp. is the Canadian dollar. The functional currency of 1Linx Ltd. is the United States dollar and the currency translation adjustment is recognized through other

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

comprehensive income. The preparation of consolidated financial statements in compliance with IFRS requires management to make certain critical accounting estimates. It also requires management to exercise judgment in applying the Company's accounting policies.

Basis of Consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries:

Company Name	Country of Incorporation	Functional Currency	Business Activity	Ownership % as at January 31, 2025 and 2024
Red Water Acquisition Corp.	Canada	Canadian Dollar	Digital Asset Mining	100%
1Linx Ltd.	U.S.A.	U.S. Dollar	Blockchain Technology	100%
CryptoPlug Technologies Inc.	Canada	Canadian Dollar	Application Technology	100%
Optimal CP Inc.	Canada	Canadian Dollar	Digital Mining	100%

All intercompany transactions and balances have been eliminated on consolidation.

3. Material Accounting Policy Information

a) Use of Estimates, Assumptions and Judgements

The preparation of the consolidated financial statements in conformity with IFRS requires the Company's management to make estimates, assumptions and judgements that affect the application of accounting policies and reported amounts of assets, liabilities, revenues and expenses.

The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances and which form the basis of making judgments about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and further periods if the revision affects both current and future periods.

Significant areas requiring the use of estimates, assumptions and judgement include the useful life; depreciation of equipment; amortization of intangible assets; measurement of share-based payments; revenue recognition; valuation of digital assets; valuation of investment; fair value of investments; valuation and inputs of share-based compensation; capitalization and recoverability of property; plant and equipment and intangible assets; and impairment considerations for investments, equipment, and intangible assets.

Assessment of the transactions as asset acquisitions or business combinations

Management applied judgement relating to the acquisition of the IceRiver Kaspa Miners (Note 9) to assess whether the acquisition was an asset acquisition or business combination. Management applied a three-element process considering inputs, processes and outputs of the acquisition to reach a conclusion. The Company has determined that the operations do not constitute a business by assessing that the following exist: Inputs - tangible and intangible assets, Processes - business operations, management and staff, Outputs - revenue generating from data operations. The inputs and processes are managed by an arm's length consultant and are not under the control of the Company.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Valuation of digital assets

Digital currencies are carried at their fair market value as determined by the spot rate based on volume weighted average from www.coinbase.com. The digital currency market is highly volatile; historical prices are not necessarily indicative of future value; a significant change in the market prices for digital currencies would have a significant impact on the Company's statement of loss and comprehensive loss and financial position. In addition, management estimates that selling costs will be nominal. Digital currency prices are affected by various forces including global supply and demand, interest rates, exchange rates, inflation or deflation and the global political and economic conditions. A decline in the market prices for digital currency could negatively impact the Company's future operations. The Company has not hedged the conversion of any of its digital assets.

The Company is required to make significant assumptions and judgements to its accounting policies and the application thereof which is disclosed in the notes to these financial statements. If specific guidance is enacted by the IASB in the future, the impact may result in changes to the Company's profit or loss and financial position as currently presented.

Valuation of investments

Estimation of fair value of investments at FVTPL is subject to significant uncertainty when the investments are within private companies and little or no information is available. Management is required to make significant assumptions and judgements in estimating the fair value which may result in significant changes to the Company's profit and loss in future periods when more information about the fair value becomes available.

Valuation of share-based compensation

The Company utilizes the Black-Scholes option pricing model to estimate fair value of the stock options granted to directors, employees, and consultants while RSU's are valued at the fair value on the date of grant. The use of Black-Scholes option pricing model requires management to make various estimates and assumptions that impact the value assigned to the options including the forecast future volatility of the share price, the risk-free interest rate, dividend yield and the expected life of the options. Any changes in these assumptions could have a material impact on the share-based compensation calculation value; however, the most significant estimate is the volatility. Expected future volatility can be difficult to estimate as the Company has had limited history and is in a unique industry, and historical volatility in not necessarily indicative of future volatility.

Going concern evaluation

These financial statements have been prepared under the assumptions applicable to a going concern. If the going concern assumption were not appropriate for these financial statements, the adjustments would be necessary to the carrying value of assets and liabilities, the reported expenses and the statement of financial position classifications used, and such adjustments could be material.

The Company reviews the going concern assessment at the end of each reporting period. There were no material changes to the assessment as at January 31, 2025.

b) Recent Accounting Pronouncements

The accounting standards or amendments to existing accounting standards that have been issued but have future effective dates are either not applicable or are not expected to have a significant impact on the Company's consolidated financial statements.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Presentation and Disclosure in Financial Statements ("IFRS 18"),

IFRS 18 has been issued to achieve comparability of the financial performance of similar entities. The standard, which replaces IAS 1, impacts the presentation of primary financial statements and notes, mainly the income statement where companies will be required to present separate categories of income and expense for operating, investing, and financing activities with prescribed subtotals for each new category. IFRS 18 will require management-defined performance measures to be explained and included in a separate note within the consolidated financial statements. The standard is effective for annual reporting periods beginning on or after January 1, 2027, including consolidated financial statements, and requires retrospective application. The Company is currently assessing the impact of the new standard.

Amendments to IAS 21

In August 2023, the IASB issued amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates to specify how an entity should assess whether a currency is exchangeable and how it should determine a spot exchange rate when exchangeability is lacking. The amendments also require disclosure of information that enables users of its financial statements to understand how the currency not being exchangeable into the other currency affects, or is expected to affect, the entity's financial performance, financial position and cash flows. The amendments will be effective for annual reporting periods beginning on or after 1 January 2025. The Company is currently assessing the impact of this amendment.

Implementation of IFRS S1 – General Requirements for Disclosure of Sustainability-related Financial Information - and IFRS S2 – Climate-related Disclosures

The adoption of IFRS S1 and S2 will introduce new requirements surrounding sustainability and climate-related disclosures for annual reporting purposes. The Canadian Sustainability Standards Board proposed Canadian-specific modifications to the standards issued by the International Sustainability Standards Board in June 2023. The Canadian specific versions of IFRS S1 and S2 are expected to be available for voluntary adoption starting January 1, 2025. The Canadian Securities Administrators have not yet confirmed whether the new standards will be mandatory for Canadian reporting issuers. The Company is currently assessing the expected impact of adopting these standards.

IFRS 9 Financial Instruments ("IFRS 9") and IFRS 7 Financial Instruments: Disclosures ("IFRS 7")

In May 2024, the IASB issued Amendments to the Classification and Measurement of Financial Instruments (Amendments to IFRS 9 and IFRS 7). These amendments updated classification and measurement requirements in IFRS 9 Financial Instruments and related disclosure requirements in IFRS 7 Financial Instruments: Disclosures. The IASB clarified the recognition and derecognition date of certain financial assets and liabilities, and amended the requirements related to settling financial liabilities using an electronic payment system. It also clarified how to assess the contractual cash flow characteristics of financial assets in determining whether they meet the 'solely payments of principal and interest' criterion, including financial assets that have environmental, social and corporate governance (ESG)-linked features and other similar contingent features. The IASB added disclosure requirements for financial instruments with contingent features that do not relate directly to basic lending risks and costs and amended disclosures relating to equity instruments designated at fair value through other comprehensive income. The amendments are effective for annual periods beginning on or after January 1, 2026 with early application permitted. The Company is currently assessing the effect of these amendments on the financial statements.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

c) Financial Instruments

Financial assets and financial liabilities are recognized on the consolidated statements of financial position when the Company becomes a party to the contractual provisions of the financial instrument. All financial instruments are initially recorded at fair value.

