What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-05-22 compared with 2022-11-21 · 439 added, 469 removed, 120 unchanged (88% of the section changed)

Management’s Discussion and

Analysis of Financial Condition and Results of Operations.

Management’s Discussion and Analysis

of Financial Condition and Results of Operations.

This quarterly report on Form 10-Q and other

14 unchanged sentences

estimated, expected, intended, or planned.

Factors that might cause or contribute to such a discrepancy include, but are not limited

to, those listed under the heading “Risk Factors” and those listed in our Annual Report on Form 10-K for the year ended December

Factors that might cause or contribute to such a discrepancy include, but are not limited to,

those listed under the heading “Risk Factors” and those listed in our Annual Report on Form 10-K for the year ended December

31, 2022 (the “2022 Form 10-K”) and in this Form 10-Q.

2 unchanged sentences

Although the Company believes the expectations

reflected in the forward-looking statements are based on reasonable assumptions, the Company cannot guarantee future results, levels

of activity, performance, or achievements.

Except as required by applicable law, including the securities laws of the United States,

the Company does not intend to update any of the forward-looking statements to conform these statements to actual results.

are urged to carefully review and consider the various disclosures made throughout the entirety of this report, which attempts to advise

interested parties of the risks and factors that may affect our business, financial condition, results of operations, and prospects.

reflected in the forward-looking statements are based on reasonable assumptions, the Company cannot guarantee future results, levels of

activity, performance, or achievements.

Except as required by applicable law, including the securities laws of the United States, the Company

does not intend to update any of the forward-looking statements to conform these statements to actual results.

Readers are urged to carefully

review and consider the various disclosures made throughout the entirety of this report, which attempts to advise interested parties of

the risks and factors that may affect our business, financial condition, results of operations, and prospects.

Overview of Our Business

5 unchanged sentences

increased production costs and tightened environmental laws in China, the Company had transformed its business from fruit juice manufacturing

and distribution to a real-name blockchain based e-commerce platform, supply chain financing service and trading business, money transfer

service, asset management and financial technology business.

The main business of the Company includes an online shopping platform, Chain

Cloud Mall (“CCM”), which is based on blockchain technology, supply chain financing services and trading, assets management,

money transfer service and cryptocurrency market data services.

The Company is also engaged in the development of blockchain based e-Commerce

technology, cryptocurrency mining, cryptocurrency investment management as well as financial service technology businesses.

has also expanded into financial services and cryptocurrency market data and information service businesses.

On August 6, 2021, the Company completed acquisition

of 90% of the issued and outstanding shares of Nice Talent Asset Management Limited (“NTAM”), a Hong Kong-based asset management

company, from Joy Rich Enterprises Limited (“Joy Rich”).

NTAM is licensed under the Securities and Futures Commission of Hong

Kong (“SFC”) to carry out regulated activities in Type 4:

Advising on Securities and Type 9:

Asset Management.

On September 29, 2022, FTFT UK Limited completed its acquisition of

100% of the issued and outstanding shares of Khyber Money Exchange Ltd., a company incorporated in England and Wales, from Rahim Shah,

a resident of United Kingdom (“Seller”) for a total of Euros €685,000 (“Purchase Price”), pursuant to a Share

Purchase Agreement (the “Agreement”) dated September 1, 2021.

The Company is in the process of completing accounting and other

transition and consolidation of Khyber into the Company.

and distribution to a real-name blockchain based e-commerce platform, supply chain financing service and trading business, asset management

and money transfer services.

The main business of the Company includes an online shopping platform, Chain Cloud Mall (“CCM”),

which is based on blockchain technology;

supply chain financing services and trading, asset management and money transfer services.

Company has also expanded into cryptocurrency mining, cryptocurrency market data and information service businesses.

In March 2022, FTFT UK Limited received approval

to operate as an Electronic Money Directive (“EMD”) Agent and has been registered as such with the Financial Conduct Authority

(FCA), a UK regulator.

This status grants FTFT UK Limited the ability to distribute or redeem e-money and provide certain financial services

on behalf of an e-money institution (registration number 903050).

On April 18, 2022, the Company and Future Fintech

(Hong Kong) Limited, a wholly owned subsidiary of the Company jointly acquired 100% equity interest of KAZAN S.A., a company incorporated

in Republic of Paraguay for $288.

The Company owns 90% and FTFT HK owns 10% of Kazan S.A., respectively.

has no operation before

the acquisition.

The Company plans to develop bitcoin and other cryptocurrency mining and related services in Paraguay.

The Company has

changed its name from KAZAN S.A to FTFT Paraguay S.A.

on July 28, 2022.

On September 29, 2022, FTFT UK Limited completed

its acquisition of 100% of the issued and outstanding shares of Khyber Money Exchange Ltd., a company incorporated in England and Wales,

from Rahim Shah, a resident of United Kingdom for a total of Euros €685,000 (“Purchase Price”), pursuant to a Share Purchase

Agreement (the “Agreement”) dated September 1, 2021.

Khyber Money Exchange Ltd.

is a money transfer company with

a platform for transferring money through one of its agent locations or via its online portal, mobile platform or over the phone.

Money Exchange Ltd.

is regulated by the UK Financial Conduct Authority (FCA) and the parties have received the approval by the FCA before

formal closing of the transaction.

In December 2021, FTFT Capital Investments, L.L.C.,

a subsidiary of the Company, officially launched FTFTX, a cryptocurrency market data platform that provides investors with real-time

cryptocurrency market data and trading information from a large number of cryptocurrency exchanges.

The market data is available for

Bitcoin, ETH, EOS, Litecoin, TRON and other cryptocurrencies at https://www.ftftx.com and via the FTFTX App on iOS and Android devices.

The FTFTX app is free to download on Google Play and the Apple Store.

In March 2022, FTFT UK received has received

approval to operate as an Electronic Money Directive (“EMD”) Agent and has been registered as such with the Financial Conduct

Authority (FCA), a UK regulator.

This status grants FTFT UK the ability to distribute or redeem e-money and provide certain financial

services on behalf of an e-money institution (registration number 903050).

In June 2022, Future Fintech Labs Inc.

Labs”) have teamed up with a third-party money transfer company to launch a cross-border money transfer app Tempo to offer US-based

immigrants and other users a streamlined, secure and cost-effective way to send money to friends and family among other parties in Mexico,

India and the United Kingdom.

By working with the money transfer company and other service providers that are registered with FinCEN

and have licenses for money transmission business, FTFT Labs has developed Tempo that can provide its customers with a multicurrency digital

wallet that makes sending money to Mexico, India or the UK easier and more cost-effective than many other remittance services who

charge high fees per transfer.

In October 2022, FTFT UK Limited officially launched

the FTFT Orbit e-wallet app.

The new app is now available on Google Play and the Apple App Store.

The FTFT Orbit e-wallet app is an electronic

wallet that integrates popular e-wallet functions similar to Alipay and We chat pay.

It also integrates most of the core services

that traditional banks offer such as international remittances, transfer payments, a physical debit card and bill payments.

In November 2022, FTFT Super Computing Inc.

it has completed the first construction phase of the build-out of its cryptocurrency mining farm in northwest Ohio.

testing procedures, on October 24, 2022, the first batch Antminer S19 series mining machines were successfully put into operation.

We are a holding company incorporated in Florida

and we are not a Chinese operating company.

As a holding company with no material operations of our own, we conduct a substantial majority

of our operations through our subsidiaries in China, Hong Kong, Dubai, U.S.

and UK and we operate a blockchain based online shopping mall

through contractual arrangements with a variable interest entity (VIE) –E-Commerce Tianjin, based in China and this structure involves

unique risks.

