Year-end Report

7 Sector DevelopmentYear-end Report Q4 2021Sector DevelopmentA quarter of accumulating activity and bullish news flows, priming the bitcoinmarket for solid momentum going into the last few months of the year.A solid and important quarter for bitcoin and the cryptoindustry as a whole. Bitcoin reached a new all-time highin Q4 and the price increased during a quarter that wasboth volatile and impactful.Bitcoin’s foothold in the traditional markets continues togrow and this trend accelerated in Q4. In October, theSEC approved the first U.S. BTC ETFs. Proshares’ BITO ETFmanaged to breach USD 1 billion in assets under management only two days after its launch. This made it themost successful non-equity-related U.S. ETF launch inhistory. This clearly illustrates that the demand for bitcoinexposure is sticky and very high at the institutional level.Overall, close-ended funds and ETPs now hold more than845,000 BTC, up 140,000 BTC since January 2021.Exchange traded funds holdingsBTC fund holdingsShare of total funds, anuary2021OtherApril2021July2021Canadian ETFsETF-share of total fund holdingsOctober2021December20210U.S. Futures-Based ETFsInstitutional adoption continues to evolve in crypto. InQ4, fixed-income giant PIMCO announced that they heldcrypto exposure, while Mastercard announced that theywould allow banks to offer crypto credit and debit cards.Banks are increasing their offerings within the sector,evident by a massive hiring spree in Citi and GoldmanSachs and a handful of other tier-one banks exploringbitcoin-backed loans.The expansive monetary and fiscal policies following theCovid outbreak have resulted in a 40-year high inflationin the United States. Investors who sought protection frominflation through BTC have profited. Now, we see the tideturning as hawkish policies are enacted in most majoreconomies to dampen inflation. The macro environment impacted bitcoin in the latter part of Q4. However,globally the situation remains volatile. We currently seelarge-scale adoption of bitcoin and stablecoins in Turkeyas a response to the persistent inflationary pressure inthe Turkish Lira.The regulatory landscape is also evolving. The SEC’sapproval of the first U.S.-based BTC-linked ETFs is testament to how bitcoin has matured as an asset. With thecrypto sector reaching a valuation of USD 3 trillion in Q4,the industry has become a priority in the U.S. December2021 saw the first major in-person faceoff between cryptocompanies and regulators. Industry leaders met up withthe U.S. Congress through a five-hour thoughtful discussion, educating lawmakers on the crypto industry.2021 has seen the crypto landscape evolve far beyond therealm of bitcoin. Layer-1 protocols have set the stage ripefor the adoption of new decentralized innovations and inparticular NFTs have thrived. This has led Meta (previouslyFacebook) to make a push towards the metaverse andlarge gaming companies to explore opportunities withinthe ecosystem. Meanwhile, venture capital investmentsin the industry soared in Q4, as Softbank, among others,entered the landscape. Throughout 2021, we saw over 200crypto M&As representing a 131% increase in activity YoY,and a deal value of almost USD 8 billion, a roughly 730%increase YoY. This illustrates that the sector is becomingprogressively more intertwined with the traditional financial markets.