Financial assets

On initial recognition, financial assets are recognized at fair value and are subsequently classified and measured at: (i) amortized cost; (ii) fair value through other comprehensive income ("FVOCI"); or (iii) fair value through profit or loss ("FVTPL"). The classification of financial assets is generally based on the business model in which a financial asset is managed and its contractual cash flow characteristics. A financial asset is measured at fair value net of transaction costs that are directly attributable to its acquisition except for financial assets at FVTPL where transaction costs are expensed. All financial assets not classified and measured at amortized cost or FVOCI, are measured at FVTPL. On initial recognition of an equity instrument that is not held for trading, the Company may irrevocably elect to present subsequent changes in the investment's fair value in other comprehensive income.

The classification determines the method by which the financial assets are carried on the statement of financial position subsequent to inception and how changes in value are recorded.

Financial liabilities

Financial liabilities are classified as either: (i) FVTPL; or (ii) other financial liabilities. All financial liabilities are classified and subsequently measured at amortized cost except for financial liabilities at FVTPL. The classification determines the method by which the financial liabilities are carried on the statement of financial position subsequent to inception and how changes in value are recorded.

The Company classifies and discloses fair value measurements based on a three-level hierarchy:

Level 1 – inputs are unadjusted quoted prices in active markets for identical assets or liabilities;

Level 2 – inputs other than quoted prices in Level 1 that are observable for the asset or liability, either directly or indirectly; and

Level 3 – inputs for the asset or liability that are not based on observable market.

A summary of the Company's classification of instruments under IFRS 9 Financial Instruments is as follows:

Financial Instruments	Classification
Financial Assets
Cash	Amortized cost
Loan receivable	Amortized cost
Investment in securities	FVTPL
Investment in Kaspa Mining Limited	FVTPL
Financial Liabilities
Accounts payable and accrued liabilities	Amortized cost
Liability on purchase contracts	Amortized cost
Due to related parties	Amortized cost
Loan payable	Amortized cost
Promissory Note	Amortized cost

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Impairment

An ‘expected credit loss’ impairment model applies which requires a loss allowance to be recognized based on expected credit losses. The estimated present value of future cash flows associated with the asset is determined and an impairment loss is recognized for the difference between this amount and the carrying amount as follows: the carrying amount of the asset is reduced to estimated present value of the future cash flows associated with the asset, discounted at the financial asset’s original effective interest rate, either directly or through the use of an allowance account and the resulting loss is recognized in profit or loss for the period.

In a subsequent period, if the amount of the impairment loss related to financial assets measured at amortized cost decreases, the previously recognized impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortized cost would have been had the impairment not been recognized.

d) Investments

The Company classifies and measures investments at FVTPL. As investments comprise investments in private company equity securities. If an investments’ carrying amount changes as a result of a revaluation, the change will be recognized in profit or loss.

e) Revenue Recognition

Revenue is recorded at an amount that reflects the consideration to which the entity expects to be entitled in exchange for transferring goods or services to a customer.

The principles in IFRS 15 are applied using the following five steps:

Identify the contract(s) with a customer
Identify the performance obligation in the contract
Determine the transaction price
Allocate the transaction price to the performance obligations in the contract
Recognize revenue when (or as) the entity satisfies a performance obligation. The Company has concluded that the recognition and measurement of the sale of products in all contracts is consistent with the current revenue recognition practice and therefore does not expect any transitional adjustment.

The Company derives its income from digital currencies received for providing “mining” services to digital currency blockchains. Mining is the Company’s principal business activity and is the process by which transactions are verified and added to the blockchain. A miner is only able to validate transactions once their computer equipment has solved a computationally difficult mathematical problem. A coin is considered earned on the completion and addition of a block to the blockchain, at which time the economic benefit is received and can be reliably measured. Revenue is measured based on the fair value of the digital currency received. Any difference between the fair value of cryptocurrency recorded upon receipt from mining activities and the actual realized price upon disposal are recorded as a gain or loss on disposition of cryptocurrency. The fair value is determined using the average weighted close price for the digital currency on www.coinbase.com.

f) Mining Equipment

Equipment are measured at cost, less accumulated depreciation and impairment losses, if any. Equipment are recorded at purchase cost. Direct labor and other directly attributable costs incurred to construct new assets and upgrade existing assets are capitalized. Repairs and

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

maintenance expenditures are recognized in the consolidated statements of income or loss as incurred. Significant renewals and betterments are capitalized. Equipment are depreciated using the straight-line method based on the estimated useful lives of the assets as follows:

Mining equipment has a useful life of 2 years.

The depreciation method, useful life and residual value of an asset are reviewed at least at each financial year-end and adjusted, if appropriate. When assets are retired or otherwise disposed of, their cost and the related accumulated depreciation are derecognized from the consolidated statements of financial position and the resulting gains or losses on the disposal or sale of the assets are recognized in the consolidated statements of operations.

g) Intangible Assets

Intangible assets are recorded at cost. The cost includes the purchase price, which includes import duties and non-refundable purchase taxes, after deducting trade discounts and rebates; and any directly attributable cost of preparing the asset for its intended use. Internally generated patent, research, and development assets are not capitalized, as they did not meet the criterion under IAS 38 Intangible Assets and accordingly the expenditure is reflected in the statement of total comprehensive loss in the period in which the expenditure is incurred.

Intangible assets with a finite useful life are amortized on a systematic basis over the useful life of the intangibles on a straight-line basis. The technology and economic factors indicate a longer useful life, however, the Company has used a 4-year useful life limited to the term of the patent license agreement (Note 10).

All intangible assets are assessed annually for impairment indicators.

h) Digital Assets

Digital currencies meet the definition of intangible assets in International Accounting Standards ("IAS") 38 Intangible Assets as they are identifiable non-monetary assets without physical substance. They are initially recorded at the fair value of the acquisition date and the revaluation method is used to measure the digital assets subsequently. Under the revaluation method, increases in fair value are recorded in other comprehensive income, while decreases are recorded in the Consolidated Statements of Loss and Comprehensive Loss. The Company revalues its digital assets at the end of each of its three interim financial reporting periods and at its annual financial reporting period end date. There is no recycling of gains from other comprehensive income to the Consolidated Statements of Loss and Comprehensive Loss. However, to the extent that an increase in fair value reverses a previous decrease in fair value that has been recorded in the Consolidated Statements of Loss and Comprehensive Loss, that increase is recorded in the Consolidated Statements of Loss and Comprehensive Loss. Decreases in fair value that reverse gains previously recorded in other comprehensive income are recorded in other comprehensive income. Digital currencies consist of Kaspa tokens and are measured at fair value using the quoted price on www.coinbase.com.