Our shares of common stock are shares of our Florida holding company, and we do not have any equity ownership of our VIE,

instead we control and receive the economic benefits of our VIE’s business operations through certain contractual arrangements,

which are used to replicate foreign investment in Chinese-based companies where Chinese law prohibits foreign invested equity exceeding

50% in value added telecom/e-commerce business.

Chinese regulatory authorities could disallow the VIE structure, which could result in

a material change in our operations and/or value of our shares, including that it could cause the value of shares to significantly decline

or become worthless.

There are legal and operational risks associated

with being based in and having a substantial majority of operations in China and Hong Kong.

These risks could result in a material change

in our operations and/or the value of our common stock or could significantly limit or completely hinder our ability to offer or continue

to offer securities to investors and cause the value of our shares to significantly decline or be worthless.

Recently, the PRC government

initiated a series of regulatory actions and statements to regulate business operations in China with little advance notice, including

cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas, adopting

new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement.

On July 6, 2021, the

General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued an announcement

to crack down on illegal activities in the securities market and promote the high-quality development of the capital market, which, among

other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation,

to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application

of the PRC securities laws.

On February 15, 2022, Cybersecurity Review Measures published by Cyberspace Administration of China or the

CAC, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, Ministry

of State Security, Ministry of Finance, Ministry of Commerce, People’s Bank of China, State Administration of Radio and Television,

China Securities Regulatory Commission (“CSRC”), State Secrecy Administration and State Cryptography Administration became

effective, which provides that, Critical Information Infrastructure Operators (“CIIOs”) that intend to purchase internet products

and services and Online Platforms engaging in data processing activities that affect or may affect national security shall be subject

to the cybersecurity review by the Cybersecurity Review Office.

On November 14, 2021, CAC published the Administration Measures for Cyber

Data Security (Draft for Public Comments), or the “Cyber Data Security Measure (Draft)”, which requires cyberspace operators

with personal information of more than 1 million users who want to list abroad to file a cybersecurity review with the Office of Cybersecurity

On December 24, 2021, the CSRC, together with other relevant government authorities in China issued the Provisions of the State

Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), and the Measures

for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (“Draft Overseas Listing Regulations”).

On April 2, 2022, the CSRC released the Revised Provisions on Strengthening Confidentiality and Archives Administration of Overseas Securities

Offering and Listing by Domestic Companies (Draft for Comments), which provides that PRC issuers listing their securities on foreign stock

exchanges are required to strictly comply with the relevant requirements and procedures on confidentiality and archives.

that the above proposed provisions and rules are enacted, the relevant filing procedures of the CSRC and other governmental authorities

may be required in connection with any offering of our securities.

As of the date of this report, the new laws and guidelines that became

effective have not impacted the Company’s ability to conduct its business, accept foreign investments, or list on a U.S.

foreign stock exchange;

however, new rules and regulations could be adopted and there are uncertainties in the interpretation and enforcement

of existing laws and guidelines, which could materially and adversely impact our business and financial outlook and may impact our ability

to accept foreign investments or continue to list on a U.S.

is a money transfer company with a platform

for transferring money through one of its agent locations or via its online portal, mobile platform or over the phone.

Khyber Money Exchange

is regulated by the UK Financial Conduct Authority (FCA) and the parties received approval by the FCA before the formal closing of

the transaction.

On October 11, 2022, the Company changed the name of Khyber Money Exchange Ltd.

to FTFT Finance UK Limited.

On February 27, 2023, Future FinTech (Hong Kong)

Limited (“Buyer”), a company incorporated in Hong Kong and a wholly owned subsidiary of Future FinTech Group Inc.

(the “Company”)

entered into a Share Transfer Agreement (the “Agreement”) with Alpha Financial Limited, a company incorporated in Hong Kong

(“Seller”) and sole owner and shareholder of Alpha International Securities (Hong Kong) Limited, a company incorporated in

Hong Kong (“Alpha HK”) and Alpha Information Service (Shenzhen) Co., Ltd., a company incorporated in China (“Alpha SZ”).

Alpha HK holds Type 1 ‘Securities Trading’, Type 2 ‘Futures Contract Trading’ and Type 4 ‘Securities Consulting’

financial licenses issued by the Hong Kong Securities and Futures Commission.

Alpha SZ provides technical support services to Alpha HK.

The share transfer transaction is still subject to the approval of the Securities and Futures Commission of Hong Kong (“SFC”)

and has not been closed yet.

On January 26, 2023,

the Company filed with the Florida Secretary of State’s office Articles of Amendment (the “Amendment”) to amend

its Second Amended and Restated Articles of Incorporation, as amended (“Articles of Incorporation”).

As a result of the Amendment,

the Company has authorized and approved a 1-for-5 reverse stock split of the Company’s authorized shares of common stock from 300,000,000

shares to 60,000,000 shares, accompanied by a corresponding decrease in the Company’s issued and outstanding shares of common stock

(the “Reverse Stock Split”).

The common stock continue to be $0.001 par value.

The Company rounds up to the next full share

of the Company’s shares of common stock any fractional shares that result from the Reverse Stock Split and no fractional shares

is issued in connection with the Reverse Stock Split and no cash or other consideration is paid in connection with any fractional shares

that would otherwise have resulted from the Reverse Stock Split.

No changes are being made to the number of preferred shares of the Company

which remain as 10,000,000 preferred shares as authorized but not issued.

The amendment to the Articles of Incorporation of the Company

took effect at 1:00am Eastern Time on February 1, 2023.

The Reverse Stock Split and Amendment were authorized and approved by the Board

of Directors of the Company without shareholders’ approval, pursuant to 607.10025 of the Florida Business Corporation Act of the

State of Florida.

We are a holding company

incorporated in Florida and we are not a Chinese operating company.

As a holding company with no material operations of our own, we conduct

a substantial majority of our operations through our subsidiaries in China, Hong Kong, Dubai and UK and we operate a blockchain based

online shopping mall through contractual arrangements with a variable interest entity (VIE) –E-Commerce Tianjin, based in China

and this structure involves unique risks.

Our shares of common stock are shares of our Florida holding company, and we do not have any

equity ownership of the VIE, instead we control and receive the economic benefits of the VIE’s business operations through certain

contractual arrangements, which are used to replicate foreign investment in Chinese-based companies where Chinese law prohibits direct

foreign investment in value added telecom/e-commerce business.

Chinese regulatory authorities could disallow the VIE structure, which

could result in a material change in our operations and/or value of our shares, including that it could cause the value of shares to significantly

decline or become worthless.

There are legal and operational risks associated with being based in

and having a substantial majority of operations in China and Hong Kong.

These risks could result in a material change in our operations

and/or the value of our common stock or could significantly limit or completely hinder our ability to offer or continue to offer securities

to investors and cause the value of our shares to significantly decline or be worthless.

Recently, the PRC government initiated a series

of regulatory actions and statements to regulate business operations in China with little advance notice, including cracking down on illegal

activities in the securities market, enhancing supervision over China-based companies listed overseas using variable interest entity structure,

adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement.

2021, the General Office of the Communist Party of China Central Committee and the General Office of the State Council jointly issued

an announcement to crack down on illegal activities in the securities market and promote the high-quality development of the capital market,

which, among other things, requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and

judicial cooperation, to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial

application of the PRC securities laws.

