Stonegate Capital Partners Initiates Coverage on Fold Holdings, Highlighting Bitcoin Credit Card as Growth Catalyst

Stonegate Capital Partners has initiated coverage on Fold Holdings Inc. (NASDAQ: FLD), highlighting the company's strong financial performance and strategic positioning in the cryptocurrency financial services market. Fold delivered revenue of $7.4 million with net income of $0.6 million and adjusted EBITDA of $(4.2) million as legacy products continued to scale. Operating key performance indicators showed significant momentum with $265 million in total transaction volume for the quarter, over 10,000 net new accounts, and more than 3,000 new verified accounts.

The company demonstrated impressive growth metrics with new accounts rising 2.1 percent year-over-year while transaction volumes climbed approximately 41 percent year-over-year as of the third quarter of 2025. Management reiterated typical seasonal strength expectations, noting that the company maintained almost 50 percent top-line growth over the previous year. Stonegate Capital Partners expects this strong growth momentum to continue into what is typically a seasonally strong fourth quarter. Management highlighted that headcount has roughly doubled year-over-year while maintaining margins, demonstrating early operating leverage in the business model.

Company execution remains centered on opening the customer acquisition funnel and converting engagement into monetizable flow. The recent Bitcoin Gift Card launch now has retail distribution in approximately 2,000 Kroger locations, creating a mainstream on-ramp outside the Fold application. Management has described this as the first step toward what should become an expansive retailer footprint. With data from gift card sales still in early stages, the company anticipates this will lead to wallet expansion at a negative cost of acquisition. Fold 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.

Across major products, management indicated that unit economics are already positive at the product level, with the current focus on scaling distribution. In the mid-funnel strategy, Fold is expanding exchange access to more users across additional states and adding larger order funding options, including wire transfers, which should lift average ticket size and trading frequency. The company'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 credit card rewards program advertises up to 3.5 percent on every purchase with no categories or deposit requirements, with bonus earnings up to 10 percent at top brands in the Fold network. Management reports the waitlist has surpassed 80,000 potential customers and targets initial distribution by year-end with general access expected in the first quarter of 2026. The strategic goal is to capture greater wallet share than debit cards and to turn everyday spending into durable engagement that cross-sells into trading and custody services. Management also highlighted the card as a high cross-sell engine for the broader product ecosystem.

From a treasury and capital position perspective, the company held 1,526 bitcoin in its investment treasury as of the third quarter of 2025, supporting a Bitcoin net asset value 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 Holdings 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.