UNITED STATES

 SECURITIES AND EXCHANGE COMMISSION

 Washington, D.C. 20549

 FORM 10-K/A

 ANNUAL
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the Fiscal year ended December 31, 2023

 OR

 TRANSITION
REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 For the transition period from _________ to
__________

 Commission file number: 001-41626

 (Exact name of registrant as specified in its
charter)

 Delaware

 46-0547534

 (State or other Jurisdiction of

Incorporation or Organization)

 (I.R.S. Employer

Identification No.)

 900 Easton Ave. STE 26-1088

 Somerset NJ 08873 -1760

 (917) 444-9259

 (Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)

 Securities registered pursuant to Section 12(b)
of the Act: None.

 Securities registered pursuant to Section 12(g)
of the Act: None.

 Title of class

 Not Applicable

 Not Applicable

 (Former name, former address and former fiscal
year, if changed since last report)

 Indicate by check mark if
the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

 Indicate by check mark if
the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes No

the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes No

the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T
(§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit
such files). Yes No

the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging
growth company. See the definitions of "large accelerated filer," "accelerated filer", "smaller reporting
company", and "emerging growth company" in Rule 12b-2 of the Exchange Act.

 Large accelerated filer

 Accelerated filer

 Non-accelerated filer

 Smaller reporting company

 Emerging growth company

 If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 Indicate by checkmark whether
the registrant has filed a report on and attestation to its management's assessment of the effectiveness of its internal control
over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that
prepared or issued its audit report.

 If securities are registered
pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing
reflect the correction of an error to previously issued financial statements.

any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the
registrant's executive officers during the relevant recovery period pursuant to §240.10D-1(b).

the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No

 There was no market for
the common stock of the company and no public sales of common stock effected by the company within the fiscal year ended December
31, 2023.

 As of August 15, 2024,
there were 15,690,719 shares outstanding of the registrant's common stock, par value $0.0001 per share.

 Explanatory Note

 NYIAX, Inc. (the "Company") is
filing this Amendment (this "Amendment") to the annual report on Form 10-K filed on August 19, 2024 (the "Original
Form 10-K") to amend the office location of the Report of Independent Registered Public Accounting Firm of WWC, P.C., the Company's
auditor, included in the Original Form 10-K from "New York" to "San Mateo." Other than as expressly set forth
above and herein, this Amendment does not, and does not purport to, amend, update or restate any other items or disclosures included
in the Original Form 10-K or reflect any events occurring after August 19, 2024. The financial statements and notes to the financial
statements remain the same as those contained in the Original Form 10-K.

 NYIAX, INC.

 TABLE
OF CONTENTS

 Page

 Item 1.

 Business

 Item 1A.

 Risk Factors

 Item 1B.

 Unresolved Staff Comments

 Item 1C.

 Cybersecurity

 Item 2.

 Properties

 Item 3.

 Legal Proceedings

 Item 4.

 Mine Safety Disclosures

 Item 5.

 Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

 Item 6.

 Reserved

 Item 7.

 Management's Discussion and Analysis of Financial Condition and Results of Operations

 Item 7A.

 Quantitative and Qualitative Disclosures About Market Risk

 Item 8.

 Financial Statements and Supplementary Data

 Item 9.

 Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

 Item 9A.

 Controls and Procedures

 Item 9B.

 Other Information

 Item 9C.

 Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

 Item 10.

 Directors, Executive Officers and Corporate Governance

 Item 11.

 Executive Compensation

 Item 12.

 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

 Item 13.

 Certain Relationships and Related Transactions, and Director Independence

 Item 14.

 Principal Accountant Fees and Services

 Item 15.

 Exhibits and Financial Statement Schedules

 Item 16.

 Form 10-K Summary

 Signatures

 i

 Forward-Looking Information

 This Annual Report of NYIAX, Inc. on Form 10-K contains forward-looking
statements, particularly those identified with the words, "anticipates," "believes," "expects," "plans,"
"intends," "objectives," and similar expressions. These statements reflect management's best judgment based
on factors known at the time of such statements. The reader may find discussions containing such forward-looking statements in the material
set forth under "Management's Discussion and Analysis of Financial Condition and Results of Operations," generally,
and specifically therein under the captions "Going Concern, Liquidity and Capital Resources" as well as elsewhere in this
Annual Report on Form 10-K. Actual events or results may differ materially from those discussed herein. The forward-looking statements
specified in the following information have been compiled by our management on the basis of assumptions made by management and considered
by management to be reasonable. Our future operating results, however, are impossible to predict and no representation, guaranty, or warranty
is to be inferred from those forward-looking statements. The assumptions used for purposes of the forward-looking statements specified
in the following information represent estimates of future events and are subject to uncertainty as to possible changes in economic, legislative,
industry, and other circumstances. As a result, the identification and interpretation of data and other information and their use in developing
and selecting assumptions from and among reasonable alternatives require the exercise of judgment. To the extent that the assumed events
do not occur, the outcome may vary substantially from anticipated or projected results, and, accordingly, no opinion is expressed on the
achievability of those forward-looking statements. No assurance can be given that any of the assumptions relating to the forward-looking
statements specified in the following information are accurate, and we assume no obligation to update any such forward-looking statements.

 Except as otherwise indicated herein or as the context otherwise
requires, references in this Annual Report on Form 10-K to "NYIAX," the "Company," "we," "us"
and "our" refer to NYIAX, Inc.

 ITEM 1. BUSINESS

 Our Company

 NYIAX is a financial platform technology company
founded in 2012 by Carolina Abenante, Mark Grinbaum and Graham Mosley, who formulated the genesis of NYIAX's business model to bring
forth a new era of financial platform technology and financial rigor to the advertising industry. NYIAX's platform utilizes the
Nasdaq financial framework ("NFF"). NYIAX utilizes Smart Contracts and blockchain technology as its core ledger, which enables
contract formation, compliance and reconciliation. NYIAX's utilization of financial technology brings automation of many manual
and outdated processes to the advertising industry. Our mission is to connect buyers and sellers, enabling trusted, secure, and efficient
transactions.

 NYIAX's business model is focused on the
creation of a marketplace where advertising inventory, campaigns and audience can easily be listed and sold through utilization of highly
efficient financial buying and selling technology. A media buyer ("Media Buyer") is typically an advertiser, advertising agency
or intermediary that buys on behalf of an advertiser. A media seller ("Media Seller") is typically a publisher of content,
such as websites, magazines, billboards, network TV, mobile or desktop applications or other content, or a Supply or Sell Side Platform 1
(SSP, which refers to a technology platform enabling web publishers and digital out-of-home media owners to manage their advertising inventory,
fill it with ads, and receive revenue). NYIAX has developed a technology platform which provides Media Buyers and Media Sellers a marketplace
where advertising or audience campaigns are listed, bought and sold.

 Our Strengths

 We believe the strengths stated below provide
us with an advantage in the industry we operate in.

 End to End Platform. Our platform
enables clients to save time and money on (i) outdated and manual processes; (ii) discovery and negotiation of deals; and (iii) reconciliation
and billing, providing financially rigorous transparency and automation to the contracting process across the media eco systems.

 Technology Innovation. Our use of
Nasdaq technology, our patented adaptation of financial buying and selling systems, and our use of other innovative technologies, such
as distributed ledgers and Smart Contracts enables us to interoperate with both the advertising marketplace and the new technologies as
they evolve, thereby providing both NYIAX and its customers increased efficiency in automation as digital transformation accelerates.

 Two-Sided Market. NYIAX's
unique approach of having a two-sided marketplace enables publishers and agencies to describe, negotiate, and form the contract for the
inventory while enabling and maintaining contract, descriptors and attributes standards. Our approach directly improves upon the current
advertising industry Private Marketplaces and Automated Guaranteed (AG) platforms. The current advertising industry models are auctions
based on first or second price for the inventory, while NYIAX enables dynamic pricing which allows buyers and seller to combine both human
intelligence and artificial auction models, thereby providing a market for both buyer and sellers to transact according to their business
requirements.

 Agnostic and Complimentary Nature. Our
Platform is agnostic and complimentary to the current technology partners our clients prefer for delivery, tracking and media types, thereby
enabling us to offer service and value to our customers across the ecosystem. For example, we originally developed our platform to work
with Ad Contract delivery occurring through the primary publisher and agency ad serving technology, whereas today we also support delivery
of media via both direct and indirect delivery platforms via our relationships with Supply or Sell Side Platforms (SSPs, which refer to
technology platforms enabling web publishers and digital out-of-home media owners to manage their advertising inventory, fill it with
ads, and receive revenue).

 NYIAX plans to follow the new industry standards
around third- party cookies and data and intends to support the emerging solutions for campaigns and transaction on the NYIAX platform.

 Our Growth and Scale Strategy

 NYIAX focuses on the below areas to enable growth
and scale of the NYIAX platform for its clients and partners.

 Publisher Supply
listing and availability via direct and indirect channels, balanced with agency and advertiser demand needs.

 Continued expansion and maintenance
of the Omni channel demand and supply as distribution evolves to new media types.

 As demand from the buy
side of the market dictates, we will continue to expand internationally. We have initially focused on the United States,
however, interest from global markets will enable both growth and scale over time.

 Automation with technology
 is core to the growth and scale of the business. Reducing costs for us and our clients, which enables increased productivity
and efficiency.

 New Market Opportunities

 We are of the belief that NYIAX's platform
may be extendable to other markets, and have received unsolicited interest based on business development efforts with corporations that
have inquired about using our platform for other markets. This interest is based on the jointly owned patent with Nasdaq that allows for
the technology's use in other markets.

 Management will continue to review opportunities
to extend our platform to other markets. As of the date of this Registration Statement, we have no understandings or agreements to develop
technology, or partner with any other persons or entities. We currently have no concrete plans to extend our technology to other markets.

 NYIAX will continue to extend its products and
services to support our growth. Advertising delivery/verification and integrations increase the efficiency and cost-effectiveness for
both NYIAX and our customers. Improvements to this infrastructure, APIs 20 enable us to interoperate automatically with partners.

 Our Platform

 NYIAX provides a solution to the advertising marketplace
challenges through the creation of a trusted, transparent, efficient, and auditable marketplace and platform where Media Buyers and Media
Sellers can discover, negotiate, contract formation, reconcile and bill all in one platform and with use of a dashboard, while ensuring
compliance with advertising contracts. We are of the belief that NYIAX is the first to bring this level of automation, efficiency, financial
rigor, and auditability to the advertising industry.

 NYIAX platform captures the material terms of
a buyer's and seller's contract/campaigns to the corresponding inventory, such as, counterparties to the contract, delivery
dates of the campaigns, campaign metrics, pricing, media inventory (sites, channels or applications), inventory attributes (advertising
specific attributes like content type, ad type, language, ad sizes, content categories, etc.), and standardize contract terms (count of
record for delivery tracking and payment terms).

 Further, the NYIAX platform capture campaign,
planning, inventory discovery negotiations between buyer and seller contract creation, delivery of the campaign, reconciliations of campaign
metrics, and payment distribution to seller by the buyer. NYIAX utilizes blockchain (Hyperledger) to record the contract creation and
smart contracts to enable the reconciliation of the campaign and payment.

 Moreover, the NYIAX platform facilitates the contract/campaign
through both standardization within the NYIAX taxonomy and bespoke taxonomy which over time may become part of the NYIAX taxonomy. NYIAX
taxonomy is based on industry standards and new customized attributes which are standard to our clients. However, volume, price and value
of the contract are negotiated and accepted between and among buyers and sellers in order to create the contract.

 NYIAX provides a contract marketplace that is
expected to allow Media Sellers and Media Buyers to transact purchases and sales of digital advertising inventory with an elevated level
of transparency for pricing and inventory details. NYIAX will provide a comprehensive platform for clients, and support integrations with
existing client vendors for seamless onboarding. All buying and selling activity is intended to be recorded in the ledger on the Blockchain.

 Our platform is a key component connecting the
Media sellers, Media buyers and intermediaries within the advertising supply chain.

 The below diagram illustrates the lifecycle of an advertising contract
through the NYIAX platform.

 Customer Setup: supports the onboarding of clients
into the platform.

 Discovery: enables
both buy and sell sides to view/sort the market.

 Negotiation: negotiates
contract terms, price, volume, inventory, and campaign attributes.

 Contract Formation: contract
is formed from the match of a buy and a sell order.

 Delivery: consists
of a few steps: Pre-delivery, is a lock-down period prior to delivery where an instrument can no longer be bought, sold or amended as
to material terms and the campaign is properly configured with both parties. Delivery is when the ad is delivered and both parties can
view the impression reporting and pacing.

 Reconciliation: after
the close of the delivery period, any delivery issues are reconciled, and final billing is processed, happening near simultaneously with
delivery.

 Billing: enables
multiple billing workflows based on contract terms and counterparties.

 Compliance: end
to end audits of key elements of the process to ensure compliance.

 How Participants Use the NYIAX Platform

 Buy-Side

 Media Buyers can view the current market via filters.
Initially, the most common method will be for a Media Buyer to use different filters to see what instruments are available at various
prices. However, a Media Seller could give the buyer a particular symbol, which is visible in the standard public market, or only available
in a limited private market with a discounted price, mirroring the Private Marketplace Deal ID 1 mechanism currently used in
the current Real Time Bidding environment. In addition to the general instrument attributes, advertisers can specify their potential Media
Buyers, which will then be matched against any existing restrictions, referred to as blocklists (which allow ads to be prevented from
running on specific websites and apps), set by the Media Seller.

 marketingland.com/navigating-modern-ad-serving-stack-part-3-private-marketplaces-deal-id-128234, "Deal ID" is a component of the Real Time Bidding technology standard (Open Real Time Bidding). It allows publishers to take their inventory off the open auction and place it in an invitation-only area.

 Sell-Side

 NYIAX helps Media Sellers create Ad
Instruments (listings) on the exchange, based on current forecasting and sales packages. If Media Sellers are already offering
Automated or Programmatic Guaranteed packages, we can utilize those either directly in NYIAX's platform or through integration
with their existing vendor. For the initial launch period with any new seller, we will provide these services to Media Sellers on a
fully managed basis through our upload tools. In the longterm, we expect the Media Sellers to be able to create their own
instruments or push from an existing Automated Guaranteed system as self-service.

 The NYIAX Platform enables the Media Buyers and
Sellers the ability to transact similar to other types of markets, which can require payment on the sale or on any aspect of payment settled
between Media Buyer and Seller within the order book and is a significant change compared to the advertising industry's current
payment terms.

 Further, our contract (direct 2, RFP 3
 and RFQ 4) market is focused on the underserved and highly manual direct transactions that continue to exist in the high
value portion of the advertising market. These are conducted via known counterparties and consist of upfront buys typically conducted
in advance and in bulk toward the beginning of the year and ongoing individual buys purchasing inventory for a specific quarter or month.

 Below is a snapshot of the Platform Workflow:

 Direct marketing consists of any marketing that relies on direct communication or distribution to individual consumers, rather than through a third party such as mass media. Mail, email, social media, and texting campaigns are among the delivery systems used. It is called direct marketing because it generally eliminates the middleman, such as advertising media.

 A request for proposal (RFP) is a business document that announces a project, describes it, and solicits bids from qualified contractors to complete it. Most organizations prefer to launch their projects using RFPs, and many governments always use them.

 A request for quote (RFQ), also known as an invitation for bid (IFB), is a process in which a company solicits select suppliers and contractors to submit price quotes and bids for the chance to fulfill certain tasks or projects. The RFQ process is especially important to businesses that need a consistent supply of a specific number of standard products. Companies may send RFQs alone or before a request for proposal (RFP).

 Our Technology

 The key differentiators of the NYIAX technology
include the following.

 Promotes transparency
 in the supply chain with interoperability between multiple blockchain implementations.

 Standardizes contract
types including key variable contract terms, creating increased liquidity and compliance for market participants.

 Enables rapid development
and deployment of capital markets rigor through cloud and container-based architecture. 25

 Reduces reconciliation
and manual task costs for buyers and sellers, with automation of contract workflow.

 Enables contract and
data compliance capabilities for the full contracting lifecycle with standard financial exchange grade technology via Nasdaq
licensed technology.

 NYIAX Blockchain Implementation

 By using Blockchain as its ledger, NYIAX can provide
permitted transparency to its clients, with accurate historical data set utilized for auditing, compliance, and financial transparency.

 We use Hyperledger Fabric, an open-source project
from the Linux Foundation. Hyperledger Fabric is considered an enterprise blockchain platform, which means a governance layer allows for
advanced privacy controls so that only the data we designate is permitted for participants to view, share, and transact.

 All transactions are private between the designated
participants, defined in the protocol within the governance layer of the Blockchain.

 Further, Hyperledger Fabric supports on chain
and business logic based smart contracts. We designate and determine automated NYIAX business processes enabling self-executing terms
between the participants written into lines of code. Our implementation is not distributed or decentralized. However, the contracts written
into the ledger are trackable and irreversible, enabling trust, transparency, and audibility between participants.

 An enterprise blockchain saves time, reduces costs,
and reduces risk through transparency and accountability. We do not see the need to integrate with a public blockchain at this time since
we believe that a governance layer is required in business-to-business transactions.

 The image below depicts the structure of how the
NYIAX/Nasdaq platform connects clients and partners in the advertising ecosystem.

 ITCH supports market data and is a direct data-feed
protocol such as TCP (Transmission Control Protocol) or UDP (User Datagram Protocol). ITCH 26 makes it possible for subscribers
to track the status of each order from the time it is first entered until the time it is either executed or canceled.

 Financial Information eXchange (FIX) protocol
is an electronic communications protocol initiated in 1992 for international real-time exchange of information related to securities transactions
and markets.

 Our Clients

 NYIAX has signed participants on the NYIAX platform
through a master service agreement which describes the terms and the conditions of both Media Buyers (advertisers, advertising agencies
and others buying advertising placement and audience on the NYIAX platform) and Media Sellers (publishers who own advertising inventory).
Material terms of the NYIAX agreements are as follows:

 Statement and Scope of work
which is a description of NYIAX as a contract management platform. Buyer (agency, advertiser or proxy for the advertiser) shall communicate
all proposed Campaign details and Terms and Conditions to NYIAX. These details will be provided to Seller (publisher, proxy for the publisher
(SSP Advertising Network or other proxy)). Upon acceptance from Seller and confirmation of acceptance from Buyer, NYIAX shall supply
an Advertising Contract ("Advertising Contract" means the agreement setting forth the actual purchase or sale of publisher
inventory, the serving of advertising inventory, the processing of data related to advertising inventory for analysis, or an insertion
order for the Campaign, to which the Services apply), which will, contain all governing Campaign terms and details. NYIAX represents
that it has an agreement in place with the Buyer whereunder NYIAX provides Services to the Seller as contemplated thereunder. NYIAX is
a contract management platform. NYIAX provides a full contract management suite of services for Advertising Contract compliance, reconciliation,
oversight, invoicing and distribution for Buyer, Seller and if required 3 rd party technology providers involved in advertising.
Utilization of NYIAX services also known as the NYIAX platform is the Seller's operational frontend and backend for the Campaign
(Advertising Contract).

 NYIAX shall provide the specific
Services set forth in the Advertising Contract solely for the Campaign on behalf of the Buyer for the particular Campaign. NYIAX shall
provide contract management, reconciliation, reporting accounting services, invoicing and distribution of funds throughout the lifecycle
of the Campaign (Advertising Contract). For this service NYIAX shall be entitled to a (fee percentage is negotiated) fee ("NYIAX
Fee"), which will be deducted by NYIAX from the fees due to Seller pursuant to the Advertising Contract, after such fees have been
reconciled, accepted, invoiced, and paid by the Buyer to NYIAX ("Company Fees"), where reconciled or reconciliation means
the final impression volume and number used to generate invoicing and billing to the Buyer in accordance with the set Advertising Contract.
The Seller shall be paid by NYIAX net (time period negotiated) calendar days ("Remittance Time Period") after receipt of
invoice and payment of the Campaign from the Buyer, less the NYIAX Fee. NYIAX is the facilitator for the Advertising Contract and adheres
to sequential liability, which means only upon receipt of payment of the Campaign by the Buyer post reconciliation and agreement by the
Advertiser or Agency shall NYIAX remit payment to the Company.

 NYIAX provides reconciliation
and reporting statements to both the Buyer and the Seller. NYIAX shall supply the Seller with daily reporting from the Advertising Contract
term Count (s) of Record where, "Count(s) of Record" is defined as the agreed upon sources, selected at the time Advertising
Contract formation, which represents the baseline count of delivered ads by terms and conditions of the Campaign or Advertising Contract.
This is a non-exhaustive list and can be amended by mutual agreement of the Agency and Company from time to time. Count(s) of Record
may include the following: (various reporting certification providers which are negotiated) and any other Count (s) of Record the Buyer
so chooses. In the event the Count of Record is from the Seller, then Seller shall supply daily reporting to NYIAX. NYIAX shall provide
a monthly reconciliation report, with details reduced by day, in alignment with the delivery reporting associated with the Advertising
Contract. At a minimum, NYIAX shall provide Seller with all necessary metrics in its reporting so that Seller is able to properly determine
if any disputes in reporting are present. If Company disputes details of the monthly reconciliation report, notice must be provided in
writing within (negotiated timeframe) business days of receipt of the monthly reconciliation report. NYIAX will work with the Seller
in good faith for a period of not less than (negotiated timeframe) calendar days to reconcile any disputes Seller has with the reconciliation
reports on a timely basis. NYIAX acknowledges and agrees that Seller may use and disclose Services, inclusive of reports and information
provided therein, in the ordinary course of its business and may disclose such reports and information to its client.

 Term of the agreement is based
on campaign specific timeframe, multiple campaigns timeframe or ongoing relations where termination by either party can be effectuated
with written notice (negotiated timeframe). Immediate termination on material breach by either party.

 NYIAX has signed agreements with various public
and private companies and has commenced full commercial use of the NYIAX platform as of 2021. On September 29, 2021, NYIAX and PubMatic
entered into a Managed Services Term Sheet ("PubMatic Agreement"). Under the PubMatic Agreement, the initial term commenced
from September 1, 2021 and continues indefinitely until either party terminates the agreement with thirty (30) days written notice.

 On August 16, 2021, NYIAX and OpenX entered into
an Ad Exchange Access Partner Agreement ("OpenX Agreement"). The term of the OpenX Agreement commenced on August 16, 2021
and continues for twenty-four (24) months thereafter. Pursuant to the OpenX Agreement, either party may terminate the agreement (i) for
convenience upon sixty (60) business days' prior written notice to the other party, (ii) for material breach of the agreement and
the failure to cure such breach by the breaching party within thirty (30) days after receiving written notice of the material breach from
the non-breaching party, and (iii) upon insolvency (as defined under the OpenX Agreement).

 On October 14, 2021, NYIAX and Univision entered
into a Managed Services Agreement ("Univision Agreement"). The term of the Univision Agreement commenced on November 1, 2021
and continues until completion of the services (as defined under the Univision Agreement). Pursuant to the Univision Agreement, either
party may terminate the agreement for material breach of the agreement and the failure of the breaching party to cure such breach within
thirty (30) calendar days after receiving written notice of the material breach from the non-breaching party.

 During the year ended December 31, 2021,
NYIAX has performed services for 25 Media Buyers and 23 Media Sellers. At December 31, 2021, the Company was performing services
for 16 Media Buyers and 18 Media Sellers. As of December 31, 2021, three Media Sellers, namely PubMatic, OpenX and Univision represented
approximately 30% 26%, and 11% of net revenue.

 As of December 31, 2022, three Media Sellers
represented approximately 51%, 12% and 10% respectively of revenue, net. As of December 31, 2022, two Media Buyers represented 67%
and 20% of accounts receivable. As of December 31, 2022, two Media Sellers represented 61% and 8% of accounts payable.

 NYIAX has continued to strengthen the sell side
of its marketplace by adding premium publishers and supply partners, extending NYIAX's supply footprint into digital out-of-home
(DOOH) and in-game advertising, marking significant progress towards NYIAX becoming an omnichannel marketplace.

 Market Dynamics

 The advertising
industry has grown significantly in the past twenty years. According to Statista(a frequently quoted research company which claims to
source information of over 1,000,000 statistics on over 80,000 topics from more than 22,500
sources in over 150 countries), the total global advertising spend for 2023 was over 918.18 billion US dollars and for 2024 it is estimated
to reach 989.8 billion US dollars a 7.8% growth over the prior year. Additionally, eMarketer (a frequently quoted research company which
claims to source information from 3,000 sources), published in October of 2023 that digital advertising spend worldwide was estimated
to increase by 10.7% for 2023 as a percentage of total advertising spend and in March of 2024 revised their estimate to a 12% increase
as a total of advertising spend and has estimated a continued increase in global digital spend to 12.2% for 2024 as a total of advertising
spend. US Internet advertising revenues reached a record-high of $225 billion, increasing by 7.3% year-over-year overall between
2022 and 2023, according "IAB Internet Advertising Revenue Report: Full Year 2023", which was released on April 16, 2024 by
IAB/PwC. The report found that Q4 of 2024 growth rate of 12.3% from the year prior (4.4%), with revenues rising to $64.5 billion
where the US continues to be largest market for digital advertising lead by Retail Media revenues 16% y/y growth in advertising revenues,
reaching $43.7 billion in 2023, Video advertising revenue (10.6%) y/y growth, $52.1 billion in 2023, and Audio advertising
growth of 18.9% to reach $7 billion.

 Our Competition

 As a new modality in advertising, we compete against
existing forms of buying and selling media. It is essential to note that we also complement current industry technologies and partner
with them, many of which have existed in the marketplace for years and have more readily access to technology, more relationships,
and significantly greater financial and human resources than us.

 Competition in our market involves rapidly changing
technologies, in order to promote compliance and transparency as evolving automation tools to streamline media supply and demand monetization.
If we are unable to keep pace with the evolving needs of the industry, demand for our products and services may be reduced and our business
and results of operations would be harmed.

 Intellectual Property

 The protection of our technology and intellectual
property is an important component of our success. We protect our intellectual property rights by relying on federal and state statutory
and common law rights, foreign laws where applicable, and contractual restrictions. We seek to control access to our proprietary technology
by entering into non-disclosure agreements with third parties and disclosure and invention assignment agreements with our employees and
contractors.

 We consider our patents, copyrights, trade secrets,
and other intellectual property rights to be, in the aggregate, material to our business. We currently co-owned one issued U.S. patent,
expiring in 2037, relating to electronic continuous buying and selling systems, and matching data records representing inventories with
variant characteristics such as, variant length, variant data types, etc. Example implementations provide for generating instrument descriptors
that include unitary-valued attributes and set-valued attributes, and the use of both types of attributes in buying and selling decision
making. We also own trademark registrations and applications for the "NYIAX" name and other product-related marks in the United States.
We are in the process of registering other NYIAX name variants and product-related marks in the United States. We have also registered
numerous Internet domain names related to our business.

 In addition to our intellectual property rights,
we also consider the skills and ingenuity of our employees and the functionality and frequent enhancements to our solutions to be contributors
to our success in the marketplace. We believe our platform would be difficult, time consuming, and costly to replicate. We protect our
competitive technology position through our ability to execute and deliver new functionality quickly, as well as our continuous development
of new intellectual property as we innovate.

 We intend to pursue additional intellectual property
protection to the extent we believe it would be beneficial and cost effective. Despite our efforts to protect our intellectual property
rights, it may not be respected in the future or may be invalidated, circumvented, or challenged. In addition, the laws of various foreign
countries may not protect our intellectual property rights to the same extent as laws in the United States.

 On June 25, 2017, Nasdaq, Inc. and NYIAX
signed a Joint Intellectual Property Ownership Agreement setting forth property rights related to a filed co-owned patent which is titled:
"SYSTEMS AND METHODS FOR ELECTRONIC CONTINUOUS TRADING OF VARIANT INVENTORIES." The first patent and second patent were granted
by the USPTO on March 31, 2020 and August 9, 2022, respectively, to Nasdaq Technology AB and NYIAX, Inc. as co-applicants, Patent
No. US 10,607,291 B2 and Patent No. US 11,410,236 B2. These patents disclose an invention that enables and extends discovery and automated
matching of contracts with complex attributes, requirements and order types.

 Recently about fifty percent (50%) of all equity
trading took place off exchange. (The Value of Off-Exchange Data Thomas Ernst, Jonathan Sokobin and Chester Spatt, April 26, 2021). The
joint patent between Nasdaq and NYIAX could extend to new market sectors where the technology may enable efficient buy and sell matching
through price discovery of complex contracts, thereby enabling efficient and effective regulatory compliance, audit and clearing. Price
discovery, transparent and orderly buying and selling within markets enable liquidity, market making, capital investment, compliance
and auditability 6. We currently have no concrete plans to extend our platform to other industries other than advertising. If
we were to utilize our technology for other industries and with complex contract typologies, then we would require a legal and regulatory
review.

 The illustration below describes how NYIAX creates
a durable instrument with media as an example.

 Randall Dodd, Markets: Exchange or Over-the-Counter, February 24, 2020.

 Privacy and Data

 We are subject to laws and regulations governing
privacy and the transmission, collection, and use of consumer data. Interest-based advertising, or the use of data to draw inferences
about a consumer's interests and deliver relevant advertising to that consumer, has come under increasing scrutiny by legislative,
regulatory, and self-regulatory bodies, privacy advocates, academics, and commercial interests in the United States and abroad that
focus on data protection and consumer privacy. In particular, much of this scrutiny has focused on the use of cookies and other tracking
technologies that collect or aggregate information about consumers' online browsing and mobile app usage activity. Because both
our company and our publishers rely upon large volumes of such data collected primarily through cookies and other tracking technologies,
it is essential that we monitor legal requirements and other developments in this area, domestically and globally, maintain a robust privacy
and security compliance program, and engage in responsible privacy practices, including providing consumers with notice of the types of
data we collect, how we collect it, with whom we share it, how we use that data to provide our solutions, and the applicable choices we
offer consumers.

 We provide notice through our privacy
policies and notices, which can be found on the new website at www. NYIAX.com. As stated in our privacy policy, we do not
collect information, such as names, addresses or telephone phone numbers, for providing our advertising services that can be used
directly to reveal the identity of the underlying individual. We take steps not to collect and store such information (although on
occasion, our publishers voluntarily share information of their consumers with us and in such circumstances, we require the
publishers to have obtained all necessary consents for such sharing). Our advertising and reporting rely on information that does
not (and we do not attempt to associate this information with other information that can identify such individuals). We currently do
not collect and we do not store IP addresses, geo-location information, and device identifiers that are considered personal data or
personal information under the privacy laws of some jurisdictions or otherwise may be the subject of current or future data privacy
legislation or regulation. The definition of personally identifiable information, personal information, or personal data, varies by
jurisdiction and continues to evolve in ways that may require us to adapt our practices to avoid violating laws or regulations
related to the collection, storage, and use of consumer data. As a result, our technology platform and business practices must be
assessed regularly against a continuously evolving legal and regulatory landscape, and we have adopted strong data minimization
practices that mitigate our compliance risks.

 Additionally, our compliance with our privacy
policy and our general consumer data privacy and security practices are subject to review by the Federal Trade Commission, which may bring
enforcement actions to challenge allegedly unfair and deceptive trade practices, including the violation of privacy policies and representations
or material omissions therein.

 We currently do not work with publishers outside
of the United States. In the future is we work with publishers outside of the United States and take in consumer data then our
privacy and data practices are subject to regulation by data protection authorities and other regulators in the countries in which we
do business. The use and transfer of personal data in member states of the European Union is currently governed under the General Data
Protection Regulation ("GDPR"), which grants additional rights to consumers about their data, such as deletion and portability,
and generally prohibits the transfer of personal data of EU subjects outside of the EU, unless the party exporting the data from the EU
implements a compliance mechanism designed to ensure that the receiving party will adequately protect such data.

 Other jurisdictions have enacted legislation that
closely tracks the concepts, obligations, and consumer rights described in the GDPR, including Brazil's General Data Protection
law and Thailand's Personal Data Protection Act. Some jurisdictions, including Russia and China, have in recent years enacted
data localization laws, which require any personal information of citizens of those jurisdictions to be stored and processed on servers
located in those jurisdictions. Such laws are gaining momentum and are being enforced by local authorities.

 Potential Futures Industry Governmental Regulation

 Interest-based advertising, or the use of data
to draw inferences about a user's interests and deliver relevant advertising to that user, has come under increasing scrutiny by
legislative, regulatory, and self-regulatory bodies in the United States and abroad that focus on consumer protection or data privacy.
There may be some self-regulatory activities with regard to rules enforcement and market surveillance required by us in order to maintain
an orderly market and forestall any external regulation needs. In terms of competition, if regulation were to occur, NYIAX is of the opinion
that the Nasdaq X-stream 29 platform's built-in regulatory and basic surveillance requirements could be adapted to
provide support that exceed potential NYIAX needs in a foreseeable future. There are a patchwork or state legislation which have come
to fruition, but also there is proposed pre-emptive legislation namely H.R. 1816 which introduced a hybrid of the GDPR and the California
Consumer Privacy Act of 2018 (CCPA). H.R. 1816 is less restrictive to the advertising industry and pre-emptive to state legislation
which would allow for use of "non-sensitive" data which is data which does not directly identify the individual. H.R. 1816
specifically states that "non-sensitive" data is anything not "sensitive personal information" which is defined
in the bill as financial account numbers and authentication credentials, such as usernames and passwords; health information; genetic
data; any information pertaining to children under 13; social Security numbers and any "unique government-issued identifiers";
precise geolocation information; the content of oral or electronic communications, such as email or direct messaging; personal call detail
records; biometric data; sexual orientation, gender identity or intersex status; citizenship or immigration status; mental or physical
health diagnoses, religious beliefs; and web browsing history and application usage history 30.

 We do not expect that our current business model
involving the sale and purchase of advertising audience and inventory by Media Buyers and Media Sellers of such advertising triggers regulation
and supervision by the United States Commodity Futures Trading Commission ("CFTC") under the Commodity Exchange Act.

 Furthermore, we do not expect that our facilitating
the sale of advertising on the Nasdaq X-stream marketplace platform will be subject to SEC regulation and compliance requirements
with respect to such activity.

 If in the future the services and products offered
by NYIAX are expanded to include products and or services that could trigger regulatory oversight by a market regulator (e.g. CFTC and/or
SEC), NYIAX will engage with the appropriate regulator in a timely manner to ensure full compliance with the applicable statutes and regulations.

 Human Capital

 As of August 15, 2024 we have 6 full-time employees and 8 contractors.

 Through TriNet, our PEO, or professional employer
organization, NYIAX offers a full range of benefits to our employees and employees are required to adhere to our ethics policies and are
continually evaluated against goals and objectives by our chief executive officer.

 Available Information

 We maintain an internet website at www.nyiax.com. We do not intend
the address of our website to be an active link or to otherwise incorporate the contents of our website into this Annual Report. You may
also find all of the reports that we have filed electronically with the SEC at their internet site www.sec.gov.

 NYIAX
Platform and Nasdaq Technology

 The NYIAX platform was developed in collaboration with Nasdaq in order
to bring financial rigor and oversight to the advertising and media ecosystem. NYIAX and Nasdaq have entered into a co-patent agreement
for the adaptation of novel financial technology to industries with complex attributes and requirements; such as, advertising and media
in order to enhance speed and scale through standardized instruments, which enable discovery, contract creation, and reconciliation with
compliance and auditability.

 In July 2017, Nasdaq and NYIAX signed a Joint Intellectual Property
Ownership Agreement (the "Joint IP Agreement") setting forth property rights related to a filed co-owned patent which is titled:
"SYSTEMS AND METHODS FOR ELECTRONIC CONTINUOUS TRADING OF VARIANT INVENTORIES." The methodology set forth in the proposed
patent allows for the buying and selling of a variety of highly heterogeneous inventories; such as, but not limited to, advertising, insurance,
container shipment, SWAPs101, "Designer" Bespoke Tranche, petroleum and industrial Chemicals, agricultural seeds, FLEX Options103,
unstructured (presently) debt, real estate, wine and spirits by creation of encoded unique and durable inventory descriptors (defined
as "tokens") from a superset of marketplace defined inventory characteristics (defined as "attributes"). Buyers
and sellers can then state their firm buying and selling intentions for such variant inventory instances, setting stage for their continuous
electronic matching and contract formation. Pursuant to the Joint IP Agreement, all right, title, and interest to the US Patent Family
Members (as defined in the Joint IP Agreement) shall belong jointly to both NYIAX and Nasdaq Inc., including all rights appurtenant such
as the right to sue for damages and other remedies available for past infringement. NYIAX does not own foreign rights to the patent. Furthermore,
NYIAX may not assign the patent even under a change of control or merger without written consent of Nasdaq, Inc.. In addition, NYIAX shall
be permitted to grant non-exclusive licenses under the US Patent Family Members, only to (a) to bona fide clients of NYIAX, and only to
the extent necessary to permit such clients to use the services provided by NYIAX in NYIAX's ordinary course of business, and (b)
to bona fide vendors (e.g., cloud providers, consultants, and other vendors) of NYIAX, and only to the extent such licenses are necessary
to permit such vendors to assist NYIAX in providing services in NYIAX's ordinary course of business.

 NYIAX's current business model has utilized this technology to
provide a marketplace for Media Buyers and Media Sellers to enter into contracts for the purchase and sale of advertising inventory and
audience. Thereby, applying NYIAX's technology in order to create a transparent and efficient marketplace where participants can
discover, execute contract terms and reconcile all aspects of the contract during its lifespan.