8 Business Unit DevelopmentYear-end Report Q4 2021Business Unit DevelopmentArcane AssetsArcane ResearchArcane Assets’ revenue amounted to kSEK 3,257 in Q42021 compared to kSEK 656 in Q4 2020. For the full year2021 revenue amounted to 11,300 kSEK compared to 904kSEK during the full year 2020.Arcane Research’s revenue amounted to kSEK 848 in Q42021 compared to kSEK 1,353 in Q3 2021. For the full year2021 revenue amounted to 3,066 kSEK compared to 475kSEK during the full year 2020.Arcane Assets is the entity that provides fund management services to our Fund, with Eric Wall as Chief Investment Officer (CIO).This quarter, Arcane Research’s growth has continued asit moves closer towards its goal of becoming one of themost trusted crypto research brands.Since its inception in 2020, the Fund managed by ArcaneAssets has outperformed both bitcoin and other cryptocurrency hedge funds, as measured by the EurekaCryptocurrency Hedge Fund Index. During the quarterwe have continued our efforts to prepare to scale up thefund.The demand for Arcane Research’s institutional-gradecrypto research did not slow down this quarter, with agrowth of 82% in our subscription base and coveragein Financial Times, Bloomberg and other Tier 1 mediaoutlets. In addition, our year-end research report wasshared broadly and picked up by most leading cryptonews outlets. The work of Arcane Research has also beenrecognized by regulators worldwide and was cited inofficial SEC documents in the U.S in relation to potentialbitcoin ETFs this quarter.Arcane Assets is now close to finalizing the structure forthe Exchange-Traded Product (ETP) which is based onArcane’s cryptocurrency fund, together with Valour. Thedocumentation required for the ETP has been completedand during the quarter Valour received approval fromthe Swedish Financial Supervisory Authority on its BaseProspectus, which includes an Exchange-Traded Product(”ETP”) based on Arcane Assets’ cryptocurrency fund.Arcane Assets is finalizing the mechanics for subscriptionand it is estimated that the ETP will be launched duringQ2 2022. Upon its launch, the ETP will provide ArcaneAssets with a significantly improved distribution and witha solid foundation for increased growth. Arcane Assetsis focused on building a strong investor pipeline of bothHigh-Net-Worth Individuals, family offices and fund offunds that are interested in access to a cryptocurrencyhedge fund.Assets Under Q3Q4Q12021Q2Q3Q4During the quarter Arcane Research published itsin-depth report “The State of Lightning” that was madein collaboration with Lightning Labs and powered byOpenNode. The report was well-received in the industry,and also picked up by several traditional news outletsand thought-leaders from traditional finance. Part of theteam presented the report “The State of Lightning” at theAdopting Bitcoin conference in El Salvador in November2021, where they were keynote speakers.During the quarter the team also focused on developinga new research platform that went live in beta in Q1 2022.The team also worked closely with Tech/ Engineering andDesign specialists to make their research easily accessible and tailored to users. The new platform will enableArcane Research to optimize distribution and reach evenmore users.

9 Business Unit DevelopmentYear-end Report Q4 2021KaupangArcane Green DataKaupang was acquired by Arcane Crypto on March 26,2021. Following the acquisition, the focus has been ondeveloping a dedicated premium offering for clients whoexecute larger trades and need deep liquidity.Arcane Green Data focuses on executing Arcane’s mining strategy. The operation went live in October 2021 andgenerated revenue of 8,347 kSEK with an average grossmargin of 65% during the fourth quarter, a period withhistorically high electricity prices.During Q4 2021, Kaupang continued to strengthen its premium offering to large private customers and businessesand launched an insured custody offering. The premiumoffering now includes an OTC-desk, a dedicated accountmanager setup, access to voice-trading and trading overchat, as well as institutional grade custody.Regarding trading activity, Kaupang saw an 85%increase in gross turnover compared to Q3 2021, compared to a general 22% increase in the market (bitcoinvolume). Net revenue in Q4 2021 amounted to 138,892kSEK compared to 75,262 kSEK in Q3 2021. It was a recordquarter in terms of revenue and the average order sizegradually increased each month, along with the number of customers. As for the technical road map goingforward, the plan is to move Kaupang over to the newArcane platform over time, for a seamless integrationwith several other Arcane services.We have increased Kaupang’s profitability by acquiringnew FX partners and negotiating better terms for tradingwith our liquidity partners. Lastly, the market-makingactivities have also proven to be an important extra revenue stream for us. Kaupang will continue to grow andscale its business model throughout 2022.KaupangGross trading volume, 12021Q2Q3Q4After the quarter, machines representing an additional36 PH of capacity, were delivered and are now operational. Arcane Green Data now exports a total computingcapacity of just below 80 PH/s. With current deploymentand market conditions we are generating a revenueequivalent to approximately 32 Bitcoins per quarter.With an electricity price of 1 SEK / KWh, our direct cost forgenerating one bitcoin at current market conditions isapproximately 167 kSEK. Based on the electricity futuresmarket, we expect electricity prices to reduce by approximately 50% in the longer term.