On February 15, 2022, Cybersecurity Review Measures published by Cyberspace Administration of

China or the CAC, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security,

Ministry of State Security, Ministry of Finance, Ministry of Commerce, People’s Bank of China, State Administration of Radio and

Television, China Securities Regulatory Commission (“CSRC”), State Secrecy Administration and State Cryptography Administration

became effective, which provides that, Critical Information Infrastructure Operators (“CIIOs”) that intend to purchase internet

products and services and Online Platform Operators engaging in data processing activities that affect or may affect national security

shall be subject to the cybersecurity review by the Cybersecurity Review Office.

On November 14, 2021, CAC published the Administration

Measures for Cyber Data Security (Draft for Public Comments), or the “Cyber Data Security Measure (Draft)”, which requires

cyberspace operators with personal information of more than 1 million users who want to list abroad to file a cybersecurity review with

the Office of Cybersecurity Review.

On July 7, 2022, CAC promulgated the Measures for the Security Assessment of Data Cross-border Transfer,

effective on September 1, 2022, which requires the data processors to apply for data cross-border security assessment coordinated by the

CAC under the following circumstances:

(i) any data processor transfers important data to overseas;

(ii) any critical information infrastructure

operator or data processor who processes personal information of over 1 million people provides personal information to overseas;

any data processor who provides personal information to overseas and has already provided personal information of more than 100,000 people

or sensitive personal information of more than 10,000 people to overseas since January 1st of the previous year;

and (iv) other circumstances

under which the data cross-border transfer security assessment is required as prescribed by the CAC.

On February 17, 2023, the CSRC released

the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Enterprises (the “New Overseas Listing

Rules”) with five interpretive guidelines, which took effect on March 31, 2023.

The New Overseas Listing Rules require Chinese domestic

enterprises to complete filings with relevant governmental authorities and report related information under certain circumstances, such

a) an issuer making an application for initial public offering and listing in an overseas market;

b) an issuer making an overseas

securities offering after having been listed on an overseas market;

c) a domestic company seeking an overseas direct or indirect listing

of its assets through single or multiple acquisition(s), share swap, transfer of shares or other means.

According to the Notice on Arrangements

for Overseas Securities Offering and Listing by Domestic Enterprises, published by the CSRC on February 17, 2023, a company that (i) has

already completed overseas listing or (ii) has already obtained the approval for the offering or listing from overseas securities regulators

or exchanges but has not completed such offering or listing before effective date of the new rules and completes such offering or listing

before September 30, 2023 are considered as an existing listed company and is not required to make any filing until it conducts a new

offering in the future.

Furthermore, upon the occurrence of any of the material events specified below after an issuer has completed its

offering and listed its securities on an overseas stock exchange, the issuer shall submit a report thereof to the CSRC within 3 working

days after the occurrence and public disclosure of the event:

(i) change of control;

(ii) investigations or sanctions imposed by overseas

securities regulatory agencies or other competent authorities;

(iii) change of listing status or transfer of listing segment;

voluntary or mandatory delisting.

On February 24, 2023, the CSRC, the Ministry of Finance, the National Administration of State Secretes

Protection and the National Archives Administration released the Provisions on Strengthening the Confidentiality and Archives Administration

Related to the Overseas Securities Offering and Listing by Domestic Companies, or the Confidentiality and Archives Administration Provisions,

which took effect on March 31, 2023.

PRC domestic enterprises seeking to offer securities and list in overseas markets, either directly

or indirectly, shall establish and improve the system of confidentiality and archives work, and shall complete approval and filing procedures

with competent authorities, if such PRC domestic enterprises or their overseas listing entities provide or publicly disclose documents

or materials involving state secrets and work secrets of state organs to relevant securities companies, securities service institutions,

overseas regulatory agencies and other entities and individuals.

It further stipulates that (i) providing or publicly disclosing documents

and materials which may adversely affect national security or public interests, and accounting records or photocopies thereof to relevant

securities companies, securities service institutions, overseas regulatory agencies and other entities and individuals shall be subject

to corresponding procedures in accordance with relevant laws and regulations;

and (ii) any working papers formed in the territory of the

PRC by securities companies and securities service agencies that provide domestic enterprises with securities services relating to overseas

securities issuance and listing shall be stored in the territory of the PRC, the outbound transfer of which shall be subject to corresponding

procedures in accordance with relevant laws and regulations.

As of the date of this report, these new laws and guidelines that became

effective have not impacted the Company’s ability to conduct its business, or list on a U.S.

or other foreign stock exchange;

Our VIE and certain subsidiaries of the Company

are incorporated and operating in mainland China and they have received all required permissions from Chinese authorities to operate their

current business in China, including Business licenses, Bank Account Open Permits and Value Added Telecom Business License.

new rules and regulations could be adopted and there are uncertainties in the interpretation and enforcement of existing laws and guidelines,

which could materially and adversely impact our business and financial outlook and may impact our ability to accept foreign investments

or continue to list on a U.S.

or other foreign stock exchange.

The VIE and certain subsidiaries of the Company are incorporated and operating

in mainland China and they have received all required permissions from Chinese authorities to operate their current business in China,

including Business licenses, Bank Account Open Permits and Value Added Telecom Business License.

As of the date of this report, we, our

subsidiaries and the VIE in China are not subject to permission requirements from the CSRC or CAC or any other entity that is required

to approve of the VIE’s operations and have not received or were denied such permissions by any PRC authorities.

Currently, we are

required to file with CSRC for any offerings under New Overseas Listing Rules.

Given the current PRC regulatory environment, it is uncertain

whether we, our subsidiaries or the VIE, will be able to obtain permission from the PRC government to offer our securities to foreign

investors, and even when such permission is obtained, whether it will be denied or rescinded.

If we or any of our subsidiaries or the

VIE do not receive or maintain such permissions or approvals, inadvertently conclude that such permissions or approvals are not required,

or applicable laws, regulations, or interpretations change and we or our subsidiaries are required to obtain such permissions or approvals,

it could significantly limit or completely hinder our ability to offer or continue to offer our securities to investors and cause the

value of our securities to significantly decline or become worthless.

If applicable laws, regulations, or interpretations change and the

VIE is required to obtain permissions or approvals in the future, we may face substantial uncertainties as to whether we can obtain such

permissions or approvals in a timely manner, or at all.

Failure to take timely and appropriate measures to adapt to any of these or similar

regulatory compliance challenges could materially and adversely affect our current corporate structure and business operations.

Chain Cloud Mall is a unique real-name based blockchain

16 unchanged sentences

to be admitted as the authorized agent to provide sales agent services on the platform.

The Company started its trial operation of NONOGIRL,

a cross-border e-commerce platform, in March 2020 and formally launched it in July 2020.

The cross-border e-commerce platform aimed to

build a new s2b2c (supplier to business and consumer) outsourcing sales platform dominated by social media influencers.

It was aimed at

the growing female consumer market, with the ability to broadcast, short video, and all forms communication through the platform.

also create a sales oriented sharing ecosystem with other major social media used by customers.

The Company’s promotion strategy

previously mainly relied on the training of members and distributors through meetings and conferences.

Due to the outbreak of COVID-19,

the Chinese government put a restriction on large gatherings.

These restrictions made the promotion strategy for our online e-commerce

platforms difficult to be implemented and the Company has experienced difficulties to subscribe new members for its online e-commerce

Due to the lack of new subscribers, in June 2021, the Company suspended its cross-border e-commerce platform (NONOGIRL).

since the second quarter of 2021, the Company has transformed its member-based business model of Chain Cloud Mall to a sale agent based

eCAAS platform and began to provide supply chain financing services and trading of coal for coal mines and power generation plants as

well as aluminum ingots.