 NYIAX and Nasdaq have entered into several agreements to build the
NYIAX platform. On December 21, 2015, NYIAX and Nasdaq entered into a Design Study Agreement, pursuant to which the design study for adapting
and creating of the functional specification to build the NYIAX marketplace and platform was completed. Further, on May 2016, NYIAX entered
into a services agreement (the "IT Services Agreement") with Nasdaq for building and completion of the specification of the
design study from December 20, 2015, which included exclusivity and bound Nasdaq to work only with NYIAX until October 2021 in the scope
of advertising platforms. On December 30, 2020, NYIAX and Nasdaq entered into an amendment to the IT Services Agreement to extend the
term of the agreement for an additional 10 years until April 5, 2032. Nasdaq provides cloud-based marketplace technology to NYIAX, and
NYIAX's adapted utilization of Nasdaq's technology is a backend infrastructure component of that processes.

 Pursuant to the IT Services Agreement, as amended, commencing April
2022, NYIAX is obligated to compensate NASDAQ an annual license fee of $350,000 and revenue sharing of 0.5% to 10% of revenue depending
upon various criteria. No expenses were incurred related to the annual license fee and revenue sharing agreements for the years ended
December 31 2021 and 2020. No payments were made in 2019, 2020 and 2021 related to the annual license fee and revenue sharing agreements.
The Company recognizes expenses related to the NASDAQ annual licensing fee in the period for the which the services related to the annual
license are utilized and recognizes expenses related to the NASDAQ revenue sharing in the period that the Company recognizes revenue related
to the NASDAQ agreements.

 Moreover, on December 8, 2017, NYIAX and
Nasdaq jointly filed a patent application for a US patent (Applicants: Nasdaq Technology AB and NYIAX, Inc.), which represents NYIAX
and Nasdaq's combined effort and innovation to extend financial buying and selling platforms in order to bring any type of
asset class on exchange. The application was subsequently published on June 13, 2019 and a patent was issued on March 31, 2020
(Patent No. 10,607,291). This joint ownership of innovation and enhancements to the buying and selling platforms extends NYIAX and
Nasdaq's technology cooperation not just for advertising and media, but also for future consideration of other complex
contract types which can be bought and sold on a buying and selling platforms. The inventors of the patent are Richard Payne, Valery
Gridnev from Nasdaq Technology AB and Mark Grinbaum, Carolina Abenante and Sergey Tsoy from NYIAX. We currently have no concrete
plans to extend our platform to other industries other than advertising.

 On July 8, 2023, the Company completed the
purchase of a portfolio of patents and trade secrets (the "Portfolio") from Network Foundation Technologies, LLC
("NIFTY"). The Company issued 2,000,000 shares of its common stock to NIFTY as consideration for the Portfolio. The
2,000,000 shares of common stock of NYIAX have various registration restrictions and provisions for the clawback of shares by the
Company in certain events as set forth in the Asset Purchase Agreement. In 2007, a NYIAX director, Thomas F. O'Neill., and a
NYIAX officer, Mark Grinbaum, Co-Founder and Executive Vice President of Financial Products, purchased approximately 0.17% (acquired
for $50,000) and 0.35% (acquired for $100,00) of NIFTY, respectively and owned these amounts as of July 8, 2023. Neither Mr.
O'Neill nor Mr. Grinbaum were a director or officer of NIFTY.

 The Portfolio consists of a portfolio of eighteen (18) patents and
trade secrets, of which six of the patents are active. The Company will amortize the active patents over their useful lives.

 The Company will use the Portfolio to enhance its offerings for the
buying and selling of media, advertising audience, and advertising inventory. Additionally, the Company will use the Portfolio acquired
from NIFTY to create new revenue streams in markets such as: (i) market data, (ii) streaming media (advertising, livestreaming and video-on-demand),
and (iii) the webinar market. NYIAX engaged an intellectual property valuation company to assess the potential opportunities of the patents
and trade secrets prior to our acquisition of the patents and trade secrets.

 ITEM 1A. RISK FACTORS

 The risks and uncertainties described below
could materially and adversely affect our business, financial condition and results of operations and could cause actual results to differ
materially from our expectations and projections. You should read these Risk Factors in conjunction with "Management's Discussion
and Analysis of Financial Condition and Results of Operations" in Item 7 and our Financial Statements and related notes in Item
8. These risks and uncertainties are not the only ones facing us and there may be additional matters that we are unaware of or that we
currently consider immaterial.

 Risks Related to Our Business

 There can be no guarantee that the
Company will be successful in securing capital.

 The Company requires additional capital. The
Company believes it does not have sufficient cash to meet working capital and capital requirements for at least twelve months
from the issuance of these financial statements.

 Historically, the Company's liquidity needs
have been met by the sale of common shares, the issuance of common shares through the exercise of warrants, and issuance of convertible
note payable. Without a new loan or other equity support, the Company would not be able to support the current operating plans through
twelve months from the issuance of these financial statements. No assurance can be given at this time, however, as to whether we
will be able to raise new equity or loan support.

 For the years ended December 31, 2023 and
2022, the Company's operations lost approximately $8.7 million and $11.1 million, respectively, of which approximately $2.7
million and $4.1 million, respectively, were non-cash expenses, net.

 The Company generated negative cash used in operating
activities of approximately $3.3 million for the twelve months ended December 31, 2023 and generated negative cash used in operating activities
of approximately $5.3 million for the twelve months ended December 31, 2022. Historically, the Company's liquidity needs have been
met by the sale of convertible notes payable, common shares, and the issuance of common shares through the exercise of warrants.

 As of December 31, 2023, NYIAX had total current
assets of approximately $323,000, of which approximately $55,000 was cash and total current liabilities of approximately $7.9 million,
of which approximately $2.4 million was convertible notes payable, accrued interest, and payables to shareholder-founders, all payable-in-kind
of the Company's shares.

 To enable the Company to meet immediate capital
requirements until longer term requirements can be met, during the second quarter of 2024, the Company sold convertible notes for the
2024A Convertible Notes Payable offering and during the third quarter the Company sold convertible notes for the 2024B Convertible Note
Offering. The Company sold approximately $1.3 million of the 2024A Convertible Note Payable and as of August 15, 2024, the Company sold
approximately $0.2 million of the 2024B Convertible Note Payable offerings.

 We have incurred net losses and experienced
net cash outflows from operating activities. If we do not effectively manage our cash and other liquid financial assets, execute our plan
to increase profitability and obtain additional financing, we may not be able to satisfy repayment requirements on our obligations.

 We have historically incurred operating losses,
experienced cash outflows from operations and we have accumulated deficit. Our net loss was approximately $8.7 million for the twelve
months ended December 31, 2023, $11.1 million for the year ended December 31, 2022, $13.5 million for the year ended December 31, 2021,
and $6.2 million for the year ended December 31, 2020.

 As of December 31, 2023, the Company had negative
working capital of approximately $7.6 million of which approximately $2.4 million were convertible notes payable, accrued interest, and
note payable, stockholder, all payable-in-kind of the Company's shares.

 The Company has also been historically reliant
on sales of debt or equity securities to fund its working capital obligations. As a result, the Company is of the opinion that it will
not have sufficient cash to meet working capital and capital requirements for at least twelve months from the date of this prospectus
unless it is able to raise additional capital. Management has implemented various efforts to improve liquidity and conserve cash, including
the sale of convertible notes and reducing staffing levels. Because we are not yet producing sufficient revenue to sustain our operating
costs, we are dependent upon raising capital to continue our business.

 If we are unable to raise additional
capital, increase revenue and reduce operating expenses we may not be able to continue as a going concern. See page 40 for the Going
Concern, Liquidity and Capital Resources section of the Management Discussion and Analysis of Financial Condition and Results of the
of Operations for further discussion of the Company's liquidity and capital resources.

 We will not be able to execute our business
plan or stay in business without additional or adequate funding.

 Our ability to successfully develop our business,
generate operating revenues and achieve profitability will depend upon our ability to obtain the necessary or adequate financing to implement
our business plan. We will require financing through the issuance of additional debt and/or equity to implement our business plan, including
identifying, acquiring and distributing consumer products, building inventory, hiring additional personnel as needed and eventually establishing
profitable operations. Such financing may not be forthcoming. As has been widely reported, global and domestic financial markets and economic
conditions have been, and continue to be, distressed and volatile due to a variety of factors, including, but not limited to, economic
conditions triggered by the COVID-19 pandemic, supply-chain disruptions, high inflation, and rising interests. As a result, the cost of
raising money in the debt and equity capital markets may increase while the availability of funds from those markets could diminish
significantly, even more so for smaller companies like ours. If such conditions and constraints exist, we may not be able to acquire funds
either through credit markets or through equity markets and, even if financing is available, it may not be available on terms which we
find favorable. Failure to secure funding when needed will have an adverse effect on our ability to meet our obligations and remain in
business.

 We may be subject to litigation from time
to time during the normal course of business, which may adversely affect our business, financial condition and results of operations.

 Currently, WestPark, the Company, and one of
our directors are named defendants in a pending U.S. District Court case, which could have a negative effect on us or on our business.

 On
November 17, 2023, certain individual investors in NYIAX filed a complaint in the United States District Court for the Southern District
of New York (the "Complaint") against Westpark Capital, Inc., the Company, Robert Ainbinder, Jr., a director of the Company
since April 2016, and Robert Ainbinder, Jr.'s brother, alleging claims of violation of securities law, common law fraud and
negligence. The case underlying the Complaint was earlier the subject of a FINRA
arbitration case, without NYIAX as a party to the FINRA arbitration case, subsequently withdrawn and filed in the United States District
Court for the Southern District of New York.

 The Company has concluded that it is
not possible to assess the likelihood of a loss at this time. The case underlying the Complaint could impede our ability to raise funds
and may have a material adverse effect on the Company's business, financial condition, operating results, or cash flows. The Company
intends to vigorously defend its positions. However, there can be no assurances that the Company's contentions and affirmative defenses
in response to claims will be successful in the Court or in arbitration. A copy of the Complaint will be sent to any investor free of
charge upon e-mail request to the Company at info@nyiax.com.

 A Former Underwriter may initiate a lawsuit
to recover amounts it claims are owed pursuant to its engagement by the Company and the Company may initiate litigation against the Former
Underwriter.

 A Former Underwriter claims that the
Company owes or will owe the Former Underwriter approximately $1 million for commissions on funds privately raised by the Company during
its engagement with the Former Underwriter and approximately $1.2 million if the Company completes an IPO with another underwriter.

 The Former Underwriter may continue
to claim that the Company owes or will owe the Former Underwriter approximately $1 million for commissions on funds privately raised by
the Company during its engagement with the Former Underwriter and approximately $1.2 million if the Company completes an IPO with another
underwriter.

 There can be no assurance that the Former
Underwriter will not initiate a lawsuit to recover the amounts it claims are owed and any such litigation could impede our ability to
complete an IPO and could negatively affect our financial condition. There can be no assurance that the Company will prevail in any lawsuit
it commences against the Former Underwriter. The Company disputes the amounts owed that have been claimed by the Former Underwriter and
further is of the belief that if any commissions are due to the Former Underwriter, they would be significantly less than the amounts
claimed by the Former Underwriter. It is reasonably possible that the Company and the Former Underwriter will end up in litigation over
claims by the Former Underwriter against the Company and claims by the Company against the Former Underwriter. Litigation is expensive
and time consuming with uncertain outcomes.

 The Former Underwriter may not release us
from its ROFR under our engagement letter agreement.

 The Company executed an engagement letter with
the Former Underwriter that terminates on the later of (i) eighteen (18) months from the date executed (March 23, 2021) or (ii) twelve
months from the completion date of the IPO and the term may be extended pursuant to the engagement letter. The Company agreed that the
advisor shall have the right of first refusal (ROFR) for two (2) years from the consummation of a transaction or termination or expiration
of the Engagement Letter to act as advisor or as joint financial advisor under at least equal economic terms to the Engagement Letter.
The Former Underwriter has a right of first refusal ("ROFR") pursuant to the initial engagement letter agreement entered into
by and between the Company and the Former Underwriter.

 There can be no assurance that the Former Underwriter
will release us from the ROFR or that our ability to complete an IPO will not be impeded as a result.

 Our business is subject to the risk of catastrophic
events such as pandemics, earthquakes, flooding, fire, and power outages, and to interruption by man-made problems such as terrorism and
wars.

 Our business is vulnerable to damage or interruption
from pandemics, earthquakes, flooding, fire, power outages, telecommunications failures, terrorist attacks, acts of war, human errors,
break-ins, and similar events. A significant natural disaster could have a material adverse effect on our business, results of operations,
and financial condition, and our insurance coverage may be insufficient to compensate us for losses that may occur.

 Our business, financial condition and results
of operations may be negatively affected by economic and other consequences from Russia's military action against Ukraine and the
international sanctions imposed in response to that action.

 We employ a U.S. based development company, BWSoft
Management LLC, ("BWSoft") with employees around the world, including Russia. In late February 2022, Russia launched a large-scale
military attack on Ukraine. In response to the military action by Russia, various countries, including the United States, issued broad-ranging
economic sanctions against Russia. Such sanctions included, among other things, a prohibition on doing business with certain Russian companies.
The war in Ukraine and related sanctions imposed on Russia could limit our ability to transact with our developer that has employees located
in Russia. Currently, BWSoft is not under sanctions. The Company, along with BWSoft carefully monitors regulation initiatives. In the
event of future sanctions, BWSoft and NYIAX will react accordingly to provide consistent and safe development services to NYIAX. We are
currently reviewing other options for our external development. If our developer were to terminate the employment of these development
team members located in Russia, such termination could disrupt or delay the development of incremental features to our platform, increase
our costs, or force us to shift development efforts to resources in other geographies that may not possess the same level of cost efficiencies.
Additionally, as of the date of this prospectus, there are no import or export control restrictions applicable to our business or our
relationship with BWSoft.

 Since our formation, we have never been
profitable. Our lack of operating history makes it difficult to evaluate our business and prospects and may increase the risks associated
with an investment in our Common Stock.

 Since our formation, we have never been profitable.
Our lack of operating history makes it difficult to evaluate our business and prospects and there can be no guarantee that we will ever
be profitable. Furthermore, we do not expect positive cash flow from operations in the near term. There is no assurance that actual cash
requirements for our business will not exceed our estimates. In particular, additional capital may be required if our operating costs
increase beyond our expectations or we encounter greater costs associated with general and administrative expenses or other costs.

 We will have a Board with new members and
an even number of directors.

 Following the resignation of a Board member on
April 30, 2024, and the appointment of three (3) new independent members, the Company's Board consists of two long-term members
that are also included as management, the new chief executive officer, and three (3) new independent members. The new directors have not
worked together or with management. The new directors will have different backgrounds, experiences and perspectives from those individuals
who have historically served on our Board and may have different views on the direction of our business. The effect of implementation
of those views may be difficult to predict and may result in conflict amongst the Board members or with management, at least in the short
term, and could result in disruption of the strategic direction of our business.

 Additionally, the ability of the new directors
to quickly expand their knowledge of our business operations will be critical to their ability to make informed decisions about our business
and strategies, particularly given the competitive environment in which we operate. There can be no assurance that our new directors will
have the ability to gain the requisite knowledge in a timely matter.

 Legislation and regulation of online businesses,
including privacy and data protection regulations/restrictions, could create unexpected costs, subject us to enforcement actions for compliance
failures, or cause us to change our technology platform or business model, which could have a material adverse effect on our business.

 Government regulation could increase the costs
of doing business online. U.S. and foreign governments have enacted or are considering legislation related to online advertising
and we expect to see an increase in legislation and regulation related to advertising online, the use of geo-location data to inform advertising,
the collection and use of anonymous Internet user data and unique device identifiers, such as IP address or unique mobile device identifiers,
and other data protection and privacy regulation. Recent revelations about bulk online data collection by the National Security Agency,
and news articles suggesting that the National Security Agency may gather data from cookies placed by Internet advertisers to deliver
interest-based advertising, may further interest governments in legislation regulating data collection by commercial entities, such as
advertisers and publishers and technology companies that serve the advertising industry. Such legislation could affect the costs of doing
business online and could reduce the demand for our solution or otherwise harm our business, financial condition and results of operations.
For example, a wide variety of provincial, state, national and international laws and regulations apply to the collection, use, retention,
protection, disclosure, transfer and other processing of personal data. Our failure to comply with applicable laws and regulations, or
to protect personal data, could result in enforcement action against us, including fines, imprisonment of our officers and public censure,
claims for damages by consumers and other affected individuals, damage to our reputation and loss of goodwill, any of which could have
a material adverse impact on our business, financial condition and results of operations. Even the perception of privacy concerns, whether
or not valid, could harm our reputation and inhibit adoption of our solution by current and future advertisers and advertising agencies.

 Fee pressure may result in a reduction in
the fees we are able to charge on our platform, which could have a material adverse effect on our business.

 Fee pressure would be any pressure from publishers
or advertisers to reduce the percentage that NYIAX would receive due to the downturn of the value of instruments or specific instruments
including mismatched pricing. Fee pressures also have to do with the cyclicality of the advertising market, which is dependent upon the
spending based on the particular time of the year. Any fee pressure could have a material adverse impact on the Company's business
and results of operations.

 Projecting the market's acceptance of a
new price or structure is imperfect and we may price too high or too low, both of which may carry adverse consequences.

 If our estimates related to expenditures
are inaccurate, our business may fail.

 Our success is dependent in part upon the accuracy
of our management's estimates of expenditures for the next twelve months and beyond. If such estimates are inaccurate, or we
encounter unforeseen expenses and delays, we may not be able to carry out our business plan, which could result in the failure of our
business.

 Because we rely on third-party blockchain technologies,
users of our platform could be subject to blockchain protocol risks.

 Reliance upon other third-party blockchain technologies
to create our platform subjects us and our customers to the risk of ecosystem malfunction, unintended function, unexpected functioning
of, or attack on, the providers' blockchain protocol, which may cause our platform to malfunction or function in an unexpected manner,
including, but not limited to, slowdown or complete cessation in functionality of the platform.

 Artificial Intelligence May Have Risks to
the Company's Operations and Profitability

 As Artificial Intelligence (AI) evolves, AI laws,
regulations, and standards all may impact the Company's productivity and profitability as well as have an impact on increased cybersecurity
risks and social and ethical challenges from reliance on third-party AI systems. The Company is studying AI and its potential impacts.

 We depend on a limited number of customers
and the loss of one or more of these customers could have a material adverse effect on our business, financial condition and results of
operations.

 As of December 31, 2023, three Media Sellers represented approximately
46%, 14% and 7% respectively of our revenue, net. As of December 31, 2023, three Media Buyer represented 34%, 25% and 18% of our accounts
receivable. As of December 31, 2023, two Media Sellers represented 80% and 10% of our accounts payable.

 As of December 31, 2022, three Media Sellers represented
approximately 51%, 12% and 10% respectively of our revenue, net. As of December 31, 2022, two Media Buyer represented for 67% and 20%
of accounts receivable. As of December 31, 2022, two Media Sellers represented 61% and 8% of accounts payable.

 Due to the concentration of revenues from a limited
number of customers, if we do not receive the payments from or if our relationships become impaired with any of these major customers,
our revenue, results of operation and financial condition will be negatively impacted.

 In addition, we cannot assure that any of our
customers in the future will not cease using our products and services, significantly reduce orders or seek price reductions in the future,
and any such event could have a material adverse effect on our revenue, profitability, and results of operations.

 Our revenue and operating results will be
highly dependent on the overall demand for advertising and could fluctuate significantly depending upon various factors, such as seasonal
fluctuations and market changes. Factors that affect the amount of advertising spending, such as economic downturns, particularly in the
fourth quarter of our fiscal year, will make it difficult to predict our revenue, and could cause our operating results to fall below
investors' expectations and adversely affect our business and financial condition.

 Our business depends on the overall demand for
advertising and on the economic health of our current and prospective sellers and buyers. If advertisers reduce their overall advertising
spending, our revenue and results of operations are directly affected. Many advertisers devote a disproportionate amount of their advertising
budgets to the fourth quarter of the calendar year to coincide with increased holiday purchasing, and buyers may spend more in the fourth
quarter for budget reasons. As a result, any events that reduce the amount of advertising spending during the fourth quarter or reduce
the amount of inventory available to buyers during that period, could have a disproportionate adverse effect on our revenue and operating
results for that fiscal year. Economic downturns or instability in political or market conditions generally may cause current or new advertisers
to reduce their advertising budgets. Reductions in inventory due to loss of sellers would make our solution less robust and attractive
to buyers. Adverse economic conditions and general uncertainty about economic recovery are likely to affect our business prospects. Uncertainty
regarding economic conditions in the United States and other countries may cause general business conditions in the United States
and elsewhere to deteriorate or become volatile, which could cause buyers to delay, decrease or cancel purchases, exposing us to reduced
demand for our solution, and increased credit risk on buyer orders. Moreover, any changes in the favorable tax treatment of advertising
expenses and the deductibility thereof would likely cause a reduction in advertising demand. In addition, concerns over the sovereign
debt situation in certain countries in the European Union as well as continued geopolitical turmoil in many parts of the world have and
may continue to put pressure on global economic conditions, which could lead to reduced spending on advertising.

 Our revenue, cash flow from operations, operating
results and other key operating and financial measures may vary from quarter to quarter due to the seasonal nature of advertiser spending.
For example, many advertisers devote a disproportionate amount of their advertising budgets to the fourth quarter of the calendar year
to coincide with increased holiday purchasing. Moreover, advertising inventory in the fourth quarter may be more expensive due to increased
demand for advertising inventory.

 Our revenue can vary greatly from period
to period and it is dependent on several factors, including on our business development team and the Media Contracts. Our net revenue
decreased sequentially quarter on quarter in 2022 and 2023.

 Our business is in the early stage and depends
on the overall demand for digital advertising, the economic health of our current and prospective sellers and buyers and the on-boarding
of new Media Contracts, which can vary greatly from period to period. The value of each Media Contracts varies dependent upon several
factors, including size of the media buy and commission rates. We currently have only a limited number of buyers and sellers on our platform
and need to increase the number of Media Contracts in order to increase our revenues.

 Revenue is also dependent upon the cumulative
effort of business development employees driving revenue relationships to the Company. The Company does not currently have a book of repeatable
business and as such revenue is substantially dependent upon business development headcount driving relationships and new transactions.

 Obtaining new Media Contracts is dependent on
several factors, including on our new business development (sales and representatives) team, which headcount has decreased from eleven
at December 31, 2021 to three at March 31, 2023. (At March 31, 2021, the business development headcount was one and revenue for the three-month
period ended March 31, 2021 was nil.)

 In addition, our revenue from quarter to quarter
has decreased for quarters ended March 31, 2022, June 30, 2022, September 30, 2022, March 31, 2023, and June 30, 2023, and increased for
the quarters ended December 31, 2022, September 30, 2023, and December 31, 2023 as follows:

 31-Mar-22

 $
 485,065

 30-Jun-22

 339,423

 30-Sep-22

 124,987

 31-Dec-22

 374,830

 For The Year Ended December 31, 2022

 $
 1,324,305

 31-Mar-23

 $
 138,037

 30-Jun-23

 88,977

 30-Sep-23

 97,820

 31-Dec-23

 331,266

 For The Year Ended December 31, 2023

 $
 656,100

 There can be no assurance that we will be able
to increase the number of Media Contracts the value per Media Contract, or our overall revenue. In the event that we are unable to increase
the number of Media Contracts and/or the value per Media Contract, on our platform, we will not be able to increase revenues and may be
unable to continue in business.

 Our business depends substantially on the
continuing efforts of our executive officers and key employees, and our business may be severely disrupted if we lose their services.

 Our future success depends substantially on the
continued services of our executive officers and key employees. If one or more of our executive officers and key employees are unable
or unwilling to continue in their present positions, we may not be able to replace them readily, if at all. The loss of any of our officers,
including the chief executive officer, and key employees could cause our business to be disrupted, and we may incur additional expenses
to recruit and retain their replacements. On May 26, 2022, Robert E. Ainbinder resigned as our Chief Executive Officer, while he continues
to serve as a Director of the Company. On the same day, Christopher Hogan, our Chief Operating Officer, was appointed Interim Chief Executive
Officer and President. On January 19, 2024, Teresa Gallo was appointed Chief Executive Officer of the Company. With the recent appointment
of our new Chief Executive Officer, the Interim Chief Executive Officer position previously held by Mr. Hogan has been eliminated, as
planned.

 Our Chief Executive Officer is new to the
Company.

 Our Chief Executive Officer is new to the Company and the inherent
risks of a new CEO exist. On January 19, 2024, Teresa Gallo was appointed Chief Executive Officer of the Company and joined the Board
of Directors on May 1, 2024. Prior to her appointment, she was not with the Company. In 2023 Ms. Gallo founded Assemblage Digital, a boutique
advisory firm focused on digital marketing, commercial strategies, and revenue development for technology companies. From May 2020 to
May 2023, Ms. Gallo served as Executive Vice President and General Manager at Kinneso, a technology driven marketing and advertising agency
and affiliate of Interpublic Group of Companies, Inc. ("IPG"), in New York, New York. Ms. Gallo led Kinneso's global
marketplace team and was responsible for organization design, strategy, operations, revenue delivery, partnerships and market expansion
of its business. From December 2018 to May 2020, Ms. Gallo served as Chief Digital Officer for Orion, a subsidiary of IPG, where she oversaw
Orion's worldwide digital business and designed the roll-out and implementation of Orion's programmatic advertising platform
for publisher and advertiser utilization. From October 2013 to July 2018, Ms. Gallo served as Senior Vice President at OpenX, a programmatic
advertising platform for publishers, advertisers, and agencies. Ms. Gallo was responsible for OpenX's global corporate business
development for publishers and advertisers. Prior to joining Open X, Ms. Gallo was a founding executive at Cadreon, IPG's first
global programmatic agency and she spent over a decade at AOL in leadership roles. Ms. Gallo currently serves on the board of directors
of the Rutgers University Center for Innovation Education, where she participated in framing the direction and growth of the Rutgers's
Innovation Center and its Professional Science master's degree in data.

 Our management team has limited experience
managing a public company and we will incur significantly increased costs and devote substantial management time as a result of operating
as a public company.

 Most members of our management team have limited
experience managing a publicly traded company, interacting with public company investors, and complying with the increasingly complex
laws, rules, and regulations that govern public companies. As a public company, we are subject to significant obligations relating to
reporting, procedures and internal controls, and our management team may not successfully or efficiently manage such obligations. These
obligations and scrutiny will require significant attention from our management and could divert their attention away from the day-to-day
management of our business, which could adversely affect our business, results of operations, and financial condition. We expect that
compliance with these requirements will increase our compliance costs. We will need to hire additional accounting, financial, and legal
staff with appropriate public company experience and technical accounting knowledge and will need to establish an internal audit function.
We cannot predict or estimate the amount of additional costs we may incur as a result of becoming a public company or the timing of these
costs.

 We may be subject to litigation from time
to time during the normal course of business, which may adversely affect our business, financial condition and results of operations.

 The Company, Robert Ainbinder, Jr., a director
of the Company, and WestPark Capital, Inc. are named defendants in a pending case filed in the United States District Court for the Southern
District of New York by a group of investors in NYIAX. From time to time in the normal course of business or otherwise, we may become
subject to litigation that may result in liability material to our financial statements as a whole or may negatively affect our operating
results if changes to business operation are required. The cost to defend such litigation may be significant and may require a diversion
of our resources. There also may be adverse publicity associated with litigation that could negatively affect customer perception of our
business, regardless of whether the allegations are valid or whether we are ultimately found liable. As a result, litigation may adversely
affect our business, financial condition and results of operations.

 We are subject to ongoing public reporting
requirements that are less rigorous than Exchange Act rules for companies that are not emerging growth companies and our shareholders
could receive less information than they might expect to receive from more mature public companies.

 We are required to publicly report on an ongoing
basis as an "emerging growth company" (as defined in the JOBS Act) under the reporting rules set forth under the Exchange
Act. For so long as we remain an emerging growth company, we may take advantage of certain exemptions from various reporting requirements
that are applicable to other Exchange Act reporting companies that are not emerging growth companies, including but not limited to:

 not being required to comply with the auditor attestation
requirements of Section 404 of the Sarbanes-Oxley Act;

 being permitted to comply with reduced disclosure obligations
regarding executive compensation in our periodic reports and proxy statements; and

 being exempt from the requirement to hold a non-binding advisory
vote on executive compensation and shareholder approval of any golden parachute payments not previously approved.

 In addition, Section 107 of the JOBS Act also
provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities
Act for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain
accounting standards until those standards would otherwise apply to private companies. We have elected to take advantage of the benefits
of this extended transition period. Our financial statements may therefore not be comparable to those of companies that comply with such
new or revised accounting standards.

 We expect to take advantage of these reporting
exemptions until we are no longer an emerging growth company. We would remain an emerging growth company for up to five years, although
if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, we would
cease to be an emerging growth company as of the following December 31.

 Because we will be subject to ongoing public reporting
requirements that are less rigorous than Exchange Act rules for companies that are not emerging growth companies, our shareholders could
receive less information than they might expect to receive from more mature public companies. We cannot predict if investors will find
our common stock less attractive if we elect to rely on these exemptions, or if taking advantage of these exemptions would result in less
active trading or more volatility in the price of our common stock.

 If we fail to establish and maintain effective
internal controls, our ability to produce accurate financial statements and other disclosures on a timely basis could be impaired.

 The Sarbanes-Oxley Act requires, among other things,
that we maintain effective disclosure controls and procedures and internal control over financial reporting. We are continuing to develop
and refine our disclosure controls and other procedures that are designed to ensure that information required to be disclosed by us in
the reports that we will file with the SEC is recorded, processed, summarized, and reported within the time periods specified in SEC rules
and forms and that information required to be disclosed in reports under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), is accumulated and communicated to our principal executive and financial officers.

 We are also continuing to expand our internal
controls over financial reporting. In order to maintain and improve the effectiveness of our disclosure controls and procedures and internal
control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources, including accounting-related
costs, and significant management oversight. If any of these new or improved controls and systems do not perform as expected, we may experience
material weaknesses in our controls. Our current controls and any new controls that we develop may become inadequate because of changes
in conditions in our business. Further, weaknesses in our disclosure controls and internal control over financial reporting may be discovered
in the future. Any failure to develop or maintain effective controls or any difficulties encountered in their implementation or improvement
could harm our results of operations or cause us to fail to meet our reporting obligations and may result in a restatement of our financial
statements for prior periods. Any failure to implement and maintain effective internal control over financial reporting also could adversely
affect the results of periodic management evaluations and annual independent registered public accounting firm attestation reports regarding
the effectiveness of our internal control over financial reporting that we will eventually be required to include in our periodic reports
that will be filed with the SEC.

 We have identified material weaknesses
in our internal control over financial reporting in connection with the preparation of our financial statements for the periods
ended June 30, 2023, March 31, 2023, and the fiscal years ended December 31, 2023 and 2022, and may identify additional material weaknesses
in the future that may cause us to fail to meet our reporting obligations or result in material misstatements of our financial
statements. If we fail to remediate our material weakness or if we fail to establish and maintain an effective system of internal
control over financial reporting, we may not be able to accurately report our financial results, meet our reporting obligations, or
prevent fraud. Failure to comply with requirements to design, implement and maintain effective internal controls or any inability to
report and file our financial results accurately and timely could harm our business and adversely impact the trading price of our
securities.

 Prior to becoming a reporting company, we were
a private company and had limited accounting and financial reporting personnel and other resources with which to address our internal
controls and procedures. In connection with the review of our consolidated financial statements for the years ended December 31, 2023
and 2022 included in this Form 10-K, our management identified material weaknesses in our internal control over financial reporting. A
material weakness is defined as a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that
there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or
detected on a timely basis. Specifically, we identified certain payments made that were not in accordance with our policies, including
reimbursement of expenses more than amounts owed, reimbursement of expenses without adequate documentation, and inadequate reporting of
amounts paid to contractors.

 Specifically, the material weakness related to
the following:

 For the six-month period ended June 30 2023 and the three-month
period ended March 31, 2023, the Company did not report the treatment of deferred offering costs in accordance with ASC 230, Statement
of Cash Flows. In accordance with ASC 230-10-50, deferred offering cost write-off should be reflected in statement of cash flows
within cash flows from operating activities and not within cash flows from financing activities as previously reported in the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 2023, filed with the SEC on July 21, 2023, and the Company's Quarterly
Report on Form 10-Q for the quarter ended June 30, 2023, filed with the SEC on August 14, 2023.

 For the year ended December 31, 2022 and as of June 30, 2023,
there were material weakness identified in the Company's Information Technology General Controls ("ITGCs"). The control
deficiencies identified were over the design of internal controls surrounding user access security, and change management for the Company's
internally developed applications and external financial-based software used by the Company. These deficiencies were in regards to user
access provisioning, terminations, user access review, change management, segregation of duties of developers and migrators. The Company's
ITGCs were not designed and not operating effectively to ensure (i) appropriate segregation of duties were in place to perform program
changes and (ii) activities of individuals with access to modify data and make program changes not being appropriately monitored. These
control deficiencies aggregated to a Material Weakness for Information Technology General Controls for absence and limited or no presence
of compensating IT Controls that mitigate the risk associated with the IT deficiencies. There is a risk under the current circumstances
that intentional or unintentional errors could occur and not be detected.

 The restatement matters were primarily the result
of our lack of internal controls over completeness of contract recording and accounting personnel that lack experience in SEC reporting
regulation.

 As part of our plan to remediate these material
weaknesses, we have adopted the following remediation efforts to improve our internal controls:

 Hired incremental financial staff

 Established separation of duties for cash payments

 Instituted new policies for:

 Expense and payment approvals

 Payment procedures that include segregation of duties

 Travel and entertainment reimbursement (revisions of previous
policies)

 Ethics

 Reviewed payments to contractors

 Reinforced policies regarding board approval of all material
contracts

 Will be retaining experienced accounting personnel that have
experience in SEC reporting regulation after the next financing is completed.

 Risks Related to the Advertising Technology
Industry, Market and Competition

 The digital advertising market is relatively
new, dependent on growth in various digital advertising channels, and vulnerable to adverse public perceptions and increased regulatory
responses. If this market develops more slowly or differently than we expect, or if issues encountered by other participants or the industry
generally are imputed to or affect us, our business, growth prospects and financial condition would be adversely affected. Our technology
could become obsolete and increased competition could adversely affect our business.

 The digital advertising market is relatively new,
and our solution may not achieve or sustain high levels of demand and market acceptance. While display advertising has been used successfully
for many years, marketing via new digital advertising channels, such as mobile and social media and digital video advertising, is
not as well established. The future growth of our business could be constrained by the level of acceptance and expansion of emerging digital
advertising channels, as well as the continued use and growth of existing channels, such as digital display advertising, in which our
capabilities are more established.

 Further, the digital advertising industry is complex,
and evolving, and there are relatively few publicly traded companies operating in the business. Consequently, the digital advertising
industry may not be as widely followed or understood in the financial markets as more mature industries. Problems experienced by one industry
participant (even private companies) or issues affecting a part of the business have the potential to have adverse effects on other participants
in the industry or even the entire industry. Emerging understanding of how the digital advertising industry operates has spurred privacy
concerns and misgivings about exploitation of consumer information and prompted regulatory responses that limit operational flexibility
and impose compliance costs upon industry participants. As a general matter the digital advertising business is relatively new and digital
advertising companies and their specific product and service offerings are not well understood.

 Any expansion of the market for digital advertising
solutions depends on several factors, including social and regulatory acceptance, the growth of the digital advertising market, the growth
of social, mobile and video as advertising channels, and the actual or perceived technological viability, quality, cost, performance and
value associated with emerging digital advertising solutions. If demand for digital display advertising and adoption of automation does
not continue to grow, or if digital advertising solutions or advertising automation do not achieve widespread adoption, or there is a
reduction in demand for digital advertising caused by weakening economic conditions, decreases in corporate spending, quality, viewability,
malware issues or other issues associated with buyers, advertising channels or inventory, negative perceptions of digital advertising,
additional regulatory requirements, or other factors, or if we fail to develop or acquire capabilities to meet the evolving business and
regulatory requirements and needs of buyers and sellers of multi-channel advertising, our competitive position will be weakened and our
revenue and results of operations could be harmed.

 Our future operating results depend on market
adoption by both advertisers and publishers, which could take a long period of time or may not happen at all. Any delay or failure to
adopt by either Media Buyers or Media Sellers could delay revenue or recognition of revenue.

 We operate in an intensely competitive market
that includes companies that have greater financial, technical and marketing resources than we do. If we do not effectively compete against
current and future competitors, our business, results of operations, and financial condition could be harmed.

 There are other competitors which have vast access
to resources and could have the ability to replicate a similar business model in time or with a highly scalable and financially rigorous
transaction platform. Our ability to compete successfully depends on elements both within and outside of our control. We will face significant
competition from major global companies as well as smaller companies focused on specific market niches. In addition, companies not currently
in direct competition with us may introduce competing products in the future.