Management considers this fair value to be a level two input under IFRS 13 Fair Value Measurement fair value hierarchy as the price on this source represents an average of quoted prices on multiple digital currency exchanges. The digital currencies are valued based on the average weighted closing price obtained from www.coinbase.com at the time the digital currency is mined and at the reporting date for any digital currencies that are held. The Company's determination to classify its holding of digital currencies as current assets is based on management's assessment that its digital currencies held can be considered to be a commodity that may be readily sold because liquid markets are available.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

i) Business Combinations and Goodwill

An acquisition of a business, (an integrated set of activities and assets that is capable of being conducted and managed for the purpose of providing a return directly to investors), is a business combination. Determining whether the acquisition meets the definition of a business combination requires judgement to be applied on a case by case basis. Acquisitions are assessed under the relevant criteria to establish whether the transaction represents a business combination or an asset purchase. Depending on the specific facts, acquisitions of exploration and evaluation licenses for which a development decision has not yet been made, have largely been concluded to represent asset purchases.

Business combinations, except for transactions between entities under common control, are accounted for using the acquisition method of accounting. The acquired identifiable tangible and intangible assets, liabilities and contingent liabilities are measured at their fair values at the date of the acquisition. Acquisition costs incurred are expensed in the consolidated statement of comprehensive loss. Goodwill (if any) is initially measured at the excess of the aggregate of the consideration transferred and the amount recognized for any non-controlling interest over the fair value of the identifiable assets acquired and liabilities assumed at the acquisition date.

The non-controlling interest is measured at fair value or at the proportion of the acquired entity's identifiable net assets as elected for each business combination. Goodwill acquired is allocated to each of the cash-generating units expected to benefit from the combination's synergy.

j) Investment in associate

An associate is an entity over which the Company has significant influence, and which is neither a subsidiary nor a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. Significant influence is presumed to exist when the Company holds between 20% and 50% of the voting power of another entity but can also arise where the Company holds less than 20% if it has the power to be actively involved and influential in policy decision affecting the entity.

An investment in associate is accounted for using the equity method. Under the equity method, investments in associates are carried in the consolidated statement of financial position at cost adjusted for post-acquisition changes in the Company's share of net assets of the associate, less any impairment losses. Losses in an associate in excess of the Company's interest in that associate are recognized only to the extent that the Company has incurred a legal or constructive obligation to make payments on behalf of the associate. Unrealized profits or losses on transactions between the Company and an associate are eliminated to the extent of the Company's interest therein.

At the end of each reporting period, the Company assesses whether there is any evidence that an investment in associate is impaired. This assessment is generally made with reference to the status of license applications, operating results achieved, and an assessment of the likely results to be achieved from future business operations of the associate. When there is evidence that an investment in an associate is impaired, the carrying amount of such investment is compared to its recoverable amount.

If the recoverable amount of an investment in associate is less than its carrying amount, the carrying amount is reduced to its recoverable amount and an impairment loss, being the excess of carrying amount over the recoverable amount, is recognized in the period of impairment.

When an impairment loss reverses in a subsequent period, the carrying amount of the investment in associate is increased to the revised estimate of recoverable amount to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had an impairment loss not been previously recognized. A reversal of an impairment loss is recognized in net earnings in the period the reversal occurs.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

The Company accounts for its investments in IONiX Pro Battery Technologies Inc. (IONiX) as investments with significant influence due to its ownership portion. On January 2, 2024, the company sold its position in IONiX.

The Company accounts for its investment in Kaspa Mining Limited as a investment with significant influence due to its ownership of 20% and the Company has a right of first refusal on any other acquisitions of Kaspa Mining Limited.

k) Foreign Currency Translation

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the period-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined. Foreign exchange gains and losses are included in the statement of operations. At the end of each reporting period, assets and liabilities of the Company's subsidiaries which have different functional currencies are translated at the rate of exchange at the statement of financial position date. Revenues and expenses are translated at the exchange rates approximating those in effect on the date of the transactions. Exchange gains and losses arising on translation are reflected in other comprehensive loss for the period.

l) Income Taxes

Current income tax

Current income tax assets and liabilities for the current period are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting date. Current income tax relating to items recognized directly in other comprehensive income or equity is recognized in other comprehensive income or equity and not in the statement of operations. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred income tax

Deferred income tax is provided using the statement of financial position method on temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. The carrying amount of deferred income tax assets is reviewed at the end of each reporting period and recognized only to the extent that it is probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Deferred income tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realized or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. Deferred income tax assets and deferred income tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority.

m) Loss Per Share

Basic loss per share is computed using the weighted average number of common shares outstanding during the period. The treasury stock method is used for the calculation of diluted loss per share, whereby all "in the money" stock options and share purchase warrants are assumed to have been exercised at the beginning of the period and the proceeds from their exercise are assumed to have been used to purchase common shares at the average market price during the period. When a loss is incurred during the period, basic and diluted loss per share are the same

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

as the exercise of stock options and share purchase warrants is considered to be anti-dilutive.

n) Comprehensive Loss

Comprehensive loss is the change in the Company's net assets that results from transactions, events and circumstances from sources other than the Company's shareholders and includes items that are not included in the statement of operations.

o) Equity Reserves

Equity reserves presented as contributed surplus include amounts related to share-based compensation and warrants.

p) Share-based Payments

The Company grants stock options and restricted stock units ("RSUs") to its directors, employees, and consultants from time to time. The Company accounts for share-based compensation associated with option and RSU grants using a fair value-based method. For directors and employees, the fair value of options and RSUs is measured at the date of grant. For consultants, the fair value of options and RSUs is measured at the fair value of the goods or services received, or the fair value of the equity instrument issued if it is determined that the fair value of the goods or services cannot be reliably measured and are recorded at the date the goods or services are received. For directors, employees and consultants, the fair value of options and RSUs granted is accrued and charged to operations over the vesting period, with the offsetting credit to share-based compensation reserve for options, and commitment to issue share for RSUs. If and when options are exercised, the applicable amounts are transferred from contributed surplus to share capital. When the shares associated with RSUs are issued, the applicable fair value is transferred from contributed surplus to share capital.

Options are valued by using the Black-Scholes option pricing model while RSU's are valued at the fair value on the date of grant. Charges for stock options that are forfeited before vesting are reversed from contributed surplus and recorded as a gain through profit or loss. For cancelled options, the related vesting is accelerated.

Share-based payment arrangements in which the Company receives goods or services as consideration for its own equity instruments are accounted for as equity-settled, share-based payment transactions, regardless of how the equity instruments are obtained by the Company.

All equity-settled share-based payments are reflected in share-based payment reserve, unless exercised. Upon exercise, shares are issued from the treasury and the amount reflected in share-based payment reserve is credited to share capital, adjusted for any consideration paid.

