Stonegate Capital Partners Initiates Coverage on Fold Holdings, Highlighting Bitcoin-Focused Growth Strategy

Stonegate Capital Partners has initiated coverage on Fold Holdings Inc. (NASDAQ: FLD), providing analysis of the company's financial performance and growth trajectory in the Bitcoin and digital assets space. Fold reported revenue of $7.4 million, net income of $0.6 million, and adjusted EBITDA of $(4.2) million as legacy products continued to scale during the quarter.

The company demonstrated significant operational momentum with $265 million in total transaction volume for the quarter, adding over 10,000 net new accounts and 3,000 new verified accounts. Year-over-year metrics showed new accounts rising 2.1% while transaction volumes climbed approximately 41%, with management highlighting typical seasonal strength patterns. The company maintained nearly 50% top-line growth compared to the previous year, with expectations that this strong growth momentum will continue into the seasonally strong fourth quarter.

Management execution remains focused on opening the customer funnel and converting engagement into monetizable flow. The recent Bitcoin Gift Card launch has achieved retail distribution in approximately 2,000 Kroger locations, creating a mainstream on-ramp outside the Fold application. Management described this as the first step toward what should become an expansive retailer footprint. The company has also engaged in a partnership with Steak 'n Shake that rewards customers with a $5 Bitcoin Gift Card, providing a scalable path for broad retail distribution. Management indicated that unit economics are already positive at the product level, with current focus on scaling distribution.

Fold's Bitcoin Rewards Credit Card is emerging as the flagship growth lever, built in partnership with Visa and Stripe to deliver a premium, bitcoin-native credit experience. The card offers rewards up to 3.5 percent on every purchase with no categories or deposit requirements, with bonus earnings up to 10 percent at top brands within the Fold network. Management reports the waitlist has surpassed 80,000 potential users, targeting initial distribution by year-end with general access expected in the first quarter of 2026. The goal is to capture greater wallet share than debit options and turn everyday spending into durable engagement that cross-sells into trading and custody services.

The company's treasury and capital position remains strong, holding ₿1,526 in its investment treasury as of the third quarter of 2025, supporting a Bitcoin NAV of approximately $160 million. Management views the Bitcoin treasury as a differentiated, lower-cost source of growth capital relative to issuing traditional equity or term debt. Fold has multiple funding levers available, including a $250 million equity purchase facility tied to product momentum and market windows. During the quarter, the company secured a $45.0 million revolving credit facility to support future growth initiatives and strengthen its financial position.

Stonegate's valuation analysis utilizes two comparable approaches. The blended EV/Revenue analysis arrives at a valuation range of $5.42 to $7.71 with a midpoint of $6.57, while the EV/BTC NAV analysis suggests a valuation range of $5.23 to $8.65 with a midpoint of $6.94. The coverage initiation comes as Fold demonstrates improving operating leverage with focused, disciplined spending on distribution and product development, while headcount has roughly doubled year-over-year while maintaining margins.