The Company currently has ten direct wholly-owned

The Company started its trial operation of NONOGIRL, a cross-border

e-commerce platform, in March 2020 and formally launched it in July 2020.

The cross-border e-commerce platform aimed to build a new s2b2c

(supplier to business and consumer) outsourcing sales platform dominated by social media influencers.

It was aimed at the growing female

consumer market, with the ability to broadcast, short video, and all forms communication through the platform.

It could also create a

sales oriented sharing ecosystem with other major social media used by customers, etc.

The Company’s promotion strategy previously

mainly relied on the training of members and distributors through meetings and conferences.

Due to the outbreak of COVID-19, the

Chinese government put a restriction on large gatherings.

These restrictions made the promotion strategy for our online e-commerce platforms

difficult to be implemented and the Company has experienced difficulties to subscribe new members for its online e-commerce platforms.

Due to the lack of new subscribers, in June 2021, the Company suspended its cross-border e-commerce platform (NONOGIRL) which later being

Also, since the second quarter of 2021, the Company has transformed its member-based business model of Chain Cloud Mall to a sale

agent based eCAAS platform and began to provide supply chain financing services and trading of coal for coal mines and power generation

plants as well as aluminum ingots.

The Company currently has ten direct controlled

subsidiaries:

4 unchanged sentences

Capital Management, LLC, a company incorporated under the laws of Connecticut, Future Fintech Digital Number One GP, LLC, a company incorporated

under the laws of Connecticut, Future FinTech Labs Inc., a company incorporated under the laws of New York and FTFT SuperComputing Inc.

a company incorporated under the laws of Ohio and FTFT Paraguay S.A., a company incorporated under the law of Republic of Paraguay.

under the laws of Connecticut, Future FinTech Labs Inc., a company incorporated under the laws of New York, FTFT SuperComputing Inc.

company incorporated under the laws of Ohio and FTFT Paraguay S.A., a company incorporated under the laws of Paraguay.

CCM Shopping Mall

Due to the lack of new member subscriptions caused

by restrictions on our promotion strategy for the control of spread of COVID-19, we have transformed the CCM shopping mall from a member

based platform to a sale agent based eCAAS platform since the second quarter of 2021.

Due to the lack of new

member subscriptions caused by restrictions on our promotion strategy for the control of spread of COVID-19, we have transformed the CCM

shopping mall from a member based platform to a sale agent based eCAAS platform.

The eCAAS platform is entrusted by the Anti-Counterfeiting

Committee to run its Responsible Brand Program.

Anti-Counterfeiting Committee reviews and accepts

the companies to join its Responsible Brand Program.

After acceptance, these companies are authorized to use 315 anti-counterfeiting labels

on their products and sell them on our eCAAS platform.

The companies can also use sales agents to sell their products on our eCAAS platform

and parties can negotiate the commission percentages for the products sold.

Any new sales agent must be recommended by existing agents

and pay a one-time fee to the eCAAS platform to be admitted as the authorized agent to provide sales agent services on the platform.

Coal and Aluminum Ingots Supply Chain Financing

Service and Trading

Since the second quarter of 2021, we started coal

supply chain financing service and trading business.

Since the third quarter of 2021, we started aluminum ingots supply chain financing

Anti-Counterfeiting Committee

will review and accept the companies to join its Responsible Brand Program.

After acceptance, these companies are authorized to use 315

anti-counterfeiting labels on their products and sell them on our eCAAS platform.

The companies can also use sales agents to sell their

products on our eCAAS platform and parties can negotiate the commission percentages for the products sold.

Any new sales agent must be

recommended by existing agents and pay a one-time fee to the eCAAS platform to be admitted as the authorized agent to provide sales agent

services on the platform.

Coal, Aluminum Ingots, Sand and Steel Supply

Chain Financing Service and Trading

Since the second quarter of 2021, we started coal supply chain financing

service and trading business.

Since the third quarter of 2021, we started aluminum ingots supply chain financing service and trading business.

Since the first quarter of 2023, we started sand and steel supply chain financing service and trading business.

Our supply chain finance business mainly serves

the receivables and payables for industrial customers, obtains the creditor’s rights or rights of commodity goods for large state-owned

enterprises or public companies through trade execution, provides customers with working capital, accelerates capital turnover, and then

expands the business scale and improves the business value.

the receivables and payables of industrial customers, obtains the creditor’s rights or commodity goods rights of large state-owned

enterprises through trade execution, provides customers with working capital, accelerates capital turnover, and then expands the business

scale and improves the industrial value.

Through our supply chain service ability and customer

resources, we can tap into low-risk assets, flexibly carry out financial services for the actual financial needs of certain industries,

resources, we can tap into low-risk assets, flexibly carry out financial services around the actual financial needs of certain industries,

and reduce the overall risk of the business by using the control of business flow, goods logistics and capital flow in the process of

commodity circulation.

We focus on bulk coal and aluminum ingots and

take large state-owned or listed companies as the core service targets;

We use our own funds as the operation basis, actively use a variety

of channels and products of financing, such as banks, commercial factoring companies, accounts receivable, asset-backed securities, and

other innovative financing methods to obtain sufficient funds.

We sign purchase and sale agreements with suppliers

The suppliers are responsible for the supply and transportation of coal to the end users’ designated freight yard or

transfer the title of aluminum ingots to us in certain warehouses.

We select the customers and suppliers that have good credit and reputation.

We focus on bulk coal, aluminum ingots, sand and steel and take large

state-owned or listed companies as the core service targets;

We use our own funds as the operation basis, actively uses a variety of channels

and products for financing, such as banks, commercial factoring companies, accounts receivable, asset-backed securities, and other innovative

financing methods to obtain sufficient funds.

We sign purchase and sale agreements with suppliers and buyers.

suppliers are responsible for the supply and transportation of the commodities to the end users’ designated freight yard or transfer

the title of them to us in certain warehouses.

We are considered as trading agent if we don’t take control over of the goods.

select the customers and suppliers that have good credit and reputation.

Asset Management Service .

10 unchanged sentences

(1) Equity Investment

NTAM manages clients’

investment portfolio in stocks of the companies listed on the international markets with strong liquidity.

At the same time, it selects

companies that have unique or differentiated businesses, realizing above average profit growth.

NTAM manages clients’ investment portfolio

in stocks of the companies listed on the international markets with strong liquidity.

At the same time, it selects companies that have

unique or differentiated businesses, realizing above average profit growth.

(2) Debt investment

When NTAM manages clients’

investment portfolio in bonds that are denominated in major international currencies such as US dollar, euro and sterling, the issuer

of debts shall have good credit rating and asset liability ratio.

Through active management, NTAM focus on bonds with higher yield to

maturity among bonds with the same maturity and credit rating.

When NTAM manages clients’ investment portfolio

in bonds that are denominated in major international currencies such as US dollar, euro and sterling, the issuer of debts shall have good

credit rating and asset liability ratio.

Through active management, NTAM focus on bonds with higher yield to maturity among bonds with

the same maturity and credit rating.

(3) Precious metals and currencies investment

NTAM also manages clients’

investment portfolio in major international currencies and precious metals, including US dollar, euro, British pound, Japanese yen, Australian

dollar and offshore Chinese yuan.

NTAM also manages clients’ investment portfolio

in major international currencies and precious metals, including US dollar, euro, British pound, Japanese yen, Australian dollar and offshore

Chinese yuan.

Precious metals include gold, platinum and silver.