Loan Receivable

On April 13, 2022, the Company advanced a $200,000 unsecured arm's length promissory note receivable bearing interest at 12% per annum and a maturity date of December 31, 2022. The Company granted borrower an extension and the borrower has agreed to pay a penalty of $20,000 with accrued interest up to the date the amount is paid in full. The Company recognized interest income of $Nil for the year ended January 31, 2025 (January 31, 2024: $23,934). The Company has written-off the entire loan receivable balance of $263,200 (2024: $Nil) due to on-going default and no interest or principal repayment since the funds were advanced. As of Jan 31, 2025, loan receivable balance is $Nil (2024-$263,200).

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

5. Prepaid and Deposit

The Company provided a cash deposit of $150,000 to OJF Capital Ltd. in 2022 to facilitate the acquisition of a cryptocurrency mining facility, however, due to the risk of collection this has been written-off.

The Company made a strategic decision to continue to focus the blockchain technology and infrastructure business and shift away from its previous involvement in electric vehicles (EV) and battery development. As a result, management determined that the $1,900,000 previously advanced for the development of an EV prototype was no longer recoverable and accordingly wrote off the full amount.

6. Investment in Securities

a) Investment in Modern Battery Solutions Inc.:

On January 2, 2024, the Company sold its investment in IONiX Pro Battery Technologies Inc. and settled on outstanding debts for an investment in Modern Battery Solutions Inc. (Modern) of 571,161 common shares at $3.00 per shares for a total value of $1,725,483. Modern Battery Solutions Inc. is a privately held company.

As at January 31, 2025, due to the absence of a market to sell the shares and the inability to reliably measure the fair value of a private investment, the Company has assessed the fair value at $nil and recorded a loss on change in fair value of $1,725,483 (2024 - $Nil). As at January 31, 2025, the company has an investment of $Nil (2024 - $1,725,483).

b) Investment in Voltaire Services Corp.:

	January 31, 2025, and 2024
	Cost $	Fair Value $
Voltaire Services Corp. - 1,000 common shares	1	1

7. Investment in Associate

a) Investment in Kaspa Mining Ltd.

On January 30, 2025, the Company completed a Securities Exchange Agreement to acquire a 20% equity interest in Kaspa Mining Limited ("KML") for $1,000,000. The fair value of this investment at acquisition is based on the fair value of the promissory note issued (Note 14). The investment is accounted for using the equity method as the Company has significant influence over KML through its 20% ownership and right-of-first refusal on any other acquisitions of KML. As at January 31, 2025, the investment in KML is $1,000,000.

Summary of unaudited financial information of investment in associates:

As at	January 31, 2025
	$
Current assets	4,028,720
Non-current assets	-
Current liabilities	7,079
Non-current liabilities	-

b) Investment in Ionix Pro Battery Technologies Inc.

On January 2, 2024, the Company sold its 25% interest in IONiX Pro Battery Technologies Inc

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

("IONiX") to Modern Battery Solutions Inc. (Modern) and assigned debt outstanding for a total consideration of $1,725,483 for 571,161 common shares at a fair value of $3.00 per share. The Company recognized a gain on sale of investment of $Nil (January 31, 2024 - $1,450,333).

8. Related Party Transactions

The Company has identified the directors and senior officers as key management personnel.

As at January 31, 2025, the Company owed a balance of $78,562 to the CEO (January 31, 2024 - $75,000). During the year ended January 31, 2025, the Company expensed $120,000 in management fees for the CEO (January 31, 2024 - 75,000). On March 18, 2024, the company issued 54,545 shares at a fair value per share of $0.32 in exchange for settlement of $30,000 in debt with the CEO (January 31, 2024 - Nil).

The Company accrued $100,000 director and officer fees for the year ended January 31, 2025 (January 31, 2024 - Nil).

On October 30, 2024, the Company issued 2,000,000 restricted share units ("RSUs") with market price of $0.175 per unit to CEO of the Company that vest as follows: (i) 25% to vest four (4) months from issuance; (ii) 25% to vest eight (8) months from issuance; (iii) 25% to vest twelve (12) months from issuance; and (iv) 25% to vest sixteen (16) months from issuance. During the year ended January 31, 2025, the Company recognized an expense of $139,717 (January 31, 2024 - Nil) (Note 17).

On January 24, 2024, the Company granted stock options to the officers and directors of the company at an exercise price of $0.065 for a term of five years. The options vest over a schedule of three years starting with 25% immediately and 12.5% after each six months, totally 100% vesting in three years. The fair value of the stock options calculated using the Black-Scholes model was $0.055 per stock option.

a) The CEO and director received 2,500,000 stock options. During the year ended January 31, 2025, the Company expensed $66,128 (January 31, 2024 - $35,991) through the statement of loss and comprehensive loss for vesting stock loss.

b) The CFO received 250,000 stock options. During the year ended January 31, 2025, the Company expensed $6,613 (January 31, 2024 - $3,599) through the statement of loss and comprehensive loss for vesting stock.

c) The directors received 100,000 stock options each for a total of 200,000 stock options. During the year ended January 31, 2025, the company expensed $5,290 (January 31, 2024 - $2,879) through the statement of loss and comprehensive loss.

9. Mining Equipment

IceRiver Miners

On November 13, 2024, the Company completed an asset purchase agreement with 1001038815 Ontario Inc. to purchase five (5) IceRiver KS3 Kaspa mining units ("IceRiver Miners"). Following the closing of this transaction, the Company and the Vendor have entered into a Management Services Agreement (the "MSA") to provide for the hosting, set up, operations and ongoing maintenance, of the Miners at a rate of $0.055 kW per hour.

As consideration for the Agreement, the Company has issued 11,000,000 common shares at a fair value of $0.10 per share for a transaction value of $1,100,000. The Company also paid a finder's fee of 550,000 common shares at a fair value of $0.10 per share for total consideration of $55,000. On November 13, 2024, the date the shares were issued, the fair value of the common shares was estimated at $0.10 per share after applying a discount for lack of marketability, discount factor for

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

restrictions to the market price of the shares and a large volume discount.

The Company determined that this acquisition was an asset acquisition, based on the analysis of the inputs, processes and outputs, given that the Company has acquired only IceRiver Miners. The Company does not have control over the inputs and processes as they are managed by 1001038815 Ontario Inc. which continues to operate independently from the Company. The output of a digital asset is dependent on the inputs and processes which are managed and controlled by 1001038815 Ontario Inc. through services provided.

Red Water Acquisition Corp. Miners

On June 29, 2023, the Company completed the acquisition of Red Water Acquisition Corp. ("Redwater"), through which it acquired 133 ASIC miners. The Company has taken an impairment loss on the 133 ASIC miners in the amount of $332,500 during the year ended January 31, 2025 (2024 - $Nil). The recoverable value of these miners has been assessed as $nil as at year end due to the events outlined in Note 11.