 Our inability to compete effectively could materially
adversely affect our business and results of operations. Products or technologies developed by competitors that are larger and have more
substantial research and development budgets, or that are smaller and more targeted in their development efforts, may render our products
or technologies obsolete or noncompetitive. We also may be unable to market and sell our products if they are not competitive on the basis
of price, quality, technical performance, execution, features, system compatibility, customized design, innovation, availability, delivery
timing and/or reliability. If we fail to compete effectively on developing strategic relationships with customers, our sales and revenue
may be materially adversely affected. Competitive pressures may limit our ability to transact business, raise prices, and any inability
to maintain revenue or raise prices to offset increases in costs could have a significant adverse effect on our gross margin, possibly
contributing to a deficit in our gross margin. Reduced sales and lower gross margins (deficits) would materially adversely affect our
business and results of operations.

 Technology breaches or failures, including
those resulting from a malicious cyber-attack on us or our business partners and service providers, could disrupt or otherwise negatively
impact our business.

 We will rely on information technology systems,
including systems of Nasdaq Technology AB ("Nasdaq"), a wholly-owned subsidiary of Nasdaq, Inc., as part of our agreement
with Nasdaq to process, transmit, store and protect the electronic information, financial data and proprietary models that are critical
to our business. Furthermore, a significant portion of the communications between our employees and our business, banking and investment
partners depends on information technology and electronic information exchange. Like all companies, our information technology systems
and Nasdaq's are vulnerable to data breaches, interruptions or failures due to events that may be beyond our control, including,
but not limited to, natural disasters, theft, terrorist attacks, computer viruses, hackers and general technology failures.

 Errors or failures in our software and transaction
systems with Nasdaq could adversely affect our operating results and growth prospects. Moreover, errors in debugging or breaks in our
system could create delay in publisher and advertiser adoption, which would have adverse effect on our business.

 We believe that we have established and implemented
appropriate security measures, controls and procedures to safeguard our information technology systems and to prevent unauthorized access
to such systems and any data processed or stored in such systems and procedures. Despite these safeguards, disruptions to and breaches
of our information technology systems are possible and may negatively impact our business. We have not secured insurance coverage designed
to specifically protect us from an economic loss resulting from such events.

 Our future success is dependent on Internet
technology developments and our ability to adapt to these and other technological changes and to meet evolving industry standards.

 Our ability to operate our business is dependent
on the development and maintenance of Internet technology as well as our ability to adapt our solutions to changes in Internet technology.

 We may encounter difficulties responding to these
and other technological changes that could delay our introduction of products and services. The software and tech industries are characterized
by rapid technological change and obsolescence, frequent product introduction, and evolving industry standards. Our future success will,
to a significant extent, depend on our ability to enhance our existing products, develop and introduce new products, satisfy an expanded
range of customer needs, and achieve market acceptance. We may not have sufficient resources to make the necessary investments to develop
and implement the technological advances required to operate our business or maintain a competitive position.

 Our intellectual property is valuable and
integral to our success and competitive position. Any misuse of our intellectual property by others could harm our business, reputation
and competitive position.

 Our patent, copyrights, trade secrets and designs
are valuable and integral to our success and competitive position. Despite our efforts to protect our intellectual property rights, we
cannot assure you that we will be able to adequately protect our proprietary rights through reliance on a combination of patent, copyrights,
trade secrets, confidentiality procedures, contractual provisions and technical measures from outside influences. Protection of trade
secrets and other intellectual property rights in the markets in which we operate and compete is highly uncertain and may involve complex
legal questions. In addition, the laws of various foreign countries may not protect our intellectual property rights to the same extent
as laws in the United States. We cannot completely prevent the unauthorized use or infringement of our intellectual property rights,
as such prevention is inherently difficult.

 We also expect that the more successful we are,
the more likely that competitors will try to illegally use our proprietary information and develop products that are like ours, which
may infringe on our proprietary rights. In addition, we could potentially lose future trade secret protection for our source code if any
unauthorized disclosure of such code occurs. The loss of future trade secret protection could make it easier for third parties to devise
and implement competitive products (and services) more easily. Any changes in, or unexpected interpretations of, the trade secret and
other intellectual property laws in any country in which we operate may compromise our ability to enforce our trade secret and intellectual
property rights. Costly and time-consuming litigation could be necessary to enforce and determine the scope of our confidential information
and trade secret protection. If we are unable to protect our proprietary rights or if third parties independently develop or gain access
to our or similar technologies, our business, service revenue, reputation and competitive position could be materially adversely affected.

 No proven ability to commercialize our intellectual
property.

 To date we have generated relatively limited revenues
from the exploitation or commercialization of our intellectual property, particularly our patents. In addition, we recently acquired a
portfolio of patents and trade secrets from Network Foundation Technologies, LLC ("Nifty") in exchange for two million (2,000,000)
shares of our common stock. To our knowledge, Nifty had not generated any revenue from the commercialization of such portfolio of patents
and trade secrets and there can be no assurance that we will realize any commercial benefits or revenue from such patents and/or trade
secrets.

 The portfolio of patents and trade secrets
purchased from Network Foundation Technologies, LLC have a high level of Intellectual Property ("IP") risk.

 All patents are subject to risk factors that may
diminish their value.

 Before purchasing the portfolio of patents and
trade secrets from Network Foundation Technologies, LLC ("Nifty"), the Company retained an independent valuation firm to perform
a risk assessment of the portfolio of patents and trade secrets purchased from Nifty. Each patent in the portfolio was read and assessed
based on a set of risk criteria (including, but not limited to, IP status, type of infringement, infringement detection, substitutes and
market readiness). The valuation firm applied scores and weights based on the assessment to generate an IP risk adjustment factor and
this percentage is applied directly to the net present value of the patents (an IP risk adjustment factor with a lower percentage indicates
less risk). The valuation firm determined a possible discount rate range was between twenty five percent (25%) and ninety per cent (90%)
(with a lower percentage is better) and the valuation firm applied a risk assessment discount rate of eighty two percent (82%) to patents
acquired from Nifty. The valuation firm's assessment indicated the patents acquired from Nifty have a high level of IP risk, primarily
due to the age of the patent portfolio and patent expirations before the end of the licensing term. The valuation firm determined that
other factors that lowered the score of the patents acquired from Nifty include: smaller size of the portfolio; infringement detection;
and the potential for invent-on-top IP from competitor. To compensate for the high risk, the company is reviewing various plans to update
and expand the portfolio with new patent filings. As of the date of this prospectus, the Company has not adopted a plan to expand the
portfolio with new patent filings. The cost to update and expand the new patents can be significant and there can be no assurance that
we will be successful in updating and expanding the portfolio with new patent filings. See "Business — Intellectual
Property" beginning on page 10 of this prospectus for information on expired patents.

 We may be subject to intellectual property
rights claims and validity challenges by third parties, which are extremely costly to defend, could require us to pay significant damages
and could limit our ability to use certain technologies.

 Third parties may assert claims of infringement
of intellectual property rights in proprietary technology or initiate invalidity proceedings challenging our patents, against us or against
our advertisers for which we may be liable or have an indemnification obligation. Any claim of infringement by a third party, even those
without merit, could cause us to incur substantial costs defending against the claim and could distract our management from operating
our business. We might not have the necessary capital to defend against any potential claims which could adversely affect our business.
There can be no assurance that any patents which we may file will be granted by the USPTO and foreign patent offices in the future.

 Although third parties may offer a license to
their technology, the terms of any offered license may not be acceptable and the failure to obtain a license or the costs associated with
any license could cause our business, financial condition and results of operations to be materially and adversely affected. In addition,
some licenses may be non-exclusive, and therefore our competitors may have access to the same technology licensed to us. Alternatively,
we may be required to develop non-infringing technology, which could require significant effort and expense and ultimately may not be
successful. Furthermore, a successful claimant could secure a judgment, or we may agree to a settlement that prevents us from distributing
certain products or performing certain services or that requires us to pay substantial damages, including treble damages if we are found
to have willfully infringed such claimant's patents or copyrights, royalties or other fees. Any of these events could seriously
harm our business financial condition and results of operations.

 Risks Relating to our Technological Relationship
with Nasdaq

 If the NYIAX/Nasdaq platform does not operate
up to technological expectations, we may be adversely affected.

 We expect to be dependent on relationships with
third parties particularly our agreements with Nasdaq to successfully commercialize our planned product lines. Our relationship with Nasdaq
is critical to our commercial success and any deterioration or termination of this relationship would result in a material adverse effect
on our business and could cause us to cease operations.

 Publishers and advertisers may not migrate to
the NYIAX platform and continue to use other existing platforms in the market. In such case, the Company will not meet its requisite minimum
revenue goals for its agreement with Nasdaq, which could cause the Company to scale down or discontinue its operations.

 If the NYIAX/Nasdaq platform does not operate
up to technological expectations with respect to functionality and efficiency as compared to its competitors, it is unlikely that publishers
and advertisers will continue to use the system thereby adversely affecting the Company's ability to conduct business and its future
operations and financial results.

 Our technological relationship with NASDAQ
is not an endorsement by NASDAQ of our company, this Offering, the value of the securities being offered, the success or failure of this
Offering or the approval by NASDAQ of a listing of our Common Stock.

 We have entered into commercial agreements with
Nasdaq Technology AB ("NASDAQ") to build the NYIAX platform. Our commercial relationship with Nasdaq should not be viewed
as an endorsement by NASDAQ of our company, this Offering, the value of the securities being offered, the success or failure of this Offering
or the approval by NASDAQ of a listing of our Common Stock. Nasdaq has not endorsed our securities or this offering and our commercial
relationship with Nasdaq does not have any bearing on whether our application to list our common stock on the Nasdaq Capital Market will
be approved. Investors should not view our relationship or agreement with NASDAQ as anything other than a commercial agreement among two
unrelated parties.

 Risk Relating to Possible Regulation and Supervision

 Interest-based advertising, or the use of data
to draw inferences about a user's interests and deliver relevant advertising to that user, has come under increasing scrutiny by
legislative, regulatory, and self-regulatory bodies in the United States and abroad that focus on consumer protection or data privacy.
There may be some self-regulatory activities with regard to rules enforcement and market surveillance required by us in order to maintain
an orderly market and forestall any external regulation needs.

 We do not believe that our current activities
and services provided to buyers and sellers of advertising trigger SEC securities regulation or futures/derivatives regulation of the
United States Commodity Futures Trading Commission ("CFTC"). If in the future our services and products are expanded
to include products and/or services that could trigger regulatory oversight by a market regulator (e.g. CFTC and/or SEC), we will engage
with the appropriate regulator in a timely manner to ensure full compliance with applicable statute and regulations. There can be no assurance
that we will be able to comply with future regulatory requirements, in which case we could be forced to discontinue applicable operations.

 Risks Related to Our Securities and the Securities
Markets.

 We have no dividend policy.

 The Company does not presently intend to pay cash
dividends in the near future, as any earnings must be retained for use in current operations. Investors must not look to an investment
in the Company as a source of cash distributions.

 There is potential future dilution to our
current shareholders' ownership in the Company.

 The Company intends to raise additional capital
in the future for working capital and business expansion. As a result, our shareholders will likely experience significant dilution of
their ownership in the Company.

 Future issuances of our common stock or
securities convertible into, or exercisable or exchangeable for, our common stock, would result in the dilution of your holdings.

 Future issuances of our common stock or securities
convertible into, or exercisable or exchangeable for, our common stock, if any, of future issuances of our securities, would result in
the dilution of your holdings.

 Future issuances of debt securities, which
would rank senior to our common stock upon our bankruptcy or liquidation, and future issuances of preferred stock, which could rank senior
to our common stock for the purposes of dividends and liquidating distributions, may adversely affect the level of return you may be able
to achieve from an investment in our common stock.

 In the future, we may attempt to increase our
capital resources by offering debt securities. Upon bankruptcy or liquidation, holders of our debt securities, and lenders with respect
to other borrowings we may make, would receive distributions of our available assets prior to any distributions being made to holders
of our common stock. Moreover, if we issue preferred stock, the holders of such preferred stock could be entitled to preferences over
holders of common stock in respect of the payment of dividends and the payment of liquidating distributions. Because our decision to issue
debt or preferred stock in any future offering, or borrow money from lenders, will depend in part on market conditions and other factors
beyond our control, we cannot predict or estimate the amount, timing or nature of any such future offerings or borrowings. Holders of
our common stock must bear the risk that any future offerings we conduct or borrowings we make may adversely affect the level of return,
if any, they may be able to achieve from an investment in our common stock.

 Our officers and directors and other significant
investors (the "Group") own a significant amount of our outstanding common stock. As a result, the Group may have the ability
to approve all matters submitted to our shareholders for approval.

 As of June 30, 2024, our officers and directors
beneficially owned approximately 19.0%, Network Foundation Technologies, LLC owns approximately 12.8%, Suwyn Investments, LLC owns approximately
11.1%, and Graham Mosley owns approximately 5.7% of our 15,690,719 outstanding voting shares.

 Such persons may have the ability to significantly
influence all matters submitted to our shareholders for approval including:

 election of our board of directors;

 removal of any of our directors;

 any amendments to our articles of incorporation or our bylaws;
and

 adoption of measures that could delay or prevent a change
in control or impede a merger, takeover or other business combination involving us.

 In addition, this concentration of ownership may
discourage a potential acquirer from making a tender offer or otherwise attempting to obtain control of us, which in turn could reduce
our stock price or prevent our shareholders from realizing a premium over our stock price.

 Our stockholders will experience additional
dilution due to the 2024A and 2024B Convertible Note Payable offerings.

 2023B Convertible Note Payable offering

 Pursuant to the 2023B Convertible Note
offering we sold $1,970,000 of convertible notes to accredited investors. The closing of the offering occurred on June 28, 2023. The 2023B
Convertible Notes bear interest at twelve percent (12.0%) per annum, which shall be paid as a Payment-in-Kind in our common stock. For
approximately 86% of the outstanding principal and interest of the 2023B Convertible Note Payable, the conversion price is four dollars
($4.00) per share and in the event that the Company has not received an effective order from the SEC on its registration statement by
February 14, 2024, the outstanding principal of the 2023B Convertible Note Payable shall automatically be converted into common stock
of the Company at $2.00 per share. For approximately 14% of the outstanding principal and interest of the 2023B Convertible Note Payable
the conversion price is two dollars ($2.00) per share.

 The additional shares of our common
stock issuable upon automatic conversion of the notes could cause the market price of our common stock to decline. In addition, the notes
automatically convertible into equity securities would result in dilution of our existing stockholders' equity interest.

 2024A Convertible Note Payable

approximately $1.3 million in the 2024A Convertible Note Payable offering. The 2024A Convertible Note Payable offering closed on May 28,
2024. The Offering consisted of two-year convertible notes with 10% interest payment-in-kind in Company common stock at two ($2.00) dollars,
which shall be paid at maturity or upon conversion. Additionally, the Company issued with the Notes, warrant coverage at the rate of one
hundred (100%) percent of the dollar value of the Note at two ($2.00) dollars per share as the strike price of the Warrants. The Warrants
are for a period of five (5) years.

 Upon completion of a subsequent financing
where the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal
balance of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as
those securities purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following:
the lower of (i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00) dollars,
but in no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from the final
Closing of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's
common stock at two ($2.00) dollars per share.

 2024B Convertible Note Payable

approximately $0.2 million in the 2024B Convertible Note Payable offering. The Offering consists of two-year convertible notes with 10%
interest payment-in-kind in Company common stock at two ($2.00) dollars, which shall be paid at maturity or upon conversion. Additionally,
the Company issued with the Notes, warrant coverage at the rate of one hundred (100%) percent of the dollar value of the Note at two ($2.00)
dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing where
the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal balance
of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as those securities
purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following: the lower of
(i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00) dollars, but in
no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from the final Closing
of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's common
stock at two ($2.00) dollars per share.

 ITEM 1B. UNRESOLVED STAFF COMMENTS

 None.

 ITEM 1C. Cybersecurity

 Cybersecurity Risk Management and Strategy

 In the normal course of business, we may collect
and store customer information, and certain sensitive company information, including proprietary and confidential business information.
To protect this information, our existing cybersecurity policies require continuous monitoring, network security measures, and encryption
of data. We maintain various protections designed to safeguard against cyberattacks, including firewalls, key-based authentication, and
virtual private networks. We protect against business interruption by backing up our major systems.

 Our cybersecurity program is led by our CTO, alongside
the CEO, and includes but is not limited to: IT security policies and practices, security risk assessment and mitigations, software vulnerability
checks and updates, regular access certificate rotations - all designed to protect the privacy and security of the sensitive information
and continuation of business.

 Given the size of the company, we do not have
a specific committee dedicated to cybersecurity oversight. Instead, all board members participate in the review and monitoring of these
risks. The CTO and the CEO inform the board of directors on information security and cybersecurity matters as needed.

 Despite the implementation of our cybersecurity
program, our security measures cannot guarantee that a significant cyberattack will not occur. A successful attack on our information
technology systems could have significant consequences for the business. While we devote resources to our security measures to protect
our systems and information, these measures cannot provide absolute security.

 Cybersecurity Incidents

 None.

 ITEM 2. PROPERTIES

 None.

 ITEM 3. LEGAL PROCEEDINGS

 There is a pending suit. in the Southern District
of New York instituted by plaintiffs who are shareholders of NYIAX alleging claims of violation of securities law, common law fraud and
negligence. The Investors are seeking compensatory damages of $1,277,500 in addition to punitive damages, interest and attorney's
fees. NYIAX intends to vigorously dispute and defend against each and every claim by all of the plaintiffs.

 ITEM 4. MINE SAFETY DISCLOSURES

 Not applicable.

 ITEM 5. MARKET FOR REGISTRANT'S COMMON
EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

 MARKET INFORMATION

 Our Common Stock is not quoted, listed or trading
on any stock exchange.

 HOLDERS

 As of the date hereof, there are 285 record
holders of our Common Stock

 DIVIDEND POLICY

 We have never declared or paid cash dividends
on our capital stock. We currently intend to retain all available funds and any future earnings, if any, to fund the development and expansion
of our business and we do not anticipate paying any cash dividends in the foreseeable future. Any future determination related to dividend
policy will be made at the discretion of our board of directors and will depend upon, among other factors, our results of operations,
financial condition, capital requirements, tax considerations, legal or contractual restrictions, business prospects, the requirements
of current or then-existing debt instruments, general economic conditions and other factors our board of directors may deem relevant.

 EQUITY INCENTIVE PLAN

 On April 23, 2021, the Board of Directors and
shareholders adopted a 2021 Equity Incentive Plan (the "2021 Plan").

 GRANTS UNDER THE 2021 PLAN

 In 2021, the Company granted 1,607,500 options at a weighted average
exercise price of $4.33 and in 2022 the Company granted 517,500 options at a weighted average exercise price of $4.44.

 RECENT SALES OF UNREGISTERED SECURITIES

 During the past two fiscal years, the Company
made sales of the following unregistered securities:

 2023A Convertible Note Payable

 On January 10, 2023, the Company commenced
a Convertible Notes Offering ("2023A Convertible Note Payable") pursuant to which it offered up to $500,000 of convertible
notes. A total of approximately $200,000 of the 2023A Convertible Notes have been sold.

 Under the terms of the 2023A Convertible Notes
offered in the convertible notes:

 The notes convert at two dollars ($2.00) per share concurrently
when shares of common stock are sold to the public in the Financing Event, or in the event the Financing Event is not completed within
eighteen (18) months from the date of the individually issued notes, the Conversion Price shall be the reduced price of two dollars
($2.00) per share and the conversion amount shall automatically be converted into common stock of the Company at $2.00 per share on the
Maturity Date.

 The outstanding principal balance of the 2023A Convertible
Notes and all accrued interest automatically converted into common stock of the Company on February 7, 2023, immediately prior to
the Company's receipt of an effective order from the SEC declaring the registration statement of its initial public offering effective.

 The annual rate of return is twelve percent (12.0%) per annum,
which shall be paid as a Payment-in-Kind in the Company's common stock valued at two dollars ($2.00) per share.

 Warrants (the "Warrants") were issued at a rate
of one (1) Warrant for every ten dollars ($10) principal amount of notes purchased. Each Warrant shall be exercisable for a period
of five (5) years at a price of $5.50 per share. See Subsequent Events footnote for more details relating to the 2023A Convertible
Note Payable.

 2023B Convertible Note Payable

 On April 3, 2023, the Company commenced a
Convertible Notes Offering ("2023B Convertible Note Payable") pursuant to which it will offer up to $2,000,000 of convertible
notes.

 Under the amended terms of the 2023B Convertible
Notes offered in the convertible notes:

 For approximately 86% of the outstanding principal and interest
of the 2023B Convertible Note Payable, the conversion price is four dollars ($4.00) per share and in the event that the Company has not
received an effective order from the SEC on its registration statement by February 14, 2024, the outstanding principal of the 2023B Convertible
Note Payable shall automatically be converted into common stock of the Company at $2.00 per share. For approximately 14% of the outstanding
principal and interest of the 2023B Convertible Note Payable the conversion price is two dollars ($2.00) per share.

 The annual rate of return is twelve percent (12.0%) per annum,
which shall be paid as a Payment-in-Kind in the Company's common stock valued at two dollars ($2.00) per share.

 Warrants (the "Warrants") were issued at a rate
of one half warrant issued for every $10 of Notes purchased with an exercise price of four dollars ($4.00). and one half warrant issued
for every $10 of Notes purchased with an exercise price of two dollars ($2.00). Each Warrant shall be exercisable for a period of five
(5) year.

 $1,970,000 of 2023B Convertible Note Payable
were sold.

 2024A Convertible Note Payable

approximately $1.3 million in the 2024A Convertible Note Payable offering. The Offering consists of two-year convertible notes with 10%
interest payment-in-kind in Company common stock at two ($2.00) dollars, which shall be paid at maturity or upon conversion. Additionally,
the Company issued with the Notes, warrant coverage at the rate of one hundred (100%) percent of the dollar value of the Note at two ($2.00)
dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing
where the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal
balance of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as
those securities purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following:
the lower of (i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00) dollars,
but in no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from the final
Closing of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's
common stock at two ($2.00) dollars per share.

 2024B Convertible Note Payable

approximately $0.2 million in the 2024B Convertible Note Payable offering. The Offering consists of two-year convertible notes with 10%
interest payment-in-kind in Company common stock at two ($2.00) dollars, which shall be paid at maturity or upon conversion. Additionally,
the Company issued with the Notes, warrant coverage at the rate of one hundred (100%) percent of the dollar value of the Note at two ($2.00)
dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing where
the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal balance
of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as those securities
purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following: the lower of
(i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00) dollars, but in
no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from the final Closing
of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's common
stock at two ($2.00) dollars per share.

 Payables to Shareholder-Founders and Conversion to Common Shares

 Certain shareholder-founders purchased
$100,000 in the form of convertible notes in October 2023. These convertible notes payables to certain shareholder-founders of $100,000
plus interest automatically converted to 50,328 common shares in December 2023 at a share price of $4.00 per share.

 From November 27, 2023 through December
11, 2023 the Company sold $163,500 of convertible notes to certain shareholder-founders. These convertible notes payables to certain shareholder-founders
of $163,500 plus interest automatically converted to 41,144 common shares during the three-month period ending March 31, 2024 at a share
price of $4.00 per share.

 During January 2024 the Company sold
$150,000 of convertible notes to certain shareholder-founders. The convertible notes payable, plus interest at 4%, automatically converted
to 32,462 common shares during the three-month period ending March 31, 2024 at a share price of $4.00 per share.

 During the three-month period ended
March 31, 2024 certain shareholder-founders purchased $21,000 of these convertible notes payable. These notes plus interest automatically
converted to common shares upon two (2) months from the date of the convertible notes at a share price of $4.00 per share.

 Securities Act Exemptions

 We deemed all of the above offers, sales
and issuances of our securities to be exempt from registration under the Securities Act in reliance on Section 4(a)(2) of the Securities
Act, including Regulation D and Rule 506 promulgated thereunder, relative to transactions by an issuer not involving a public offering.
All purchasers of securities in transactions exempt from registration pursuant to Regulation D represented to us that they were accredited
investors and were acquiring the shares for investment purposes only and not with a view to, or for sale in connection with, any distribution
thereof and that they could bear the risks of the investment and could hold the securities for an indefinite period of time. The
purchasers received written disclosures that the securities had not been registered under the Securities Act and that any resale must
be made pursuant to a registration statement or an available exemption from such registration.

 All certificates representing the securities issued
in the transactions described in this Item 5 included appropriate legends setting forth that the securities had not been offered
or sold pursuant to a registration statement and describing the applicable restrictions on transfer of the securities.

 ITEM 6. [RESERVED]

 ITEM 7. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION

 Management's Discussion and Analysis of Financial Condition
and Results of Operations

 The following discussion and analysis of our
financial condition and results of operations should be read together with our financial statements and the related notes and the other
financial information included elsewhere in this Annual Report on Form 10-K. This discussion contains forward-looking statements that
involve risks and uncertainties. Forward looking statements are statements not based on historical information and which relate to future
operations, strategies, financial results or other developments. Forward looking statements, particularly those identified with the
words, "anticipates," "believes," "expects," "plans," "intends," "objectives,"
and similar expressions, are necessarily based upon estimates and assumptions that are inherently subject to significant business, economic
and competitive uncertainties and contingencies, many of which are beyond our control and many of which, with respect to future business
decisions, are subject to change. These uncertainties and contingencies can affect actual results and could cause actual results to differ
materially from those expressed in any forward-looking statements made by, or on our behalf. We disclaim any obligation to update forward
looking statements, except as required by law. When used herein, unless the context requires otherwise, references to the "Company,"
"we," "our" and "us" refer to NYIAX, Inc.

 Results of Operations For Years Ended
and December 31, 2023 and 2022

 The following table presents the Company's
comparable financial results between 2023 and 2022:

 For the

 For the

 Year Ended

 Year Ended

 December, 31

 2023

 2022

 Revenue, net

 $
 656,100

 $
 1,324,305

 Cost of Sales

 848,312

 1,182,303

 Gross Margin

 $
 (192,212
)

 $
 142,002

 Operating expenses

 $
 1,282,006

 $
 1,822,228

 Selling, general and administrative

 5,437,208

 7,869,144

 Deferred offering cost write-off

 1,026,012

 -

 (769,839
)

 -

 Depreciation and amortization

 596,366

 1,647

 Total operating expenses

 $
 7,571,753

 $
 9,693,019

 Loss from operations

 $
 (7,763,965
)

 $
 (9,551,017
)

 Other (income) expenses

 Interest and debt expense

 960,898

 1,563,162

 Total other (income) expenses

 $
 960,898

 $
 1,563,162

 Loss before provision for income taxes

 $
 (8,724,863
)

 $
 (11,114,179
)

 Net loss

 $
 (8,724,863
)

 $
 (11,114,179
)

 Net loss per share - basic and diluted

 $
 (0.60
)

 $
 (0.96
)

 Weighted average number of common shares outstanding - basic and diluted

 14,425,474

 11,577,808

 Net Revenue

 NYIAX's business model is focused on the
creation of a marketplace where the listing of advertising inventory, campaigns and audience can easily be sold through utilization of
highly efficient buying and selling technology.

 The Company enters into agreements with both the
Media Buyers and Media Sellers which set out the terms of the relationship and access to the Company's platform; the Company considers
both the Media Buyers and Media Sellers to be its customers. A media buyer ("Media Buyer") is typically an advertiser or advertising
agency that buys on behalf of an advertiser. Currently, the Media Buyers do not compensate the Company for the use of the platform and
other services. A media seller ("Media Seller") is typically a publisher of content, such as, websites, mobile or desktop
applications, podcast, Connected TV (also commonly defined as OTT, over-the-top, and streaming, allowing brands to reach their audience
on smart TVs and Internet devices) or other. The Media Sellers compensate the Company for the use of the platform and other services.

 NYIAX's technology platform provides Media
Buyers and Media Sellers a marketplace where advertising or audience campaigns are listed, bought, or sold as a durable instrument; thereafter,
contract flows directly into the Blockchain for contract management, reconciliation and automation purposes as a count of record. A Blockchain
is basically a distributed ledger that tracks transactions among parties, that includes the following fundamental properties applicable
to every single transaction: (i) all parties agree that the transaction occurred; (ii) all parties agree on the identities of
the individuals participating in the transaction; (iii) all parties agree on the time of the transaction; (iv) the details of
the transaction are easy to review and not subject to dispute; and evidence of the transaction persists, unchangeable, over time. The
combination of these properties of Blockchain results in a system that, by design, timestamps and records all transactions in a secure
and permanent manner, and is easily auditable in the future. Moreover, the ledger is distributed across many participants in the network,
and copies are simultaneously updated with every fully participating node in the ecosystem. Due to such distributed nature, the system
is highly resilient to downtime. Blockchain allows for immutability, consistency, and continuity of the contracts or advertising contracts
from contract formation, execution, and delivery to reconciliation.

 NYIAX uses coding through smart contracts ("Smart
Contracts"), which are self-executing contracts with the terms of the agreement between buyer and seller being directly written
into lines of code. The code and the agreements contained therein exist across a distributed, decentralized Blockchain network, and therefore
render transactions traceable, transparent, and irreversible. The use of Smart Contracts allows NYIAX advertising contracts to self-effectuate
(reconciling through automation without human intervention), which reduces backend audit and compliance costs for three parties: NYIAX,
the Media Buyer and the Media Seller. Finally, all parties to the advertising contracts have the ability to view Blockchain as it populates
with the contract formation, execution, and delivery, thereby providing a complete and full audit trail of events and subsequent changes
to the contract or advertising contract. To our knowledge, our current implementation of near real time compliance which is displayed
to both the advertiser/agency and publisher from contract formation to reconciliation currently does not exist in the advertising industry.

 NYIAX connects Media Buyers (brands, advertisers
or agencies) and Media Sellers (publishers or media) to execute media advertising sales contracts. NYIAX receives a commission or fee
from Media Sellers upon completion of the media advertising contract. NYIAX does not take ownership or positions of the media at any time
during the process.

 The Company acts as an agent for the Media Seller
and is not a principal in the purchase and sale of advertising inventory, data and other add-on features.

 Status

 In 2020 and 2019, to scale the NYIAX platform
in a commercial environment with publishers and advertising agencies, NYIAX Media Sellers a substantially reduced transaction fees. In
2019 and 2020 NYIAX had a single Media Buyer and a single Media Seller for a single campaign. The platform was being used by these customers
and NYIAX. This campaign concluded on December 31, 2020.

 In the first quarter of 2021, NYIAX reviewed its
offering and marketing programs, launched a sales process, and hired a sales team.

 The sales team was built in 2021 and subsequently
reduced in 2022 due to capital concerns. In 2023, the sales team was minimal.

 Factors Affecting Our Performance

 Development of the NYIAX platform is substantially
complete, although further features and user capabilities are expected to be added. NYIAX is currently monetizing the platform by building
a sales infrastructure and attracting Media Buyers, Media Sellers, and business partners. A business partner is an advertising agency
that represents one or more Media Buyers in acquiring media for use.

 NYIAX's Revenue Drivers:

 Media Buyer — An advertiser
or advertising agency that buys on behalf of an advertiser.

 Business Partner — Typically
Media Buyers are represented by advertising agencies that perform media planning and buying as an agent for the Media Buyer. The number
and quality of the media buyers is pivotal to our success.

 Media Sellers — Entities
that NYIAX has signed onto the platform with a Master Services.

 Sales Representatives — The
relationships with Media Buyers, Media Sellers and business partners are key to NYIAX's success. The quality and number of sales
representatives that NYIAX employs directly affects its continued revenue growth.

 Media on Exchange — A direct
result of contracts between Media Buyers and Media Sellers, Media on Exchange, as reported, is the media that was bought and sold on the
platform via our Smart Contract, delivered, reconciled and billed to the Media Buyer.

 At times, the Media Buyer and Media Seller will
settle the media cost outside the NYIAX Platform. Media on Exchange includes the notional amounts of these settlements.

 Media Contracts — A Smart
Contract between a Media Seller and Media Buyer. The Company is compensated for the execution of the Smart Contract. The compensation
is variable based upon the volume of the contract, the Media Seller and other variables. A Media Contract is analogous to an insertion
order whereby delivery, reconciliation and billing take place.

 Transaction Fees — NYIAX
charges transparent transaction fees.

 Transaction fees are charged to the Media Seller
(the publisher) for all advertising transactions at variable rates on the gross amount indicated in the Order from each contract. The
rates are independent for each Media Seller and vary based on volume of media and service levels.

 Transaction fees are billed to the Media Buyer
along with the media during the reconciliation process or paid net by the Media Seller. After payment is received for the media and the
transaction fee, the cost of the media is then paid to the Media Seller.

 Revenue Build

 NYIAX will build its Business Development (sales
and representatives) teams following consummation of a capital raise. The size, ramp-up and quality of the team will affect net revenue.

 Other Factors affecting NYIAX's Net Revenue

 Identifying valuable ad impressions that we
can profitably monetize at scale — We continuously review our available inventory from existing publishers
across every format (mobile, desktop, digital video, Over the Top Media, CTV, and rich media). The factors we consider to determine which
impressions we process include transparency on price, counterparties to the transaction, viewability, brand integrity in regard to ad
placement and whether or not the impression is human sourced (also known as fraud). By consistently applying these criteria, we believe
that the ad impressions we process will be valuable and marketable to advertisers.

 Managing industry dynamics — We
operate in the rapidly evolving digital advertising industry. Due to the scale and complexity of the digital advertising ecosystem, direct
sales via manual, person-to-person processes are insufficient for delivering a real-time, personalized ad experience, creating the need
for programmatic advertising. In turn, advances in programmatic technologies have enabled publishers to auction their ad inventory to
more buyers, simultaneously, and in real time through a process referred to as header bidding. Header bidding has also provided advertisers
with transparent access to ad impressions. As advertisers keep pace with ongoing changes in the way that consumers view and interact with
digital media there will be further innovation and we anticipate that header bidding will be extended into new areas such as OTT/CTV. We
believe our focus on publishers and buyers has allowed us to understand their needs and our ongoing innovation has enabled us to quickly
adapt to changes in the industry, develop new solutions and do so cost effectively. Our performance depends on our ability to keep pace
with industry changes such as header bidding and the evolving needs of our publishers and buyers while continuing our cost efficiency.

 Seasonality — The
advertising industry experiences seasonal trends that affect many participants in the digital advertising ecosystem. Most notably, advertisers
have historically spent relatively more in the fourth quarter of the calendar year to coincide with the holiday shopping season, and relatively
less in the first quarter. We expect seasonality trends to continue, and our ability to manage our resources in anticipation of these
trends will affect our operating results.

 Management's Plans

 NYIAX management's plans for developing
operations and generating substantive revenues and gross margins will require the following:

 1.
 NYIAX has completed the development
the initial platform.

 2.
 The NYIAX sales team has been
signing up Media Sellers and Media Buyers.

 3.
 NYIAX is currently building
out its sales organization. Currently, we have entered into four master service agreements with media buyer organizations, such as advertising
agencies that represent a number of brands.

 4.

 NYIAX expects that based upon this plan that it would not be able to realize substantive revenues until approximately one year from a financing event, or possibly later, depending on investment spend, later.

 5.
 NYIAX recognizes that its business
will require substantial scale in order to achieve profitability. The Company expects that there will be substantial sales, marketing
and continued engineering and development costs to generate revenue and maintain the platform. As such, the Company will need to generate
revenues at scale in order to become profitable. NYIAX is estimating that it would not be profitable until at least twelve months from
investing into a substantial sales team. Current estimates reflect conditions the Company expects to exist, the course of action the
Company expects to take, as the current estimates incorporate internal data, historical data, and financial models, all of which are
unproven.

 Results of Operations

 Net Revenue

 Net revenue decreased to $656,100 from $1,324,305, or by $668,205 (50%),
from 2022 to 2023, due to decreased activity in the Company's sales and marketing programs.

 For the year ended December 31, 2023, the
Company was compensated for the completion of 690 Media Contracts with average compensation of $951 per Media Contract. For the year
ended December 31, 2022, the Company was compensated for the completion of 1,116 Media Contracts with average compensation of $1,187
per Media Contract. The reduction in revenue was primarily caused by reduction in force from our sales and marketing department.

 The following chart illustrates Media Contracts
completed in each of the following quarters of 2023 and 2022 with related quarterly revenue and revenue per contract:

 Media

 Contracts

 Completed

 Quarterly

 Revenue

 Revenue /

 Media

 Contract

 Quarter Ending March 31, 2022

 $
 485,065

 $
 3,620

 Quarter Ending June 30, 2022

 339,423

 1,363

 Quarter Ending September 30, 2022

 124,987

 Quarter Ending December 31, 2022

 374,830

 1,186

 Year Ending December 31, 2022

 1,116

 $
 1,324,305

 $
 1,187

 Quarter Ending March 31, 2023

 $
 138,037

 $

 Quarter Ending June 30, 2023

 88,977

 Quarter Ending September 30, 2023

 97,820

 Quarter Ending December 31, 2023

 331,266

 1,640

 Year Ending December 31, 2023

 $
 656,100

 $

 Obtaining new Media Contracts is dependent on
several factors, including on our new business development (sales and representatives) team, which headcount has decreased from thirteen
(13) at March 31, 2022 to two (2) at December 31, 2023. The following table compares the business development headcount at quarter-end
and the Company's quarterly revenue.

 Quarterly Revenue

 Business Development

 Headcount at Quarter End

 31-Mar-22

 $
 485,065

 30-Jun-22

 339,423

 30-Sep-22

 124,987

 31-Dec-22

 374,830

 31-Mar-23

 138,037

 30-Jun-23

 88,977

 30-Sep-23

 97,820

 31-Dec-23

 331,266

 See "Risk Factors — Our revenue
can vary greatly from period to period and it is dependent on several factors, including our business development team. Our net revenue
decreased sequentially quarter on quarter in 2022."