With research on the fundamentals of market supply

and demand to predict the trend of commodity prices, NTAM endeavors to improve the rate of return for clients through dual currency investment,

options and structured products.

With research on the fundamentals of market supply and demand to predict

the trend of commodity prices, NTAM endeavors to improve the rate of return for clients through dual currency investment, options and

structured products.

(4) Derivative Investment

NTAM also manages clients’

investment portfolio in financial derivatives in different asset classes, such as options and structured products.

NTAM also manages clients’ investment portfolio

in financial derivatives in different asset classes, such as options and structured products.

(5) External Asset Management Services (EAM)

This business takes customer

demand as the service purpose, cooperates with several private banks which provide asset custody services, and innovatively introduces

the function of investment bank to provide exclusive private solutions for our clients.

main revenue is generated from providing professional advices to clients and management fees for managing the investment of the clients.

of September 30, 2022, NTAM has approximately US$195 million assets under its management.

Recent Developments

Related to the COVID-19 Outbreak

In December 2019, a novel strain of coronavirus

was reported and has spread throughout China and other parts of the world.

On March 11, 2020, the World Health Organization characterized

the outbreak as a “pandemic”.

In early 2020, Chinese government took emergency measures to combat the spread of the virus,

including quarantines, travel restrictions, and the temporary closure of office buildings and facilities in China.

In response to

the evolving dynamics related to the COVID-19 outbreak, the Company is following the guidelines of local authorities as it prioritizes

the health and safety of its employees, contractors, suppliers and business partners.

Our offices in China were closed and the employees

worked from home at the end of January 2020 until late March 2020.

The quarantines, travel restrictions, and the temporary closure of

office buildings have materially negatively impacted our business.

Our suppliers were negatively affected, and could continue to be negatively

affected in their ability to supply and ship products to our customers in case of any resurgence of COVID-19.

Our customers that have

been negatively impacted by the outbreak of COVID-19 may reduce their budgets to purchase products and services from us, which may materially

adversely impact our revenue.

The business operations of the third parties’ stores on our e-commerce platform have been and continue

to be negatively impacted by the outbreak, which in turn adversely affects the business of our platform as a whole as well as our financial

condition and operating results.

The outbreak has had and continues to have disruption to our supply chain, logistics providers, customers

or our marketing activities with the new variants of COVID-19, which could materially adversely impact our business and results of operations, especially to our supply chain financing and trading business during the first quarter of 2022.

Although China has already begun to recover from the outbreak of COVID-19, there are still outbreak in various cities and provinces

due to new variants, including the recent outbreak of Omicron variant in Xi’an city, Hong Kong, Shanghai and Beijing in 2022, which

have resulted quarantines, travel restrictions, and temporary closure of office buildings and facilities in these cities.

The Company’s

promotion strategy of CCM Shopping Mall previously mainly relied on the training of members and distributors through meetings and conferences.

Chinese government still puts a restriction on large gatherings.

These restrictions made the promotion strategy for our online e-commerce

platforms difficult to implement and the Company has experienced difficulties to subscribe new members for its online e-commerce platforms.

to the lack of new subscribers, in June 2021, the Company suspended its cross-border e-commerce platform NONOGIRL.

Also, since the second

quarter of 2021, the Company has transformed its member-based Chain Cloud Mall to a sale agent based eCAAS platform and began to provide

supply chain financing services.

The global economy has also been materially negatively

affected by the COVID-19 and there is continued severe uncertainty about the duration and intensity of its impacts.

This business takes customer demand as the service

purpose, cooperates with several private banks which provide asset custody services, and innovatively introduces the function of investment

bank to provide exclusive private solutions for our clients.

NTAM’s main revenue is generated from providing professional

advices to clients and management fees for managing the investment of the clients.

As of March 31, 2023, NTAM has approximately US$242

million assets under its management.

Money Transfer Business

FTFT Finance UK Limited (“FTFT Finance”)

formerly known as Khyber Money Exchange Ltd.

was acquired by FTFT UK Limited in September 2022.

It is regulated by UK Financial Conduct

Authority (“FCA”) for its cross-border money transfer systems and service.

FTFT Finance was incorporated in 2009 and is a

pioneer in the UK for money remittance services.

FTFT Finance provides money transfer services through its platform to transfer money

around the world via one of its agent locations or its online portal, mobile platform, or over the phone.

FTFT Finance is headquartered

in the UK and it has a trade name of FTFT Pay.

FTFT Finance’s plan is to develop products and services across different regions

of the world and become a global name in money remittance services.

FTFT Finance is a financial platform that enables

its customers to send their hard-earned money to their country of origin, or any other country of their liking, with ease and at a reasonable

cost, transparent exchange rate and without any hidden charges.

We believe that it is our understanding of our customers and their diverse

backgrounds that has helped FTFT Finance to become a credible and trustworthy money remittance business.

The FTFT Pay platform and system

support direct connections to over 130 countries and their local banks, targeting customers with transfer destinations based in prominent

countries across the Middle East and Southeast Asia.

Remittance service is a highly saturated market

in the United Kingdom.

There are many companies that offer remittance services however FTFT Finance only sees Ace Money Transfer, Wise

(formerly known as Transfer Wise), Remitly and Remit World as its main competitors.

FTFT Finance has an edge over companies like wise

in many different ways, for example, FTFT Finance offers competitive rates for its services and does not charge customer fees for remittance

to Pakistan as it receives its rebate from local banks.

This approach provides gives us an advantage over our competitors.

Expats living in the United Kingdom often send

money to their relatives either to support them, or for emergency uses or weddings.

The UK has a large migrant population of Indians,

Pakistanis and Bangladeshis.

FTFT Finance has been in money remittance business

since 2009 and has over 500,000 customers.

FTFT Finance advertises through Instagram, Twitter, Facebook and LinkedIn in order to reach

out to new customers.

FTFT Finance implemented email marketing, in which they email customers daily to keep them updated on their account,

transactions as well as marketing and promotions.

The management of FTFT Finance are currently engaged

in talks with different PR companies to kick start a new campaign under FTFT Finance brand name as all previous campaigns were under Khyber

Money Exchange brand.

Recent Developments Related to the COVID-19

In December 2019, a novel strain of coronavirus was reported and has

spread throughout China and other parts of the world.

On March 11, 2020, the World Health Organization characterized the outbreak as a

In early 2020, Chinese government took emergency measures to combat the spread of the virus, including quarantines,

travel restrictions, and the temporary closure of office buildings and facilities in China.

In response to the evolving dynamics related

to the COVID-19 outbreak, the Company followed the guidelines of local authorities as it prioritizes the health and safety of its employees,

contractors, suppliers and business partners.

Our offices in China were closed and the employees worked from home at the end of January

2020 until late March 2020.

The quarantines, travel restrictions, and the temporary closure of office buildings have materially negatively

impacted our business.

Our suppliers were negatively affected, and could continue to be negatively affected in their ability to supply

and ship products to our customers in case of any resurgence of COVID-19.

Our customers that have been negatively impacted by the outbreak

of COVID-19 may reduce their budgets to purchase products and services from us, which may materially adversely impact our revenue.

business operations of the third parties’ stores on our e-commerce platform have been and continue to be negatively impacted by

the outbreak, which in turn adversely affects the business of our platform as a whole as well as our financial condition and operating

The outbreak has had and continues to have disruption to our supply chain, logistics providers, customers or our marketing activities

with the new variants of COVID-19, which could materially adversely impact our business and results of operations, especially to our supply

chain financing and trading business during the first quarter of 2022.