	Amount ($)
Cost
Acquired on June 29, 2023 Redwater Miners	332,500
Balance at January 31, 2024	332,500
Acquired on November 13, 2024 IceRiver Miners	1,155,000
Impairment of equipment	(332,500)
Balance at January 31, 2025	1,155,000
Accumulated Depreciation
Addition – IceRiver Miners	120,312
Balance at January 31, 2025	120,312
Net Book Value
Balance at January 31, 2024	332,500
Balance at January 31, 2025	1,034,688

10. Intangible Asset - Technology License

a) Crypto Green Tech Inc. Patent License

On November 17, 2023, the Company has entered into a 4-year patent license agreement with Crypto Green Tech Inc., ("Crypto Green") an Ontario Corporation, whereby the Company has acquired a four-year royalty-free, assignable, worldwide license to develop and distribute products based on Crypto Green's crypto mining hybrid solar and wind tree with water reservoir system. Crypto Green holds the rights to a patent application submitted with the International Bureau of World Intellectual Property Organization respecting the Renewable Energy Powered Crypto Mining Technology. The amortization period for the Crypto Green patent license is 4 years.

In consideration for the license agreement, the Company has issued 40,000,000 of its common shares to Crypto Green's shareholders. A finder's fee of 2,800,000 common shares was issued to the party that introduced Crypto Green to the Company. The fair value of the consideration was $0.25 per common share for a total of $1,070,000, $1,000,000 for the Patent license and $70,000 for the share issuance cost. The Crypto Green Patent license was fairly valued at $800,000 on the date of purchase and recognized a $200,000 impairment on intangible during the year ended January 31, 2024. The Company has taken a full impairment of $566,667 during the year ended January 31, 2025 due to the delay in creating a proto-type and getting into production and risk of adoption of this new technology.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Cost:
Additions	$ 1,000,000
Impairment	(200,000)
Balance, January 31, 2024	$ 800,000
Impairment	(566,667)
Balance, January 31, 2025	$ 233,333
Accumulated Amortization:
Additions	$ 33,333
Balance, January 31, 2024	33,333
Additions	200,000
Balance, January 31, 2025	$ 233,333
Net Book Value:
Balance, January 31, 2024	$ 766,667
Balance, January 31, 2025	$ -

b) Battery Management Systems Technology License

On August 31, 2020, the Company signed a definitive agreement with IBS - Intelligent Battery Services Ltd. and Jiangsu RichPower New Energy Co. Ltd. to acquire the exclusive North and South American rights, as well as the European and African rights to a broad set of applied technologies and solutions for battery management systems, energy storage technology applications and battery safety applications (BMS Technology). The BMS Technology license was amortized over a 10-year period.

As at January 31, 2025, the intangible asset value for this license is nil (January 31, 2024 - $Nil). During the year ended January 31, 2025, the Company had an impairment loss of Nil (January 31, 2024 - $760,278).

Cost:
Balance, January 31, 2023, 2024 and 2025	$ 1,000,000
Accumulated Amortization and Impairment:
Balance, January 31, 2023	$ (239,722)
Impairment	(760,278)
Balance, January 31, 2024 and 2025	$ (1,000,000)
Net Book Value:
Balance, January 31, 2023	760,278
Balance, January 31, 2024 and 2025	-

11. Intangible Assets – Intellectual Property

a) Red Water Acquisition Corp.

On June 16, 2023, the Company entered into a Share Purchase Agreement (the "Agreement") with Red Water Acquisition Corp ("Red Water") to acquire 100% of the issued and outstanding shares of Red Water. The acquisition is determined to be a business combination. In exchange for 100% of the total issued and outstanding shares of Red Water, the Company will issue 22,000,000 common shares of the Company (the "Consideration Shares"). The Consideration Shares issued in tranches with 11,828,080 Consideration Shares being delivered to the shareholders on Red Water (the "Vendors") upon closing of the Acquisition on June 29, 2023, and the remaining 10,171,920 Consideration Shares to be delivered upon the completion of certain milestones being met by the Vendors and Red Water pursuant to the terms of the Agreement. The fair value of the consideration for the first tranche of 11,828,080 common shares is $1,774,212 at $0.15 per common share. The fair value of the outstanding consideration second and third tranche

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

of 10,171,920 common shares is $.12 per common share for a value of $1,216,921.

The purchase price allocation is as follows:

	Amount ($)	Amount ($)
Purchase Consideration
Shares issued (11,828,080 shares at $0.15 per Share)		1,774,212
Outstanding share (10,171,920 shares at $0.12 per share, discounted at 4.9% over 3 months)		1,216,921
Total Purchase Consideration		2,991,133
Net identifiable assets
Accounts Receivable and other assets	2,401
Equipment – 133 ASIC Miners	332,500
Purchase Contracts	1,607,322
Accounts Payable and Accrued Liabilities	(4,615)
Liability on rights to purchase contracts	(1,607,322)
Total net identifiable assets		330,286
Goodwill		2,660,847
Total Net Assets		2,991,133

On June 16, 2023, the Company signed a share purchase agreement (the "Agreement") to acquire Red Water Acquisition Corp. ("Redwater"). Redwater and its vendors were not able to execute on the milestones pursuant to the terms of the Agreement despite several extensions of the Agreement. On May 15, 2024, the Company entered into an amendment to the Agreement extending the deadline to complete the milestones to June 30, 2024. On June 30, 2024, the Company further extended this date to September 30, 2024.

On October 7, 2024, the Company entered into a Master Service Agreement with True North Data Solutions (True North) to host the 133 ASIC Miners and operate the miners from the Agreement. The miners were commissioned but True North did not deposit the bitcoin mined, if any, into the Company's owned wallets. The Company is now in a process of resolving this matter with the Redwater, its vendors and True North. If no resolution can be made soon, the Company may need to take legal action to recover damages incurred.

During the year ended January 31, 2025, the Company has derecognized the obligation to issue shares in the amount of $1,216,921 as the milestones were not achieved by the extended deadline nor were the parties involved able to further extend this timeline. The Company has derecognized the account payable of $1,607,322 related to the purchase option contracts underlying the Agreement as these were not executed by the deadline as well. An equal and offsetting intangible asset of $1,607,322 was fully impaired. Lastly, the company also wrote off the account receivable in the amount of $2,179. During the year ended January 31, 2024, the Company took a goodwill impairment of $2,660,847.

The Company has incurred damages due to the events that have transpired, however, has not recorded a contingent asset as estimate of the amount, timing and likelihood are uncertain at this time. The Company has assessed the risk of liability to be low and cannot estimate the amount, timing and likelihood at this time.

b) Digital Assets

On November 13, 2024, the Company completed an asset purchase agreement with 1001038815 Ontario Inc. (the "Vendor") for the acquisition of five (5) IceRiver KS3 Kaspa mining units (the

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

"Miners"). Concurrent with the closing of this transaction, the Company and the Vendor entered into a Management Services Agreement (the "MSA"), under which the Vendor agreed to host, set up, operate, and maintain the Miners on behalf of the Company. Pursuant to the MSA, the Miners were operational between November 21, 2024, and January 31, 2025, during which time they produced a total of 16,514.92 Kaspa tokens. As of January 31, 2025, the fair market value of each Kaspa token was $0.19, resulting in a total value of $3,138.

c) Optimal CP Inc.