 NYIAX's business model is focused on the
creation of a marketplace where the listing of advertising inventory, campaigns and audience can easily be sold through utilization of
highly efficient buying and selling technology.

 The Company enters into agreements with both the
Media Buyers and Media Sellers which set out the terms of the relationship and access to the Company's platform; the Company considers
both the Media Buyers and Media Sellers to be its customers. A media buyer ("Media Buyer") is typically an advertiser or advertising
agency that buys on behalf of an advertiser. Currently, the Media Buyers do not compensate the Company for the use of the platform and
other services. A media seller ("Media Seller") is typically a publisher of content, such as, websites, mobile or desktop
applications, podcast, Connected TV (also commonly defined as OTT, over-the-top, and streaming, allowing brands to reach their audience
on smart TVs and Internet devices) or other. The Media Sellers compensate the Company for the use of the platform and other services.

 NYIAX's technology platform provides Media
Buyers and Media Sellers a marketplace where advertising or audience campaigns are listed, bought, or sold as a durable instrument; thereafter,
contract flows directly into the Blockchain for contract management, reconciliation and automation purposes as a count of record. A Blockchain
is basically a distributed ledger that tracks transactions among parties, that includes the following fundamental properties applicable
to every single transaction: (i) all parties agree that the transaction occurred; (ii) all parties agree on the identities of the individuals
participating in the transaction; (iii) all parties agree on the time of the transaction; (iv) the details of the transaction are easy
to review and not subject to dispute; and evidence of the transaction persists, unchangeable, over time. The combination of these properties
of Blockchain results in a system that, by design, timestamps and records all transactions in a secure and permanent manner, and is easily
auditable in the future. Moreover, the ledger is distributed across many participants in the network, and copies are simultaneously updated
with every fully participating node in the ecosystem. Due to such distributed nature, the system is highly resilient to downtime. Blockchain
allows for immutability, consistency, and continuity of the contracts or advertising contracts from contract formation, execution, and
delivery to reconciliation.

 NYIAX uses coding through smart contracts ("Smart
Contracts"), which are self-executing contracts with the terms of the agreement between buyer and seller being directly written
into lines of code. The code and the agreements contained therein exist across a distributed, decentralized Blockchain network, and therefore
render transactions traceable, transparent, and irreversible. The use of Smart Contracts allows NYIAX advertising contracts to self-effectuate
(reconciling through automation without human intervention), which reduces backend audit and compliance costs for three parties: NYIAX,
the Media Buyer and the Media Seller. Finally, all parties to the advertising contracts have the ability to view Blockchain as it populates
with the contract formation, execution, and delivery, thereby providing a complete and full audit trail of events and subsequent changes
to the contract or advertising contract. To our knowledge, our current implementation of near real time compliance which is displayed
to both the advertiser/agency and publisher from contract formation to reconciliation currently does not exist in the advertising industry.

 NYIAX connects Media Buyers (brands, advertisers
or agencies) and Media Sellers (publishers or media) to execute media advertising sales contracts. NYIAX receives a commission or fee
from Media Sellers upon completion of the media advertising contract. NYIAX does not take ownership or positions of the media at any time
during the process.

 The Company acts as an agent for the Media Seller
and is not a principal in the purchase and sale of advertising inventory, data and other add-on features.

 Technology and Development

 Technology and Development costs decreased to
$1,282,006 from $1,822,228 or by $540,222 (30%), from 2022 to 2023. The Company's technology and development decreased due to decreased
development of our platform.

 Technology and development consist of (i) Product
development expenses related to the ongoing maintenance and operation of the platform, integrations with clients and partners applications,
including not limited to product and technology team members and outside services. Except to the extent that such costs are associated
with software development that qualify for capitalization, which are then recorded as capitalized software development costs; and (ii) Infrastructure
costs such as AWS (Amazon Web Services) or other cloud hosting solutions, Software development tools used for the creation and ongoing
management and maintenance of the NYIAX platform and service.

 Selling General and Administrative

 Selling general and administrative costs decreased
to $5,437,208 from $7,869,144, or by $2,431,936 (31%), from 2022 to 2023 primarily resulting from a marked decrease in (i) sales and marketing
staff with related expenses and (ii) administrative costs related to the Company going public.

 Selling general and administrative consists primarily
of personnel costs, including salaries, bonuses, employee benefits costs and the Company's sales and marketing personnel. Sales
and marketing expense also includes costs for market development programs, promotional and other marketing activities, and costs associated
with the Company's executive, finance, legal, human resources, compliance, and other administrative personnel, as well as accounting
and legal professional services fees, and rent.

 Depreciation and Amortization

 For the twelve-months ended December 31, 2023,
compared to the twelve-months ended December 31, 2022, depreciation and amortization increased from $1,647 to $596,366 from 2022 to 2023.
The increase was attributed to amortization of the purchase of intellectual property portfolio of $595,042 which commenced in July 2023
upon the acquisition of the patent portfolio in July 2023.

 Additionally, amortization capitalized software
costs of approximately $197,000 for the years ended December 31, 2023 and 2022 were classified as cost of sales.

 Deferred Offering Cost Write-off

 It Is the Company's policy to defer the
recognition of deferred offering costs Pursuant to the Codification of Staff Accounting Bulletins, Topic 5: Miscellaneous Accounting A.
Expenses of Offering. As of December 31, 2022, $848,531 of deferred offering costs were recorded on the balance sheet.

 On February 14, 2023, the Registration Statement
on Form S-1 filed by the Company with the Securities and Exchange Commission was declared effective by the SEC.

 In March, 2023, the Company's financial
advisor, representative and lead underwriter for the offering, Boustead Securities LLC ("Boustead"), informed the Company
of its decision not to proceed with pricing of the Company's Offering.

 In accordance with the Codification of Staff Accounting
Bulletins / Topic 5: Miscellaneous Accounting, the Company has written off these costs, $848,531, during the three-month period ended
March 31, 2023. And, for the three-month period ended September 30, 2023, the Company recorded $177,481 of deferred offering costs which
were written off during the three-month period ended September 30, 2023 as a result of Spartan Capital Securities, LLC's decision
not to continue as lead underwriter on October 6, 2023 (the Company engaged Spartan Capital Securities, LLC, as lead underwriter, deal
manager and investment banker for the Offering on April 12, 2023).

 During the twelve-month period ended December
31, 2023, in connection with the Company's attempted initial public offering, certain NYIAX current and former officers, agreed
to forfeit $769,839 of deferred compensation amounts owed by NYIAX, including payroll taxes. The deferred compensation arose from
a salary deferral program where each founder agreed to defer a portion of their contractual salary or contractor fees. This forfeiture
represents a permanent waiver of rights to this deferred compensation.

 Share-Based Compensation

 Share-based compensation decreased to$580,002
from $2,301,735, or by $1,721,733. The expense decreased as there were no new awards in 2023 or expenses related to principal stockholder
share-based payment awards and several other awards were fully expensed in prior fiscal periods.

 The share-based compensation expense related to
stock options and restricted stock awards which are referred to collectively as options and awards granted under the Company's employee
option plans, is measured and recognized in the financial statements based on the fair value of the awards granted. The fair value of
each option award is estimated on the grant date using the Black-Scholes option-pricing model. The Company uses the Black-Scholes model
to calculate the fair value for all options granted, based on the inputs relevant on the date granted, such as the fair value of our shares,
prevailing risk-free interest rate, risk-free interest rate, expected term at issuance, volatility, and dividend rate, etc. The value
of the portion of the award is ultimately expected to vest is recognized as expense in the statements of operations on an over the requisite
service periods. Awards are subject to forfeiture until vesting conditions have been satisfied under the terms of the award. Determining
the fair value of stock options awards requires judgement. The Company's use of the Black-Scholes option pricing model requires
the input of subjective assumptions.

 For the years ended December 31, 2023 and December
31, 2022, the Company reported the share-based compensation expenses on the statement of operation as follows:

 2023

 2022

 Cost of sales

 $
 22,743

 $
 62,099

 53,544

 59,734

 Sales, general and administrative

 503,715

 2,179,902

 Total

 $
 580,002

 $
 2,301,735

 Interest and Debt Expense, net

 Interest and debt expense, net — For
the year ended December 31, 2023 compared to the year ended December 31, 2022, interest and debt expense decreased to $960,898
from $1,563,162, a net decrease of $602,264. The decrease is primarily related to the convertible notes payable issued in 2022 and 2021
that converted to common shares in 2022 and 2023.

 Provision for Income Taxes

 NYIAX, Inc. is taxed as a "C" Corporation
subject to federal, state and local income taxes.

 The Company records income tax expense in accordance
with ASC - 740 Income Taxes, as amended mandating how uncertain tax positions should be recognized, measured, presented, and disclosed
in the financial statements. The standards require the evaluation of tax positions taken or expected to be taken in the course of preparing
the Company's tax returns to determine whether the tax positions are more-likely-than-not of being sustained upon examination by
the applicable tax authority, based on the technical merits of the tax position, and then recognizing the tax benefit that is more-likely-than-not
to be realized. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax expense in the current
reporting period. The Company has analyzed its tax positions and has concluded that as of December 31, 2023 and 2022, no uncertain positions
are taken or are expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements.

 The Company's policy is to record interest
expense and penalties pertaining to income taxes in operating expenses. For the years ended December 31, 2023 and 2022, there were no
interest and penalties expenses recorded and no accrued interest and penalties.

 Deferred tax assets and liabilities are recognized
for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities
and their respective tax bases. Deferred tax assets, including net operating loss carryforwards ("NOL's"), and liabilities,
are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected
to be recovered or settled.

 The effect on deferred tax assets and liabilities
of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents
the change during the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a valuation allowance
when, in the opinion of management, it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.
Realization of the deferred income tax asset is dependent on generating sufficient taxable income in future years. The amount of the deferred
income tax asset considered realizable, if any, could be reduced in the near term if estimates of future taxable income are reduced.

 At December 31, 2023, the Company has available Federal net operating
loss carryforwards ("NOLs"), of approximately $32.1 million to reduce future taxable income which do not expire but are limited
to 80% of taxable income and approximately $30.4 million in multiple states (primarily New York and California) the earliest expiring
in 2040.

 Condensed Cash Flows

 The following table shows a summary of our cash flows for the twelve-month
periods ending December 31, 2023 and 2022:

 2023

 2022

 Change

 Net Loss

 $
 (8,724,863
)

 $
 (11,114,179
)

 Cash used in operating activities

 (3,270,823
)

 (5,284,498
)

 2,013,675

 -38
 %

 Cash provided by (used in) investing activities

 (2,043
)

 2,043

 -100
 %

 Cash provided by financing activities

 2,533,500

 2,691,678

 (158,178
)

 -6
 %

 (Decrease) increase in cash and cash equivalents

 $
 (737,323
)

 $
 (2,594,863
)

 $
 1,857,540

 -72
 %

 Cash and cash equivalents, beginning of period

 $

 $
 3,387,200

 $
 (2,594,863
)

 -77
 %

 Cash and cash equivalents, end of period

 $
 55,014

 $

 $
 (737,323
)

 -93
 %

 Net cash used in operating activities were $3,270,823 and $5,284,498
for each of the years ended December 31, 2023 and 2022, respectively.

 For the year ended December 31, 2023, the net cash used was principally
on account of the net loss of $(8,724,862) less debt discount amortization of $713,681, share-based compensation of $580,002, a decrease
in accounts receivable of $ 1,602,486, and an increase in accounts payable and accrued expenses of $1,078,518, all partially offset by
$769,839 of forfeiture of deferred compensation.

 For the year ended December 31, 2022, the net cash used in operating
activities were principally on account of the net loss of $11,114,179 less debt discount amortization of $1,187,656, share-based compensation
of $2,301,735, decrease in accounts receivable of $1,121,030, partially offset by increase in accounts payable of $715,178.

 Net cash provided by financing activities were
$ 2,533,500 and $2,691,698 for each of the years ended December 31, 2023 and 2022, respectively.

 For the year ended December 31, 2023, the
net cash provided was principally from the proceeds from the issuance of a convertible notes in the amount of $2,170,000, and issuance
of notes payable, stockholder of $363,500.

 For the year ended December 31, 2022, the net cash provided was
principally from the proceeds of convertible notes payable, net of discount of $2,364,400, issuance of common stock pursuant to exercise
of warrants of $1,285,833, and partially offset by deferred offering costs of the IPO of $468,531 and partially offset by non-cash forgiveness
of $510,000 of forgiveness by stockholders of payables to stockholder founders.

 Non-GAAP Financial Measures

 We report our financial results in accordance
with GAAP. However, management believes that Adjusted EBITDA, a non-GAAP financial measure (the "Non-GAAP Measure"),
provides investors with additional useful information in evaluating our performance.

 We calculate Adjusted EBITDA as net loss, adjusted
to exclude: (1) interest expense and debt expense, net, (2) depreciation and amortization, (3) share-based compensation
expense, and (4) other one-time items.

 The Non-GAAP Measures are financial measures that
are not required by or presented in accordance with GAAP. We believe that the Non-GAAP Measures, when taken together with our financial
results presented in accordance with GAAP, provides meaningful supplemental information regarding our operating performance and facilitates
internal comparisons of our historical operating performance on a more consistent basis by excluding certain items that may not be indicative
of our business, results of operations or outlook. In particular, we believe that the use of the Non-GAAP Measures are helpful to our
investors as they are measures used by management in assessing the health of our business, determining incentive compensation and evaluating
our operating performance, as well as for internal planning and forecasting purposes.

 The Non-GAAP Measures are presented for supplemental
informational purposes only, have limitations as an analytical tool and should not be considered in isolation or as a substitute for financial
information presented in accordance with GAAP. Some of the limitations of the Non-GAAP Measures include that (1) the measures
do not properly reflect capital commitments to be paid in the future, (2) although depreciation and amortization are non-cash charges,
the underlying assets may need to be replaced and Adjusted EBITDA do not reflect these capital expenditures, (3) Adjusted EBITDA
do not consider the impact of share-based compensation expense, which is an ongoing expense for our company and (4) Adjusted EBITDA
do not reflect other non-operating expenses, including interest and debt expense. In addition, our use of the Non-GAAP Measures may not
be comparable to similarly titled measures of other companies because they may not calculate the Non-GAAP Measures in the same manner,
limiting its usefulness as a comparative measure. Because of these limitations, when evaluating our performance, you should consider the
Non-GAAP Measures alongside other financial measures, including our net income (loss) and other results stated in accordance with GAAP.

 The following table presents a reconciliation
of Adjusted EBITDA to net loss, the most directly comparable financial measure stated in accordance with US GAAP:

 For the

 For the

 Year Ended

 Year Ended

 2023

 2022

 Net Loss

 $
 (8,724,863
)

 $
 (11,114,179
)

 Reconciliation of Adjusted EBITDA Loss to Net Loss:

 Depreciation and amortization

 $
 (792,949
)

 $
 (199,225
)

 (580,002
)

 (2,301,735
)

 Deferred offering cost write-off

 (1,026,012
)

 -

 769,839

 -

 Interest expense

 (960,898
)

 (1,563,162
)

 Total Adjustments of EBITDA Loss to Net Loss

 $
 (2,590,022
)

 $
 (4,064,122
)

 Adjusted EBITDA

 $
 (6,134,841
)

 $
 (7,050,057
)

 Adjusted EBITDA

 For the year ended December 31, 2023, compared to the year ended December
31, 2022, the adjusted EBITDA loss decreased to $6,134,841 from $7,050,057 or decreased by 915,216, or 13%.

 Although adjusted EBITDA decreased due to (a)
in 2022 the Company reduced its sales team after increasing the sales team in 2021, (b) decreasing various general and administrative
costs related to the IPO in 2022 and (c) a decrease in technology and development in 2023 over 2022 as the Company focused on the IPO.

 Going Concern, Liquidity and Capital Resources

 The Company believes it does not have sufficient
cash to meet working capital and capital requirements for at least twelve months from the issuance of these financial statements.

 Historically, the Company's liquidity needs
have been met by the sale of common shares, the issuance of common shares through the exercise of warrants, and issuance of convertible
notes payable. Without a new loan or other equity support, the Company would not be able to support the current operating plans through
twelve months from the issuance of these financial statements. No assurance can be given at this time, however, as to whether we
will be able to raise new equity or loan support.

 The Company generated negative cash flows from
operations of approximately $3.3 million for the twelve months ended December 31, 2023. Historically, the Company's liquidity needs
have been met by the sale of sale of convertible notes payable, common shares, and the issuance of common shares through the exercise
of warrants.

 As of December 31, 2023, NYIAX had total current
assets of approximately $323,000, of which approximately $55,000 was cash and total current liabilities of approximately $7.9 million,
of which $2.4 million were convertible notes payable, accrued interest, and Shareholder-Founders, all payable-in-kind of the Company's
shares.

 For the year ended December 31, 2023, the
Company's operations lost approximately $8.7 million of which approximately $2.7 million were non-cash expenses, net.

 For the year ended December 31, 2022, the Company used approximately
$5.3 million of cash in operating activities.

 To enable the Company to meet immediate capital
requirements until longer term requirements can be met, during the second quarter of 2024, the Company sold convertible notes for the
2024A Convertible Notes Payable offering and during the third quarter the Company sold convertible notes for the 2024B Convertible Note
Offering. The Company sold approximately $1.5 million of the 2024A Convertible Note Payable and as of August 15, 2024, the Company sold
approximately $0.2 million of the 2024B Convertible Note Payable offerings.

 The Company is also subject to certain business
risks, including dependence on key employees, competition, market acceptance of the Company's platform, ability to source demand
from buyers of advertising inventory and dependence on growth to achieve its business plan.

 Through the date herein, the Company sold convertible notes from four
convertible note offerings.

 2023A Convertible Note Payable

 On January 10, 2023, the Company commenced
a Convertible Notes Offering ("2023A Convertible Note Payable") pursuant to which it offered up to $500,000 of convertible
notes. A total of approximately $200,000 of the 2023A Convertible Notes have been sold. The 2023A Convertible Notes convert at two dollars
($2.00) per share concurrently when shares of common stock are sold to the public in the Financing Event, or in the event the Financing
Event is not completed within eighteen (18) months from the date of the individually issued notes, the Conversion Price shall be the reduced
price of two dollars ($2.00) per share and the conversion amount shall automatically be converted into common stock of the Company at
$2.00 per share on the Maturity Date. The annual rate of return was twelve percent (12.0%) per annum, which was paid as a Payment-in-Kind
in the Company's common stock valued at two dollars ($2.00) per share. Concurrently with the 2023A Convertible Notes,
the Company issued warrants (the "Warrants") at a rate of one (1) Warrant for every ten dollars ($10) principal amount of
notes purchased. Each Warrant shall be exercisable for a period of five (5) years at a price of $5.50 per share. See Subsequent Events
footnote for more details relating to the 2023A Convertible Note Payable.

 The outstanding principal balance of
the 2023A Convertible Notes and all accrued interest automatically converted into common stock of the Company on February 7, 2023, immediately
prior to the Company's receipt of an effective order from the SEC declaring the registration statement of its initial public offering
effective.

 $200,000 of 2023A Convertible Note Payable
were sold and converted to shares on February 7, 2024.

 2023B Convertible Note Payable

 On April 3, 2023, the Company commenced
a Convertible Notes Offering ("2023B Convertible Note Payable") pursuant to which it will offer up to $2,000,000 of convertible
notes.

 The 2023A Convertible Notes converts
at two dollars ($2.00) per share concurrently when shares of common stock are sold to the public in the Financing Event, or in the event
the Financing Event is not completed within eighteen (18) months from the date of the individually issued notes, the Conversion Price
shall be the reduced price of two dollars ($2.00) per share and the conversion amount shall automatically be converted into common stock
of the Company at $2.00 per share on the Maturity Date. The annual rate of return is twelve percent (12.0%) per annum, which shall be
paid as a Payment-in-Kind in the Company's common stock valued at two dollars ($2.00) per share. Concurrently with the issuance
of the 2023B Convertible Notes Payable, the company issues warrants (the "Warrants") The Warrants were issued at a rate of
one half warrant issued for every $10 of notes purchased with an exercise price of four dollars ($4.00).and one half warrant issued for
every $10 of notes purchased with an exercise price of two dollars ($2.00). Each Warrant shall be exercisable for a period of five (5)
year.

 $1.970,000 of 2023B Convertible Note Payable were sold as
of June 28, 2023 and the note offering was closed. These notes and interest are currently outstanding and are payable in the Company's
stock.

 2024A Convertible Note Payable

approximately $1.3 million in the 2024A Convertible Note Payable offering. The Offering consists of two-year convertible notes (the "Notes")
with 10% interest payment-in-kind in Company common stock at two ($2.00) dollars, which shall be paid at maturity or upon conversion.
Additionally, the Company issued with the Notes, warrant coverage at the rate of one hundred (100%) percent of the dollar value of the
Note at two ($2.00) dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing
where the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal
balance of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as
those securities purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following:
the lower of (i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00)
dollars, but in no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from
the final Closing of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's
common stock at two ($2.00) dollars per share.

 2024B Convertible Note Payable

approximately $0.2 million in the 2024B Convertible Note Payable offering. The Offering consists of two-year convertible notes with 10%
interest payment-in-kind in Company common stock at two ($2.00) dollars, which shall be paid at maturity or upon conversion. Additionally,
the Company issued with the Notes, warrant coverage at the rate of one hundred (100%) percent of the dollar value of the Note at two ($2.00)
dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing where
the Company raises cumulative gross proceeds of at least $1,500,000 (the "Financing Event") the outstanding principal balance
of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as those securities
purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following: the lower of
(i) eighty-five (85%) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($2.00) dollars, but in
no event less than one dollar and fifty cents ($1.50) per share. If a Financing Event shall not occur two (2) years from the final Closing
of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's common
stock at two ($2.00) dollars per share.

 Future capital requirements will depend on many factors, including
the Company's rate of revenue growth and its level of expenditures. To the extent that existing capital resources, revenue growth
and cash flow from operations are not sufficient to fund future activities, the Company will need to raise additional funds through equity
or debt financing or curtail expenses. However, no assurances can be provided that additional funding or alternative financing will be
available at terms acceptable to the Company, if at all.

 Management must evaluate whether there are conditions
or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern
within one year after the date that the financial statements are issued.

 Due to these factors, substantial doubt exists regarding the Company's
ability to continue as a going concern through twelve months from the issuance date of these the financial statements. Management has
taken the steps to reduce the losses significantly by curtailing certain aspects of its operations or expansion activities. The financial
statements for the year ended December 31, 2023, do not include any adjustment relating to the recoverability and classification of recorded
asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern.

 The Company is also subject to certain business
risks, including dependence on key employees, competition, market acceptance of the Company's platform, ability to source demand
from buyers of advertising inventory and dependence on growth to achieve its business plan.

 Off-Balance Sheet Obligations and Arrangements

 Through December 31, 2023, the Company did
not have any relationships with unconsolidated organizations or financial relationships, such as structured finance or special purpose
entities that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow
or limited purposes.

 Quantitative and Qualitative Disclosures about
Market Risk

 All the Company's revenue, net is derived
from Media Buyers and Media Sellers within the United States. NYIAX's operations are primarily within the United States,
although certain contractors are located outside the United States. All contractor payments are denominated in US Dollars. Although
we are exposed to market risks in the ordinary course of our business, we do not hedge our activities. These risks include primarily
interest rate and inflation risks.

 Interest Rate Risks

 Our cash consisted of cash in banks accounts
insured by the FDIC. In the future, NYIAX will place cash equivalents in marketable securities consist of cash, money market funds,
commercial paper, and U.S. Treasury and government debt securities. The primary objective of our investment activities will be to
preserve principal while maximizing income without significantly increasing risk.

 Increasing Interest Rates may increase investment
risk and limit the Company's ability to sell securities. We do not hedge our activities.

 Inflation Risk

 We do not believe that inflation has had a material
effect on our business, results of operations, or financial condition. If our costs were to become subject to significant inflationary
pressures, our inability or failure to do so could adversely affect our business, results of operations, and financial condition. We
do not hedge our activities.

 Significant
Accounting Policies

 Critical Accounting Policies and Estimates

 We prepare our financial statements in accordance
with US generally accepted accounting principles. The preparation of the financial statements requires us to make estimates and assumptions
that affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts
of revenue, net and expenses. We evaluate our estimates and assumptions on an ongoing basis using historical experience and other factors
and adjust those estimates and assumptions when facts and circumstances dictate. Actual results could materially differ from these estimates
and assumptions.

 We believe estimates and assumptions associated
with the evaluation of revenue recognition criteria, including the determination of revenue reporting as net versus gross in our revenue
arrangements, as well as internal use software development costs, fair values of share-based awards, and income taxes have the greatest
potential impact on our financial statements. Therefore, we consider these to be our critical accounting policies and estimates.

 Revenue Recognition

 NYIAX brings together Media Buyers (brands, advertisers
or agencies) and Media Sellers (publishers or media) to execute media sales contracts. NYIAX receives a fee upon completion of the media
contract. NYIAX does not take ownership of or positions in the media at any time during the process.

 Generally, the Company bills Media Buyers the
gross amount of advertising, including the Company's commissions or fees in a single invoice and pays the Media Seller upon receipt.
The Company's accounts receivable are recorded at the amount of gross billings for the amounts it is responsible to collect, and
accounts payable are recorded at the amount payable to Media Seller.

 Substantially all of the Company's revenues
are recognized at the point in time that the (i) contract reconciliations are completed, (ii) accepted by the Media Buyer and
Media Seller, and (iii) NYIAX's performance obligations are completed.

 The Company maintains agreements with each Media
Buyer and Media Seller which set out the terms of the relationship.

 Revenue is recognized based on the five-step
process outlined in the Accounting Standards Codification ("ASC") 606:

 Step 1 — Identify the Contract
with the Customer — A contract exists when (a) the parties to the contract have approved the contract and are committed
to perform their respective obligations, (b) the entity can identify each party's rights regarding the goods or services to
be transferred, (c) the entity can identify the payment terms for the goods or services to be transferred, (d) the contract
has commercial substance and it is probably that the entity will collect substantially all of the consideration to which it will be entitled
in exchange for the goods or services that will be transferred to the customer.

 Step 2 — Identify Performance
Obligations in the Contract — Upon execution of a contract, the Company identifies as performance obligations each promise
to transfer to the customer either (a) goods or services that are distinct, or (b) a series of distinct goods or services that
are substantially the same and have the same pattern of transfer to the customer. To the extent a contract includes multiple promised
goods or services, the Company must apply judgement to determine whether the goods or services are capable of being distinct within the
context of the contract. If these criteria are not met, the goods or services are accounted for as a combined performance obligation.

 Step 3 — Determine the Transaction
Price — When (or as) a performance obligation is satisfied, the Company shall recognize as revenue the amount of the
transaction price that is allocated to the performance obligation. The contract terms are used to determine the transaction price. Generally,
all contracts include fixed consideration. If a contract did include variable consideration, the Company would determine the amount of
variable consideration that should be included in the transaction price based on expected value method. Variable consideration would
be included in the transaction price, if in the Company's judgement, it is probable that a significant future reversal of cumulative
revenue under the contract would not occur.

 Step 4 — Allocate the Transaction
Price — After the transaction price has been determined, the next step is to allocate the transaction price to each performance
obligation in the contract. If the contract only has one performance obligation, the entire transaction price will be applied to that
obligation. If the contract has multiple performance obligations, the transaction price is allocated to the performance obligations based
on the relative standalone selling price at contract inception.

 Step 5 — Satisfaction of
the Performance Obligations (and Recognize Revenue)–Revenue is recognized when (or as) goods or services are transferred to a customer.
The Company satisfies each of its performance obligations by transferring control of the promised good or service underlying that performance
obligation to the customer. Control is the ability to direct the use of and obtain substantially all of the remaining benefits from an
asset. It includes the ability to prevent other entities from directing the use of and obtaining the benefits from an asset. Indicators
that control has passed to the customer include: a present obligation to pay; physical possession of the asset; legal title; risks and
rewards of ownership; and acceptance of the asset(s). Performance obligations can be satisfied at a point in time or over time.

 The Company has determined that it is acting
as an agent for the Media Seller as (i) NYIAX does not obtain control of the Seller's media (goods& services) before transferring
control to the Buyer. The Seller has control of the media. Specifically, NYIAX does not control the specified media before transferring
the media to the Media Buyer, the Company is not primarily responsible for the performance of the Media Seller, nor can the Company redirect
those services to fulfill any other contracts. (ii) NYIAX does not have inventory or credit risk for the media. And (iii) The
Media Seller establishes the pricing in the Smart-Contracts (self-executing contracts which are automatically effectuated
by the terms of the agreement between buyer and seller), and the Media Buyers and Media Sellers agree to the pricing.

 Internally Developed Software

 The Company capitalizes or expenses costs associated
with creating internally developed software related to the Company's technology infrastructure in accordance with the following
policies.

 I — Preliminary project stage
activities undertaken in the preliminary project stage are analogous to research and development activities (pre-project planning and
evaluation activities) and are expensed as incurred. Pilot projects are also to be expensed as it is deemed to be research and development
costs.

 II — Application development
stage costs are capitalized when all of the following occur:

 1.
 the preliminary project stage
has been completed;

 2.
 management authorizes and commits
to funding the project; and

 3.
 it is probable that the project
will be completed and the software will be used to perform the function intended.

 The costs of certain activities typically incurred
in this phase are capitalized, which include (but are not limited to):

 External direct costs when
management maintains discreet records of the expenses;

 Direct payroll and payroll-related
costs to the extent discreet time records of the expenses records indicate; and

 Interest costs (if any incurred
at the entity level).

 Capitalization ceases at the earlier of when:

 i.

 it is no longer likely that the project will be completed
 and placed into service; or

 ii.

 the project is substantially complete and ready for
 its intended use.

 Income Taxes

 Financial Accounting Standards Board ("FASB")
has issued guidance mandating how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements.
The standards requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Company's tax
returns to determine whether the tax positions are more-likely-than-not of being sustained upon examination by the applicable tax authority,
based on the technical merits of the tax position, and then recognizing the tax benefit that is more-likely-than-not to be realized.
Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax expense in the current reporting period.

 The Company has analyzed its tax positions and has concluded that
as of December 31, 2023 and 2022, no uncertain positions are taken or are expected to be taken that would require recognition of a liability
(or asset) or disclosure in the financial statements.

 The Company's policy is to record interest expense and penalties
pertaining to income taxes in operating expenses. For the years ended December 31, 2023 and 2022, there were no interest and penalties
expenses recorded and no accrued interest and penalties.

 Deferred Taxes

 Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and
their respective tax bases. Deferred tax assets, including net operating loss carryforwards ("NOL's"), and liabilities,
are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected
to be recovered or settled.

 The effect on deferred tax assets and liabilities of a change in tax
rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during
the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a valuation allowance when, in
the opinion of management, more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

 Realization of the deferred income tax asset is dependent on generating
sufficient taxable income in future years. The Company has not generated any taxable income and as of December 31, 2023, does not assume
it will generate taxable income for the purpose of recognizing a deferred tax asset. The amount of the deferred income tax asset considered
realizable, if any, could be reduced in the near term if estimates of future taxable income are reduced.

 Share-Based Compensation

 The share-based compensation expense related
to stock options and restricted stock awards which are referred to collectively as options and awards granted under the Company's
employee option plans, is measured and recognized in the financial statements based on the fair value of the awards granted. The fair
value of each option award is estimated on the grant date using the Black-Scholes option-pricing model. We use the Black-Scholes model
to calculate the fair value for all options granted, based on the inputs relevant on the date granted, such as the fair value of our
shares, prevailing risk-free interest rate, etc. The value of the portion of the award, after considering potential forfeitures, that
is ultimately expected to vest is recognized as expense in our statements of operations on a over the requisite service periods. Awards
are subject to forfeiture until vesting conditions have been satisfied under the terms of the award. Determining the fair value of stock
options awards requires judgment. The Company's use of the Black-Scholes option pricing model requires the input of subjective
assumptions.

 Recent Accounting Standards

 The Company considers the applicability and impact of all Accounting
Standard Updates ("ASUs"). ASUs adopted during 2023 were assessed, and determined to be either not applicable or are expected
to have minimal impact on its financial position or results of operations.

 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK

 Not applicable.

 ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

 INDEX TO FINANCIAL STATEMENTS

 Page

 Audited Financial Statements for the Years
 Ended December 31, 2023 and 2022

 Report of Independent Registered
 Public Accounting Firm (WWC, P.C., San Mateo, California PCAOB firm ID 1171)

 Balance Sheets as of December 31, 2023 and 2022

 Statements of Operations for the Years Ended December 31, 2023 and 2022

 Statements of Changes in
 Shareholders' (Deficit) Equity for the Years Ended December 31, 2023 and 2022

 Statements of Cash Flows for the Years Ended December 31, 2023 and 2022

 Notes to Financial Statements

 F- 1

 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM

 To the Shareholders and Board of Directors of NYIAX,
Inc.

 Opinion on the Financial Statements

 We have audited the accompanying balance sheets
of NYIAX, Inc. (the Company) as of December 31, 2023 and 2022, and the related statements of income, changes in shareholders' equity
(deficits), and cash flows for each of the years in the two years ended December 31, 2023, and the related notes and schedules (collectively
referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects,
the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each
of the two years ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

 Explanatory Paragraph about the Company's
Ability to Continue as a Going Concern

 The accompanying financial statements have been
prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company
has experienced recurring losses from operations and negative cash flows from operating activities during the year ended December 31,
2023. The company had a working capital deficit as of December 31, 2023. These factors raise substantial doubt about its ability
to continue as a going concern. Management's plans in regard to these matters are described in Note 1. These financial statements
do not include any adjustments that might result from the outcome of this uncertainty.

 Basis for Opinion

 These financial statements are the responsibility
of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our
audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and
regulations of the Securities and Exchange Commission and the PCAOB.

 We conducted our audits in accordance with the
standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged
to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding
of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company's
internal control over financial reporting. Accordingly, we express no such opinion.

 Our audits included performing procedures to assess
the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond
to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating
the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

 /s/ WWC, P.C.

WWC, P.C.

Certified Public Accountants

PCAOB ID No. 1171

 We have served as the Company's auditor since 2024

 San Mateo, California

August 19, 2024

 F- 2

Balance Sheets

As of December 31, 2023 and 2022

 2023

 2022

 Assets

 Cash

 $
 55,014

 $

 Accounts receivable, net

 262,588

 1,972,034

 Other current assets

 5,000

 92,497

 Total current assets

 $
 322,602

 $
 2,856,868

 Capitalized software development costs, net

 $
 196,572

 $
 393,157

 Patents, net of amortization

 3,404,958

 -

 Property, plant and equipment, net

 2,196

 3,519

 Operating lease right-of-use asset

 244,451

 395,470

 Deferred offering Costs

 -

 848,531

 Security deposit

 74,068

 74,068

 Total assets

 $
 4,244,847

 $
 4,571,613

 Liabilities and Shareholders' Equity

 Current liabilities

 Accounts payable and accrued expenses

 $
 5,327,206

 $
 4,841,045

 Convertible notes payable, net of deferred debt discounts

 1,970,000

 2,355,735

 Payables to shareholder-founders

 264,000

 -

 Accrued Payment-In-Kind Interest

 146,655

 71,614

 Current portion of operating lease obligations

 175,585

 162,503

 Total current liabilities

 $
 7,883,446

 $
 7,430,897

 Long-term liabilities

 Operating lease obligations, net of current maturities

 $
 92,800

 $
 268,385

 Payables to shareholder-founders

 -

 100,500

 Total long-term liabilities

 -

 368,885

 Total liabilities

 $
 7,976,246

 $
 7,799,782

 COMMITMENTS AND CONTINGENCIES

 Shareholders' equity (deficit)

 Common stock $ 0.0001 par value, 125,000,000 common shares authorized; 15,611,827 and 12,370,002 shares issued and outstanding as of December 31, 2023 and December 31, 2022, respectively.

 $
 1,562

 $
 1,237

 Preferred shares: 10,000,000 authorized, none outstanding, par value $ 0.0001 per share

 -

 -

 Additional Paid in Capital

 58,244,754

 50,023,446

 Accumulated deficit

 ( 61,977,715
)

 ( 53,252,852
)

 Total shareholders' (deficit) equity

 $
 ( 3,731,399
)

 $
 ( 3,228,169
)

 Total liabilities and shareholders' (deficit) equity

 $
 4,244,847

 $
 4,571,613

 The accompanying notes to the financial statements
are an integral part of these financial statements.

 F- 3

Statements of Operations

For the Years Ended December 31, 2023 and 2022

 2023

 2022

 Revenue, Net

 $
 656,100

 $
 1,324,305

 Cost of Sales

 848,312

 1,182,303

 Gross Margin

 ( 192,212
)

 142,002

 Operating expenses

 $
 1,282,006

 $
 1,822,228

 Selling, general and administrative

 5,437,208

 7,869,144

 Deferred offering cost write-off

 1,026,012

 -

 Forfeiture of deferred compensation

 ( 769,839
)

 -

 Depreciation and amortization

 596,366

 1,647

 Total operating expenses

 $
 7,571,753

 $
 9,693,019

 Loss from operations

 ( 7,763,965
)

 ( 9,551,017
)

 Other (income) expenses

 Interest expense, net

 960,898

 1,563,162

 Total other (income) expenses

 $
 960,898

 $
 1,563,162

 Loss before provision for income taxes

 $
)

 $
)

 Net loss

 $
)

 $
)

 Net loss per share - basic and diluted

 $
 ( 0.60
)

 $
 ( 0.96
)

 Weighted average number of common shares outstanding – basic and diluted

 14,425,474

 11,577,808

 The accompanying notes to the financial statements
are an integral part of these financial statements.