10 Business Unit DevelopmentYear-end Report Q4 2021TrijoPuremarketsRevenue in Q4 2021 amounted to 741 kSEK compared to525 kSEK in Q3 2021.The Company owns 37.5% of Puremarkets. Puremarketsis building an interbank marketplace for cryptocurrencyprice discovery and exchange of wholesale risk via theirPure Digital platform. Pure Digital will provide a bestin-class class primary wholesale marketplace, with aconsortium of banks as liquidity providers, custodiansand clearers. The management team brings many yearsof experience at top-tier banks and have successfullydelivered a similar platform for the FX market.The acquisition of Trijo was completed through adirected set-off issue of shares in Arcane Crypto to thesellers on July 2, 2021. Trijo is consolidated into Arcane’saccounts as of Q3 2021.During Q4, Torbjørn Bull Jenssen and Totte Löfströmmutually agreed that Torbjørn Bull Jenssen should takeover the role as CEO of Trijo to unify operations and infrastructure across the Group.During the quarter, Trijo worked on revising the feestructure and now enables users to buy crypto for a feestarting at 0.5%. The revised fee structure, integration ofTrustly and the launch of Trijo Autopilot, the first servicein Sweden for automatic saving in Bitcoin, Ethereum andLitecoin in Q3 2021 has led to record trading volumes inQ4 2021, up 78% compared to the previous quarter.Arcane continues to work on a unified operation andinfrastructure across Kaupang and Trijo, which willinclude deep integration with Teslacoil to enable Lightning transactions and payments. Trijo has continuedto work on strengthening its partnership with Kaupangduring the quarter, to offer better liquidity on theexchange.TrijoGross trading volume, 3Q4Puremarkets have seen steady development in Q4. Theteam has used this quarter to continue to hold regularmeetings and calls with investment banks that havesigned LOIs. Topics of discussion have included regulation, custody options and the banks’ expected plans forlaunching spot trading in crypto. The Pure Digital platform is now complete and ready for test trading withthe banks and Zodia has been set up for testing on theplatform.Puremarkets submitted their application to the UK’sFinancial Conduct Authority to register as a crypto assetbusiness under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer)Regulations 2017 in Q2 2021 and await feedback on theirapplication.At the end of the period there were 6 LOIs in place withTier 1 investment banks, two of which have already beenannounced (State Street and Bank of New York Mellon).

11 Business Unit DevelopmentYear-end Report Q4 2021LN MarketsLN MarketsGross trading volume, kSEK1,200,000On April 16, 2021, Arcane Crypto entered into an investment agreement to increase its ownership in LN Marketsfrom 7% to around 16% via a cash investment of 1,500,000EUR (equivalent to 15,356 kSEK). LN Markets is a tradingplatform built on the Bitcoin Lightning Network and usesbitcoin, paid and settled over the Lightning Network, ascollateral for derivatives ng Q4, the total volume traded on LN Markets’ platformamounted to 120 MUSD (equivalent to 1,068,000 kSEK),up 104% from 53 MUSD in Q3 2021 (equivalent to 449,922kSEK), compared to a general market increase in tradingactivity (bitcoin spot) of 22%. While the trading volumecorrelated with market sentiment, LN Markets continued tosee a strong increase in their user base, up 33%.LN Markets provides access to instant and low-costderivatives transactions using the Bitcoin LightningNetwork. LN Markets’ setup and APIs further enable easyintegration with other services such as trading systemsand bitcoin lightning wallets. As an example, LN Markets is integrated with the node platform Umbrel. On theproduct development front, LN Markets has increasedmaximum leverage on the platform to 100x and areworking on developing the trading module for optionstrading, on a broker model.Q12020Q2Q3Q4Q12021Q2Q3Q4AlphaplateDuring Q4 2021, Arcane held 45% of Alphaplate and thisremained unchanged during the period. Alphaplatereported an estimated profit for Q4 2021 of 105,058 GBP(equivalent to 1,240 kSEK).Following the period Arcane sold its shares in Alphaplate.The transaction was completed on January 22, 2022.Organization as of December 31, 2021Arcane Crypto AB556668-3933Sweden100%Arcane Crypto AS994 608 973Norway100%Arcane Assets AS920 423 477Norway100%Teslacoil Solutions AS924 758 686Norway100%Kaupang Krypto AS919 578 998Norway37.5%100%100%Puremarkets Ltd.07663681United KingdomIjort Invest AB 1)(Trijo)559152-3278SwedenArcane Green DataHolding AS927 407 183Norway100%1)Fully consolidated as of July 2, 2021.Arcane Green DataServices AS925 401 749Norway16%ITOAM Sarl(LN Markets)847 894 615France