On November 22, 2021, the Company entered into a share exchange agreement to acquire Optimal CP Inc. ("Optimal"), a company focused on the development and management of crypto mining facilities. As compensation for the acquisition, the Company agreed to issue 5,500,000 common shares at a price of $2.50 per common share, to the shareholders of Optimal, for a deemed transaction value of $13,750,000. On December 8, 2021, the Company closed the acquisition of Optimal CP Inc., by issuing 5,500,000 common shares at a price of $2.50 per common share to the shareholders of Optimal CP Inc., for a deemed transaction value of $13,750,000. There are 3,000,000 of 5,500,000 common shares issued held in an escrow account until the milestones specified in the agreement are met. As at January 31, 2025 and January 31, 2024, the 3,000,000 shares remain held in escrow.

12. Accounts Payable and Accrued Liabilities

	January 31, 2025	January 31, 2024
Accounts Payables	$1,113,566	$1,058,074
Accrued Liabilities	261,310	142,603
	$1,374,876	$1,200,677

13. Loan Payable

a) CEBA Loan

As at January 31, 2025, the CEBA loan has a balance outstanding of $Nil$ (January 31, 2024 - $Nil$ ). The company repaid the amount of $40,000 on January 18, 2024 and received a loan forgiveness of $16,865 during the year ended January 31, 2024 through other income.

b) XLabs Therapeutics Inc. and XLabs Therapeutics (Ont) Inc. Loans

The Company was advanced the following unsecured one-year term loans. The loan advances have an interest rate of $18\%$ compounded annually and due on the maturity date. As at January 31, 2025, the balance outstanding was $\$290,130$ (January 31, 2024 - $\$40,256$ ).

Effective Date of Advance	Expiry Date	Principal Amount	Interest accrued year ended January 31, 2024	Interest accrued year ended January 31, 2025	Total
January 18, 2024	January 18, 2026	$40,000	$256	$7,269	$47,525
March 28, 2024	March 28, 2026	75,000		11,429	86,429
May 7, 2024	May 7, 2026	60,000		7,959	67,959
May 24, 2024	May 24, 2026	25,000		3,107	28,107
June 25, 2024	June 25, 2025	25,000		2,712	27,712
August 22, 2024	August 22, 2024	30,000		2,398	32,398
Total		$255,000	$256	$34,874	$290,130

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

c) Baiocchi Ventures Inc.

On November 28, 2024, the Company received $22,500 one-year unsecured term loan from Baiocchi Ventures Inc. at an interest rate of 18% payable on maturity. During year ended January 31, 2025, interest of $710 was accrued. As at January 31, 2025, the balance outstanding was $23,210 (January 31, 2024 - $Nil)

d) 1437160 BC Ltd.

On October 29, 2024, the Company received $8,000 one-year unsecured term loan from 1437160BC Ltd. at an interest rate of 18% payable on maturity. During year ended January 31, 2025, interest of $371 was accrued. As at January 31, 2025, the balance outstanding was $8,371 (January 31, 2024 - $Nil)

14. Promissory Note

On January 30, 2025, the Company completed the acquisition of 20% equity interest in Kaspa Mining Limited for $1,000,000 (Note 7). The company issued a promissory note for $1,000,000 payable over 30 months as consideration. A payment of $200,000 is due every 6 months from date of issuance with accrued interest at 18% due at the end of the term. The fair value of the promissory note on date of issuance is $1,000,000 as the market interest rate is 18%. As at January 31, 2025, the promissory note outstanding is $1,000,000 and the current portion of this promissory note is $400,000. The promissory note is a level 3 financial liability held at amortized cost.

15. Share Capital

Authorized share capital:

Unlimited common shares without par value

Issued and outstanding:

For the year ended January 31, 2025

a) On March 18, 2024, the company issued 109,090 shares at the fair value of $0.32 per share for a fair value of $34,909. The Company converted $60,000 of outstanding debt which resulted in a debt settlement gain of $25,091.

b) On August 1, 2024, the Company issued 25,000 shares for stock options were exercised at an exercise price of $0.065 per stock option for total proceeds of $1,625 and fair value of $1,375.

c) On August 2, 2024, the Company issued 93,750 shares for stock options were exercised at an exercise price of $0.065 per stock option for total proceeds of $6,094 and fair value of $5,156.

d) On August 12, 2024, the Company issued 93,750 shares for stock options were exercised at an exercise price of $0.065 per stock option for total proceeds of $6,094 and fair value of $5,156.

e) On August 20, 2024, the Company issued 937,500 shares for stock options were exercised at an exercise price of $0.065 per stock option for total proceeds of $60,938 which was adjusted against the liability and fair value of $51,562.

f) On November 13, 2024, the Company completed an asset purchase agreement with 1001038815 Ontario Inc. to purchase five (5) IceRiver KS3 Kaspa mining units. Following the closing of this transaction, the Company and the Vendor have entered into a Management Services Agreement (the "MSA") to provide for the hosting, set up, operations and ongoing maintenance, of the Miners by the Vendor. As consideration for the Agreement, the Company has issued 11,550,000 common shares

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

at a fair value price of $0.10 per share for a fair value of $1,155,000. A finder's fee of 550,000 common shares is included in the total consideration.

For the year ended January 31, 2024

During the year ended January 31, 2024, there were share transactions as follows.

g) On June 12, 2023, the Company issued 714,286 common shares at a price of $0.14 for a deemed transaction value of $100,000 to the directors and officer of the Company for directors' fees.

h) On June 29, 2023, the Company issued 11,828,080 common shares at a fair value of $0.15 to Redwater's shareholders for total consideration of $1,774,212 as part of consideration of Red Water acquisition. (Note 11)

i) On November 20, 2023, the Company has entered into a patent license agreement with Crypto Green Tech Inc., ("Crypto Green") and a finder's fees for 42,800,000 common shares at a fair value of $0.25 per common share for a total consideration of $1,070,000 (Note 10)

16. Purchase Warrants

The following table summarizes information about the warrants at January 31, 2025 and January 31, 2024 and the changes for the period then ended:

	January 31, 2025		January 31, 2024
	Number of Warrants	Weighted average exercise price $	Number of Warrants	Weighted average exercise price $
Warrants outstanding – beginning of year	3,018,680	6.27	12,849,180	1.55
Expired	(1,560,280)	5.00	(7,600,000)	0.08
Expired	(1,008,400)	10.00	(2,230,500)	0.17
Expired	(450,000)	2.50	-
Warrants outstanding – end of the year	-	-	3,018,680	6.27

On February 11, 2024, 1,560,280 share purchase warrants with an exercise price of $5.00 expired.

On April 1, 2024, 638,000 share purchase warrants with an exercise price of $10.00 expired.

On June 9, 2024, 370,400 shares purchase warrants with an exercise price of $10.00 expired.

On January 17, 2025, 450,000 shares purchase warrants with an exercise price of $2.50 expired.

The following table summarizes information about granted, exercised purchase warrants and outstanding warrants at January 31, 2025.