 F- 4

Statements of Changes in Shareholders' Equity (Deficit)

 For the Years Ended December 31,
2023 and 2022

 Common Stock

 Additional

 Shares
 Outstanding

 Amount

 Paid in
 Capital

 Accumulated
 Deficit

 Total

 Balance - January 1, 2022

 10,243,442

 $
 1,024

 $
 38,089,295

 $
 ( 42,110,073
)

 $
 ( 4,019,754
)

 -

 -

 1,694,344

 -

 1,694,344

 Issuance of common stock pursuant to restricted stock awards (share-based compensation)

 290,000

 607,362

 -

 607,391

 Conversion of Convertible 2021 Convertible Note Payable and accrued interest to common shares

 1,594,807

 7,973,848

 -

 7,974,007

 Deemed Dividend from Inducement to Exercise Warrants

 -

 -

 28,600

 ( 28,600
)

 -

 Issuance of common stock pursuant to exercise of warrants

 235,693

 1,285,809

 -

 1,285,833

 Deferred debt discount on 2022 convertible notes payable

 -

 -

 324,213

 -

 324,213

 Issuance of common stock pursuant to exercise of employee stock options

 6,060

 19,975

 -

 19,976

 Net Loss

 -

 -

 -

)

)

 Balance - December 31, 2022

 12,370,002

 $
 1,237

 $
 50,023,446

 $
 ( 53,252,852
)

 $
 ( 3,228,169
)

 Balance - January 1, 2023

 12,370,002

 $
 1,237

 $
 50,023,446

 $
 ( 53,252,852
)

 $
 ( 3,228,169
)

 -

 -

 496,141

 -

 496,141

 Issuance of common stock pursuant to restricted stock awards

 ( 250,000
)

 ( 25
)

 83,886

 -

 83,861

 Conversion of Convertible Note Payable and accrued interest to common shares

 1,441,497

 2,719,197

 -

 2,719,341

 Conversion of Shareholder Note and accrued interest to common shares

 50,328

 201,309

 -

 201,315

 Deferred debt discount on 2022 convertible notes payable

 -

 -

 720,975

 -

 720,975

 Issuance of common stock pursuant to exercise of employee stock options

 -

 -

 -

 -

 -

 Issuance of common stock for patents acquisition

 2,000,000

 3,999,800

 -

 4,000,000

 Net Loss

 -

 -

)

)

 Balance - December 31, 2023

 15,611,827

 $
 1,562

 $
 58,244,754

 $
 ( 61,977,715
)

 $
 ( 3,731,399
)

 The accompanying notes to the financial statements
are an integral part of these financial statements.

 F- 5

Statements of Cash Flows

For the Years Ended December 31, 2023 and 2022

 2023

 2022

 Cash flows from operating activities

 Net loss

 $
)

 $
)

 Adjustments to reconcile net income to net cash provided by operating activities:

 Depreciation and amortization

 $
 792,949

 $
 199,225

 Operating lease right-of-use asset amortization, net

 ( 11,484
)

 6,913

 Accrued PIK Interest

 247,257

 375,629

 Debt discount amortization

 713,681

 1,187,656

 580,002

 2,301,735

 Provision for allowance for expected credit losses

 106,959

 -

 ( 769,839
)

 -

 Deferred offering cost write-off

 1,026,012

 -

 Change in operating assets and liabilities:

 Accounts receivable

 1,602,487

 1,121,030

 Prepaid expenses and other current assets

 87,497

 ( 77,685
)

 Accounts payable and accrued expenses

 1,078,518

 715,178

 Net cash used in operating activities

 $
 ( 3,270,823
)

 $
 ( 5,284,498
)

 Net cash used in investing activities

 Acquisition of Fixed Assets

 -

 $
 ( 2,043
)

 $

 $
 ( 2,043
)

 Cash flows from financing activities

 Proceeds from convertible notes payable, net of discount

 $
 2,170,000

 $
 2,364,400

 Payable (forgiveness) to founders' stockholder payable

 -

 ( 510,000
)

 Issuance of common stock pursuant to exercise of warrants

 -

 1,285,833

 Issuance of payables to shareholder-founders

 363,500

 -

 Deferred offering costs

 -

 ( 468,531
)

 Proceeds from issuance of stock upon exercise of Employee Options

 -

 19,976

 Net cash provided by financing activities

 $
 2,533,500

 $
 2,691,678

 Net decrease in cash and cash equivalents

 $
 ( 737,323
)

 $
 ( 2,594,863
)

 Cash and cash equivalents – Beginning of period

 3,387,200

 Cash and cash equivalents – End of period

 $
 55,014

 $

 Supplemental disclosures of non-cash flow investing and financing activities:

 Deferred debt discount on convertible note payable

 $
 720,975

 $
 ( 324,212
)

 Deemed Dividends

 -

 28,600

 Conversion of convertible note payable and accrued interest to common shares

 2,719,341

 7,974,007

 Issuance of common stock for patents acquisition

 4,000,000

 -

 Conversion of shareholder notes and accrued interest to shares

 201,315

 -

 The accompanying notes to the financial statements
are an integral part of these financial statements.

 F- 6

NOTES TO THE FINANCIAL STATEMENTS

For the Years Ended December 31, 2023 and 2022

 Note 1 — Organization
and Nature of Business

 Brief Overview:

 NYIAX, Inc. (the "Company" or "NYIAX")
was incorporated on July 12, 2012 in the State of Delaware.

 NYIAX connects Media Buyers (brands, advertisers
or agencies) and Media Sellers (publishers or media) to execute media advertising sales contracts. NYIAX receives a commission or fee
upon completion of the media advertising contract. NYIAX does not take ownership or positions of the media at any time during the process.

 Going Concern, Liquidity and Capital Resources

 The Company believes it does not have sufficient
cash to meet working capital and capital requirements for at least twelve months from the issuance of these financial statements.

 Historically, the Company's liquidity needs
have been met by the sale of common shares, the issuance of common shares through the exercise of warrants, and issuance of convertible
note payable. Without a new loan or other equity support, the Company would not be able to support the current operating plans through
twelve months from the issuance of these financial statements. No assurance can be given at this time, however, as to whether we
will be able to raise new equity or loan support.

 The Company generated negative cash flows from
operations of approximately $ 3.3 million for the twelve months ended December 31, 2023. Historically, the Company's liquidity needs
have been met by the sale of sale of convertible notes payable, common shares, and the issuance of common shares through the exercise
of warrants.

 As of December 31, 2023, NYIAX had total
current assets of approximately $ 323,000, of which approximately $ 55,000 was cash and total current liabilities of approximately
$ 7.9 million, of which $ 2.4 million were convertible notes payable, accrued interest, and note payable, stockholder, all
payable-in-kind of the Company's shares.

 For the year ended December 31, 2023, the
Company's operations lost approximately $ 8.7 million of which approximately $ 2.7 million were non-cash expenses, net.

 For the year ended December 31, 2022, the
Company used approximately $ 5.3 million of cash in operating activities.

 To enable the Company to meet immediate capital
requirements until longer term requirements can be met, during the second quarter of 2024, the Company sold convertible notes for the
2024A Convertible Notes Payable offering and during the third quarter the Company sold convertible notes for the 2024B Convertible Note
Offering. The Company sold approximately $ 1.5 million of the 2024A Convertible Note Payable and as of August 15, 2024, the Company sold
approximately $ 0.2 million of the 2024B Convertible Note Payable offerings.

 The Company is also subject to certain business
risks, including dependence on key employees, competition, market acceptance of the Company's platform, ability to source demand
from buyers of advertising inventory and dependence on growth to achieve its business plan.

 F- 7

 Note 2 — Basis of Presentation
and Summary of Significant Accounting Policies

 Financial Statements

 The accompanying financial statements are presented
in accordance with accounting principles generally accepted in the United States of America ("US GAAP").

 Use of Estimates

 The preparation of financial statements in conformity
with US GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures
of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ materially from these estimates.

 On an on-going basis, management evaluates its estimates, primarily
those related to: (1) revenue recognition criteria, including the determination of revenue reporting as net versus gross in the Company's
revenue arrangements, (2) allowances for doubtful accounts, (3) the useful lives of property and equipment and capitalized software
development costs, (4) income taxes, (5) the valuation of share-based compensation, (6) assumptions used in the Black-Scholes
option pricing model to determine the fair value of stock options and warrants (7) allowance for expected credit losses, (8) impairment
estimates, and (9) the recognition and disclosure of contingent liabilities. These estimates are based on historical data and experience,
as well as various other factors that management believes to be reasonable under the circumstances, the results of which form the basis
for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Estimates relating
to the valuation of share-based compensation, options and warrants, require the selection of appropriate valuation methodologies and models,
and significant judgment in evaluating ranges of assumptions and financial inputs. Actual results may differ materially from those estimates
under different assumptions or circumstances.

 Cash and Cash Equivalents

 The Company considers all highly liquid investments
with an original maturity of three months or less when purchased, to be cash equivalents. There were no cash equivalents at December 31,
2023 and 2022, respectively.

 Accounts Receivable, Net

 Accounts receivable consists of amounts billed to Media Buyers. Accounts
receivable, net are carried at their contractual amounts, less an estimate for expected credit losses. Management estimates the allowance
for expected credit losses based on existing economic conditions, historical experience, the financial conditions of the customers, and
the amount and age of past due accounts. Receivables are considered past due if full payment is not received by the contractual due date.
Past due accounts are generally written off against the allowance for expected credit losses only after all collection attempts have been
exhausted.

 The Company performs ongoing credit evaluation. The allowance for allowance
for expected credit losses is determined based on historical collection experience and the review in each period of the status of the
then-outstanding accounts receivable, while taking into consideration current client information, subsequent collection history and other
relevant data. The Company reviews the allowance for expected credit losses on a quarterly basis. For the year ended and December 31,
2022, the Company had no allowance for expected credit losses and no write-offs of accounts receivable. For the year ended December 31,
2023, the Company had an allowance for expected credit losses of $ 106,959 and no direct write-offs of accounts receivable.

 Patents

 Patents and other intellectual property acquired
through purchase are recorded at the time of acquisition at cost of the acquisition plus the transaction costs, if material, of the acquired
assets.

 Amortization commences when the Patents are available
for its intended use over their useful lives.

 In accordance with ASC 360 Impairment Accounting for the Impairment
or Disposal of Long-Lived Assets, the Company periodically reviews the carrying value of long-lived assets whenever events or changes
in circumstances indicate that the historical carrying value of the long-lived assets may have been impaired. Management determined long-lived
assets held at December 31, 2023 had not been impaired.

 F- 8

 Capitalized Software Development Costs

 The Company capitalizes or expenses costs associated
with creating internally developed software related to the Company's technology infrastructure in accordance with ASC 350-40,
Intangibles — Goodwill and Other — Internal Use Software, that generally relate to software that the
Company does not intend to sell or market.

 All costs incurred during the preliminary project
stages are expensed as incurred. Once the projects have been committed to and it is probable that the projects will meet functional requirements,
costs are capitalized in accordance ASC 350-40.

 Amortization commences when the software is available
for its intended use. The estimated useful life of the capitalized software development costs is five years. The Company commenced
amortizing the capitalized software development costs related to its platform in January 2020.

 Certain long-lived assets including capitalized
software development costs are also subject to measurement at fair value on a nonrecurring basis if they are deemed to be impaired as
a result of an impairment review. For the years ended December 31, 2023 and 2022, no impairments were recorded on those assets.

 Property and Equipment, Net

 Property and equipment are stated at cost, net
of accumulated depreciation and amortization, which is recorded commencing at the in-service date using the straight-line method over
the estimated useful lives of the assets, as follows: 3 to 5 years for office equipment and software.

 Repair and maintenance costs are expensed as
incurred and major improvements are capitalized. When assets are retired or otherwise disposed of, the cost and related accumulated depreciation
are removed from the accounts and any resulting gain or loss is reflected in the Company's operating results.

 Operating Leases

 The Company has entered into operating leases
consisting principally for the rental of office space. The Company adopted ASC 842. The guidance requires the recognition of right-of-use
("ROU") assets and related operating lease liabilities on the balance sheet for those leases previously classified as operating
leases. The Company adopted this new guidance using the modified retrospective approach.

 Under ASC 842, lease expense is recognized
as a single lease cost on a straight-line basis over the lease term. The lease term consists of non-cancelable periods and may include
options to extend or terminate the lease term, when it is reasonably certain such options will be exercised.

 The Company enters into contracts in the normal
course of business and assesses whether any such contracts contain a lease. The Company determines if an arrangement is a lease at inception
if it conveys the right to control the identified asset for a period of time in exchange for consideration. The Company classifies leases
as operating or financing in nature and records the associated lease liability and right-of-use asset on its balance sheet. The lease
liability represents the present value of future lease payments, net of lease incentives, discounted using an incremental borrowing rate,
which is a management estimate based on the information available at the commencement date of a lease arrangement. With respect to operating
lease arrangements, the Company accounts for lease components, and non-lease components that are fixed, as a single lease component.
Non-lease components that are variable are expensed as incurred in the consolidated statement of operations. The Company recognizes costs
associated with lease arrangements having an initial term of 12 months or less ("short-term leases") on a straight-line
basis over the lease term; such short-term leases are not recorded on the balance sheet.

 Lease expense for the years ended December 31,
2023 and 2022 were $ 172,540 and $ 197,245, respectively.

 F- 9

 Fair Value of Financial Instruments

 Fair value is defined as the exchange price that
would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset
or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair
value must maximize the use of observable inputs and minimize the use of unobservable inputs.

 Fair value measurements are based on a fair value
hierarchy, based on three levels of inputs, of which the first two are considered observable and the last unobservable, which are the
following:

 Level 1

 —

 Quoted prices (unadjusted) in active markets for identical assets or
 liabilities that the Company has the ability to access at the measurement date.

 Level 2

 —

 Inputs other than quoted prices included within Level 1 that are observable
 for the asset or liability, either directly or indirectly, such as quoted market prices for similar assets and liabilities; quoted
 prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially
 the full term of the asset or liability.

 Level 3

 —

 Unobservable inputs. Observable inputs are based on market data obtained
 from independent sources.

 The Company's financial instruments, including cash and cash equivalents,
accounts receivables, and accounts payables and accrued expenses have carrying amounts that approximate their fair values due to their
short-term nature.

 Concentrations of Risk

 Financial instruments that potentially subject
the Company to concentration of credit risk consist principally of cash, and accounts receivable. The Company maintains its cash with
financial institutions which exceed the Federal Deposit Insurance Corporation ("FDIC") federally insured limits.

 As of December 31, 2023, three Media Sellers represented approximately
 46 %, 14 % and 7 % respectively of revenue, net. As of December 31, 2023, three Media Buyer represented 34 %, 25 % and 18 % of accounts receivable.
As of December 31, 2023, two Media Sellers represented 80 % and 10 % of accounts payable.

 As of December 31, 2022, three Media Sellers represented approximately
 51 %, 12 % and 10 % respectively of revenue, net. As of December 31, 2022, two Media Buyer represented for 67 % and 20 % of accounts receivable.
As of December 31, 2022, two Media Sellers represented 61 % and 8 % of accounts payable.

 Expected credit loss

 The Company accounts for expected credit
losses in accordance with ASU No. 2016-13, Financial Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on
Financial Instruments requires entities to use a current lifetime expected credit loss methodology to measure impairments of certain
financial assets.

 Convertible Debt

 Convertible debt obligations are accounted for
in accordance with ASC480 Distinguishing Liabilities from Equity. The relative value of the beneficial conversion features and the warrants
are recorded as deferred debt discount and amortized over the term of the convertible note using the effective interest method. The deferred
debt discount is being amortized over the life of the convertible note payable.

 The warrants issued with the convertible debt did not contain obligations
of the Company to (i) redeem the warrants for cash or other assets, (ii) repurchase the Company's equity shares by transferring
assets, or (iii) to issue a variable number of equity shares and in accordance with ASC480 Distinguishing Liabilities from Equity, the
Company is accounting for the conversion feature and the warrants as equity.

 Deferred Financing Costs

 Deferred financing costs include debt discounts
and debt issuance costs related to a recognized debt liability and are presented in the balance sheet as a direct reduction from the
carrying value of the debt liability. Amortization of deferred financing costs are included as a component of interest expense. Deferred
financing costs are amortized using the effective interest method.

 Deferred Offering Costs

 Deferred offering costs include specific incremental costs directly
attributable to the Company's initial public offering of securities. Deferred offering costs exclude management salaries or other
general and administrative expenses. These costs are being deferred and will be charged against the gross proceeds of the offering.

 F- 10

 Revenue Recognition

 NYIAX brings together Media Buyers (brands, advertisers
or agencies) and Media Sellers (publishers or media) to execute media sales contracts. NYIAX receives a fee upon completion of the media
contract. NYIAX does not take ownership of or positions in the media at any time during the process.

 Generally, the Company bills Media Buyers the
gross amount of advertising, including the Company's commissions or fees in a single invoice and pays the Media Seller upon receipt.
The Company's accounts receivable are recorded at the amount of gross billings for the amounts it is responsible to collect, and
accounts payable are recorded at the amount payable to Media Seller.

 Substantially all of the Company's revenues
are recognized at the point in time that the (i) contract reconciliations are completed, (ii) accepted by the Media Buyer and
Media Seller, and (iii) NYIAX's performance obligations are completed.

 The Company maintains agreements with each Media
Buyer and Media Seller which set out the terms of the relationship.

 Revenue is recognized based on the five-step
process outlined in the Accounting Standards Codification ("ASC") 606:

 Step 1 — Identify the Contract
with the Customer — A contract exists when (a) the parties to the contract have approved the contract and are committed
to perform their respective obligations, (b) the entity can identify each party's rights regarding the goods or services to
be transferred, (c) the entity can identify the payment terms for the goods or services to be transferred, (d) the contract
has commercial substance and it is probable that the entity will collect substantially all of the consideration to which it will be entitled
in exchange for the goods or services that will be transferred to the customer.

 Step 2 — Identify Performance
Obligations in the Contract — Upon execution of a contract, the Company identifies as performance obligations each promise
to transfer to the customer either (a) goods or services that are distinct, or (b) a series of distinct goods or services that
are substantially the same and have the same pattern of transfer to the customer. To the extent a contract includes multiple promised
goods or services, the Company must apply judgement to determine whether the goods or services are capable of being distinct within the
context of the contract. If these criteria are not met, the goods or services are accounted for as a combined performance obligation.

 Step 3 — Determine the Transaction
Price — When (or as) a performance obligation is satisfied, the Company shall recognize as revenue the amount of the
transaction price that is allocated to the performance obligation. The contract terms are used to determine the transaction price. Generally,
all contracts include fixed consideration. If a contract did include variable consideration, the Company would determine the amount of
variable consideration that should be included in the transaction price based on expected value method. Variable consideration would
be included in the transaction price, if in the Company's judgement, it is probable that a significant future reversal of cumulative
revenue under the contract would not occur.

 Step 4 — Allocate the Transaction
Price — After the transaction price has been determined, the next step is to allocate the transaction price to each performance
obligation in the contract. If the contract only has one performance obligation, the entire transaction price will be applied to that
obligation. If the contract has multiple performance obligations, the transaction price is allocated to the performance obligations based
on the relative standalone selling price at contract inception.

 Step 5 — Satisfaction of
the Performance Obligations (and Recognize Revenue)–Revenue is recognized when (or as) goods or services are transferred to a customer.
The Company satisfies each of its performance obligations by transferring control of the promised good or service underlying that performance
obligation to the customer. Control is the ability to direct the use of and obtain substantially all of the remaining benefits from an
asset. It includes the ability to prevent other entities from directing the use of and obtaining the benefits from an asset. Indicators
that control has passed to the customer include: a present obligation to pay; physical possession of the asset; legal title; risks and
rewards of ownership; and acceptance of the asset(s). Performance obligations can be satisfied at a point in time or over time.

 F- 11

 The Company considers both the Media Buyers and
Media Sellers to be its customers. However, currently, the Media Buyers do not pay the Company, and only the Media Sellers compensate
the Company for the use of the platform and other services. Fees or commissions are established differently for each Media Seller dependent
upon various variables, including anticipated volume.

 The performance obligations within the Company's
contractual arrangements with customers is satisfied upon the contract reconciliations being completed and accepted by the Media Buyer
and Media Seller.

 The Company has determined that it is acting
as an agent for the Media Seller as (i) NYIAX does not obtain control of the Seller's media (goods & services) before
transferring control to the Buyer. The Seller has control of the media. Specifically, NYIAX does not control the specified media before
transferring the media to the Media Buyer, the Company is not primarily responsible for the performance of the Media Seller, nor can
the Company redirect those services to fulfill any other contracts. (ii) NYIAX does not have inventory or credit risk for the media.
And (iii) the Media Seller establishes the pricing in the Smart-Contracts (self-executing contracts with the terms of the agreement
between buyer and seller standardized.) and the Media Buyers and Media Sellers agree on the pricing.

 Based on these and other factors, the Company
has determined it acts as an agent in the purchase and sale of advertising media inventory and therefore reports revenue on a net basis
for the commissions and fees the Company charges after the performance obligations are met.

 Cost of sales

 Cost of sales consists of datacenter costs (our
cloud operations used by our platform to service our customers), amortization expense related to capitalized internal use software development
costs, and personnel costs. Personnel costs include salaries, bonuses, share-based compensation, and employee benefit costs, and are
primarily attributable to groups which maintains our datacenters, and our client operations group, which is responsible for the integration
of new publishers and buyers and providing customer support for existing customers.

 Operating Expenses

 Technology and development expenses consist of
personnel costs, including salaries, bonuses, share-based compensation, and employee benefits costs, and professional services. These
expenses include costs incurred in (i) product development related to the front-end client user interface and back-end systems,
ongoing maintenance and operation of the platform, integrations with clients and partners applications. Except to the extent that such
costs are associated with software development that qualify for capitalization, which are then recorded as capitalized software development
costs; and (ii) infrastructure costs such as AWS or other cloud hosting solutions, software development tools used for the creation
and ongoing management and maintenance of the NYIAX platform and service.

 Selling, general and administrative expenses
consist of personnel costs, including salaries, bonuses, share-based compensation, and employee benefits costs, for our employees engaged
in sales, business development, executive, finance, legal, and human resources employees. Selling, general and administrative also include
expenses related to marketing activities and professional services outside such as legal and accounting services as well as rent expenses.

 Share-Based Compensation

 The share-based compensation expense related
to stock options and restricted stock awards which are referred to collectively as options and awards granted under the Company's
employee option plans, is measured and recognized in the financial statements based on the fair value of the awards granted. The fair
value of each option award is estimated on the grant date using the Black-Scholes option-pricing model. The Company uses the Black-Scholes
model to calculate the fair value for all options granted, based on the inputs relevant on the date granted, such as the fair value of
our shares, prevailing risk-free interest rate, risk-free interest rate, expected term at issuance, volatility, and dividend rate, etc.
The value of the portion of the award is ultimately expected to vest is recognized as expense in the statements of operations on an over
the requisite service periods. Awards are subject to forfeiture until vesting conditions have been satisfied under the terms of the award.
Determining the fair value of stock options awards requires judgement. The Company's use of the Black-Scholes option pricing model
requires the input of subjective assumptions.

 F- 12

 Income Taxes

 The Company records income tax expense in accordance with ASC - 740
Income Taxes, as amended mandating how uncertain tax positions should be recognized, measured, presented, and disclosed in the financial
statements. The standards require the evaluation of tax positions taken or expected to be taken in the course of preparing the Company's
tax returns to determine whether the tax positions are more-likely-than-not of being sustained upon examination by the applicable tax
authority, based on the technical merits of the tax position, and then recognizing the tax benefit that is more likely-than-not to be
realized. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax expense in the current reporting
period. The Company has analyzed its tax positions and has concluded that as of December 31, 2023 and 2022, no uncertain positions are
taken or are expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements.

 The Company's policy is to record interest expense and penalties
pertaining to income taxes in operating expenses. For the years ended December 31, 2023 and 2022, there were no interest and penalties
expenses recorded and no accrued interest and penalties.

 Deferred tax assets and liabilities are recognized for the future
tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and
their respective tax bases. Deferred tax assets, including net operating loss carryforwards ("NOL's"), and liabilities,
are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected
to be recovered or settled.

 The effect on deferred tax assets and liabilities of a change in tax
rates is recognized in income in the period that includes the enactment date. Deferred income tax expense represents the change during
the period in the deferred tax assets and deferred tax liabilities. Deferred tax assets are reduced by a valuation allowance when, in
the opinion of management, more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

 Realization of the deferred income tax asset is dependent on generating
sufficient taxable income in future years. The Company has not generated any taxable income and as of December 31, 2023, does not assume
it will generate taxable income for the purpose of recognizing a deferred tax asset. The amount of the deferred income tax asset considered
realizable, if any, could be reduced in the near term if estimates of future taxable income are reduced.

 Earnings Per Share

 In accordance with ASC-260 Earnings Per Share,
basic earnings per share (EPS) is calculated by dividing the net income attributable to common stockholders by the weighted-average number
of shares of common stock outstanding. Diluted net income per share per share is computed by dividing net income by the weighted average
number vested of common shares, plus the net impact of common shares (computed using the treasury stock method), if dilutive, resulting
from the exercise of dilutive securities. In periods when losses are reported, the weighted-average number of common shares outstanding
exclude common stock equivalents because their inclusion would be anti-dilutive. The Company has issued employee incentive options and
warrants. These employee incentive options and other warrants are excluded from the calculation as the employee incentive options and
warrants are anti-dilutive.

 F- 13

 As of December 31, 2023 and 2022, the Company
excluded the common stock equivalents summarized below, which entitle the holders thereof to ultimately acquire shares of common stock,
from its calculation of earnings per share, as their effect would have been anti-dilutive.

 For the Years Ended

 2023

 2022

 Equity Incentive Plans

 2,934,038

 3,086,626

 Common Stock Issuable Upon Conversion of Convertible Notes, including PIK Interest

 602,921

 1,506,829

 Selling Agent and Advisor Warrants

 23,538

 23,538

 Warrants Issued with Common Stock Offerings

 932,374

 889,500

 Warrants Issued with Convertible Notes Offerings

 1,133,400

 947,150

 5,626,271

 6,453,643

 During 2022, approximately 235,693, warrants
issued with convertible notes payable were exercised for proceeds of approximately $ 1,285,800, respectively.

 Recently Issued Accounting Pronouncements

 ASU No. 2016-13, Financial Instruments —
Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments requires entities to use a current lifetime expected
credit loss methodology to measure impairments of certain financial assets. The Current Expected Credit Losses model ("CECL"),
could result in earlier recognition of credit losses than under the current incurred loss approach, which requires waiting to recognize
a loss until it is probable of having been incurred. There are other provisions within the standard that affect how impairments of other
financial assets may be recorded and presented, and that expand disclosures. The Company adopted the new standard effective January 1,
2023 and applied to accounts receivable and other financial instruments. The adoption of this guidance did not materially impact the
net earning and financial position and has no impact on the cash flows.

 Other ASUs recently issued were assessed and determined
to be either not applicable or are expected to have minimal impact on the Company's financial position or results of operations.

 In August 2020, the FASB issued No. 2020-06,
Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity's
Own Equity (Subtopic 815-40) — Accounting for Convertible Instruments and Contracts in an Entity's Own Equity. The amendments
are effective for fiscal years beginning after December 15, 2023. The Company evaluated any potential impact from ASU 2021-07 and believes
it will have no material impact on our financial results OPEN.

 Note 3 –Litigation and Contingencies

 Investor Litigation Complaint

 Investor Litigation Complaint On November 17,
2023, certain individual investors (the "Investors") in NYIAX filed a complaint (the "Complaint") in the United
States District Court for the Southern District of New York (the "Court") against the Company, Robert Ainbinder, Jr., a director
of the Company since April 2016 and former chief executive officer from August 2019 until May 2022, Westpark Capital, Inc., and Michael
Ainbinder, Robert Ainbinder Jr.'s brother. The complaint alleges, among other allegations, that the defendants, together or in
their individual capacity, (i) violated Section 10(b) and Rule 10b-5 of the Exchange Act, (ii) violated Sections 206(1) and 206(2) of
the Advisers Act (15 U.S.C. §§ 80b-6(1) and 80b-6(2)), (iii) committed fraud, (iv) committed negligent misrepresentation and
omission, (v) breached fiduciary duties, (vi) breached contracts, (vii) breached duties of good faith and fair dealing, and (viii) committed
negligence by, among other things, making material misrepresentations of fact related to plaintiffs' investments in the Company
and omitting material facts while soliciting plaintiffs' investments in the Company.

 The Investors paid $ 1,227,500 for 315,240 shares
of common stock in various private placement offerings of the Company. $ 1,050,000 of the purchases were made during 2016, 2017 and 2018
for an aggregate of 277,906 shares of common stock; and $ 177,500 of the purchases were made during 2020, 2021 and 2022 for an aggregate
of 37,334 shares of common stock. The Investors are seeking compensatory damages of $ 1,277,500, plus punitive damages of treble the compensatory
damages, along with interest and attorney's fees.

 F- 14

 Additionally, the Company has certain indemnification
obligations to WestPark resulting from this litigation and the various engagement letters executed with WestPark, and WestPark has given
notice of indemnification to the Company.

 The Company has concluded that it is not possible
to assess the likelihood of a loss at this time.

 The case underlying the Complaint could impede
our ability to raise funds and may have a material adverse effect on the Company's business, financial condition, operating results,
or cash flows.

 The Company intends to vigorously defend its
positions. However, there can be no assurances that the Company's contentions and affirmative defenses in response to claims will
be successful in the Court or in arbitration.

 Threatened Litigation

 On March 23, 2021, the company entered into an
engagement letter (the "Engagement Letter") with Boustead Securities, an advisor to the Company for certain corporate financing
transactions. The Engagement Letter provided for Initial Public Offering ("IPO"), Pre-IPO and corporate finance transaction
advice and the advisor expressed its intent to enter into an underwriting agreement with the Company to act as the lead underwriter for
the proposed IPO on a firm commitment basis.

 The Engagement Letter terminates on the later
of (i) eighteen (18) months from the date executed (March 23, 2021) or (ii) twelve months from the completion date of the IPO and the
term may be extended pursuant to the engagement letter. Also, the Company agreed that the advisor shall have the right of first refusal
(ROFR) for two (2) years from the consummation of a transaction or termination or expiration of the Engagement Letter to act as advisor
or as joint financial advisor under at least equal economic terms to the Engagement Letter.

 In accordance with the Engagement Letter, NYIAX
had engaged Boustead Securities as its sole representative, underwriter and financial advisor. The Company was unable to complete the
initial public offering at such time. NYIAX requested the SEC declare the offering effective. Upon the SEC approval NYIAX became a 1934
Securities Act reporting company with all the related responsibilities and costs.

 On February 14, 2023, the Registration Statement
on Form S-1 filed by the Company with the Securities and Exchange Commission (the "SEC") was declared effective by the SEC.
The Company's financial advisor, representative and lead underwriter for the Offering was Boustead Securities LLC ("Boustead").
Boustead informed the Company of its decision not to price and consequently the Company was unable to complete the initial public offering
at such time NYIAX requested the SEC declare the Registration Statement on Form S-1 effective. Upon the SEC approval, NYIAX became a
1934 Securities Act reporting company with all the related responsibilities and costs.

 During the time the Company was engaged with
Boustead with respect to the IPO, the Company raised approximately $ 10.0 million in private transactions. Based on the formula in the
Engagement Letter, the commissions on such amount were approximately $ 588,000, which has been acknowledged by Boustead and are accrued
in our Financial Statements as of December 31, 2023. Additionally, the Company issued Boustead 23,538 warrants to purchase NYIAX common
stock at a per share exercise price of $ 4.00.

 On April 7, 2023, the Company received a demand
letter from Boustead. Boustead claims that the Company owes or will owe Boustead approximately $ 1 million for commissions on funds privately
raised by the Company during its engagement with Boustead and approximately $ 1.2 million if the Company completes an IPO with another
underwriter. The Company disputes the amounts owed that have been claimed by Boustead and further is of the belief that if any commissions
are due to Boustead, they would be significantly less than the amounts claimed by Boustead.

 F- 15

 Boustead may claim that the Company owes or will
owe Boustead approximately $ 1 million for commissions on funds privately raised by the Company during its engagement with Boustead and
approximately $ 1.2 million if the Company completes an IPO with another underwriter.

 There can be no assurance that Boustead will
not initiate a lawsuit to recover the amounts it claims are owed and any such litigation could impede our ability to complete a capitalization
and could negatively affect our financial condition. There can be no assurance that the Company will prevail in any lawsuit it commences
against Boustead. The Company disputes the amounts owed that have been claimed by Boustead and further is of the belief that if any commissions
are due to Boustead, they would be significantly less than the amounts claimed by Boustead. There is a probability that the Company and
Boustead will end up in litigation over claims by Boustead against the Company and claims by the Company against Boustead. Litigation
is expensive and time consuming with uncertain outcomes. The Company has concluded that it is not possible to assess the likelihood of
a loss at this time.

 The Company intends to vigorously defend its
positions regarding the payment of any commissions to Boustead, however there can be no assurances that the Company's contentions
and affirmative defenses in response to claims by Boustead for any commissions will be successful in the event that the issue of Engagement
Letter termination and the entitlement to, and amount of, commissions pursuant to the Engagement Letter are contested by Boustead in
a court of law or arbitration or if the matter is otherwise settled by the Company and Boustead.

 Note 4 — Commitments

 Employment Agreements

 The Company has entered into employment agreements
with executive managers. Generally the agreements are "at will" agreements and have a termination benefit of up to three months
of salary.

 On May 23, 2022, the Company and Carolina Abenante
entered into an employment agreement and general release, pursuant to which Ms. Abenante agreed to be employed as Co-Founder, Chief Strategy
Officer, Chief Evangelist, Vice Chairperson and Director of the Company. The agreement automatically renews for one year on each anniversary
date, unless it is terminated earlier with 30 days' written notice by either party prior to each renewal. As compensation, the
Company agreed to pay Ms. Abenante (i) a base salary at the rate of $ 255,000 per annum except that for the period of May 16, 2022 through
July 15, 2022, Ms. Abenante's base salary will be $ 100,000 per year; and (ii) an annual discretionary bonus of 20 % of the actual
paid base salary.

 On May 24, 2022, the Company and Mark Grinbaum
entered into a consulting agreement, pursuant to which Mr. Grinbaum agreed to perform services in the role of Co-Founder and Executive
Vice President of Financial Products of the Company, which is a part-time non-exclusive position for twelve months. The Company agreed
to pay Mr. Grinbaum a base compensation of $ 90,000 per year.

 Nasdaq Licensing Fees

 The Company and Nasdaq, Inc ("NASDAQ")
have entered into a Joint Intellectual Property and an Information Technology Services Agreement. Nasdaq provides cloud-based marketplace
technology to NYIAX, and NYIAX custom software instance of Nasdaq's technology is a backend infrastructure component of that processes.

 Pursuant to an IT Services Agreement, as amended
in December 2020, commencing April 2022, NYIAX was obligated to compensate NASDAQ an annual license fee of $ 350,000 (plus certain
escalations which are currently $ 17,500) and revenue sharing of 0.5 % to 10 % of revenue depending upon various criteria.

 F- 16

 The Company recognizes expenses related to the
NASDAQ annual licensing fee in the period for the which the services related to the annual license are utilized and recognizes expenses
related to the NASDAQ revenue sharing in the period that the Company recognizes revenue related to the NASDAQ agreements.

 For the years ended December 31, 2023 and 2022,
the Company recorded approximately $ 363,000 and $ 262,500, respectively, of expense related to the annual license fee which were recorded
as technology and development costs. For the years ended December 31, 2023 and 2022, the Company recorded approximately $ 132,400 and
$ 70,000, respectively, of expense related to the revenue sharing which were recorded as cost of sales.

 Note 5 — Shareholder
Equity:

 Authorized and Outstanding Shares

 As of December 31, 2023 and 2022 the Company
had authorized 135,000,000 shares consisting of 125,000,000 shares of common stock and 10,000,000 shares of preferred stock each with
a par value of $ 0.0001.

 As of December 31, 2023 and 2022, there were
 15,611,827 and 12,370,002 common shares outstanding, respectively.

 Issuance of Shares to Founders

 In 2016, the Company issued 4,233,696 shares
to Founders valued at par value, $ 0.0001 per share. The shares had various restrictions, primarily service periods and vested either
immediately or over three years. 604,832 shares were cancelled and did not vest. At December 31 2023 and 2022, 3,628,864 shares
were fully vested and outstanding.

 As discussed in Note 13 - Related Parties, Certain
shareholder-founders purchased $ 100,000 in the form of convertible notes in October 2023. These convertible notes payables to certain
shareholder-founders of $ 100,000 plus interest automatically converted to 50,328 common shares in December 2023 at a share price of $ 4.00
per share.