12 FinancialsYear-end Report Q4 2021FinancialsThe financial statements have been prepared in accordance with the Company’s accounting policies, alignedwith BFNAR Annual Reports and Consolidated Financial Statements (K3) and the Annual Accounts Act (Sw.årsredovisningslagen). The financial statements areprepared on the basis that the acquisition is reported as aReverse Takeover in accordance with K3 19.6. and Chapter 7 Section 23 of the Annual Accounts Act. This meansthat Arcane Crypto AS is consolidated as a part of ArcaneCrypto AB from 2021 even though it is Arcane Crypto ASthat is seen as the acquiring party for financial reportingpurposes.Comments October – December 2021and January – December 2021Income statementThe strong growth in revenue continued in this period andfollowing the consolidation of Kaupang in Q2 2021 andTrijo in Q3 2021, the Group’s revenue amounted to 332,625kSEK in FY 2021 compared to 2,103 kSEK in FY 2020. EBITDAamounted to –21,969 kSEK during FY 2021 compared to–17,812 kSEK in FY 2020. In Q4 2021, the Group had revenueof 148,930 KSEK compared to 1,224 kSEK in the corresponding period last year. EBITDA amounted to –3,383 kSEK inthe quarter compared to –10,358 kSEK for the corresponding period last year.Please note that neither Alphaplate, LN Markets, norPuremarkets are consolidated into Arcane’s accounts.These portfolio companies are instead accounted for inaccordance with the equity method and Arcane’s shareof ownership. Result from participation of the associatedcompanies amounted to –5,490 kSEK in FY 2021 and –1,540kSEK in Q4 2021.The acquisition of Arcane Crypto by then Vertical Venturesis accounted for as a Reverse Takeover in the consolidatedGroup statements, which leads to a cost item included inInterest expense and other financial costs in Q1 2021.Revenue generated by Kaupang from cryptocurrency isaccounted for according to the accounting principle ofgoods (in Norway NRS 1). When selling cryptocurrency tocustomers, the acquisition cost is expensed as the cost ofgoods and the sales value of the cryptocurrency is recognized as sales revenue. When Kaupang acquires cryptocurrencies from a customer and off-sets the trade byexchanging the cryptocurrencies with another counterparty, the off-setting trade is classified as sales revenuewhile the purchase from the customer is classified as thecost of goods.Balance sheetAfter the consolidation in accordance with the Groupaccounting principles, intangible assets have increasedby 50,966 kSEK, mainly related to goodwill from the acquisitions of Kaupang and Trijo.In Q3 2021, Arcane founded Arcane Green Data andinvested 35,978 kSEK in mining hardware during Q3 andanother 31,779 kSEK in Q4. Arcane Green Data has nowbegun mining bitcoin in Norway.Investment in Financial Assets amounted to 17,244 kSEKthrough the cash investment in IOTAM (LN Markets).The successful directed issue in Q1 2021 increased thecash balance and equity by 49,500 kSEK. In Q3 2021,Arcane conducted another successful directed issue of61,000 kSEK in order to finance the investment in ArcaneGreen Data. Consolidated equity as of 31st Decemberwas 148,948 kSEK which was a net increase of 116,746 kSEKcompared to the same period last year. Current liabilitiesamounted to 32,096 kSEK which was a net increase of23,055 kSEK compared to the same period last year. Thiswas mainly driven by the consolidation of current liabilities in Arcane Green Data Services (17,595 kSEK), Kaupang(4,901 kSEK) and in Trijo (1,068 kSEK).According to the applicable accounting rules for theReverse Takeover the acquired entity, Arcane CryptoAS, is seen as the surviving entity in the Group accounts.The consolidated changes in equity shall be comparedagainst previous accounts for the surviving entity. Adjustment to align with the share capital in the legal parentcompany is presented on a separate line in the statementof changes in equity.Cash flowInvestments in intangible fixed assets are related to goodwill from acquisitions of subsidiaries and cash flow fromfinancing activities is related to the completed directedshare issue (private placement) in Q1. During 2021, 88,288kSEK was invested in the acquisition of Kaupang and Trijo,increased ownership in LN Markets and in hardware forthe operation of Arcane Green Data. All of this was mainlyfinanced through the two private placements amountingto a total of 110,882 kSEK.

13 The Share

Year-end Report Q4 2021 A strong quarter with record revenue Fourth quarter of 2021 - compared to fourth quarter 2020 - Group revenue increased to 148,930 kSEK (1,224) EBITDA amounted to -3,383 kSEK (-10,358) EBIT amounted to -11,737 kSEK (-10,373) The result for the period amounted to -12,568 (-9,533) Earnings per share before dilution amounted to SEK