How Interactive Strength erased a $50M FET token bet and sent common shareholders to the back of the line
Interactive Strength’s crypto treasury of FET tokens was liquidated in late 2025. On July 28, the firm paid a dividend with 619,584 most popular shares, preserving money and placing $1.239 million of minimal base liquidation choice forward of common holders.
An 8-K filed July 31 breaks out 281,344 Series A shares and 338,240 Series C shares. The concern lifted the excellent totals to 4,696,089 Series A and 3,187,097 Series C. Compared with the counts instantly earlier than the distribution, Series A grew 6.37% and Series C 11.87%.
Preferred inventory ranks forward of common fairness in a liquidation. Each sequence begins with a $2 unique concern worth, adjusted for recapitalizations. Series A compounds an 8% cumulative dividend yearly. Series C compounds at 15% and ranks forward of Series A, Series B, and common inventory.
The new Series A shares carry $562,688 of base choice and about $45,015 of first-year dividend accrual. Series C provides $676,480 and $101,472. The mixed tab comes to $1,239,168 of minimal base choice, plus roughly $146,487 for a full first 12 months earlier than compounding. Those quantities describe fairness precedence and accrued dividends. Cash usually modifications fingers solely when the board declares a fee, besides underneath the liquidation phrases.
Common-share dilution has its personal math. It activates the conversion costs in impact after Interactive Strength’s 1-for-7 common-stock reverse split on June 30. The July submitting leaves each post-split costs undisclosed. Stockholder-approval limits and 4.99% possession caps can even prohibit issuance. An actual common equal stays unknown.
How the FET treasury unwound
Interactive Strength constructed the crypto treasury with $55.56 million of senior secured convertible exchangeable notes, offered for $50 million. The deal carried a 10% unique concern low cost, 12% annual curiosity, and a lien over treasury-subsidiary property anticipated to consist of custodied FET.
By the fourth quarter of 2025, the treasury had run its course. The 2025 annual report information the liquidation of all digital property, zero digital property at Dec. 31, and full satisfaction of the unique FET-backed notes by way of token gross sales and separate the rest notes. The FET pledge was passed by year-end.
ATW and DWF acquired unsecured remainder notes of $3 million and $4.5 million. The first-quarter filing nonetheless confirmed the full $7.5 million face principal at March 31, with an accounting truthful worth of $4.538 million.
The steadiness sheet supplied little cushion. Cash stood at $4.738 million in opposition to a $22.4 million working-capital deficit. Unrestricted liquidity was about $1.3 million at the May 20 submitting date, and the firm warned of substantial doubt about its capability to proceed as a going concern.
On July 21, an investor exercised a pre-existing warrant. Interactive Strength issued a $2 million senior secured convertible word due in July 2027, plus warrants exercisable for 305,810 common shares. The transaction filing ties the word to that older association. FET is absent from its collateral description.
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