 Registration Rights and Restrictions of Previous
Offerings

 Investors in the August 2016, July 2017,
June 2018, July 2019, and April 2020 Offerings (collective, "Previous Offering(s)") were entitled to standard
"piggyback" registration rights on all registrations of the Company effected for other investors.

 In connection with the Previous Offerings, each
investor also entered into a Shareholder Agreement with the Company which contains restrictions on transfer of the shares purchased including
lock-up provision pursuant to which no person may sell or transfer any shares acquired or any other shares held by it until 180 days
from the date of an initial public offering of the Company.

 Convertible Notes Payable Conversions to Common Stock

 On February 7, 2023, the 2022 Convertible Note
Payable and 2023A Convertible Note Payable, including an aggregate principal amount of $ 2,670,000 (excluding deferred debt discount
and amortization of discount) and accrued payment-in-kind interest of approximately $ 110,586 converted to 1,441,497 converted to common
shares in July 2023 shares of common stock.

 On December 21, 2022, the December 2021 Convertible
Note Payable, including an aggregate principal amount of $ 50,000 (excluding deferred debt discount and amortization of discount) and
accrued payment-in-kind interest of approximately $ 5,000 converted to 11,000 shares of common stock.

 On May 30, 2022, the 2021 Convertible Note Payable,
including an aggregate principal amount of $ 7,176,335 (excluding deferred debt discount and amortization of discount) and accrued payment-in-kind
interest of approximately $ 742,700 converted to 1,583,807 shares of common stock.

 F- 17

 Issuance of Common Stock for Patents

 On July 8, 2023, Company completed the purchase
of a portfolio of patents and trade secrets from Network Foundation Technologies, LLC ("NIFTY"). The Company issued 2,000,000
shares of its common stock to NIFTY as consideration for the Portfolio. The 2,000,000 shares of common stock of NYIAX have various registration
restrictions and provisions for the clawback of shares by the Company in certain events as set forth in the Asset Purchase Agreement.
A purchase price of approximately $ 4 million was recorded as of July 8, 2023 for the Portfolio.

 Warrant Exercises

 During 2022, 418,473 warrants issued with convertible
notes payable were exercised for proceeds of approximately $ 1,285,809.

 Contingent Share Issuances

 In addition to the common stock equivalents excluded
from the Company's the Company's calculation of earnings per share the Company has approved the following contingent share
issuances:

 The Company has agreed with a vendor
that simultaneous with the time the Company's common stock becomes publicly traded, the Company will sell to a vendor and the vendor
will purchase from the Company 115,468 common shares for a purchase price equal to $ 461,872 of outstanding accounts payable. If the closing
does not occur by April 1, 2025, this contingent share issuance may be terminated by vendor by written notice to the Company.

 On June 21, 2023, the Board of Directors
contingently granted three Director Nominees 525,000 of restricted stock units upon effective upon his appointment as director and upon
the first day of trading of the Company's common stock on the NASDAQ Exchange with the award vesting one-third at grant date and
the remainder vesting quarterly over a two-year period.

 On June 21, 2023, the Board of Directors
contingently granted certain employees restricted stock units and options contingent upon the first day of trading of the Company's
common stock on the NASDAQ Exchange. A total of 400,000 contingent restricted stock ( 200,000 with a 4 year vesting schedule from IPO
and 200,000 vesting at IPO) and 200,000 contingent incentive stock options, with a strike price of $ 4.00 per share, vesting quarterly
over 4 years from the IPO date remain outstanding.

 Principal Stockholder Share-based Payment
Award

 On November 11, 2022 principal stockholders transferred
 100,000 of their shares, 50,000 each, to a contractor of the Company; The Company valued the awards on those dates at the most recent
price per unit sold by the Company, or $ 5.00 per share. The expenses, approximately $ 200,000, was recorded as share-based compensation
for the twelve months ended December 31, 2022. There were no performance conditions, in the periods the share-based payment were granted.
The Company expensed the awards as share-based compensation as consistent with the Codification of Staff Accounting Bulletins Topic 5:
Miscellaneous Accounting, T. Accounting for Expenses or Liabilities Paid by Principal Stockholder(s).

 Warrant Exercise/Deemed Dividend from Inducement
to Exercise Warrants

 Effective January 13, 2022, as an inducement
to warrant holders to exercise their warrants issued previously with common stock offerings, the Company reduced the exercise price to
$ 5.50 from $ 6.50 – $ 6.60 until March 25, 2022.

 Approximately 235,693 warrants were exercised
at $ 5.00 – 5.50 per share for the aggregate proceeds of approximately $ 1,285,833. 214,693 warrants were exercised resulting
from the Company's reducing the exercise price to $ 5.50 from $ 6.50 and 21,000 were exercised from previously issued warrants with
a strike price of $ 5.00 per share.

 F- 18

 As a result of these transactions, the Company
recognized a deemed dividend of approximately $ 28,600 resulting from the excess of the fair value of the modified warrants over the fair
value of the original warrants immediately before the modification.

 Equity Incentive Plans

 On September 6, 2016, the Board of Directors
adopted a 2016 Equity Incentive Plan (the "2016 Plan"). The 2016 Plan was approved by our shareholders on September 28,
2016. On January 18, 2018, the Board of Directors and shareholders adopted a 2017 Equity Incentive Plan (the "2017 Plan").
On April 23, 2021, the Board of Directors and shareholders adopted a 2021 Equity Incentive Plan (the "2021 Plan"). (collectively
the "Equity Incentive Plans").

 13,744,376 options have been authorized under
the Equity Incentive Plans as follows:

 Options

 Authorized

 2016 Plan

 1,139,544

 2017 Plan

 604,832

 2021 Plan

 12,000,000

 13,744,376

 The 2016 Plan shall continue in effect until
its termination by the Board; provided, however, that all Awards shall be granted, if at all, within ten (10) years from September 6,
2016. "Award" means an Option, Stock Appreciation Right, Restricted Stock Purchase Right, Restricted Stock Bonus, Restricted
Stock Unit, or Stock-Based Award granted under the 2016 Plan. Shares issued pursuant to the 2016 Plan are exempt from requirements of
registration and qualification of such securities.

 The 2017 Plan shall continue in effect until
its termination by the Board; provided, however, that all Awards shall be granted, if at all, within ten (10) years from December 15,
2017. "Award" means an Option, Stock Appreciation Right, Restricted Stock Purchase Right, Restricted Stock Bonus, Restricted
Stock Unit, or Stock-Based Award granted under the 2017 Plan. Shares issued pursuant to the 2017 Plan are exempt from requirements of
registration and qualification of such securities.

 The 2021 Plan shall continue in effect until
its termination by the Board; provided, however, that all Awards shall be granted, if at all, within ten (10) years from April 23,
2021. "Award" means an Option, Stock Appreciation Right, Restricted Stock Purchase Right, Restricted Stock Bonus, Restricted
Stock Unit, or Stock-Based Award granted under the 2021 Plan. Shares issued pursuant to the 2021 Plan are exempt from requirements of
registration and qualification of such securities.

 Payment of earned Stock-Based Awards shall be
as determined by the Board and as evidenced in the award agreement. Subject to the terms of the Plans, the Board, in its sole discretion,
may pay earned Stock-Based Awards in the form of cash or in shares of Stock (or in a combination thereof) that have an aggregate Fair
Market Value equal to the value of the earned Share-Based Awards.

 F- 19

 Options are not exercisable after the expiration
of ten (10) years after the effective date of grant of such Option. All exercises are subject to various the Equity Incentive Plan
restrictions.

 For the years ended December 31, 2023
and 2022, the Company recorded share based compensation as follows

 2023 — Share-based compensation

 Share-based compensation related to Equity Plans
was allocated as follows:

 Cost of sales

 $
 22,743

 53,544

 Sales, general and administrative

 503,715

 Total

 $
 580,002

 2022 — Share-based compensation

 Share-based compensation related to Equity Plans
was allocated as follows:

 Cost of sales

 $
 62,099

 59,734

 Sales, general and administrative

 2,179,902

 Total

 $
 2,301,735

 Of the total share-based compensation for the
twelve months ended December 31, 2023 of approximately $ 580,000 approximately $ 84,000 related to the issuance of restricted share units
and $ 496,000 related to the issuance of options and warrants.

 Of the total share-based compensation for the
twelve months ended December 31, 2022 of approximately $ 2.3 million, approximately $ 607,000 related to the issuance of restricted share
units, approximately $ 200,000 related to principal stockholder share-based payment award, and the remainder, $ 1,494,000 related to the
issuance of options and warrants.

 The fair value of options on the date of grant
was estimated based on the Black-Scholes option pricing model. The weighted average assumptions used to value options granted to employees
and warrants to contractors for the twelve-month period ending December 31, 2022, was as follows:

 Risk-free Interest rate

 2.8 %

 Expected Term at Issuance

 5 – 7 years utilizing the practical expedient method in accordance with ASC 718

 Volatility

 63.9% (The Company used an average volatility of comparable entities, to develop an estimate of expected volatility.)

 Dividend Rate

 No options or warrants were issued in 2023.

 F- 20

 The following table summarizes common stock option
and warrant award activity:

 Options

 Weighted
 Average
 Exercise
 Price

 Remaining
 Life

 Aggregate
 Intrinsic
 Value for
 the Activity
 During the
 Years

 Balance, January 1, 2022

 3,116,626

 $
 4.44

 7.0

 Granted

 517,500

 Exercised

 ( 6,060
)

 (Forfeiture)

 ( 555,000
)

 Balance, December 31, 2022

 3,073,066

 $
 5.22

 6.0

 Exercisable, December 31, 2022

 2,711,448

 $
 3.40

 7.1

 Balance, January 1, 2023

 3,073,066

 $
 5.22

 6.0

 Granted

 Exercised

 (Forfeiture)

 ( 139,028
)

 Balance, December 31, 2023

 2,934,038

 $
 3.46

 5.1

 Exercisable, December 31, 2023

 2,810,820

 $
 5.25

 2.9

 As of December 31, 2023, there were 123,218 unvested
options to purchase shares of the Company's common stock and approximately $ 324,000 of unrecognized share-based compensation expense
that the Company expected to recognize over the next twelve months.

 As of December 31, 2022, there were 367,678 unvested
options to purchase shares of the Company's common stock and approximately $ 1,099,000 of unrecognized share-based compensation
expense that the Company expected to recognize over the next twelve months.

 The fair value of the warrants issuable according
to the original terms of the original contracts were estimated immediately before the modification based on the Black-Scholes option
pricing model. The weighted average assumptions used to value the investor warrants for the periods presented were as follows:

 Risk-free Interest rate

 1.64 %

 Expected Term at Issuance

 6.4 – 8.2 years

 Volatility

 69.2 %

 Dividend Rate

 F- 21

 Note 6 — Convertible Notes
Payable

 2022 Convertible Note Payable

 During 2022, the Company sold convertible note
payable (the "2022 Convertible Note Payable")

 The 2022 Convertible Note Payable convert at
$ 2.00 per share concurrently when shares of common stock are sold to the public in the financing event; or in the event the financing
event is not completed within eighteen (18) months from the date of the individually issued notes, the Conversion Price, reduced from
the original conversion price of $ 4.00 per share, was two dollars ($ 2.00) per share and the Conversion Amount shall automatically be
converted into common stock of the Company at $ 2.00 per share on the Maturity. The 2022 Convertible Note Payable carry an annual rate
of return of twelve ( 12.0 %) percent simple interest and all interest and principle are paid in the Company's Common Shares
at a value of five ($ 2.00) dollars per share, or, as Payment-in-Kind, or P-I-K. Interest shall be paid quarterly until maturity date.
Additionally, concurrently, with the 2022 Convertible Notes, the Company issued with the 2022 Convertible Notes Warrant (the "Warrants")
at a rate of one (1) Warrant for every $ 10 of Notes purchased. Each Warrant shall be exercisable for a period of five ( 5) years at a
price of $ 5.50 per share.

 $ 2,570,000 of 2022 Convertible Note Payable
were sold, 257,000 Warrants were issued.

 The warrants did not contain obligations of the
Company to (i) redeem the warrants for cash or other assets, (ii) repurchase the Company's equity shares by transferring
assets, or (iii) to issue a variable number of equity shares and in accordance with ASC480 Distinguishing Liabilities from Equity,
the Company is accounting for the conversion feature and the warrants as equity. In accordance with ASC 480 written put options and warrants
to issue redeemable equity securities. The relative value of the beneficial conversion features and the warrants are recorded as deferred
debt discount and amortized over the term of the convertible note using the effective interest method. The deferred debt discount is
being amortized over the life of the convertible note payable.

 The warrants were calculated by the Black-Scholes
formula, were allocated to the convertible note payable debt discount. The inputs for the Black-Scholes formula, were as follows:

 Term — 3 -
 18 months (maturity date of the convertible notes)

 Risk-free Interest Rate — 3.1 %
to 4.4 %, average of 3.9 % (US Treasury rates)

 Dividend Rate 0 (Historical
amounts)

 Volatility 69.5 - 82.5 %

 On November 14, 2022, the board of directors
modified the terms of the 2022 Convertible Note Payable and decreased the conversion from $ 4.00 to $ 2.00. This modification was recorded
in accordance with ASC-470. The gain on debt modification of $ 208,811 was recognized for the year ending December 31, 2022. The gain
is being amortized over the life of the debt.

 In connection with the issuance of the 2022 Convertible
Notes Payable, the Company recorded compensation of approximately $ 205,600 and 66,413 of warrants to our financial advisor. The Warrants
issued had an exercise price of $ 2 -$ 4.00 per share.

 The cash payments have not been paid and was
included in accounts payable and accrued expenses as of December 31, 2022.

 F- 22

 The debt discount of the warrants remaining after
termination was calculated by the Black-Scholes formula. The inputs for the Black-Scholes formula, were as follows:

 Term — 13 - 15 months

 Risk-free Interest Rate — 4.5 %
to 4.7 %, average of 4.6 %

 Dividend Rate 0

 Volatility 77.3 - 82.5 %

 2022 Convertible Note Payable at Issuance

 $
 2,570,000

 Deferred debt discount and payments to advisor

 ( 529,811
)

 $
 2,040,189

 Amortization of debt discounts for period

 315,546

 2022 Convertible Note Payable as of December 31, 2022

 $
 2,355,735

 2022 Convertible Note Payable as of December 31, 2023

 $

 2023A Convertible Note Payable

 On January 10, 2023, the Company commenced
a Convertible Notes Offering ("2023A Convertible Note Payable") pursuant to which it offered up to $ 500,000 of convertible
notes. A total of $ 200,000 of the 2023A Convertible Notes were sold.

 The 2023A Convertible Notes convert at two dollars
($ 2.00) per share concurrently when shares of common stock are sold to the public in the Financing Event (defined as declaring the registration
statement effective), or in the event the Financing Event is not completed within eighteen (18) months from the date of the individually
issued notes, the Conversion Price shall be the price of two dollars ($ 2.00) per share and the conversion amount shall automatically
be converted into common stock of the Company at $ 2.00 per share on the Maturity Date. The annual rate of return is twelve percent ( 12.0 %)
per annum, which was paid as a Payment-in-Kind in the Company's common stock valued at two dollars ($ 2.00) per share. Concurrently
with the sales of the 2023A Convertible Note Payable, warrants (the "Warrants") were issued at a rate of one (1) Warrant
for every ten dollars ($ 10) principal amount of notes purchased. Each Warrant shall be exercisable for a period of five ( 5) years
at a price of $ 5.50 per share.

 The warrants did not contain obligations of the
Company to (i) redeem the warrants for cash or other assets, (ii) repurchase the Company's equity shares by transferring
assets, or (iii) to issue a variable number of equity shares and in accordance with ASC480 Distinguishing Liabilities from Equity,
the Company is accounting for the conversion feature and the warrants as equity. In accordance with ASC 480 written put options
and warrants to issue redeemable equity securities. The relative value of the beneficial conversion features and the warrants were recorded
as deferred debt discount of $ 16,000 and amortized over the term of the convertible note using the effective interest method.

 The outstanding principal balance of the 2023A
Convertible Notes and all accrued interest automatically converted into 100,933 shares of common stock of the Company on February 7,
2023, immediately prior to the Company's receipt of an effective order from the SEC declaring the registration statement of its
initial public offering effective.

 F- 23

 2023B Convertible Note Payable

 On April 3, 2023, the Company commenced
a Convertible Notes Offering ("2023B Convertible Note Payable") pursuant to which it will offer up to $ 2,000,000 of
convertible notes.

 The 2023B Convertible Notes convert at two dollars
($ 2.00) per share concurrently when shares of common stock are sold to the public in the Financing Event, or in the event the Financing
Event is not completed within eighteen (18) months from the date of the individually issued notes, the Conversion Price shall be
the price of two dollars ($ 2.00) per share and the conversion amount shall automatically be converted into common stock of the Company
at $ 2.00 per share on the Maturity Date. The annual rate of return is twelve percent ( 12.0 %) per annum, which shall be paid as a Payment-in-Kind
in the Company's common stock valued at two dollars ($ 2.00) per share. Concurrently with the issuance of the 2023B Convertible
Notes Payable, the company issued warrants (the "Warrants") The Warrants were issued at a rate of one half warrant issued
for every $ 10 of notes purchased with an exercise price of four dollars ($ 4.00) and one half warrant issued for every $ 10 of notes purchased
with an exercise price of two dollars ($ 2.00). Each Warrant shall be exercisable for a period of five ( 5) years. $ 1,970,000 of 2023B
Convertible Note Payable were sold and the note offering was closed.

 The warrants did not contain obligations of the
Company to (i) redeem the warrants for cash or other assets, (ii) repurchase the Company's equity shares by transferring
assets, or (iii) to issue a variable number of equity shares and in accordance with ASC480 Distinguishing Liabilities from Equity,
the Company is accounting for the conversion feature and the warrants as equity. In accordance with ASC 480 written put options
and warrants to issue redeemable equity securities.

 The warrants and beneficial conversion option
was recorded as the convertible note payable debt discount. The inputs for the Black-Scholes formula, were as follows:

 Term — 12 months

 Risk-free Interest Rate — 4.59 % – 5.25 %

 Dividend Rate 0

 Volatility 75.2 % – 78.7 %

 The following table illustrates the value of
the 2023B convertible note payable as of December 31, 2023:

 2023B
 Convertible
 Note Payable

 2023B Convertible Note Payable at Issuance

 $
 1,970,000

 (Deferred Debt Discount)

 ( 704,975
)

 $
 1,265,025

 Amortization of debt discount for period ending December 31, 2023

 704,975

 Balance December 31, 2023

 $
 1,970,000

 Note 7— Income Taxes –

 NYIAX, Inc. is taxed as a "C" Corporation subject to federal,
state and local income taxes.

 For the years ended December 31, 2023 and 2022, NYIAX did not have
any income for tax purposes and therefore, no current tax liability or expense has been recorded in these financial statements.

 F- 24

 A reconciliation of income tax expense computed at the statutory federal
income tax rate to the provision for income taxes for the years ended December 31, 2023 and 2022 is as follows:

 2023

 2022

 Net Loss for the Year

 $
)

 $
)

 Statutory federal income tax rate

 %

 %

 Tax benefit using statutory federal income tax rate

 $
 ( 1,832,221
)

 $
 ( 2,333,978
)

 State and local taxes, net of federal benefit

 ( 171,007
)

 ( 965,370
)

 Non-deductible expenses, net of federal income tax rate

 203,955

 328,290

 101,237

 430,501

 Change in valuation allowance

 ( 2,640,167
)

 2,685,199

 Start Up Costs

 -

 ( 146,490
)

 Other, net

 4,338,204

 1,848

 Income tax expense (benefit)

 $
 -

 $
 -

 Effective income tax rate

 %

 %

 At December 31, 2023, the Company has available Federal net operating
loss carryforwards ("NOLs"), of approximately $ 32.1 million (of which approximately $ 8,450,000 was generated in 2023) to reduce
future taxable income which do not expire but are limited to 80 % of taxable income and New York NOLs of $ 24.9 million of which approximately
$ 6,170,000 expires in 2040, $ 8,870,000 expires in 2041, $ 8,610,000 expires in 2042 and $ 1.2 million expires in 2043. Additionally, the
Company had California NOLs of approximately $ 5.5 million for 2023. The Company evaluates the need for a valuation allowance at each report
date.

 Management has determined that it is not more likely than not that
the deferred tax assets will be realized. A full valuation allowance is provided against the deferred tax assets at December 31, 2023
and 2022.

 Deferred tax asset at December 31, 2023 and 2022 consists of the following:

 2023

 2022

 Deferred tax asset

 Start-up costs

 $
 3,221,000

 $
 5,042,480

 Stock based compensation

 2,009,000

 2,738,028

 Section 174 Costs

 148,000

 101,398

 Net Operating Loss

 7,212,000

 7,377,234

 Other

 ( 44,000
)

 ( 81,973
)

 $
 12,546,000

 $
 15,177,167

 Valuation allowance

 $
 ( 12,546,000
)

 $
 ( 15,177,167
)

 Net deferred taxes

 $
 -

 $
 -

 F- 25

 Note 8— Purchase of Intellectual Property Portfolio

 On July 8, 2023, Company completed the purchase
of a portfolio of patents and trade secrets (the "Portfolio") from Network Foundation Technologies, LLC ("NIFTY").
The Company issued 2,000,000 shares of its common stock to NIFTY as consideration for the Portfolio. The 2,000,000 shares of common stock
of NYIAX have various registration restrictions and provisions for the clawback of shares by the Company in certain events as set forth
in the Asset Purchase Agreement. In 2007, a NYIAX director, Thomas F. O'Neill., and a NYIAX officer, Mark Grinbaum, Co-Founder
and Executive Vice President of Financial Products, purchased approximately 0.17 % (acquired for $ 50,000) and 0.35 % (acquired for $ 100,00)
of NIFTY, respectively and owned these amounts as of July 8, 2023. Neither Mr. O'Neill nor Mr. Grinbaum were a director or officer
of NIFTY.

 The Portfolio consists of a portfolio of eighteen
(18) patents and trade secrets, of which six of the patents are active. The Company will amortize the active patents over their useful
lives.

 The Company will use the Portfolio to enhance
its offerings for the buying and selling of media, advertising audience, and advertising inventory. Additionally, the Company will use
the Portfolio acquired from NIFTY to create new revenue streams in markets such as: (i) market data, (ii) streaming media (advertising,
livestreaming and video-on-demand), and (iii) the webinar market. NYIAX engaged an intellectual property valuation company to assess
the potential opportunities of the patents and trade secrets prior to our acquisition of the patents and trade secrets.

 The Company has concluded that the purchase of
this intellectual property portfolio is an acquisition of an asset group in accordance with ASC 805-10-55 and the Company utilized
a $ 2.00 share valuation as it was consistent with the Company's latest convertible notes offering, the 2023B Convertible Notes
Offering.

 A purchase price of approximately $ 4 million
was recorded as of July 8, 2023 for the Portfolio.

 The amortized cost as of December 31, 2023 was
as follows:

 Portfolio Cost

 $
 4,000,000

 Accumulated amortization as of December 31, 2023

 ( 595,042
)

 $
 3,404,958

 The Company will record amortization expense
of the Portfolio as follows:

 For the year ending December 31, 2024

 $
 1,190,083

 For the year ending December 31, 2025

 958,678

 For the year ending December 31, 2026

 517,906

 For the year ending December 31, 2027

 341,598

 For the year ending December 31, 2028

 264,463

 Thereafter

 132,230

 Total

 $
 3,404,958

 F- 26

 Note 9 — Capitalized Software
Development Costs -

 Capitalized software development costs, net of
amortization as of December 31, 2023 and 2022 was $ 196,572 and $ 393,157, respectively. The Company had gross capitalized software
development costs of $ 982,891 as of December 31, 2023 and 2022. The Company commenced amortizing the capitalized software development
costs in January 2020. For the years ended December 31, 2023 and 2022, the Company amortized $ 196,578 and $ 196,578 of
capitalized software development costs, respectively.

 In accordance with ASC 360 Impairment Accounting
for the Impairment or Disposal of Long-Lived Assets, the Company periodically reviews the carrying value of long-lived assets whenever
events or changes in circumstances indicate that the historical carrying value of the long-lived assets may have been impaired. Management
determined long-lived assets held at December 31, 2023 had not been impaired.

 Note 10 - Deferred Offering Cost Write-off

 It is the Company's policy to defer the
recognition of deferred offering costs Pursuant to the Codification of Staff Accounting Bulletins, Topic 5: Miscellaneous Accounting
A. Expenses of Offering. As of December 31, 2022, $ 848,531 of deferred offering costs were recorded on the balance sheet.

 On February 14, 2023, the Registration Statement
on Form S-1 filed by the Company with the Securities and Exchange Commission was declared effective by the SEC.

 In March, 2023, the Company's financial
advisor, representative and lead underwriter for the offering, Boustead Securities LLC ("Boustead"), informed the Company
of its decision not to proceed with pricing of the Company's Offering.

 In accordance with the Codification of Staff
Accounting Bulletins / Topic 5: Miscellaneous Accounting, the Company has written off these costs, $ 848,531, during the three-month period
ended March 31, 2023. And, for the three-month period ended September 30, 2023, the Company recorded $ 177,481 of deferred offering costs
which were written off during the three-month period ended September 30, 2023 as a result of Spartan Capital Securities, LLC's
decision not to continue as lead underwriter on October 6, 2023 (the Company engaged Spartan Capital Securities, LLC, as lead underwriter,
deal manager and investment banker for the Offering on April 12, 2023).

 Note 11 — Operating Leases

 For operating leases, the lease liability is
initially and subsequently measured at the present value of the unpaid lease payments. The Company generally uses its incremental borrowing
rate as the discount rate for leases unless an interest rate is implicitly stated in the lease. The Company's incremental borrowing
rate used for all leases under ASC 842 was 5.60 %, the rate of interest that the Company would have to pay to borrow an amount equal
to the lease payments on a collateralized basis over a similar term. The lease term for the Company's leases includes the noncancellable
period of the lease plus any additional periods covered by either a Company option to extend the lease that the Company is reasonably
certain to exercise, or an option to extend the lease controlled by the lessor. ROU assets, once recorded, are reviewed annually for
impairment.

 On September 1, 2021, the Company entered
into an operating sub-lease for office space at 180 Maiden Lane, New York, NY 10005 that commenced on November 1, 2021,
expires September 29, 2025, and on April 16, 2024 the lease was terminated early. Base rent is $ 14,814 per month, rent escalation
is 2 % per annum commencing on the first anniversary of lease commencement and there is a rent concession of three months following
the Company's possession of space. On the commencement date, the Company recorded a right-of-use asset and lease liability in the
amount of $ 563,713.

 F- 27

 Balance sheet information related to our leases
is presented below:

 Operating leases:

 Balance Sheet Location

 December 31, 2023

 December 31, 2022

 November 1,
 2021
 (Lease Commencement)

 Right-of-use assets

 Operating lease right-of-use asset

 $
 244,451

 $
 395,470

 $
 563,713

 Operating lease liability, current

 Current portion of operating lease obligations

 $
 175,585

 $
 162,503

 $
 106,810

 Operating lease liability, long-term

 Operating lease obligations, net of current maturities

 $
 92,800

 $
 268,385

 $
 456,903

 2023

 Weighted-average discount rate – operating lease

 5.6
 %

 Weighted-average remaining lease term – operating lease (in months)

 As of December 31, 2023, the expected annual minimum lease payments of our operating lease liabilities:

 For Years Ending December 31,

 Operating
 lease

 2024

 $
 186,177

 2025

 94,320

 Total future minimum lease payments, undiscounted

 $
 280,497

 Less: Imputed interest for leases in excess of one year

 12,112

 Present value of future minimum lease payments

 $
 268,385

 Note 12 — Related Party Transactions
-

 Payables to Shareholder-Founders

 At December 31, 2023 certain shareholder-founders
loaned the Company $ 264,000.

 $ 100,500
debt for reimbursement of certain expenses from 2016. On October 30, 2023, the Company entered into an agreement with shareholder-founders
whereby the debt converts to 25,124 shares immediately upon pricing of the Company's public offering.

 $ 163,500
in the form of convertible notes from November 27, 2023 through December 11, 2023. These convertible notes payables to certain shareholder-founders
of $ 163,500 plus interest automatically convert to common shares upon the completion of a financing event or within two (2) months from
the date of the convertible notes at a share price of $ 4.00 per share.

 In October 2023, certain shareholder-founders
purchased $ 100,000 in the form of convertible notes. These convertible notes payables to certain shareholder-founders of $ 100,000 plus
interest automatically converted to 50,328 common shares in December 2023 at a share price of $ 4.00 per share.

 At December 31, 2022 the Company had a payable
to certain shareholder-founders in aggregate amount of $ 100,500 for reimbursement of certain expenses from 2016.

 F- 28

 Related Party Transactions — Former
CEO

 The Company's former CEO is also
a shareholder and Director of the Company.

 The former CEO is a co-founder of a
private investment fund, GoldStreet Holdings Limited Partnership ("GoldStreet"). For the year ended December 31, 2022, the
Company recorded $ 10,000 of general and administrative expenses related to GoldStreet for office space. The
Company did not record any related party expenses related to GoldStreet for the twelve-month period ended December 31, 2023.

 During 2023, in connection with the closing of the Company's
IPO, certain NYIAX founders, owners, officers and employees agreed to defer $ 1,229,915 of compensation amounts, including payroll taxes,
owed by NYIAX. During 2023, certain NYIAX founders, owners, officers and employees agreed to forfeit $ 769,839 of deferred compensation
amounts, including payroll taxes, owed by NYIAX. The deferred compensation arose from a salary deferral program where each founder agreed
to defer a portion of their contractual salary or contractor fees. This forfeiture represents a permanent waiver of rights to this deferred
compensation.

 This event was recorded as a contra-expense
to selling, general and administrative expenses and a debit to accrued compensation.

 Note 13 — Subsequent Events

 Management has evaluated events that have occurred subsequent to the
date of these condensed financial statements and has determined that, other than those listed below, no such reportable subsequent events
exist through August 15, 2024 in accordance with FASB ASC Topic 855, "Subsequent Events." Based upon this review, the Company
did not identify any subsequent events that would have required adjustment or disclosure in the financial statement other than noted above
and below:

 Convertible Note Offerings

 2024A Convertible Note Payable

approximately $ 1.3 million in the 2024A Convertible Note Payable offering. The Offering consists of two-year convertible notes (the "Notes")
with 10 % interest payment-in-kind in Company common stock at two ($ 2.00) dollars, which shall be paid at maturity or upon conversion.
Additionally, the Company issued with the Notes, warrant coverage at the rate of one hundred ( 100 %) percent of the dollar value of the
Note at two ($ 2.00) dollars per share as the strike price of the Warrants. The Warrants are for a period of five ( 5) years.

 Upon completion of a subsequent financing
where the Company raises cumulative gross proceeds of at least $ 1,500,000 (the "Financing Event") the outstanding principal
balance of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as
those securities purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following:
the lower of (i) eighty-five ( 85 %) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($ 2.00)
dollars, but in no event less than one dollar and fifty cents ($ 1.50) per share. If a Financing Event shall not occur two (2) years from
the final Closing of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's
common stock at two ($ 2.00) dollars per share.

 2024B Convertible Note Payable

approximately $ 0.2 million in the 2024B Convertible Note Payable offering. The Offering consists of two-year convertible notes with 10 %
interest payment-in-kind in Company common stock at two ($ 2.00) dollars, which shall be paid at maturity or upon conversion. Additionally,
the Company issued with the Notes, warrant coverage at the rate of one hundred ( 100 %) percent of the dollar value of the Note at two ($ 2.00)
dollars per share as the strike price of the Warrants. The Warrants are for a period of five (5) years.

 Upon completion of a subsequent financing where
the Company raises cumulative gross proceeds of at least $ 1,500,000 (the "Financing Event") the outstanding principal balance
of the Notes and all accrued interest shall automatically convert into such securities under the same terms and conditions as those securities
purchased in Financing Event. The conversion price of the securities will be the price per share equal to the following: the lower of
(i) eighty-five ( 85 %) percent of the price paid by purchasers of securities in such Financing Event or (ii) two ($ 2.00) dollars, but in
no event less than one dollar and fifty cents ($ 1.50) per share. If a Financing Event shall not occur two (2) years from the final Closing
of the Offering, the outstanding principal balance of the Note and the accrued interest shall convert into the Company's common
stock at two ($ 2.00) dollars per share.

 F- 29

 Executive Employment Appointments

 Appointment of Chief Executive Officer

 On January 19, 2024, the Company's
Board of Directors appointed Teresa Gallo as the Chief Executive Officer (the "CEO") of the Company and joined the
Board of Directors on May 1, 2024. In connection with Ms. Gallo's appointment as CEO, the position of Interim Chief Executive Officer
was eliminated. Ms. Gallo's primary tasks as CEO will include the development and implementation of the Company's long-term
strategic plan for its digital advertising exchange platform.

 On January 19, 2024, the Company entered
into an employment agreement with Ms. Gallo (the "Agreement"). The term of the Agreement commenced on January 19, 2024 and
continues for two (2) years unless terminated earlier pursuant to the terms of the Agreement, and thereafter will be automatically renewed
for successive one (1) year periods, unless terminated earlier pursuant to the terms of the Agreement or unless either party provides
written notice of its intention not to extend the term of the Agreement at least 30 days prior to the Initial Term.

 Under the Agreement, Ms. Gallo will
receive an annual base salary of $ 400,000 plus healthcare and other benefits including, but not limited to, life insurance coverage,
expense allowances and indemnification.

 Ms. Gallo was granted restricted stock units with a grant date cash
equivalent value of $ 100,000, vesting 50 % after six (6) months on July 19, 2024, and the remaining 50 % vesting after one year on January
19, 2025.

 Also, upon public offering of the NYIAX
shares, Ms. Gallo has also received a contingent equity grants of 200,000 incentive stock options at $ 4.00 per share and 200,000 RSUs,
both with a 4-year quarterly vesting schedule.

 In the event the Company terminates
the Agreement without cause or does not renew the Agreement or Ms. Gallo terminates the Agreement for good reason, Ms. Gallo will be
entitled to receive, among other severance benefits, cash payments equal to twelve (12) months base salary, continued health and medical
benefits, and accelerated vesting of unvested stock equity pursuant to terms of the Agreement. In the event of termination for cause
by the Company, Ms. Gallo unearned salary, benefits and unvested stock equity grants terminate.

 Appointment of Director of Development
for Special Projects

 On May 4, 2024, the Company appointed
and entered into an employment agreement with Robert Ainbinder Jr. as the Director of Development for Special Projects of the Company.
Mr. Ainbinder's primary tasks as Director of Development for Special Projects include creating a successful Capital Attainment
Program, working with the CEO and management to designate, identify and create new business lines for the Company, and other duties as
mutually agreed to between the Mr. Ainbinder and the CEO. Mr. Ainbinder is also a Board member.

 On May 4, 2024, the Company entered into an employment agreement with
Mr. Ainbinder (the "Agreement"). The term of the Agreement commenced on May 4, 2024 and continues for a period of one (1)
year or until otherwise terminated in accordance with the provisions of the Agreement. This Agreement shall automatically renew for successive
four (4) month terms unless earlier terminated Under the Agreement. Mr. Ainbinder will receive an annual base salary of $ 225,000 plus
healthcare and other benefits. During the term, in addition to the base salary, Mr. Ainbinder will be eligible for a discretionary bonus
of up to 20 % of base salary which may be in cash, equity compensation, or base salary increases.

 As of June 30, 2024, certain NYIAX
founders, owners, officers and employees agreed to forfeit $ 308,083 of deferred compensation amounts, including payroll taxes, owed by
NYIAX. The deferred compensation arose from a salary deferral program where each founder agreed to defer a portion of their contractual
salary or contractor fees. This forfeiture represents a permanent waiver of rights to this deferred compensation.

 This event was recorded as a contra-expense
to selling, general and administrative expenses and a debit to accrued compensation.

 F- 30

 Payables to Shareholder-Founders and Conversion
to Common Shares

 During January 2024 the Company sold
$ 150,000 of convertible notes to certain shareholder-founders. The convertible notes payable, plus interest at 4 %, automatically converted
to 32,462 common shares during the three-month period ending March 31, 2024 at a share price of $ 4.00 per share.

 From November 27, 2023 through December
11, 2023 the Company sold $ 163,500 of convertible notes to certain shareholder-founders. These convertible notes payables to certain
shareholder-founders of $ 163,500 plus interest automatically converted to 41,145 common shares during the three-month period ending March
31, 2024 at a share price of $ 4.00 per share.

 During the three-month period ended
March 31, 2024 certain shareholder-founders purchased $ 21,000 of these convertible notes payable. These notes plus interest automatically
converted to common shares upon two (2) months from the date of the convertible notes at a share price of $ 4.00 per share.

 On February 8, 2024, certain shareholder-founders
advanced the Company $ 48,000. The advance, plus interest at 4 % per annum was repaid on April 10, 2024.

 Lease Termination

 Effective April 16, 2024, the Company's
operating sub-lease for office space at 180 Maiden Lane, New York, NY 10005 that commenced on November 1, 2021 was terminated.

 The Company does not anticipate a material
charge from the termination.