Date issued	Expiry date	Number of warrants issued	Exercise price	Number of warrants Expired	Number of warrants Outstanding
Feb 11, 2021	Feb 11, 2024	1,560,280	5.00	1,560,280	-

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Apr 1, 2021	Apr 1, 2024	638,000	10.00	638,000	-
Jun 9, 2021	Jun 9, 2024	370,400	10.00	370,400	-
Jan 17, 2022	Jan 17, 2025	450,000	2.50	450,000	-
Balance at January 31, 2025		3,018,680	6.30	3,018,680	-

17. Share Based Compensation

The Company has an equity incentive plans provides for the issuance of share-based compensation through stock options and restricted share units ("RSU") to its directors, officers, consultants and employees. The maximum number of outstanding stock options and RSUs must be no more than 10% of the issued and outstanding shares of the Company at any point in time. The term of the options must be no longer than 10 years and the directors determine the vesting period.

Stock Options

On August 14, 2023, 270,000 stock options with an exercise price of $0.10 expired.

On January 24, 2024, the Company granted 5,700,000 stock options exercisable at $0.065 per share for a period of five years. The options vest over a schedule of three years, starting with 25% immediately and 12.5% after each six months, totaling 100% vesting in three years. The fair value of the stock options is $0.055 per stock option and was calculated using the Black-Scholes model with the following inputs: expected volatility of 278% using the Company's historical performance, stock price of $0.055, expected life of option of 4 years, exercise price of $0.065, dividend yield of nil and a risk free rate of 3.68%.

On October 31, 2024, 156,250 stock options with a fair value of $0.055 per option were forfeited due to the resignation of a consultant on August 2, 2024. The Consultant had 93,750 stock options that were vested and were exercised on August 12, 2024.

During the year ended January 31, 2025, the company recognized stock option expense of $145,717 (January 31, 2024 - $82,060).

The following table summarizes information about the options at January 31, 2025 and January 31, 2024, and the changes for the years ended:

	January 31, 2025			January 31, 2024
	Number of options	Weighted average exercise price $	Weighted average remaining life in years	Number of options	Weighted average exercise price $	Weighted average remaining life in years
Beginning of year	5,700,000	0.065		270,000	0.10
Expired	-	-		(270,000)	0.10
Forfeiture	(156,250)	0.065		-	-
Stock options issued	-	-		5,700,000	0.065
Stock options exercised	(1,150,000)	0.065		-	-
End of year	4,393,750	0.065	3.98	5,700,000	0.065	4.97

Restricted Share Units

On October 30, 2024, the Company issued 5,000,000 restricted share units ("RSUs") with market price of $0.175 per unit, 2,000,000 to the CEO and 3,000,000 to two consultants of the Company that vest as

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

follows: (i) 25% to vest four (4) months from issuance; (ii) 25% to vest eight (8) months from issuance; (iii) 25% to vest twelve (12) months from issuance; and (iv) 25% to vest sixteen (16) months from issuance. During the year ended January 31, 2025, the Company incurred an expense of $349,293 (2024 – Nil).

18. Commitments and Contingencies

a) As a result of a Temporary Order issued on November 26, 2018, issued by the B.C. Securities Commission against certain consultants, the Company is reviewing a private placement that closed in June 2018. The Order cites improper use of the "consultant's exemption" contained in section 2.24 of National Instrument 45-106 and the payment of consulting fees to the persons named in the Order. The June 2018 private placement involved multiple consultants named in the Order. Following completion of the private placement, the Company paid consulting fees to these consultants. There is a risk that the Commission in its review may view the private placement to the consultants and the use of proceeds, as an improper use of s.2.24 and an illegal distribution of shares. If such is adjudicated to be the case, the Company may be required to take remedial action. Such action, if required, cannot as at January 31, 2025 be determined.

b) On July 11, 2019, two individuals filed a Notice of Civil Claim in the Supreme Court of British Columbia seeking certification for a class action against the Company and numerous other parties. On July 2, 2024, the class action was certified. Management is not able to quantify the impact of this action and has no further update as at January 31, 2025.

19. Supplement Cash Flow

The table below summarizes the non-cash investing and financing activities.

For the year ended	Note	2025	2024
Sale of IONiX ownership for shares in Modern	6		1,725,483
Fair value of shares issued for Redwater	11		(1,774,212)
Fair value of shares issued for Crypto Green	10		(1,070,000)
Fair value of promissory note for Kaspa Mining Ltd.	7	(1,000,000)
Fair value of shares issued for Mining equipment	9	(1,155,000)
Non-cash exercise of stock options	15	(60,938)

20. Financial Instruments

The Company's financial instruments consist of cash, loan receivable, investment in securities, investment in Kaspa Mining Limited, intangible asset – digital assets, accounts payable and accrued liabilities, liability on purchase contracts, obligation to issue shares, due to related parties, loans payable, and the promissory note.

The Company classifies its fair value measurements in accordance with an established hierarchy that prioritizes the inputs in the valuation techniques used to measure fair value as follows:

Level 1 - Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2 - Inputs other than quoted prices that are observable for the asset or liability either directly or indirectly; and
Level 3 - Inputs that are not based on observable market data.

The carrying value of cash, loan receivable, accounts payable and accrued liabilities, due from related parties, and liability on purchase contracts, and loan payables approximate their respective fair values because of their short-term nature.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

The Company's intangible asset – Digital Assets are recorded at fair value using significant other observable inputs and therefore classified as level 2 within the fair value hierarchy.

The Company's investment in securities, investment in Kaspa Mining Limited, obligation to issue shares, and promissory note are classified as FVTPL and are recorded at fair value using unobservable inputs and are therefore classified as level 3 within the fair value hierarchy.

The Company's risk exposures and the impact on the Company's financial instruments are summarized below:

a) Credit Risk

Financial instruments that potentially subject the Company to a concentration of credit risk consist primarily of cash. The Company limits exposure to credit loss by placing its cash with high credit quality financial institutions. The carrying amount of financial assets represents the maximum credit exposure.

b) Liquidity Risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due. The Company currently settles its financial obligations with cash. The ability to do this relies on the Company raising debt or equity financing in a timely manner and by maintaining sufficient cash in excess of anticipated needs. Liquidity risk is assessed as high.

c) Loss of access risk

The loss of access to the private keys associated with the Company's digital assets holdings may be irreversible and could adversely affect an investment. Digital assets controllable only by an individual that possesses both the unique public key and private key or key relating to the "digital wallet" in which the cryptocurrency is held. To the extent a private key is lost, destroyed or otherwise compromised and no backup is accessible, the Company may be unable to access the digital assets. The Company has assessed this risk as low due to no occurrence since inception of business.

d) Market Risk

Market risk is the risk of loss that may arise from changes in market factors such as Kaspa prices, interest rates, and foreign exchange rates.

Kaspa Price Volatility

As of January 31, 2025, the Company held a digital currency balance in Kaspa Coins that is subject to market pricing and price volatility. Kaspa prices are affected by various forces including global supply and demand, interest rates, exchanges rates, inflation or deflation and the political and economic conditions. Further, Kaspa has no underlying backing or contracts to enforce recovery of invested amounts. Our profitability is related to the current and future market price of Kaspa; in addition, the Company may not be able to liquidate our holdings of Kaspa at our desired price if necessary. Investing in Kaspa is speculative, prices are volatile, and market movements are difficult to predict. Supply and demand for such currencies change rapidly and are affected by a variety of factors, including regulation and general economic trends. Kaspa has a limited history, its fair values have historically been volatile, and the value of our Kaspa holdings could decline rapidly. A decline in the market price of Kaspa could negatively impact our future operations. Historical performance of Kaspa is not indicative of its future performance. We recorded a loss on revaluation of digital currencies in the amount of $nil during the year ended January 31, 2025. The Company does not hedge its Kaspa holdings, but is actively monitoring Kaspa pricing, market volatility and the Company's liquidity needs to determine an appropriate risk mitigation strategy on a continuous basis.