There was outbreak in various cities and provinces due to Omicron

variant in many cities including Xi’an city, Hong Kong, Shanghai and Beijing in 2022, which have resulted quarantines, travel restrictions,

and temporary closure of office buildings and facilities in these cities.

In December 2022, the Chinese government eased its strict zero

COVID-19 policy which resulted in a surge of new COVID-19 cases during December 2022 and January 2023, which has disrupted our business

operations in China.

The Company’s promotion strategy of CCM Shopping Mall previously mainly relied on the training of members and

distributors through meetings and conferences.

Chinese government put a restriction on large gatherings in 2020 and 2021, which made the

promotion strategy for our online e-commerce platforms difficult to implement and the Company experienced difficulties to subscribe new

members for its online e-commerce platforms.

Due to the lack of new subscribers, in June 2021, the Company suspended its cross-border

e-commerce platform NONOGIRL which later being closed.

Also, since the second quarter of 2021, the Company has transformed its member-based

Chain Cloud Mall to a sale agent based eCAAS platform and began to provide supply chain financing services.

The global economy has also been materially negatively affected by

the COVID-19 and there is continued severe uncertainty about the potential outbreak and new variants of COVID-19.

The Chinese and global

11 unchanged sentences

our ability to raise additional capital.

Consequently, our results of operations have been

materially and adversely affected by COVID-19 pandemic.

Any potential further impact to our results will depend on, to a large extent,

future developments and new information that may emerge regarding the duration and severity of the COVID-19, new variants of COVID-19,

the efficacy and distribution of COVID-19 vaccines and the actions taken by government authorities and other entities to contain the COVID-19

or treat its impact, almost all of which are beyond our control.

Consequently, our results of operations have been materially and adversely

affected by COVID-19 pandemic.

Any potential further impact to our results will depend on, to a large extent, future developments and

new information that may emerge regarding new variants of COVID-19, the efficacy and distribution of COVID-19 vaccines and the actions

taken by government authorities and other entities to contain the COVID-19 or treat its impact, almost all of which are beyond our control.

Results of Operations

Comparison of Three Months ended September

Comparison of Three Months ended March 31,

2023 and 2022:

The following table presents our consolidated

revenues for the three months ended September 30, 2022 and 2021, respectively:

September 30,

and Aluminum Ingots Supply Chain Financing/Trading

management service

Revenues from coal and Aluminum Ingots Supply

Chain Financing/Trading business decreased from $9.64 million for the three months ended September 30, 2021 to $7.84 million for the three

months ended September 30, 2022.

The COVID-19 outbreak in Xi’an and other cities in China where we had our supply chain services

and related control measures by local government has had negative impact on the coal and aluminum ingot business and resulted the decrease

in revenue in the third quarter 2022 comparing to the same period of 2021.

Revenue from asset management service increased

from $2.10 million for the three months ended September 30, 2021 to $4.12 million for the three months ended September 30, 2022.

this business on August 6, 2021 and only consolidated partial of its revenues for the third quarter 2021, comparing to the full third

quarter for 2022.

If only comparing revenues from August and September 2022 to the same period of 2021, the revenue slightly increased

in 2022 comparing to such two months in 2021 because NTAM has more assets under its management in 2022 comparing to the same period of

Cost of revenues

revenues for the three months ended March 31, 2023 and 2022, respectively:

Three months ended

September 30,

Coal and Aluminum Ingots Supply Chain Financing/Trading

Asset management service

Cost of revenues for the Coal and Aluminum Ingots

Supply Chain Financing/Trading was $7.70 million and $9.35 million for the three months ended September 30, 2022 and 2021, respectively,

representing an decrease of 17.59%.

The decrease in cost of revenues was in line with a decrease in revenue.

Cost of revenues for the asset management service

increased from $1.41 for the three months ended September 30, 2021 to $2.76 million for the three months ended September 30, 2022.

acquired this business on August 6, 2021 and only consolidated partial of its cost of revenues for the third quarter 2021, comparing to

the full third quarter for 2022.

Supply Chain Financing/Trading

The decrease in revenue for the three months ended March 31, 2023 was

primarily due to less revenue from asset management service, as clients are cautious on stock and other investments during the current

market condition in the first quarter 2023, which has caused reduce in revenue of asset management business for the Company.

Supply chain financing/trading increased from $0 the three months ended

March 31, 2022 to the same period of 2023.

Due to COVID-19 outbreak and related quarantines, travel restrictions and lockdown in various

cities in China during the first quarter 2022, the Company did not have any coals and aluminum ingots supply chain financing/trading business

during the first quarter 2022 while the COVID-19 has been mostly under the control in China since the end of January 2023.

Others are mainly platform service fees, promotion

income for the stores on the platform and others.

Gross Profit and Margin

The following table presents the consolidated

gross profit of each of our main products and services and the consolidated gross profit margin, which is gross profit as a percentage

of the related revenues, for the three months ended September 30, 2022 and 2021, respectively:

Three months ended September 30,

Coal Supply and Aluminum Ingots Chain Financing/Trading

of the related revenues, for the three months ended March 31, 2023 and 2022, respectively:

Three months ended March 31,

Asset management service

Overall gross margin as a percentage of revenue

was 12.49% for the three months ended September 30, 2022, an increase of 4.12% compared to 8.37% for the same period of last fiscal year,

mainly due to more revenues from the asset management service which has a higher gross margin.

Coal Supply and Aluminum Ingots Chain Financing/Trading

gross margin was decreased 1.33% from 3.07% in three months ended September 30, 2021 to 1.74% in same period of 2022, mainly due to the

purchase prices of coal and aluminum ingot in three months ended September 30, 2022 increased comparing to the same period of 2021.

Supply Chain Financing/Trading

Overall gross margin as a percentage of revenue was 35.6% for the three

months ended March 31, 2023, a decrease of 16.0% from 51.6% for the same period of last fiscal year, mainly due to lower profit margin

from the asset management service for the three months ended March 31, 2023, comparing to the same period of 2022, which was mainly due

to increased salary and employees for our asset management business.

Operating Expenses

The following table presents our consolidated

operating expenses and operating expenses as a percentage of revenue for the three months ended September 30, 2022 and 2021, respectively:

September 30,

operating expenses and operating expenses as a percentage of revenue for the three months ended March 31, 2023 and 2022, respectively:

First quarter of 2023

First quarter of 2022

General and administrative

Research and Development expenses

Stock compensation expense

Selling expenses

Bad debt provision

Impairment Loss

1 unchanged sentence

General and administrative expenses increased

by $1.32 million, or 58.65%, from $2.24 million to $3.56 million for the three months ended September 30, 2022, compared to the same period

of last fiscal year.

The increase in general and administrative expenses was mainly due to increased professional service fees for acquisition

projects and certain training and consulting fees for the acquired and newly established companies during the three months ended September

compensation expense was $1.28 million during the three months ended September 30, 2022, as the Compensation Committee of the Board of

Directors (the “Board”) of the Company granted certain shares of common stock of the Company to certain officers and employees

in July 2022.

Stock compensation expense was decreased 76.68% from $5.49 million in three months ended September 30, 2021 to $1.28million

in same period of 2022, mainly due to stock price was lower than 2021, mainly due to the stock price on the grant date is much lower this

year comparing to price on grant date of 2021.

The Company recorded $0.79 million of research

and development expenses for the nine months ended September 30, 2022, which the Company did not have any during the same period 2021.

Research and development expenses include salaries, contracted services, as well as the related expenses of our research and product development

The research and development expenditures also include research, develop, design, and enhance our assets and wealth management options

and services to our clients, which is related to the business we acquired in the third quarter 2021.