 Withdrawn Public Offering

 On February 12, 2024 the Registration
Statement on Form S-1 filed by the "Company with the Securities and Exchange Commission (the "SEC") was declared effective
by the SEC. The Company planned to offer 2,106,250 shares of common stock (or 2,422,188 shares of common stock if the underwriters exercised
their over-allotment option in full) at a price of $ 4.00 per share, for an aggregate offering of $ 8,425,000 (the "Offering").

 The Company's financial advisor,
representative and lead underwriter for the Offering was WestPark Capital, Inc. ("WestPark"). WestPark informed the Company
of its decision not to proceed with pricing of the Company's Offering on March 5, 2024.

 Appointment and Resignation of Directors

 On May 1,
2024, the Board of Directors (the "Board") of the Company appointed Teresa Gallo, the Company's CEO, independent Directors
Bruce Cooperman, Michael Garone and Paul Richardson as Directors of the Company. As of the date hereto, the independent Directors have
not been granted equity compensation for their services.

 On April 30,
2024, Thomas F. O'Neill, the Chairman of the Board of Directors of the Company advised the Board of the Company that he was resigning
as Chairman of Board effective April 30, 2024.

 F- 31

 ITEM 9. CHANGES AND DISAGREEMENT WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE

 None.

 ITEM 9A. CONTROLS AND PROCEDURES

 Evaluation of Disclosure Controls and Procedures

 We are continuing to develop and refine our disclosure
controls and other procedures that are designed to ensure that information required to be disclosed by us in the reports that we will
file with the SEC is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms and that
information required to be disclosed in reports under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
is accumulated and communicated to our principal executive and financial officers.

 As required by Rule13a-15(b) of the Exchange
Act, the Company has evaluated, under the supervision and with the participation of senior management, including our Chief Executive
Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures. Based upon our evaluation, our principal
executive officer and principal financial officer concluded that as of the end of the period covered by this report our disclosure controls
and procedures were not effective at the reasonable assurance level because of the material weaknesses in our internal control over financial
reporting described below.

 Management's Report on Internal Controls
Over Financial Reporting

 As required by SEC rules and regulations implementing
Section 404 of the Sarbanes-Oxley Act, our management is responsible for establishing and maintaining adequate internal control over
financial reporting.

 Our internal control over financial reporting
is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements
for external reporting purposes in accordance with US GAAP.

 Our internal control over financial reporting
includes those policies and procedures that:

 (1)
 pertain to the maintenance
of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of our company,

 (2)
 provide reasonable assurance that transactions are recorded as
 necessary to permit preparation of financial statements in accordance with US GAAP, and that our receipts and expenditures are being
 made only in accordance with authorizations of our management and directors, and

 (3)
 provide reasonable assurance
regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect
on the financial statements.

 Because of its inherent limitations, internal
control over financial reporting may not prevent or detect errors or misstatements in our financial statements. Also, projections of
any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions,
or that the degree or compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of our internal
control over financial reporting at December 31, 2023. In making these assessments, management used the criteria set forth by the Committee
of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control — Integrated Framework (2013).

 Based on our assessments and those criteria, management
determined that our internal controls over financial reporting were not effective as of December 31, 2023, material weaknesses exist in
the Company's internal control over financial reporting and disclosures. As defined in Exchange Act Rule 12b-2 and Rule 1-02 of
Regulation S-X, a material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting such
that there is a reasonable possibility that a material misstatement of the registrant's annual or interim financial statements will
not be prevented or detected on a timely basis.

 These weaknesses are that the Company was unable
to provide a timely financial reporting package in connection with the year end audits and quarterly reviews. In addition, the Company
identified material weaknesses in the revenue recognition process, expense reimbursement controls as well as errors over financial reporting
which required the Company to restate its prior years financial statements. These errors related to material adjustments over the Company's
accounting of deferred offering cost, debt discount, share-based payment awards and related disclosures. This was primarily the results
of the Company's lack of documentation of internal control in place, limited accounting personnel and lack of segregation of duties.

 Additionally, for the year ended December 31,
2022, there were material weaknesses identified in the Company's Information Technology General Controls ("ITGCs").
The control deficiencies identified were over the design of internal controls surrounding user access security, and change management
for the Company's internally developed applications and external financial-based software used by the Company. These deficiencies
were in regards to user access provisioning, terminations, user access review, change management, segregation of duties of developers
and migrators. The Company's ITGCs were not designed and not operating effectively to ensure (i) appropriate segregation of duties
were in place to perform program changes and (ii) activities of individuals with access to modify data and make program changes not being
appropriately monitored. These control deficiencies aggregated to a Material Weakness for Information Technology General Controls for
absence and limited or no presence of compensating IT Controls that mitigate the risk associated with the IT deficiencies. There is a
risk under the current circumstances that intentional or unintentional errors could occur and not be detected.

 This Report does not include an attestation report
of our independent registered public accounting firm due to our status as an emerging growth company under the JOBS Act.

 Remediation Measures

 We continue to expand our internal controls over
financial reporting and safeguarding of assets. In order to maintain and improve the effectiveness of our disclosure controls and procedures
and internal control over financial reporting, we have expended, and anticipate that we will continue to expend, significant resources,
including accounting-related costs, and significant management oversight. If any of these new or improved controls and systems do not
perform as expected, we may experience material weaknesses in our controls. Our current controls and any new controls that we develop
may become inadequate because of changes in conditions in our business. Further, weaknesses in our disclosure controls and internal control
over financial reporting may be discovered in the future. Any failure to develop or maintain effective controls or any difficulties encountered
in their implementation or improvement could harm our results of operations or cause us to fail to meet our reporting obligations and
may result in a restatement of our financial statements for prior periods. Any failure to implement and maintain effective internal control
over financial reporting also could adversely affect the results of periodic management evaluations and annual independent registered
public accounting firm attestation reports regarding the effectiveness of our internal control over financial reporting that we will
eventually be required to include in our periodic reports that will be filed with the SEC.

 During the past year, the Company has made the
following changes to improve the internal control over financial reporting and safeguarding of assets. The Company's controller
resigned in December, 2022 and a new controller was hired in January of 2023. The Company instituted new approval policies for expense
and payment approvals. Payment procedures now include segregation of duties, we established separation of duties for cash payments; all
payments require three approvals. Our travel and entertainment reimbursement (revisions of previous policies) policies have been revised.
Additionally, we reviewed payments to contractors to ensure proper tax reporting and hiring practices. We reinforced policies regarding
board approval over material contracts. And we will be retaining experienced accounting resources that have experience in SEC reporting
regulation after the a financing event is completed.

 Changes in Internal Control Over Financial
Reporting

 Other than those actions described above, there
have been no changes in our internal control over financial reporting (as defined in Rule13a-15(f) and 15d-15(f) of the Exchange Act)
that occurred during the quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.

 ITEM 9B. OTHER INFORMATION.

 None.

 ITEM 9C. Disclosure
Regarding Foreign Jurisdictions that Prevent Inspections

 None.

 ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

 All directors hold office for one-year terms
until the election and qualification of their successors. Officers are appointed by our Board and serve at the discretion of the board,
subject to applicable employment agreements. The following table sets forth information regarding our executive officers and the members
of our Board.

 Name

 Age

 Position

 Teresa
 Gallo (1) (2)

 Chief Executive Officer

 Carolina Abenante

 Co-Founder, Chief Strategy Officer, Chief Evangelist, Vice Chairperson
 and Director

 Chief Financial Officer and Treasurer

 Sergey Tsoy

 Chief Technology and Product Officer

 Mark Grinbaum

 Co-Founder and Executive Vice President of Financial Products

 Robert E. Ainbinder, Jr.

 Paul Richardson

 Director (1)

 Michael
 Garone

 Director (1)

 Bruce
 Cooperman

 Director (1)

 (1)

 Appointed to the Board May 1, 2024.

 (2)

 Ms. Teresa Gallo was appointed
 the Company's Chief Executive Officer on January 19, 2024. Christopher Hogan was appointed Interim Chief Executive Officer
 and President of NYIAX on May 26, 2022. With the recent appointment of our new Chief Executive Officer, the Interim Chief Executive
 Officer position previously held by Mr. Hogan has been eliminated, as planned.

 Teresa Gallo (Chief Executive Officer)

 Teresa
Gallo was appointed the Company's Chief Executive Officer on January 19, 2024 and joined the Board of Directors on May 1, 2024.
In 2023 Ms. Gallo founded Assemblage Digital, a boutique advisory firm focused on digital marketing, commercial strategies, and revenue
development for technology companies. From May 2020 to May 2023, Ms. Gallo served as Executive Vice President and General Manager at Kinneso,
a technology driven marketing and advertising agency and affiliate of Interpublic Group of Companies, Inc. ("IPG"), in New
York, New York. Ms. Gallo led Kinneso's global marketplace team and was responsible for organization design, strategy,
operations, revenue delivery, partnerships and market expansion of its business. From December 2018 to May 2020, Ms. Gallo served as
Chief Digital Officer for Orion, a subsidiary of IPG, where she oversaw Orion's worldwide digital business and designed the roll-out
and implementation of Orion's programmatic advertising platform for publisher and advertiser utilization. From October 2013 to
July 2018, Ms. Gallo served as Senior Vice President at OpenX, a programmatic advertising platform for publishers, advertisers,
and agencies. Ms. Gallo was responsible for OpenX's global corporate business development for publishers and advertisers. Prior
to joining Open X, Ms. Gallo was a founding executive at Cadreon, IPG's first global programmatic agency and she spent over
a decade at AOL ("AOL") in leadership roles. She is a respected, global speaker on advertising,
data, marketing and technology. Ms. Gallo currently
serves on the board of directors of the Rutgers University Center for Innovation Education, where she participated in framing the direction
and growth of the Rutgers's Innovation Center and its Professional Science master's degree in data. She attended Simmons
College in Boston, MA and executive study programs at Harvard University Extension School in Cambridge, MA. She resides in northern NJ
with her family.

 Carolina Abenante (Co-Founder, Chief Strategy Officer, Chief Evangelist,
Vice Chairperson and Director)

 Carolina Abenante is a Founder of NYIAX. She
became Vice Chairperson in 2016 and prior to the time the sole director NYIAX from 2011 to 2016. She was our President from June 2012
to April 2018 and later became our Chief Strategy Officer and General Counsel in April 2018. Starting from May 23, 2022, she
became our Chief Evangelist and Chief Strategy Officer, and at the same time ceased to be General Counsel. She has been in the New York
City technology and advertising industry since 1999, when she was the Director of Corporate Development for Juno Online Services, Inc. 1999-2000,
focusing on corporate development, mergers and acquisitions and domestic and international strategic partnerships. In 2001-2005,
she became the Senior Director of Business Development and was part of the digital advertising tech and advertising team for Reed Elsevier
Ltd (Reed Business Information), in the U.S. (NYSE and LSE listed) working with creating and developing partnership for business-to-business
publishing through the Reed Elsevier family of digital publication and bringing Reed Business Publications to foreign markets. In 2005-2009
Vice President/Sr. Director of Business Development, Legal and Policy for Phorm Inc. (AIM: PHRM), developing strategy,
legal framework in US and foreign jurisdictions namely the United Kingdom, Brazil, Italy, Spain, and China inroads into internationalization
of its brand and products for behavioral advertising collaborating with companies; such as, British Telecom. She later became a consultant
and legal counsel in strategy and business development from 2009 to 2015 for US and International start-ups and traditional publishers
seeking to develop new strategies for the development and creation of Programmatic advertising platforms, advertisement operation and
compliance, e-commerce, and privacy. Ms. Abenante holds a Bachelor of Science degree in Management and Finance from Seton Hall University
May 1992, a J.D. from New York Law School May 1997, and an M.B.A. in General Management from SDA Bocconi School of Management, Universita Luigi
Bocconi in Milan, Italy December 1998. She is a practicing attorney and a member of the Bar of the State of New Jersey. She sits
on various New Jersey Bar and committees of the New Jersey Bar Association (Tax and Media) and is a member of the American Bar Association.
She is a long-standing member of the International Association of Privacy Professionals. She is a member and on the board of Global Women
in Blockchain since 2018. She is a global speaker on advertising, advertising technology and compliance, as well as Blockchain. She has
been a featured speaker at Imperial College London, England, Web Summit in Lisbon, Portugal, IAB Blockchain and other forums multiple
times in the area of advertising, blockchain as a technology for compliance in advertising, and the intersection of AdTech to FinTech.
She was one of the consultants and experts for advertising and media for the Digital Chamber of Commerce's White Paper on Smart
Contracts and its legal implications published in September 2018. She is a featured advertising industry professional with articles
on options intersection with advertising and audience futures, data privacy and data clean rooms. She has spoken multiple times as a
featured speaker for TechUpForWomen on advertising, hiring, crypto currency and blockchain. Additionally, she is one of the
inventors of the NYIAX/Nasdaq AB US patent on "Systems and Methods for Electronic Continuous Trading of Variant Inventories"
(Patent No. 10,607,291).

 William Feldman (Chief Financial Officer and Treasurer)

 William Feldman joined NYIAX in February 2021 as Chief Financial
Officer and appointed as Treasurer in November 2021. Mr. Feldman is a seasoned agency leadership professional with over 25 years
of experience managing marketing services businesses, leading and negotiating the purchase and sale of business, negotiating media contracts
and creating new revenue/business models. Mr. Feldman was Chief Operating Officer and founder at SweetScience (a doing-business-as name
for Punch Innovation LLC) from 2017 to 2021, where he led all financial, client finance, work-flow and delivery, administration processes,
as well as media buying within the agency. Mr. Feldman had overseen SweetScience's growth to become #388 of the Inc.
500 for 2019. Mr. Feldman started his career at PriceWaterhouseCoopers LLP from 1984 to 1989, and continued to WPP Group
where he held several roles from 1989 to 1990, including Chief Financial Officer of SBG Partners and Enterprise IG from 1992 to 2002.
From 2002 to 2005, he was Corporate Controller at AKQA Inc., a digital design and communications agency in San Francisco now owned
by WPP. While at AKQA, Mr. Feldman opened AKQA's New York office and oversaw revenue growth of 2.5 times over a three-year
period. From 2006 to 2009, he was Senior Vice President at McCann WorldGroup, a subsidiary of Interpublic Group of Companies,
Inc., where he was responsible for the financial management of McCann's key clients, Intel and MasterCard. After that, from
2009 to 2012, Mr. Feldman was the Chief Financial Officer of Integrated Media Solutions, Inc. ("IMS"),
where he led its acquisition transaction by MDC Partners, Inc. Mr. Feldman received a Bachelor of Science degree from Binghamton
University. He is a Certified Public Accountant.

 Sergey Tsoy (Chief Technology and Product Officer)

 Sergey Tsoy joined NYIAX in January 2016 and was the Executive
Vice President of Development and Engineering of NYIAX from January 2016 to April 2018. Mr. Tsoy was appointed Chief Technology
and Product Officer in April 2018. He has worked as a software engineering manager in different capacities since 2005 on internet
and advertising related projects. He was the Director of Development for PubMatic, Inc. from 2014 to 2016. He was one of the core members
of the ad server development team of Mojiva, Inc. during the period of 2011 to 2014, managing a distributed team of engineers in
the United States and Russia. His main focus is on development planning, scheduling and budgeting, risk management and technical
and architectural guidance. Mr. Tsoy received a Ph. D. equivalent degree in Mathematics and BSc in Computer Science from Tomsk University,
Tomsk, Russia in 2006.

 Mark Grinbaum (Co-Founder and Executive Vice
President of Financial Products)

 Mark Grinbaum was one of the founders of NYIAX. He
had been our Executive Vice President of Products and Secretary until May 17, 2022, starting from which day he became our Executive Advisor
of Financial Products as a consultant and at the same time cease to be Executive Vice President and Secretary. He has been managing building
and adapting IT solutions for over 30 years with the last 20 in a senior management role in the financial industry including Deutsche
Boerse's International Securities Exchange ("ISE") for over 13 years from 1997 to 2011, and Dow Jones, Inc. for
12 years prior to the ISE. Among Mr. Grinbaum's accomplishments, as ISE's the Chief Technology Officer and
Architect, was adaptation of the European Options trading platform to meet U.S. standards allowing ISE to become the largest Equity
Options exchange in the world. After the ISE launch, reporting directly to Chief Information Officer, Mr. Grinbaum was responsible
for the interfaces that facilitated many initiatives for the ISE, as well as industry and regulatory initiatives. Mr. Grinbaum is
a graduate of St. Petersburg Electro Technical University, St. Petersburg, Russian Federation with a degree of Masters of Electrical Engineering
in 1976. Mr. Grinbaum is also the primary inventor of the Nasdaq AB/NYIAX patent.

 Robert E. Ainbinder, Jr. (Director and Director
of Business Development)

 Robert E. Ainbinder, Jr. has served as Director
of NYIAX since August 2016. From August 2019 to December 2020, Mr. Ainbinder served as Interim Chief Executive Officer of NYIAX, after
which he served as Chief Executive Officer from December 16, 2020 to May 26, 2022. Mr. Ainbinder is currently a compensated employee of
the Company. From 2020 to 2021, Mr. Ainbinder was at Univest Securities LLC. From 2015 to 2019, Mr. Ainbinder was a Vice President of
WestPark Capital, Inc. and served on the firm's Investment Banking Committee. He began his career in 1983 as a clerk on the floor
of the American Stock Exchange and went on to achieve positions and elevated responsibilities in private wealth management, as Vice President,
as Managing Director and as Director of Corporate Finance for various investment banking firms. In 2013, Mr. Ainbinder became the Managing
Director at Newport Coast Securities, Inc. where he managed a team of financial advisors. In this role, Mr. Ainbinder served as an investment
banker advising and executing transactions for public and private emerging growth companies. Mr. Ainbinder also holds the following FINRA
licenses: Series 63 (Uniform Securities Agent State Law Examination), SIE (Securities Industry Essentials Examination), Series 7 (General
Securities Representative Examination), Series 6 (Investment Company Products/Variable Contracts Representative Examination), Series 4
(Registered Options Principal Examination) and Series 24 (General Securities Principal Examination).

 On May 4, 2024, NYIAX appointed and entered into
an employment agreement with Robert Ainbinder Jr. as the Director of Development for Special Projects of the Company. Mr. Ainbinder's
primary tasks as Director of Development for Special Projects include creating a successful Capital Attainment Program, working with the
CEO and management to designate, identify and create new business lines for the Company, and other duties as mutually agreed to between
the Mr. Ainbinder and the CEO. Mr. Ainbinder is also a Board member.

 Paul Richardson (Director)

 Paul Richardson became an independent non-executive
Director of NYIAX on May 1, 2024. From 1996 to 2020, Paul Richardson served as a board member and Chief Financial Officer of WPP Group,
where he was responsible for WPP Group's worldwide functions in finance, information technology, procurement, property, treasury,
taxation, internal audit and corporate and social responsibility initiatives. Mr. Richardson initially joined WPP Group as Treasurer in
1992. At WPP Group, Mr. Richardson was involved with the company's M&A activity, including WPP's acquisitions of Young
& Rubicam, Grey Global Group, Taylor Nelson Sofres and 24/7 Real Media. In addition, he served a non-executive director of two companies
associated with WPP Group, Chime Communications PLC from 1997 to 2014 and STW Communications Group Limited in Australia from 1999 to 2020.
Prior to joining WPP, Mr. Richardson worked in Beecham Finance as Assistant Treasurer of Beecham Group (now GlaxoSmithKline) from 1982
to 1985 and as Deputy Treasurer at Hanson Trust from 1986 to 1992. He also served on the board of Ceva Group PLC (a subsidiary of Apollo.
Mr. Richardson trained as a Chartered Accountant in London with KPMG, and is a Fellow of the Association of Corporate Treasurers. Mr.
Richardson was also awarded the FTSE 100 Finance director of the year in 2007. He received a degree in 1979 from the University of East
Anglia in the United Kingdom.

 Michael M. Garone
(Director)

 Michael Garone became an independent non-executive
Director of NYIAX on May 1, 2024. Mr. Garone began his financial services career on Wall Street in 1977. Mr. Garone currently serves
as an Independent Financial Consultant with Garone Capital Management, a sole proprietorship, and has served in this role since November
2010. Mr. Garone brings over 45 years of experience managing both domestic and international businesses for top tier financial institutions.
To that end, Mr. Garone served as: Vice President and CFO of CM&M Futures Group from November 1984 to January 1990 and was Vice President
and CFO of Carroll McEntee & McGinley Securities, Inc. from November 1980 to November 1984 (both subsidiaries of HSBC Ltd.); President,
COO and Board member of Adler, Coleman & Co., an NYSE clearing member, from January 1990 to December 1991; Managing Director, CFO
and Board member of Serfin Securities, Inc. from January 1992 to December 1997 and Managing Director, CFO and Board member of Serfin International
Holdings, Inc. from January 1992 to December 1997 (both subsidiaries of Grupo Financiero Serfin); Executive Vice President and CFO of
ABSA Securities, Inc. from January 1998 to February 1999 (a subsidiary of Amalgamated Banks of South Africa); President, COO and Board
member of Erste Bank Artesia Securities, Inc., a jointly owned subsidiary of Erste Bank of Austria & Artesia Banking Group of Belgium,
from March 1999 to July 2002; CFO and COO of Union & Employee Affiliations, a subsidiary of USI Holdings Corp., from August 2002 to
December 2008. Mr. Garone received a Bachelor of Science degree in Business Management from St. Francis College in May of 1975. Mr. Garone
also received an MBA degree in Finance from Pace University in May of 1977. Mr. Garone held multiple FINRA licenses, which are currently
expired, including: SIE (obtained in February 2017), Series 66 (obtained in April 2011), Series 63 (obtained in November 2005), Series
7 (obtained in April 1990), Series 53 (obtained in November 1990), Series 4 (obtained in September 1990), Series 24 (obtained in June
1990), and Series 27 (obtained in July 1981).

 Bruce Cooperman (Director)

 Bruce Cooperman became
an independent non-executive Director of NYIAX on May 1, 2024. Bruce Cooperman is currently serving as Managing Partner at Nereus Advisors,
LLC, a management and operational consulting services company, and has served in this role since January 2014. He founded Nereus Advisors
in 2014 to provide financial and operational advisory services to businesses across two primary domains — financial technology and
B2B business software services. Using his experience in management, corporate governance, capital raising and strategic investing, Mr.
Cooperman provides insight and support to both management and investors. His clients are companies in the early or mid-stages of development
that want to take advantage of opportunities for company-building and process development. Mr. Cooperman previously served as the Chief
Financial Officer of Clearpool Group ("Clearpool"), an electronic trading software provider and independent agency broker
dealer, where he was responsible for the finance, treasury, tax, legal, human resources and other administrative functions. Mr. Cooperman
helped Clearpool grow and scale through strategic and operational development, directed several equity and debt capital raises, and was
integral in the sale of Clearpool to BMO Financial Group in April 2020. From November 2011 to January 2014, Mr. Cooperman was the Chief
Financial Officer of AppNexus, Inc., a Delaware company, where he guided AppNexus through a rapid growth stage in its development and
maturation. From February 1999 to November 2011, Mr. Cooperman was Chief Financial Officer of International Securities Exchange, Inc.
("ISE"), a Delaware company, where he directed ISE's initial public offering in 2005 and facilitated the sale of the
company to Deutsche Borse AG in April 2007. From May 1997 to February 1999, Mr. Cooperman was Senior Vice President at the Board of Trade
of the City of New York. From May 1993 to May 1997, Mr. Cooperman was Director of Finance and Information Technology at Fischer, Francis,
Trees & Watts, Inc., an investment advisory services company, where he directed the global operations of the finance and technology
divisions. From May 1984 to May 1993, Mr. Cooperman was Vice President in the Finance Division of Credit Suisse. Mr. Cooperman has served
on the boards of not-for-profit and private companies and has been management liaison to audit and compensation committees. He is well
versed in best practices of corporate governance, risk management and compliance. Mr. Cooperman is a graduate of the Ohio State University,
where he received a B.S. degree in Accounting and Computer Science in December 1980. He lives in Ashville, North Carolina, with his family.

 To our knowledge, during the past ten years,
none of our directors, executive officers, promoters, control persons, or nominees has:

 had any bankruptcy petition
filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was
a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time;

 been convicted in a criminal
proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offenses);

 been subject to any order,
judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority,
permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities,
futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any
such activity;

 been found by a court of competent
jurisdiction in a civil action or by the SEC or the Commodity Futures Trading Commission to have violated a federal or state securities
or commodities law, and the judgment has not been reversed, suspended, or vacated;

 been the subject of, or a party
to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated
(not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state
securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including,
but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent
cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection
with any business entity; or

 been the subject of, or a party
to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of
the Exchange Act), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act), or any equivalent
exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member.

 Board of Directors

 As of the date hereof, our Board of Directors
consists of six directors. Our Board of Directors has determined that Director's — Bruce Cooperman, Michael Garone and Paul
Richardson — satisfied the "independence" requirements of Rule 5605(a)(2) of the Listing Rules of the Nasdaq Stock Market
and Rule 10A-3 under the Exchange Act.

 Board Committees

 We have established two committees under the board
of directors: an Audit Committee and a Compensation Committee. We have adopted a charter for each of the two committees. Each committee's
members and functions are described below.

 Audit Committee

 The Company's Audit Committee is comprised
of Paul Richardson (Chair),Michael M. Garone (Director), Bruce Cooperman (Director).

 The Board has determined that all members are
independent directors and Director Richardson qualifies as an "audit committee financial expert" within the meaning of the
rules of the SEC.

 The purpose of the Audit Committee is to oversee
the Company's accounting and financial reporting processes and the audit of the Company's financial statements.

 Compensation Committee

 The Company's Compensation Committee is
comprised of Paul Richardson, Michael M. Garone, and Bruce Cooperman. A chair is to be nominated.

 The purpose of the Compensation Committee is to
carry out the responsibilities delegated by the Board relating to the review and determination of executive compensation.

 Code of Business Conduct and Ethics

 The Company has adopted a Code of Business Conduct
and Ethics applicable to directors, officers and employees. The Code of Conduct is available on our website at www.nyiax.com.
Information contained on or accessible through our website is not a part of and is not incorporated by reference into this Annual Report
on Form 10-K, and the inclusion of our website address in this report is an inactive textual reference only. The nominating and governance
committee of our Board will be responsible for overseeing the Code of Conduct and must approve any waivers of the Code of Conduct for
employees, executive officers, and directors. We expect that any amendments to the Code of Conduct, or any waivers of its requirements,
will be disclosed on our website.

 Insider Trading Policy

 The Company has adopted an Insider Trading
Policy which requires insiders to: (i) refrain from purchasing shares during certain blackout periods and when they are in possession
of any material non-public information and (ii) to clear all trades with the compliance officer of the policy prior to execution.

 Limitation on Directors Liability and Indemnification

 Section 145 of the Delaware General
Corporation Law (the "DGCL") provides that a corporation may indemnify any person who was or is a party or is threatened to
be made a party to an action by reason of the fact that he or she was a director, officer, employee or agent of the corporation or is
or was serving at the request of the corporation against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him or her in connection with such action if he or she acted in good faith and in a
manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his or her conduct was unlawful, except that, in the case of an action by or
in right of the corporation, no indemnification may generally be made in respect of any claim as to which such person is adjudged
to be liable to the corporation.

 Section 145(g) of the DGCL permits
a corporation to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation. The
Company has purchased director and officer liability insurance to cover certain liabilities that its directors and officers may incur
in connection with their services to the Company.

 In addition, Section 102(b)(7) of the DGCL
permits a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable
to the corporation or its stockholders for monetary damages for breach of fiduciary duties as a director, except for liability for any:
(i) breach of a director's duty of loyalty to the corporation or its stockholders; (ii) act or omission not in good faith
or that involves intentional misconduct or a knowing violation of law; (iii) unlawful payment of dividends or redemption of shares; or
(iv) transaction from which the director derives an Improper personal benefit.

 Our bylaws provide that any director or officer
who is involved in litigation by reason of his or her position as a director or officer of the Company shall be indemnified and held harmless
by the Company to the fullest extent authorized by Delaware law.

 Indemnification Agreements

 We have entered into indemnification agreements
with each of our current directors and executive officers. The indemnification agreements provide for indemnification against expenses,
judgments, fines and penalties actually and reasonably incurred by an indemnitee in connection with threatened, pending or completed proceedings,
subject to certain limitations. The indemnification agreements also provide for the advancement of expenses in connection with the investigation,
defense, settlement or appeal of a proceeding, provided that the indemnitee provides an undertaking to repay to us any amounts advanced
if the indemnitee is ultimately found not to be entitled to indemnification by us. The indemnification agreements set forth procedures
for making and responding to a request for indemnification or advancement of expenses, as well as dispute resolution procedures that will
apply to any dispute between us and an indemnitee arising under the indemnification agreements.

 ITEM 11. EXECUTIVE COMPENSATION

 Summary Compensation Table

 The following table presents information regarding
the total compensation awarded to, earned by, or paid to our chief executive officer and the four most highly compensated executive officers
(other than the chief executive officer) who were serving as executive officers as of December 31, 2023 for services rendered in all capacities
to us for the years ended December 31, 2023 and 2022.

 Name

 Principal Position

 Year

 Salary

($)

 Bonus
 ($)

 Option

Awards (1)

 ($)

 Share-based

Awards (1)

 ($)

 Total

 ($)

 Feldman,
 William

 Chief
 Financial

 2023

 $
 145,000

 $
 156,145

 $
 301,145

 Officer
 and Treasurer

 2022

 $
 180,000

 $
 156,145

 $
 336,145

 Sergey
 Tsoy

 Chief
 Technology

 2023

 230,000

 30,950

 260,950

 and
 Product Officer

 2022

 $
 216,538

 36,108

 252,646

 Robert
 Ainbinder Jr

 Former
 Chief

 2023

 219,680

 219,680

 Executive
 Officer (2)

 2022

 $
 318,750

 $
 144,250

 $
 463,000

 Toothaker,
 Gregory

 Chief
 Business

 2023

 $
 190,625

 $
 190,625

 Robert (4)

 Officer

 2022

 242,211

 $
 242,211

 Christopher
 Hogan

 Interim
 Chief Executive Officer, President and Chief Operating Officer (formerly

 2023

 $
 111,300

 $
 111,300

 Chief Operating
 Officer) (3)

 2022

 $
 365,141

 $
 365,141

 (1)
 In accordance with ASC 718.

 (2)
 Mr. Ainbinder
was appointed Chief Executive Officer on July 22, 2020, prior to which he was Interim Chief Executive Officer since August 19,
2019. On May 26, 2022, Mr. Ainbinder resigned as Chief Executive Officer, but continued to be a Director of the Company. Following Mr.
Ainbinder's resignation as Chief Executive Officer, the Company continued to compensate Mr. Ainbinder on a month-to-month basis,
at a rate of $270,000 per annum, for ongoing services provided. On September 28, 2023, Mr. Ainbinder voluntarily deferred his salary
commencing 10/1/2023 (to be reflected in the 10/15/2023 payroll) until the IPO. During such time, Mr. Ainbinder agreed for an annual
salary rate of $32,000 versus a previous annual salary rate of $270,000.
On May 4, 2024, the Company appointed and entered into an employment agreement with Robert Ainbinder Jr. as the Director of Development
for Special Projects of the Company (the "Agreement"). The term of the Agreement commenced on May 4, 2024 and continues for
a period of one (1) year or until otherwise terminated in accordance with the provisions of the Agreement. This Agreement shall automatically
renew for successive four (4) month terms unless earlier terminated. Mr. Ainbinder will receive an annual base salary of $225,000 plus
healthcare and other benefits. During the term, in addition to the base salary, Mr. Ainbinder will be eligible for a discretionary bonus
of up to 20% of base salary which may be in cash, equity compensation, or base salary increases.

 (3)
 Christopher Hogan's non-exclusive services as Chief Operating
Officer were rendered through Southside Strategies, LLC and included various expenses paid to sub-contractors. On May 26, 2022, Mr. Hogan
was appointed as Interim Chief Executive Officer and President. With the recent appointment of our new Chief Executive Officer, the Interim
Chief Executive Officer position previously held by Mr. Hogan has been eliminated, as planned.

 (4)
 Mr. Toothaker was terminated effective January 9, 2024.

 Employment Agreements and Consulting Agreements

 On May 23, 2022, the Company and Carolina Abenante
entered into an employment agreement and general release, pursuant to which Ms. Abenante agreed to be employed as Co-Founder, Chief
Strategy Officer, Chief Evangelist, Vice Chairperson and Director of the Company. The agreement is automatically renewed for one year
on each anniversary date, unless it is terminated earlier with 30 days' written notice by either party prior to each renewal.
As compensation, the Company agreed to pay Ms. Abenante (i) a base salary at the rate of $255,000 per annum except that for the period
of May 16, 2022 through July 15, 2022, Ms. Abenante's base salary will be $100,000 per year; and (ii) an annual discretionary
bonus of 20% of the actual paid base salary. Ms. Abenante voluntarily agreed to defer her salary to $60,000 per year until the Company
effectuates its financing event.

 On May 24, 2022, the Company and Mark Grinbaum
entered into a consulting agreement, pursuant to which Mr. Grinbaum agreed to perform services in the role of Co-Founder and Executive
Vice President of Financial Products of the Company, which is a part-time non-exclusive position for twelve months. The Company agreed
to pay Mr. Grinbaum a base compensation of $90,000 per year. From July 16, 2022, Mr. Grinbaum voluntarily agreed to defer his compensation
until the Company effectuates its financing event.

 On July 16, 2016, the Company and Sergey
Tsoy entered into an employment agreement, pursuant to which Mr. Tsoy agreed to be employed as Executive Vice President of Technology
of the Company. As compensation, the Company agreed to pay Mr. Tsoy (i) a base salary at the rate of $150,000 per annum; (ii) a
discretionary bonus of 20% of the base salary; (iii) 50,076 shares of common stock of the Company, subject to the terms of a restricted
stock agreement dated April 20, 2016; and (iv) incentive stock options to purchase 100,000 shares of common stock of the Company
at $4.60 per share, subject to the terms of a stock option award agreement dated May 1, 2017. Mr. Tsoy voluntarily agreed to defer
a portion of his compensation until the Company effectuates its financing event.

 On May 26, 2022, Mr. Hogan and the Company entered
into an employment agreement, pursuant to which Mr. Hogan agreed to be employed as President and Chief Operating Officer of the Company
and agreed to act as Interim Chief Executive Officer. The Company agreed to pay Mr. Hogan (i) a base salary of $360,000 per annum; (ii)
a discretionary bonus of up to 50% of salary; (iii) an annual award of incentive stock options to purchase 75,000 shares of common stock
of the Company at market price; and (iv) one time incentive bonus of $20,000 to $250,000 to be paid to Mr. Hogan based upon meeting key
performance indicators related to media billed on the Company's platform. With the recent appointment of our new Chief Executive
Officer, the Interim Chief Executive Officer position previously held by Mr. Hogan has been eliminated, as planned. Additionally, Mr.
Hogan voluntarily forfeited all of his deferred compensation.

 On August 26, 2019, the Company and Robert
Ainbinder, Jr. entered into an employment agreement, pursuant to which Mr. Ainbinder agreed to be employed as Interim Chief Executive
Officer of the Company. As compensation, the Company agreed to pay Mr. Ainbinder (i) a base salary at the rate of $360,000 per
annum, prorated based on the start date; (ii) a discretionary bonus equal to 2.5% of the funds received by the Company in a private
placement commenced on August 19, 2019 (which pursuant to the understanding of the parties was not paid by the Company to Mr. Ainbinder);
(iii) a discretionary bonus of 50% of the base salary upon the Company receiving funding, in one or multiple rounds, of $6,000,000;
provided, however, Mr. Ainbinder shall not be eligible to receive such bonus if the aforementioned bonus equal to 2.5% of the funds
raised by the Company has been paid to him; (iv) a discretionary bonus of up to 100% of the base salary upon the Company achieving
a merger or initial public offering where the value of the Company is over $60 million; and (v) an increase of the base salary
to $420,000 upon the Company achieving a merger or initial public offering of at least $75 million unless finances of the Company
are not permitting, or the Board is not in agreement. Pursuant to a stock option award agreement dated October 14, 2016, Mr. Ainbinder
also received 10-year incentive stock options to purchase 113,578 shares of common stock of the Company at $3.30 per share. On December 16,
2020, Mr. Ainbinder became Chief Executive Officer of the Company. Additionally, in 2021, Mr. Ainbinder was issued incentive
options to purchase100,000 shares of common stock at $4.40 per share under 2021 Equity Incentive Plan. On May 26, 2022, Mr. Ainbinder
resigned as Chief Executive Officer of the Company, but continues to be a Director of the Company. Following Mr. Ainbinder's resignation
as Chief Executive Officer, the Company continues to compensate Mr. Ainbinder, at a rate of $270,000 per annum, for ongoing services provided
with various salary deferrals. On May 4, 2024, the Company appointed and entered into an employment agreement with Robert Ainbinder Jr.
as the Director of Development for Special Projects of the Company. Mr. Ainbinder's primary tasks as Director of Development for
Special Projects include creating a successful Capital Attainment Program, working with the CEO and management to designate, identify
and create new business lines for the Company, and other duties as mutually agreed to between the Mr. Ainbinder and the CEO. Mr. Ainbinder
is also a Board member. On May 4, 2024, the Company entered into an employment agreement with Mr. Ainbinder. (the "Agreement").
The term of the Agreement commenced on May 4, 2024 and continues for a period of one (1) year or until otherwise terminated in accordance
with the provisions of the Agreement. This Agreement shall automatically renew for successive four (4) month terms unless earlier terminated
Under the Agreement. Mr. Ainbinder will receive an annual base salary of $225,000 plus healthcare and other benefits. During the term,
in addition to the base salary, Mr. Ainbinder will be eligible for a discretionary bonus of up to 20% of base salary which may be in cash,
equity compensation, or base salary increases. Mr. Ainbinder voluntarily agreed to defer a portion of his compensation until the Company
effectuates its financing event.