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

Interest Rate Risk

The interest rate risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market interest rates. We are exposed to interest rate risk on the variable rate of interest we earn on bank deposits. The interest rate risk on bank deposits is insignificant, as our deposits are all short-term. The interest on our loan payable and promissory note is fixed and therefore has limited exposure to changes in interest rates.

Foreign Exchange Rate Risk

Foreign exchange rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The Company has exposure to currency risk from assets and liabilities denominated in US dollars. The Company does not use derivative instruments to hedge exposure to foreign exchange rate risk. However, management believes that the risk from fluctuations in foreign exchange rates is not significant.

21. Capital Management

The Company's capital structure consists of all components of shareholders' equity. The Company's objective when managing capital is to maintain adequate levels of funding to support the current operations and the necessary corporate and administrative functions to facilitate these activities. This is done primarily through equity financing. future financings are dependent on market conditions and there can be no assurance the Company will be able to raise funds in the future.

The Company invests all capital that is surplus to its immediate operational needs in digital assets in various accounts. There were no changes to the Company's approach to capital management during the year. The Company is not subject to externally imposed capital requirements. There have been no changes to the Company's capital management policy during the year ended January 31, 2025.

22. Segmented Reporting

During the year ended January 31, 2025, the Company generated revenue of $3,138 (January 31, 2024: $Nil). All revenue was earned in Canada. The Company operated in one operating segment, which is the mining business.

23. Income Taxes

The tax effect (computed by applying the Canadian federal and provincial statutory rate) of the significant temporary differences, which comprise deferred income tax assets and liabilities, are as follows:

	2025 $	2024 $
Statutory income tax rate	27%	27%
Income tax recovery at statutory rate	(1,514,194)	(597,716)
Permanent differences and other	(650,519)	(414,921)
Temporary differences	467,685	630,542
Change in valuation allowance	1,697,028	382,095
Deferred income taxes	-	-

Dynamite Blockchain Corp.

(formerly Cryptoblox Technologies Inc.)

Notes to the Consolidated Financial Statements

For the years ended January 31, 2025 and 2024

(Expressed in Canadian dollars, unless otherwise noted)

The significant components of deferred income tax assets and liabilities are as follows:

| | 2025
$ | 2024
$ |
| --- | --- | --- |
| Non-capital losses | 9,572,269 | 8,435,469 |
| Property and equipment | 61,055 | 19,123 |
| Intangible assets | 2,788,880 | 2,148,750 |
| Share issuance costs | (152,833) | (154,299) |
| Valuation allowance | (12,269,371) | (10,449,043) |
| Deferred income taxes recovered | - | - |

As of January 31, 2025, the Company has non-capital tax losses of approximately of $35,452,847 (2024 - $31,242,478) that may be offset against future Canadian and United States taxable income. This loss expires commencing 2044.

24. Subsequent Events

The Company and Daymak Inc. have entered into a Master Service Agreement on February 1, 2025 and intend to utilize a previously paid and written off deposit to design, develop and build the renewable energy powered crypto mining technology with Crypto Green Tech Inc. patent license (Note 10, 5).

The Company entered into several assignments and loan extension agreements where Xlabs Therapeutic (Ont.) Inc. assigned its loan to Xlabs Therapeutic and extended the balances for a one-year term at an interest rate of 18%, on March 28, 2025 a balance of $88,500, on May 7, 2025 a balance of $70,800, and on May 24, 2025 a balance of $29,500.

On May 2, 2025, the Company entered into a loan agreement with Xlabs Therapeutic Inc. for an amount of $50,000 with a one-year term at an interest rate of 18%.

On May 12, 2025, the Company acquired 100% of the outstanding common shares of Kaspa Secure Technologies Inc. (Kaspa Secure) for 80,000,000 common shares of the Company at a deemed price of $0.06 for a deemed transaction value of $4,800,000. Kaspa Secure's blockchain solutions include an IMME Wallet with an integrated AI-driven biometric authentication and compliance tool.

On May 16, 2025, the Company entered into a loan agreement with Xlabs Therapeutic Inc. for an amount of $25,000 with a one-year term at an interest rate of 18%.

On May 28, 2025, the Company entered into a loan agreement with Xlabs Therapeutic Inc. for an amount of $40,000 with a one-year term at an interest rate of 18%.

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Dynamite Blockchain Corp. — Audit Report / Information 2025

47277_rns_2025-05-30_0a680d62-ac79-4bbf-9c95-0a6de5f5af41.pdf

INDEPENDENT AUDITOR'S REPORT

Basis for Opinion

Emphasis of Matter - Material Uncertainty Related to Going Concern

Key Audit Matters

Other Matter

Other Information

Responsibilities of Management and Those Charged with Governance for the Consolidated Financial Statements

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Independent Auditor's Report to the Shareholders of Dynamite Blockchain Corp. (formerly Cryptoblox Technologies Inc.) (continued)

Auditor's Responsibilities for the Audit of the Consolidated Financial Statements (continued)

DYNAMITE BLOCKCHAIN CORP.

DYNAMITE BLOCKCHAIN CORP.

1. Nature of Operations and Going Concern

Going concern uncertainty

2. Basis of Presentation

Statement of Compliance

Basis of Measurement

Basis of Consolidation

3. Material Accounting Policy Information

Valuation of digital assets

Valuation of investments

Valuation of share-based compensation

Going concern evaluation

b) Recent Accounting Pronouncements

Impairment

d) Investments

e) Revenue Recognition

f) Mining Equipment

5. Prepaid and Deposit

6. Investment in Securities

7. Investment in Associate

8. Related Party Transactions

9. Mining Equipment

IceRiver Miners

10. Intangible Asset - Technology License

a) Crypto Green Tech Inc. Patent License

Dynamite Blockchain Corp.

b) Battery Management Systems Technology License

11. Intangible Assets – Intellectual Property

a) Red Water Acquisition Corp.

c) Optimal CP Inc.

12. Accounts Payable and Accrued Liabilities

13. Loan Payable

a) CEBA Loan

b) XLabs Therapeutics Inc. and XLabs Therapeutics (Ont) Inc. Loans

14. Promissory Note

15. Share Capital

16. Purchase Warrants

Dynamite Blockchain Corp.

17. Share Based Compensation

Stock Options

Restricted Share Units

18. Commitments and Contingencies

19. Supplement Cash Flow

20. Financial Instruments

Interest Rate Risk

Foreign Exchange Rate Risk

21. Capital Management

22. Segmented Reporting

23. Income Taxes

24. Subsequent Events

More from Dynamite Blockchain Corp.

Dynamite Blockchain Corp. Audit Report / Information 2025