Selling expenses increased by $0.16 million during

the three months ended September 30, 2022 comparing to the same period of 2021, the increase in selling expenses was mainly due to increased

salary and advertising fee.

by $0.07 million, or 2.0%, from $3.4 million to $3.5 million for the three months ended March 31, 2023, compared to the same period of

last fiscal year.

The increase in general and administrative expenses was mainly due to increased rental fee during the three months ended

March 31, 2023.

Selling expenses decreased by $0.24 million during

the three months ended March 31, 2023, compared to the same period of last fiscal year.

The decrease in selling expenses was mainly due

to decreased salaries and advertising fees.

The Company recorded $0.25 million of impairment

loss in three months ended September 30, 2022 relating to short term investment which mainly due to Future Private Equity Fund Management

loss in three months ended March 31, 2022 relating to short term investment which mainly due to Future Private Equity Fund Management

(Hainan) Co., Ltd.

1 unchanged sentence

various types of investment portfolios.

The impairment loss relating to short term investment is due to that overall economic environment

has worsened in China with Covid-19 outbreak and related lockdown in various cities in China in 2022, Ukraine war, inflation, looming

recession worldwide.

According to the market value, the Company’s balance of the short term investment was$0.97 million on September

Other Income, Net

income, net increased by $0.98 million to $1.21 million for the three months ended September 30, 2022 from $0.23 million in the same period

of the last fiscal year, primarily due to a large change in foreign exchange gain.

Tax provision increased by $0.20 million for the

three months ended September 30, 2022.

We did not have tax provision for the same period of the last fiscal year.

Non-controlling Interests

Shaanxi Chunlv Ecological Agriculture Co., Ltd.

(“Shaanxi Chunlv”) holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited, which was dissolved and

deregistered on June 27, 2022.

Nature Worldwide Resources Ltd.

holds 40% interest in DCON DigiPay Limited (“DCON Digipay”).

Each of Bin Wu and Lixiong Huang holds 25% and 20% interest in FTFT Capital Investments L.L.C., respectively.

Loss from Continuing Operations

Loss from continuing operations decreased by $3.00

million from $6.63 million for the three months ended September 30, 2021 to $3.63 million for the same period of 2022 mainly due to the

increase in gross profit margin and decrease in operating expenses, as discussed above.

Comparison of Nine Months Ended September 30,

2022 and 2021

The following table presents our consolidated

revenues for the nine months ended September 30, 2022 and 2021, respectively:

Nine months ended

September 30,

CCM Shopping Mall Membership

Coal and Aluminum Ingots Supply Chain Financing/Trading

Asset management service

CCM Shopping Mall Membership fees decreased from

$85 for the nine months ended September 30, 2021 to $0 for the nine months ended September 30, 2022 because there was no new membership

enrollment and the Company has transformed its business model of CCM Shopping Mall from a member-based platform to a sales agent based

eCAAS platform since the second quarter of 2021, which has not generated any meaningful revenue.

Due to COVID-19 related restriction on

large gathering for meetings and conferences which primarily used by us before the pandemic for marketing and business development of

new members for the platform, we were unable to attract new member enrollment and have had difficulties to generate revenues for the platform.

Revenues for coal and Aluminum Ingots Supply Chain

Financing and Trading business increased from $10.40 million for the nine months ended September 30, 2021 to $11.49 million for the nine

months ended September 30, 2022.

We started the supply chain financing and trading business in the second quarter 2021, therefore we had

more months to generate revenues for such business in 2022comparing to the same period of 2021.

The COVID-19 outbreak in Xi’an and

other cities in China where we had our supply chain business and the control measures by local government have caused material negative

impact on our coal and aluminum ingot supply chain business revenues in the first quarter of 2022.

Revenues from asset management service increased

from $2.10 million for the nine months ended September 30, 2021 to $11.27 million for the nine months ended September 30, 2022.

this business on August 6, 2021 and only consolidated partial of its revenues for the nine months ended September 30, 2021, comparing

to the full third quarters for 2022.

If only comparing revenues from August and September 2022 to the same period of 2021, the revenue

slightly increased in 2022 comparing to such two months in 2021 because NTAM has more assets under its management in 2022 comparing to

the same period of 2021.

Other revenues increased from $0 for nine months

ended September 30, 2021 to $78,170 for the nine months ended September 30, 2022, which were mainly increased NTAM’s Consulting

fee income during the nine months ended September 30, 2022, which we did not have for the same period of 2021.

Cost of revenues

Nine months ended

September 30,

CCM Shopping Mall Membership

Coal and Aluminum Ingots Supply Chain Financing/Trading

Asset management service

Cost of revenues for the Coal and Aluminum Ingots

Supply Chain Financing/Trading was $11.30 million and $10.65 million for the nine months ended September 30, 2022 and 2021, respectively,

representing an increase of 6.08%.

The increase in cost of revenues was in line with an increase in revenue.

Cost of revenues for the asset management service

increased from $1.41 million for the nine months ended September 30, 2021 to $6.89 million for the nine months ended September 30, 2022.

We acquired this business on August 6, 2021 and only consolidated partial of its cost of revenues for nine months ended 2021, comparing

to the full third quarters for 2022.

If only comparing cost of revenues from August and September 2022 to the same period of 2021, the

cost of revenue slightly increased in 2022 comparing to such two months in 2021 which is in line with the slight increase in revenue.

The following table presents the consolidated

gross profit of each of our main products and services and the consolidated gross profit margin, which is gross profit as a percentage

of the related revenues, for the nine months ended September 30, 2022 and 2021, respectively:

Nine months ended September 30,

CCM Shopping Mall Membership

Coal Supply Chain Financing/Trading

Asset management service

Overall gross margin as a percentage of revenue

was 20.38% for the nine months ended September 30, 2022, an increase of 16.87% compared to 3.51% for the same period of last fiscal year,

mainly due to more revenues from the asset management service which had a higher gross margin.

The others were mainly increase in

NTAM consulting fee income during the nine months ended September 30, 2022, which we did not have for the same period of 2021.

Operating Expenses

The following table presents our consolidated

operating expenses and operating expenses as a percentage of revenue for the nine months ended September 30, 2022 and 2021, respectively:

September 30, 2022

September 30, 2021

General and administrative

Research and Development expenses

Stock compensation expense

Selling expenses

Impairment Loss

Bad debt provision

Total operating expenses

General and administrative expenses increased

by $5.05 million, or 110.58%, from $4.57 million to $9.62 million for the nine months ended September 30, 2022, compared to the same period

of last fiscal year.

The increase in general and administrative expenses was mainly due to increased professional service fees for acquisition

projects and certain training and consulting fees for the acquired and newly established companies during the nine months ended September

compensation expense was $1.28 million during the nine months ended September 30, 2022, as the Compensation Committee of the Board of

Directors (the “Board”) of the Company granted certain shares of common stock of the Company to certain officers and employees

in July 2022.

Stock compensation expense was decreased 76.68% from $5.49 million in nine months ended September 30, 2021 to $1.28million

in same period of 2022, mainly due to stock price was lower than 2021, mainly due to the stock price on the grant date is much lower this

year comparing to price on grant date of 2021.

Overall economic environment got worsened in China with Covid-19 outbreak and related lockdown

in various cities in China in 2022, Ukraine war, inflation, looming recession worldwide.

According to the market value, the Company’s

balance of the short - term investment was $1.8 million on March 31, 2022.