 On July 1, 2021 Mr. Feldman became an employee
of NYIAX. As compensation, pursuant to an employment agreement, the Company agreed to pay Mr. Feldman (i) a base salary at the rate of
$200,000 per annum; (ii) a bonus at the discretion of the Company, which shall not be more than 50% of the base salary; and (iii) incentive
stock options to purchase 150,000 shares of common stock of the Company at $4.40 per share, with a 4-year vesting schedule; provided,
however, vesting of such options shall be accelerated of up to nine months when Mr. Feldman's employment commenced with the Company.
From July 16, 2022, Mr. Feldman voluntarily agreed to defer 20% of his salary compensation until the Company effectuates its financing
event. On April 15, 2023, Mr. Feldman voluntarily agreed to defer 30% of his salary compensation until the Company effectuates its financing
event On June 21, 2023, the NYIAX Board authorized the grant of 200,000 restricted stock units in accordance with the Company's
existing stock compensation plan in effect as of this date to William Feldman, the Company's Chief Financial Officer. The award
removes all service and other contingencies upon the first day of trading of the Company's stock and are to be awarded six months
after the first day of trading of the Company's stock as registered free trading shares. Additionally, Mr. Feldman forfeited $47,000
of deferred compensation. The deferred compensation arose from a salary deferral program where certain founders and employees agreed to
defer a portion of their contractual salary or contractor fees. Mr. Feldman voluntarily agreed to defer a portion of his compensation
until the Company effectuates its financing event.

 Outstanding Equity Awards

 The following table summarizes, for each of the
named executive officers, the number of shares of common stock underlying outstanding stock options held as of December 31, 2023.

 Option Awards

 Stock Awards

 Name

 Total

 securities
 underlying
 unexercised
 options (#)
 exercisable

 securities
 underlying
 unexercised
 options (#)
 un exercisable

 Equity
 incentive
 plan
 awards:
 securities
 underlying
 unexercised
 unearned
 options
 (#)

 Option
 exercise
 price
 ($)

 Option
 expiration date

 shares
 or

units
 of

stock
 that
 have not
 vested
 (#)

 Market
 value

of
 shares
 of

units
 of stock
 that
 have
 not
 vested
 ($)

 Equity
 incentive
 plan
 awards:
 unearned
 shares,
 units or
 other
 rights
 that have
 not vested
 (#)

 Equity
 incentive
 plan
 awards:
 Market
 or

payout
 value of
 unearned
 shares,
 units or
 other
 rights that
 have not vested
 ($)

 Sergey Tsoy

 100,000

 100,000

 4.6

 5/1/2027

 50,000

 31,250

 18,750

 5.50

 11/1/31

 Robert Ainbinder Jr. (2)

 113,578

 113,578

 —

 —

 $
 3.30

 10/14/26

 100,000

 100,000

 —

 —

 $
 5.00

 05/01/31

 50,000

 50,000

 —

 —

 $
 5.00

 01/13/32

 Christopher Hogan (1)

 —

 —

 —

 Feldman, William (3)

 150,000

 150,000

 $
 4.40

 08/01/31

 Toothaker, Gregory Robert

 70,000

 70,000

 4.60

 04/24/27

 Director Compensation

 The following table details the compensation paid
to or accrued for each of the Company's non-management directors in the year ended December 31, 2023:

 Name

 Fees Earned or Paid in Cash
 ($)

 Stock Awards
 ($)

 Option Awards
 ($)

 Non-Equity Incentive Plan Compensation ($)

 Change in Pension Value and Nonqualified Deferred Compensation Earnings
 ($)

 All Other Compensation ($)

 Total
 ($)

 William Wise

 Thomas F. O'Neill (1)

 —

 (1)

 113,577 options were awarded to Mr. O'Neill on October 14, 2016, all of which were fully vested as of December 31, 2022. On January 13, 2022, the Board of Directors awarded Mr. O'Neil 50,000 options, with an exercise price of $5 per share and vested immediately, as a director of the Company, and an additional 50,000 options with the same terms as Chairman of the Audit Committee. During the year ended December 31, 2023, no compensation was earned by, paid to or accrued for Mr. O'Neill. Mr. O'Neill resigned from the Board on April 30, 2024.

 (2)

 Pursuant to an agreement entered into by and between the Company and William Wise dated as of November 1, 2016, Mr. Wise agreed to serve as a member of the Board of Directors of the Company. As compensation, the Company agreed to grant to Mr. Wise 142,443 non-statutory stock options on November 1, 2016 under the Company's 2016 Equity Incentive Plan, with an exercise price of $3.30 per share, having a value equal to $470,061.90. 47,481 options vested and became exercisable as of the date of the agreement, and the remainder of 94,962 options granted to Mr. Wise were fully vested as of December 31, 2023.

 On January 13, 2022, the Board of Directors
awarded Mr. Wise, as a director of the Company, 50,000 options, which are exercisable at $5 per share and were forfeited on June 20, 2023
following Mr. Wise's resignation on March 20, 2023.

 On April 19, 2022, as compensation
for his service as Chairman until such date, the Board of Directors awarded

 Mr. Wise 250,000 restricted stock units
under the 2021 Equity Incentive Plan, which were to vest over two years in two equal instalments starting from the first-year anniversary
of such award and were forfeited on June 20, 2023 following Mr. Wise's resignation on March 20, 2023.

 During the years ended December 31,
2023 and 2022, no compensation was earned by, paid to or accrued for Mr. Wise. On March 20, 2023, Mr. Wise resigned from the Board
of Directors of the Company.

 Exclu ded
from the table above are:

 For
 Ms. Gallo, on January 19, 2024, concurrently with the execution of her employment contract,
 the NYIAX Board granted, with said grant to occur, upon consummation of our IPO, Teresa Gallo,
 our Chief Executive Officer, 200,000 restricted stock units vesting quarterly over 4 years
 from the IPO date; and 200,000 incentive stock options, with a strike price of $4.00 per
 share, vesting quarterly over 4 years from the IPO date. Ms. Gallo joined the Board of Directors
 on May 1, 2024.

 For Mr. Richardson, Mr. Garone, and Mr. Cooperman,
Mr. Garone: 175,000 restricted stock units to be granted as a Director. On June 21, 2023, Mr. Garone, and Mr. Cooperman, Mr. Garone were
each granted 175,000 restricted stock units effective upon his appointment as director upon the first day of trading of the Company's
common stock on the NASDAQ Exchange and with the award vesting one-third at grant date and the remainder vesting quarterly over a two
year period in accordance with the Plan. Mr. Garone, and Mr. Cooperman, Mr. Garone joined the Board on May 1, 2024 and the 175,000 restricted
stock grant is subject to the Board finalizing the grant.

 Equity Compensation Plan Information

 The following table provides certain information
with respect to all of our equity compensation plans in effect as of the fiscal year ended December 31, 2023.

 A

 B

 C

 D

 Maximum
 aggregate
 number of
 shares of
 Common
 Stock that may
 be issued
 under the
 Plans

 common shares
 to be issued
 upon
 exercise of
 outstanding
 options,
 warrants and
 rights, net of
 cancellations

 Weighted-
 average
 exercise price of
 outstanding
 option,
 warrants
 and rights

 common shares
 remaining
 available for
 future issuance
 under equity
 compensation
 plans (excluding
 shares reflected
 in column B)

 Equity compensation plans approved by security holders

 2016 Equity Compensation Plan

 1,133,483

 916,344

 $
 2.82

 141,019

 2017 Equity Compensation Plan

 604,832

 583,638

 2.09

 21,194

 2021 Equity Compensation Plan

 12,000,000

 1,310,838

 4.13

 10,689,162

 Equity compensation plans not approved by security holders

 Total

 13,738,315

 2,810,820

 $
 3.28

 10,851,375

 ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

 The following table sets forth the number of shares
of Common Stock beneficially owned as of the date hereof by:

 each of each of our named executive
officers;

 each of our directors;

 all of our directors and
current executive officers as a group; and

 each of our stockholders who
is known by us to beneficially own more than 5% of our Common Stock.

 Beneficial ownership is determined based on the
rules and regulations of the SEC. A person has beneficial ownership of shares if such individual has the power to vote and/or dispose
of shares. This power may be sole or shared and direct or indirect. Applicable percentage ownership in the following table is based on
the total of 15,611,827 shares of common stock outstanding as of the date of this Annual Report on Form 10-K.

 In computing the number of shares beneficially
owned by a person and the percentage ownership of that person, shares of common stock that are subject to options or warrants held by
that person and exercisable as of, or within 60 days of, the date of this Annual Report on Form 10-K. These shares, however, are
not counted as outstanding for the purposes of computing the percentage ownership of any other person(s). Except as may be indicated in
the footnotes to this table and pursuant to applicable community property laws, each person named in the table has sole voting and dispositive
power with respect to the shares of common stock set forth opposite that person's name. Unless indicated below, the address of each
individual listed below is c/o NYIAX, Inc., 900 Easton Ave. STE 26-1088, Somerset, NJ 08873.

 Reference

 Total Shares Beneficially Owned (A)

 % of Beneficial Ownership

 Teresa Gallo

 25,000

 0.2
 %

 Carolina Abenante

 1,121,404

 7.0
 %

 Mark Grinbaum

 1,076,475

 6.7
 %

 Robert Ainbinder

 604,758

 3.7
 %

 150,000

 0.9
 %

 Sergey Tsoy

 200,076

 1.3
 %

 Paul Richardson

 -

 Michael Garone

 25,000

 0.2
 %

 Bruce Cooperman

 -

 Chris Hogan

 400,000

 2.5
 %

 Gregory Toothacher

 70,000

 0.4
 %

 all officers & directors as a group

 3,647,713

 19.0
 %

 Other 5% Beneficial Owners

 Suwyn Investments, LLC

 11.1
 %

 Network Foundation Technologies, LLC

 12.8
 %

 Graham Mosley

 5.7
 %

 *
 Less than 1%.

 (A)
 The percentages herein take into account of (a) shares
of Common Stock beneficially owned or vested as of the date hereof, both of which have voting power, and (b) options or warrants
exercisable as of, or within 60 days of, the date hereof.

 (1)

 For Ms. Gallo, on January 19, 2024, concurrently with the
execution of her employment contract, the NYIAX Board granted, with said grant to occur, Teresa Gallo, our Chief Executive Officer, 25,000
units of restricted stock units with 50% vesting six months from her employment date and 50% vesting one year from her employment date.

 Additionally, upon consummation of our IPO, 200,000 restricted stock
 units vesting quarterly over 4 years from the IPO date; and 200,000 incentive stock options, with a strike price of $4.00 per share, vesting
 quarterly over 4 years from the IPO date. Ms. Gallo joined the Board of Directors on May 1, 2024.

 (2)

 For Ms. Abenante, the shares beneficially owned include (i) 850,000 shares of Common Stock; (ii) 61,404 from shareholder notes that have converted or are converting to shares, (iii) vested options exercisable within 60 days to purchase an aggregate of 160,000 shares of Common Stock and (iv) 50,000 vested options granted by the Board of Directors to each Director for 2021 services as a Board Member, including Ms. Abenante, as of the date hereof, all of the options have vested.

 (3)

 For Mr. Grinbaum, the shares beneficially owned include (i) 827,238 shares of Common Stock; (ii) vested options exercisable within 60 days to purchase an aggregate of 160,000 shares of Common Stock (iii) 39,457 shares from the future conversion of 2022 convertible note payable purchased September 14, 2021, including estimated interest on the note and exercise of all warrants and (iv) 62,537 from shareholder notes that have converted or are converting to shares.

 (4)

 For Mr. Ainbinder, the shares beneficially owned include (i) 318,665 shares of Common Stock; (ii) vested options exercisable within 60 days to purchase an aggregate of 213,578 shares of Common Stock; (iii) 50,305 shares of Common Stock received for services from WestPark Capital while Mr. Ainbinder was employed as a registered representative with WestPark Capital; (iv) 50,000 vested options granted by the Board of Directors to each Director for 2021 services as a Board Member, including Mr. Ainbinder; and (v) warrants issued on August 10, 2018 exercisable within 60 days to purchase 22,515 shares of Common Stock received for services from WestPark Capital while Mr. Ainbinder was employed as a registered representative with WestPark Capital. Mr. Ainbinder was a Vice President at the New York City office of WestPark Capital, Inc., the former Placement Agent in the Company's certain prior offerings. As of the date hereof, all of the options have vested. On May 26,

 (5)

 For Mr. Feldman, the shares beneficially
 owned include vested options exercisable within 60 days to purchase an aggregate of 150,000 shares of Common Stock.

 (6)
 Mr. Tsoy has been granted 50,076 shares of Common Stock pursuant to his RSA. All of the shares
 have vested. Additionally, pursuant to a stock option award agreement Mr. Tsoy received 100,000 incentive stock option, all of
 which have vested as of the date hereof. Mr. Tsoy was granted an additional 50,000 options by the Board on April 27, 2022, with a
 four-year vesting schedule in equal instalments starting from one year anniversary of the grant.

 (7)

 For Mr. Richardson: 175,000 restricted
stock units to be granted to Mr. Richardson, a Director. On June 21, 2023, Mr. Richardson was granted 175,000 restricted stock units
(an increase of 25,000 restricted stock units over the May 31, 2022 grant of 150,000 restricted stock units) effective upon his appointment
as director upon the first day of trading of the Company's common stock on the NASDAQ Exchange and with the award vesting one-third
at grant date and the remainder vesting quarterly over a two year period in accordance with the Plan. Mr. Richardson joined the Board
on May 1, 2024 and the 175,000 restricted stock grant is subject to the Board finalizing the grant;

 For Mr. Garone was awarded 25,000 warrants.
 10,000 of the warrants have a strike price of $3.30 and vested immediately; 15,000 of the warrants have a strike price of $5.00 and
 vested monthly over three years.

 Additionally, Mr. Garone: 175,000 restricted stock
 units to be granted to Mr. Garone, a Director. On June 21, 2023, Mr. Garone was granted 175,000 restricted stock units effective upon
 his appointment as director upon the first day of trading of the Company's common stock on the NASDAQ Exchange and with the award
 vesting one-third at grant date and the remainder vesting quarterly over a two year period in accordance with the Plan. Mr. Garone joined
 the Board on May 1, 2024 and the 175,000 restricted stock grant is subject to the Board finalizing the grant;

 For Mr. Cooperman: 175,000 restricted stock units
 to be granted to Mr. Garone, a Director. On June 21, 2023, Mr. Cooperman was granted 175,000 restricted stock units effective upon his
 appointment as director upon the first day of trading of the Company's common stock on the NASDAQ Exchange and with the award vesting
 one-third at grant date and the remainder vesting quarterly over a two year period in accordance with the Plan. Mr. Cooperman joined the
 Board on May 1, 2024 and the 175,000 restricted stock grant is subject to the Board finalizing the grant;

 (8)

 For Mr. Hogan, the shares beneficially owned include includes (i) 200,000 shares of Common Stock — gifted June 22,202, see below; and (ii) vested options exercisable within 60 days to purchase an aggregate of 200,000 shares of Common Stock. On June 22, 2021, Mr. Hogan received a common stock grant as a gift from the principal stockholders, Carolina Abenante and Mark Grinbaum, who transferred 200,000 of their shares, 100,000 each to Mr. Hogan. There were no performance conditions in this gifted grant and the principal stockholders, Carolina Abenante and Mark Grinbaum, paid all taxes related to this gifted grant. The Company expensed the award as share-based compensation in 2021 as is consistent with the Codification of Staff Accounting Bulletins Topic 5. The common stock grant gift are not to be sold for 181 days after the Company's first day of trading of its stock. In connection with Ms. Gallo's appointment as CEO, the position of Interim Chief Executive Officer was eliminated.

 (9)

 For Mr. Toothaker, includes vested options exercisable within 60 days to purchase an aggregate of 70,000 shares of Common Stock. Mr. Toothaker employment terminated effective January 4, 2024.

 (10)

 Suwyn Investments, LLC includes (i) 90,909 shares of Common Stock purchased in the Company's past private offerings; (ii) 500,695 shares of Common Stock issuable upon exercise of warrants; (iii) 150,000 shares of Common Stock from an exercise of warrants issued in the 2020 Convertible Notes Payable Offering; (iv) 594,171 shares of Common Stock from the conversion of a promissory note issued in 2020 Convertible Notes Payable Offering (v) 111,444 shares of Common Stock from mandatory conversion on May 30, 2022 of a promissory note issued in the 2021 Convertible Notes Payable Offering (vi) 156,750 shares from the conversion of 2022 convertible note payable purchased August 19, 2022 and (vii) 100,134 shares from the future conversion of 2023B convertible note payable. Of the 500,695 warrants disclosed in (ii) above, a total of 205,240 warrants (issued in the 2020 Convertible Notes Payable Offering, the 2021 Convertible Notes Payable Offering and the 2022 Convertible Notes Payable Offering), if remained unexercised and outstanding, will expire in five years or the closing of this offering, whichever occurs first. The address of Suwyn Investments, LLC is 26291 Woodlyn Dr., Bonita Springs, FL 34134. Mark Suwyn has voting and dispositive power over the shares held by Suwyn Investments, LLC as its Manager.

 (11)

 On July 8, 2023, the Company completed the purchase of an intellectual property portfolio, including various patents and trade secrets for 2,000,000 shares of common stock from Network Foundation Technologies, LLC. The common shares are restricted from sale as follows: one third for fourteen months, one third for twenty-four months, and one-third for thirty-six months. Concurrent with the asset purchase, Board member Ainbinder received a proxy to vote all un-restricted shares until IPO and the proxy will be transferred to Mr. Richardson on the first day of trading.

 (12)
 For Mr. Mosley includes (i) 45,927 shares of Common
Stock that Mr. Mosley received as a former employee and (ii) 850,000 shares of Common Stock issued pursuant to a settlement agreement
by and between Mr. Mosley and the Company.

 ITEM 13. CERTAIN RELATIONSHIPS AND RELATED
TRANSACTIONS AND DIRECTOR INDEPENDENCE

 Unless described below, during the last two fiscal
years, there are no transactions or series of similar transactions to which we were a party or will be a party, in which:

 the amounts involved exceeded or will exceed $120,000; and

 any of our directors, executive officers or holders of more than 5% of our capital stock, or any member of the immediate family of the foregoing persons, had or will have a direct or indirect material interest.

 Former CEO Services

 Mr. Ainbinder is our former CEO, current
Director and a shareholder of the Company. He became a Director of the Company in April 2016. From November 2015 through July 2019, Mr.
Ainbinder was a Vice President of WestPark Capital, Inc. ("WestPark") and served on its Investment Committee. WestPark acted
as a placement agent for the Company in the private placements occurred in August 2016, July 2017, June 2018 and July 2019.

 Related Party Office Space

 The former CEO is a co-founder of a private investment
fund, GoldStreet Holdings Limited Partnership ("GoldStreet").

 For the year ended December 31, 2022, the Company
recorded $10,000 of general and administrative expenses related to GoldStreet for office space. The amount was paid as of December 31,
2022.

 Payables to Shareholder-Founders

 At December 31, 2023 certain shareholder-founders
loaned the Company $264,000.

 $100,500 debt for reimbursement of certain expenses from 2016. On October 30, 2023, the Company entered into an agreement with shareholder-founders
whereby the debt converts to 25,124 shares immediately upon pricing of the Company's financing event.

 $163,500 in the form of convertible notes from November 27, 2023 through December 11, 2023. These convertible
notes payables to certain shareholder-founders of $163,500 plus interest automatically convert to common shares upon the completion of
a financing event or within two (2) months from the date of the convertible notes at a share price of $4.00 per share.

 In October 2023, certain shareholder-founders
purchased $100,000 in the form of convertible notes. These convertible notes payables to certain shareholder-founders of $100,000 plus
interest automatically converted to 50,328 common shares in December 2023 at a share price of $4.00 per share.

 At December 31, 2023 the Company had a payable
to certain shareholder-founders in aggregate amount of $100,500 for reimbursement of certain expenses from 2016.

 Share Transfers by Shareholder-Founders

 Two of our founders and shareholders, Carolina
Abenante and Mark Grinbaum, agreed to transfer Patrick Maddren, a NYIAX contractor, an aggregate of 100,000 shares of our common stock,
or 50,000 shares of our common stock each. In the transfer letter, dated November 11, 2022, Patrick Maddren agreed to assume all tax liabilities
related to the transfer and to a general releases in favour of Carolina Abenante, Mark Grinbaum, and NYIAX from any and all prior claims,
actions, causes of action, grievances, suits, charges, or complaints of any kind or nature whatsoever. Patrick Maddren was previously
awarded 100,000 warrants in connection with the execution of his independent contractor agreement, which warrants were granted on May
1, 2021, have an exercise price of $1.00, and vested immediately.

 During 2023, certain NYIAX founders, owners, officers and employees
agreed to forfeit $769,838 of deferred compensation amounts, including payroll taxes, owed by NYIAX. The deferred compensation arose from
a salary deferral program where each founder agreed to defer a portion of their contractual salary or contractor fees. This forfeiture
represents a permanent waiver of rights to this deferred compensation.

 This event was recorded as a contra-expense to selling, general and
administrative expenses and a debit to accrued compensation.

 2022 Convertible Note Payable Offering

 On July 7, 2022, the Company commenced a Convertible
Notes Offering pursuant to which it offered up to $6,000,000 of convertible notes to accredited investors pursuant to Rule 506 of Regulation
D of the Act ("2022 Convertible Note Offering"). The closing of the offering occurred on November 30, 2022.

 Under the original terms of the 2022 Convertible
Note Offering, the Company may sell up to $6,000,000 of convertible notes (the "2022 Convertible Notes"). Each of the 2022
Convertible Notes offered in the 2022 Convertible Note Offering has an annual rate of return of twelve percent (12.0%) per annum, which
shall be paid as a Payment-in-Kind in the Company's common stock valued, at five dollars ($5) per share, at the Maturity Date of
the 2022 Convertible Notes.

 The Maturity Date of the 2022 Convertible Notes
shall be the date which is eighteen (18) months from the closing of the 2022 Convertible Note Offering (the "Maturity Date").
Additionally, the Company shall issue with the 2022 Convertible Notes warrant coverage (the "Warrants") at a rate of one (1)
Warrant for every $10 of Notes purchased. Each Warrant shall be exercisable for a period of five (5) years at a price of $5.50 per share.

 The outstanding principal balance of the 2022
Convertible Notes and all accrued interest shall automatically convert into common stock of the Company immediately prior to the Company's
receipt of an effective order from the SEC declaring the registration statement of its initial financing event effective. The shares of
common stock issuable upon conversion of the 2022 Convertible Notes are being registered in this Registration Statement. The "Conversion
Price" of the 2022 Convertible Notes will be at a price per share equal to the lower of the following: (i) 80% of the price per
share paid by the purchasers of securities in our financing event ($4.00); or (ii) 5.00 if our initial public offering is not completed.
In the event that the Company fails to complete a financing event of its common stock resulting in gross proceeds of at least $5 million
prior to the Maturity Date, the Conversion Price shall be reduced to $2.50 per share.

 At the NYIAX board of directors meetings held
on November 7, 2022 and November 15, 2022, the board of directors agreed to amend the following three conditions of the 2022 Convertible
Note Payable:

 Under the amended terms,

 A.

 The 2022 Convertible Note Payable convert as follows:

 (i)

 At $2.00 per share concurrently when shares of common stock are sold to the public in the financing event; or

 (ii)

 In the event the financing event is not completed within eighteen (18) months from the date of the individually issued notes, the Conversion Price shall be the reduced price of two dollars ($2.00) per share and the Conversion Amount shall automatically be converted into common stock of the Company at $2.00 per share on the Maturity Date.

 B.

 The subscription period will begin as of the date of the first sale of the Offering and terminated November 19, 2022.

 C.

 Annual rate of return of twelve (12.0%) percent simple interest and all interest and principle are paid in the Company's Common Shares at a value of five ($2.00) dollars per share, or, as Payment-in-Kind, or P-I-K. Interest shall be paid quarterly until maturity.

 All 2022 Convertible Note Payable noteholders
have agreed to the amended terms.

 As of the date of this Annual Report on Form 10-K,
$2,570,000 of the 2022 Convertible Notes have been sold. $75,000 of the notes were issued to Mark Grinbaum.

 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

 Marcum LLP ("Marcum") served as the
Company's independent registered public accounting firm for the last two fiscal years. The following table shows the fees that were
billed for the audit and other services provided to the Company for 2023 and 2022.

 Marcum's reports
on the Registrant's financial statements for the year ended December 31, 2022 did not contain an adverse opinion or a disclaimer
of opinion, and were not qualified or modified as to uncertainty, audit scope, or accounting principles, except that Marcum's report
for the year ended December 31, 2022 raised substantial doubt about the Registrant's ability to continue as a going concern.

 In connection with its
audit of, and in the issuance of its report on the Registrant's financial statements for the year ended December 31, 2022, Marcum
delivered a letter to the Audit Committee of the Registrant's Board of Directors and management that identifies certain items that
it considers to be material weaknesses in the effectiveness of its internal controls pursuant to standards established by the Public Company
Accounting Oversight Board. A "material weakness " is a deficiency, or a combination of deficiencies, in internal control
over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company's annual or interim
financial statements will not be prevented or detected on a timely basis.

 The Company identified
material weaknesses in the revenue recognition process, expense reimbursement controls as well as errors over financial reporting. This
was primarily the results of the Company's lack of documentation of internal control in place, limited accounting personnel and
lack of segregation of duties. Additionally, there were material weaknesses identified in the Company's Information Technology General
Controls ("ITGCs"). The control deficiencies identified were over the design of internal controls surrounding user access
security, and change management.

 During the two most recent fiscal years and the subsequent interim
period through May 24, 2024, there were no disagreements between the Registrant and Marcum on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Marcum, would
have caused Marcum to make reference to the subject matter of the disagreements in connection with their reports on the financial statements
for such periods.

 Effective May 30, 2024 NYIAX, Inc. (the "Registrant")
dismissed its independent auditor, Marcum LLP ("Marcum"). On May 24, 2024, the Registrant engaged WWC, P.C., CPA, certified
public accountant, ("WWC") as the Registrant's independent accountant to report on the Registrant's balance sheet
as of December 31, 2023 and 2022, and the related combined statements of income, stockholders' equity and cash flows for the year
then ended. The decision to appoint WWC was approved by the Registrant's Board of Directors.

 During the Registrant's two most recent
fiscal years and any subsequent interim period prior to the engagement of WWC, neither the Registrant nor anyone on the Registrant's
behalf consulted with WWC regarding either (i) the application of accounting principles to a specified transaction, either contemplated
or proposed, or the type of audit opinion that might be rendered on the Registrant's financial statements or (ii) any matter that
was either the subject of a "disagreement" or a "reportable event," as those terms are defined in Regulation S-K,
Items 304 (a) (1) (iv) and 304 (a) (1) (v).

 2023

 2022

 Audit Fees

 $
 185,767

 $
 416,292

 Audit-Related Fees

 $
 211,642

 $
 407,365

 Tax Fees

 All Other Fees

 Total

 $
 397,408

 $
 823,657

 Audit Fees — This category includes
the audit of our annual financial statements and services that are normally provided by the independent registered public accounting firm
in connection with engagements for those fiscal years. This category also includes advice on audit and accounting matters that arose during,
or as a result of, the audit or the review of interim financial statements.

 Audit-Related Fees — This category
consists of assurance and related services by the independent registered public accounting firm that are reasonably related to the performance
of the audit or review of our financial statements and are not reported above under "Audit Fees." The services for the fees
disclosed under this category include consultation regarding the Company's correspondence with the SEC and other accounting consulting.

 Tax Fees — This category consists
of professional services rendered by our independent registered public accounting firm for tax compliance and tax advice. The services
for the fees disclosed under this category include tax return preparation and technical tax advice.

 All Other Fees — This category
consists of fees for other miscellaneous items.

 The Board of Directors, or previously the audit
committee, pre-approves all auditing services and any non-audit services that are to be performed for us by our independent auditor.

 ITEM 15. EXHIBITS AND
FINANCIAL STATEMENT SCHEDULES

 Exhibit No.

 Description

 3.1

 Amended and Restated Certificate of Incorporation, dated November 29, 2017 (incorporated by reference to Form S-1 filed on February 2, 2024)

 3.2

 Certificate of Amendment to Amended and Restated Certificate of Incorporation, dated April 23, 2021 (incorporated by reference to Form S-1 filed on February 2, 2024)

 3.3

 Bylaws (incorporated by reference to Form S-1 filed on February 2, 2024)

 4.1

 Specimen Common Stock Certificate (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.1

 Design Study Agreement, dated December 21, 2015, by and between NYIAX, Inc. and Nasdaq Technology AB (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.2

 IT Services Agreement, dated May 17, 2016, by and between NYIAX, Inc. and Nasdaq Technology AB (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.3

 Amendment to IT Services Agreement, dated December 30, 2020, by and between NYIAX, Inc. and Nasdaq Technology AB (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.4

 Joint Intellectual Property Ownership Agreement, dated June 25, 2017, by and between NYIAX, Inc. and Nasdaq, Inc. (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.5

 Form of Master Service Agreement (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.6

 Form of Shareholders' Agreement (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.7

 2016 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.8

 Form of Option Agreement of 2016 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.9

 2017 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.10

 Form of Option Agreement of 2017 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.11

 2021 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.12

 Form of Option Agreement of 2021 Equity Incentive Plan (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.13

 Form of Restricted Stock Units Award Agreement (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.14

 Form of Subscription Agreement for August 2016 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.15

 Form of Subscription Agreement for July 2017 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 Exhibit No.

 Description

 10.16

 Form of Placement Agent Warrant Agreement for July 2017 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.17

 Form of Subscription Agreement for June 2018 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.18

 Form of Investor Warrant Agreement for June 2018 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.19

 Form of Placement Agent Warrant Agreement for June 2018 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.20

 Form of Subscription Agreement for July 2019 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.21

 Form of Investor Warrant for July 2019 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.22

 Form of Placement Agent Warrant for July 2019 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.23

 Form of Subscription Agreement for March 2020 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.24

 Form of Investor Warrant for March 2020 Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.25

 Form of Securities Purchase Agreement for December 2020 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.26

 Form of Convertible Note for December 2020 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.27

 Form of Investor Warrant for December 2020 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.28

 Form of Securities Purchase Agreement for October 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.29

 Form of Convertible Note for October 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.30

 Form of Investor Warrant for October 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 Exhibit No.

 Description

 10.31

 Form of Securities Purchase Agreement for December 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.32

 Form of Convertible Note for December 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.33

 Form of Investor Warrant for December 2021 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.34

 Employment Agreement and General Release, dated May 23, 2022, by and between NYIAX, Inc. and Carolina Abenante (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.35

 Form of Employment Agreement, dated August 26, 2019, by and between NYIAX, Inc. and Robert E. Ainbinder, Jr. (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.36

 Consultancy Agreement, (commencing February 22, 2021), by and between NYIAX, Inc. and William Feldman (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.37

 Employment Agreement, (commencing upon financing event), by and between NYIAX, Inc. and William Feldman (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.38

 Employment Agreement, dated May 26, 2022, by and between NYIAX, Inc. and Christopher Hogan and resignation letter dated _____ (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.39

 Advisor Agreement and General Release, dated May 24, 2022, by and between NYIAX, Inc. and Mark Grinbaum (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.40

 Employment Agreement, dated July 16, 2016, by and between NYIAX, Inc. and Sergey Tsoy (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.41

 Offer Letter to William Wise, dated November 1, 2016 (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.42

 Employment Agreement, dated January 19, 2024, by and between NYIAX, Inc. and Teresa Gallo (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.43

 Offer Letter to Gregory Toothaker, dated April 12, 2017 (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.44

 Form of Indemnity Agreement (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.45

 Settlement Agreement and General Release, dated January 22, 2018, by and between NYIAX, Inc. and Graham M. Mosley (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.46

 Form of Agreement with Joseph G. Passaic, Jr. as Corporate Secretary (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.47

 Form of Managed Services Term Sheet, dated September 1, 2021, by and between NYIAX, Inc. with PubMatic Inc. (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.48

 Form of Master Services and Co-Marketing Agreement, dated April 23, 2020, by and between NYIAX, Inc. and JW Player (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.49

 Form of Ad Exchange Access Partner Agreement, effective August 16, 2021, by and between NYIAX, Inc. and OpenX Technologies, Inc. (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.50

 Form of Managed Services Agreement, dated October 14, 2021, by and between NYIAX, Inc. and Univision Management Co. (portions of the exhibit omitted pursuant to Item 601 of Regulation S-K) (incorporated by reference to Form S-1 filed on February 2, 2024)

 Exhibit No.

 Description

 10.51

 Consultancy Agreement, effective as of August 30, 2019, by and between NYIAX, Inc. and Patrick Maddren (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.52

 Form of Subscription Agreement for 2022 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.53

 Form of Investor Warrant for 2022 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.54

 Form of Convertible Note for 2022 Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.55

 Form of Subscription Agreement for 2023A Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.56

 Form of Investor Warrant for 2023A Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.57

 Form of Convertible Note for 2023A Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.58

 Form of Subscription Agreement for 2023B Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.59

 Form of Investor Warrant for 2023B Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.60

 Form of Convertible Note for 2023B Convertible Note Payable Offering (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.61

 Asset Purchase Agreement, dated July 8, 2023, by and between NYAX, Inc. and Network Foundation Technologies, LLC (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.62

 Form of Amendment to the 2023B Convertible Note Payable (incorporated by reference to Form S-1 filed on February 2, 2024)

 10.63

 Form of Subscription Agreement for 2024A Convertible Note Payable Offering (incorporated by reference to Form 8-K filed on April 24, 2024)

 10.64

 Form of Investor Warrant for 2024A Convertible Note Payable Offering (incorporated by reference to Form 8-K filed on April 24, 2024)

 10.65

 Form of Convertible Note for 2024A Convertible Note Payable Offering (incorporated by reference to Form 8-K filed on April 24, 2024)

 10.66

 Form of Subscription Agreement for 2024B Convertible Note Payable Offering

 10.67

 Form of Investor Warrant for 2024B Convertible Note Payable Offering (included in Exhibit 10.66)

 10.68

 Form of Convertible Note for 2024B Convertible Note Payable Offering (included in Exhibit 10.66)

 10.69

 Asset
 Purchase Agreement between Network Foundation, LLC and NYIAX, Inc. dated July 8, 2023 (incorporated by reference to Form
 8-K filed on July 12, 2023)

 10.70

 Assignment Agreement between Network Foundation, LLC and NYIAX, Inc. dated July 8, 2023

 10.71

 Employment Agreement between NYIAX, Inc. and Robert Ainbinder dated May 4, 2024

 10.72

 Sub-lease Termination and Surrender Agreement dated April 16, 2024

 14.1

 Code of Ethics (incorporated by reference to Form S-1 filed on February 2, 2024)

 Rule 13a-14(a) Certifications

 32.1

 Section 1350 Chief Executive Officer Certification

 32.2

 Section 1350 Chief Financial Officer Certification

 Clawback Policy

 ITEM 16. FORM 10-K SUMMARY

 None.

 SIGNATURES

 In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned thereunto duly authorized on February 19, 2025.

 NYIAX, INC.

 By:

 /s/ Teresa Gallo

 Name:

 Teresa Gallo

 Title:

 Chief Executive Officer

(Principal Executive Officer)

 By:

 /s/ William Feldman

 Name:

 Title:

 Chief Financial Officer and Treasurer

(Principal Financial and Accounting Officer)

 KNOW ALL MEN BY THESE PRESENTS, that we, the undersigned
officers and directors of NYIAX, Inc., a Delaware corporation (the "Registrant"), do hereby constitute and appoint William
Feldman, NYIAX chief financial officer, as his or her true and lawful attorney-in-fact and agent, with full power of substitution
and re-substitution, for him and in his name, place, and stead, in any and all capacities, to sign any and all amendments to this Annual
Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities
and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he might
or could do in person, hereby ratifying and confirming that the said attorneys-in-fact and agent, or any of his substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.

 Pursuant to the requirements of the Securities
Exchange Act of 1934, this Annual Report on Form 10-K has been signed below by the following persons on behalf of the Registrant
and in the capacities and on the dates indicated.

 Person

 Capacity

 Date

 /s/
 Teresa Gallo

 Chief
 Executive Officer, President and Chief Operating Officer

 Teresa Gallo

 (Principal Executive Officer)

 /s/

 Chief
 Financial Officer and Treasurer

 (Principal Financial and
 Accounting Officer)

 /s/
 Carolina Abenante

 Co-Founder, Vice-Chairperson and Chief Strategy Officer,

 Carolina Abenante

 Chief Evangelist and Director

 /s/
 Robert E. Ainbinder, Jr

 Robert E. Ainbinder, Jr.

 /s/ Michael
 Garone

 Michael Garone

 /s/
 Bruce Cooperman

 Bruce Cooperman

 /s/
 Paul Richardson

 Paul Richardson

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