The Company recorded $0.21 million of research

and development expenses for the nine months ended September 30, 2022, which the Company did not have any during the same period 2021.

Research and development expenses include salaries, contracted services, as well as the related expenses of our research and product development

The research and development expenditures also include research, develop, design, and enhance our wealth management options and

services to our clients, which is related to the new business we acquired in August 2021.

Selling expenses increased by $0.86 million during

the nine months ended September 30, 2022, the increase in selling expenses was mainly due to increased salary and advertising fee.

The Company recorded $0.93 million of impairment

loss in nine months ended September 30, 2022 relating to short term investment which mainly due to Future Private Equity Fund Management

(Hainan) Co., Ltd.

invested $1.83 million (RMB13,000,000) to entrust Shanghai Yuli Enterprise Management Consulting Firm to invest in

various types of investment portfolios.

The impairment loss relating to the short term investment is due to that overall economic environment

has worsened in China with Covid-19 outbreak and related lockdown in various cities in China in 2022, Ukraine war, inflation, looming

recession worldwide.

According to the market value, the Company’s balance of the short term investment was $0.97 million on September

Other Income, Net

income, net increased by $1.31 million to $2.00 million for the nine months ended September 30, 2022 from $0.69 million in the same period

of the last fiscal year, primarily due to a large change in foreign exchange gain.

Tax provision increased by $0.51 million for the

nine months ended September 30, 2022.

We did not have tax provision for the same period of the last fiscal year.

and development expenses.

Research and development expenses include salaries, contracted services, as well as the related expenses of

our research and product development team, and expenditures relating to our efforts to develop, design new products and services, and

enhance our existing products and services to our clients.

Research and development expenses decreased by $0.22 million during the three

months ended March 31, 2023, compared to the same period of last fiscal year.

The decrease in research and development expenses was mainly

due to decreased salaries.

Other Income (Expense), Net

Other expenses, net increased by $0.24 million to $0.41 million for

the three months ended March 31, 2023 from $0.17 million in the same period of the last fiscal year, primarily due to increased interest

Tax provision decreased by $0.16 million for the

three months ended March 31, 2023, primarily due to decreased revenue.

Non-controlling Interests

Shaanxi Chunlv Ecological Agriculture Co., Ltd.

(“Shaanxi Chunlv”) holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited, which was dissolved and

deregistered on June 27, 2022.

As of March 31, 2023, Shaanxi Chunlv Ecological

Agriculture Co., Ltd.

(“Shaanxi Chunlv”) holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited,

which was dissolved and deregistered on June 27, 2022.

Nature Worldwide Resources Ltd.

holds 40% interest in DCON DigiPay Limited (“DCON Digipay”).

holds 40% interest in DCON DigiPay Limited (“DCON

Each of Bin Wu and Lixiong Huang holds 25% and 20% interest in FTFT Capital Investments L.L.C., respectively.

Loss from Continuing Operations

Loss from continuing operations decreased by $0.38

million from $9.05 million for the nine months ended September 30, 2021 to $8.67 million for the same period of 2022 mainly due to increase

in revenues and gross margin which was partially offset by increases in cost of revenue and operating expenses, as discussed above.

Gain on disposal of discontinued operations

Loss on disposal of discontinued operation was

$154 for the nine months ended September 30, 2022, which was related to the dissolution and deregistration of Chain Cloud Mall Logistics

Center (Shanxi) Co., Ltd.

on June 27, 2022.

Capital Partner Limited holds 5%, Cheung Hiu Tung holds 2.22% and Choi Tsz Leung holds 2.78% of equity interest of NATM.

Yaohua Dai holds

20% equity interest of Future Fintech Digital Capital.

Net loss decreased by $0.45 million from $2.70 million for the three

months ended March 31, 2022 to $2.25 million for the same period of 2023 mainly due to the decrease in operating expenses, as discussed

Loss per Share

Basic and diluted loss per share from continuing

operations were $0.12 and $0.11 for the nine months ended September 30, 2022, respectively, as compared to a loss of $0.14 and $0.14 for

the same periods of 2021, respectively.

Basic and diluted income per share attributable to discontinued operations was nil for the nine

months ended September 30, 2022 respectively.

Basic and diluted earnings per share attributable to discontinued operations was $0.04 and

$0.04 for the nine months ended September 30, 2021 respectively.

Basic and diluted loss per share were $0.15 and

$0.15 for the three months ended March 31, 2023, respectively, as compared to a loss of $0.19 and $0.18 for the same periods of 2022,

respectively.

Liquidity and Capital Resources

As of September 30, 2022, we had cash and cash

equivalents of $32.96 million, as compared to $50.27 million as of December 31, 2021.

The decrease in cash, cash equivalents was mainly

due the loss in operations and Company did not issue shares of common stock to raise money for the nine months ended September 30, 2022

comparing to the same period of 2021.

Our working capital has mainly been generated from our business operations

and financing activities.

Our working capital was $54.59 million, as of September 30, 2022, a decrease of $10.90 million from working

capital of $65.49 million, as of December 31, 2021, mainly due to the Company had loss in its operations and did not raise any funds during

the nine months ended September 30, 2022.

As of March 31, 2023, we had cash and restricted

cash of $19.80 million, as compared to $29.74 million as of December 31, 2022.

The decrease in cash, cash equivalents and restricted cash

was mainly due to increased prepayment for coals and aluminum ingots supply chain financing and trading business from the first quarter

Our working capital has historically been generated from our operating

cash flows, advances from our customers and loans from bank facilities.

Our working capital was $44.83 million as of March 31, 2023, a

decrease of $1.64 million from working capital of $46.48 million as of March 31, 2022, mainly due to the decrease in current assets and

an increase in current liabilities.

Net cash used in operating activities increased

by $20.40 million to $0.59 million for the nine months ended September 30, 2022 from a cash outflow of $19.81 million for the same period

of the last fiscal year.

The increase in net cash used in operating activities was primarily due to a decrease in accounts receivable,

increase in advances from customers and share-based payments during the nine months ended September 30, 2022.

Net cash used in investing activities increased

by $7.73 million in the nine months ended September 30, 2022, comparing the same period of 2021, mainly due to additional loan to a third

Net cash provided by financing activities for

the nine months ended September 30, 2022 was $0.25 million representing a decrease of $68.52 million, as compared to cash provided by

financing activities of $69.43 million during the nine months ended September 30, 2021.

The decrease in cash provided by financing activities

was mainly due to the Company had loss in operations and did not raise any funds during the nine months ended September 30, 2022, comparing

to the same period of 2021.

Off-balance sheet arrangements

As of September 30, 2022, we did not have any

by $9.80 million to $10.44 million for the three months ended March 31, 2023 from $0.64 million for the same period of the last fiscal

The increase in net cash used by operating activities was primarily due to increase in advances to suppliers and other current assets.

Net cash used in investing activities decreased

$0.25 million to $0.16 million for the three months ended March 31, 2023 from $0.41 million for the same period of the last fiscal year.

It was due to decrease in payment for loan receivable and purchase of intangible assets.

Net cash provided in financing activities for

the three months ended March 31, 2023 was nil representing a decrease of $3.56 million, as compared to cash provided by financing activities

of $3.56 million during the three months ended March 31, 2022.

The decrease in cash provided by financing activities was mainly due to

proceeds from loan payable.

Off-balance sheet arrangements

Quantitative and Qualitative Disclosures about Market Risk

As of March 31, 2023, we did not have any off-balance

sheet arrangements.

Quantitative and Qualitative Disclosures

about Market Risk

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis