Next Technology Holding Inc. 10-Q

Item 1. Financial Statements WETRADE GROUP INC CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (All amounts shown in U.S. Dollars) As of September 30, 2023 As of December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 1,416,885 $ 24,232 Digital assets 22,398,510 — Accounts receivable- non related parties, net 129,765 — Other receivables-related parties 5,805,500 5,805,500 Prepayments 12,125,500 50,000 Assets related to discontinued operation — 37,181,074 Total current assets 41,876,160 43,060,806 Total assets: 41,876,160 $ 43,060,806 LIABILITIES AND STOCKHOLDERS’ EQUITY Current liabilities: Account payables 123,273 — Accrued expenses 270,864 — Amount due to related parties 1,673,683 1,291,296 Other payables 50,517 50,000 Total current liabilities 2,118,337 1,341,296 Total liabilities 2,118,337 1,341,296 Stockholders’ equity: Common stock; no par value; 2,625,130 and 195,057,503 issued and outstanding at September 30, 2023 and December 31, 2022 respectively — — Additional paid in capital 56,348,650 43,732,196 Accumulated other comprehensive income ( 175 ) ( 298,576 ) Accumulated deficits ( 16,590,652 ) ( 1,714,110 ) Total stockholders’ equity 39,757,823 41,719,510 Total liabilities and stockholders’ equity $ 41,876,160 $ 43,060,806 The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 1 WETRADE GROUP INC CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) For the Three Months Ended September 30, 2023 For the Three Months Ended September 30, 2022 For the Nine Months Ended September 30, 2023 For the Nine Months Ended September 30, 2022 Revenue: Service revenue, related party $ — $ 400,702 $ 36,096 $ 689,039 Service revenue 1,633,836 5,206,568 2,193,903 8,508,642 Total service revenue 1,633,836 5,607,270 2,229,999 9,197,681 Cost of revenue ( 398,537 ) ( 6,902,250 ) ( 1,391,665 ) ( 7,670,836 ) Gross Profit/ (Loss) 1,235,299 ( 1,294,980 ) 838,334 1,526,845 Operating expenses General and administrative expense $ 13,622,149 $ 7,799,979 $ 15,128,916 $ 10,419,873 Total operating expenses ( 13,622,149 ) ( 7,799,979 ) ( 15,128,916 ) ( 10,419,873 ) Loss from operations ( 12,386,850 ) ( 9,094,959 ) ( 14,290,582 ) ( 8,893,028 ) Other income 9,255,824 235,418 9,222,557 308,360 Other expenses ( 5,365,900 ) — ( 4,355,420 ) — Loss before income taxes ( 8,496,926 ) ( 8,859,541 ) ( 9,423,445 ) ( 8,584,668 ) Income tax income/(expenses) 383 202,450 ( 31,859 ) 45,795 Net loss from continuing operation $ ( 8,496,543 ) $ ( 8,657,091 ) $ ( 9,455,304 ) $ ( 8,538,873 ) Discontinued Operations: Loss from discontinued operation ( 4,177,004 ) ( 4,936,613 ) ( 5,421,237 ) ( 6,418,752 ) Comprehensive income Net loss $ ( 12,673,547 ) $ ( 13,593,704 ) $ ( 14,876,541 ) $ ( 14,957,625 ) Other comprehensive income Foreign currency translation adjustment ( 175 ) — ( 175 ) — Total comprehensive loss $ ( 12,673,722 ) $ ( 13,593,704 ) $ ( 14,876,716 ) $ ( 14,957,625 ) Loss per share, basic and diluted $ ( 0.18 ) $ ( 0.04 ) $ ( 0.08 ) $ ( 0.04 ) *Weighted-average shares outstanding, basic and diluted 48,205,725 192,768,916 114,844,076 233,072,453 * Share and per share amounts have been retroactively adjusted to reflect the decreased number of shares resulting from a reverse stock split and issuance of new shares. The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 2 WETRADE GROUP INC CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (UNAUDITED) Three months ended September 30, 2023 Common Stock Additional Paid in Accumulated Accumulated Other Comprehensive Total Shareholder Shares Amount Capital Deficits Income Equity Balance as of June 30, 2023 195,057,503 $ — $ 43,732,196 $ ( 3,917,104 ) $ ( 935,527 ) $ 38,879,565 Reverse shares split ( 194,002,973 ) — — — — — Stock issued during the period 1,570,600 — 12,616,454 — — 12,616,454 Foreign currency translation adjustment — — — — 935,352 935,352 Disposition of discontinued operations — — — ( 5,305,607 ) — ( 5,305,607 ) Net gain from discontinued operation — — — 1,128,602 — 1,128,602 Net profit for the period — — — $ ( 8,496,543 ) — $ ( 8,496,543 ) Balance as of September 30, 2023 2,625,130 $ — $ 56,348,650 $ ( 16,590,652 ) $ ( 175 ) $ 39,757,823 Nine months ended September 30, 2023 Common Stock Additional Paid in Accumulated Accumulated Other Comprehensive Total Shareholder Shares Amount Capital Deficits Income Equity Balance as of December 31, 2022 195,057,503 $ — $ 43,732,196 $ ( 1,714,110 ) $ ( 298,576 ) $ 41,719,510 Reverse shares split ( 194,002,973 ) — — — — — Stock issued during the period 1,570,600 12,616,454 — — 12,616,454 Foreign currency translation adjustment — — — — 298,401 298,401 Disposition of discontinued operations — — — ( 6,545,912 ) — ( 6,545,912 ) Net loss from discontinued operation — — — 1,124,674 — 1,124,674 Net loss for the period — — — $ ( 9,455,304 ) — $ ( 9,455,304 ) Balance as of September 30, 2023 2,625,130 $ — $ 56,348,650 $ ( 16,590,652 ) $ ( 175 ) $ 39,757,823 3 Three months ended September 30, 2022 Common Stock Additional Paid in Retained Accumulated Other Comprehensive Total Shareholder Shares Amount Capital Earnings Income Equity Balance as of June 30, 2022 305,451,498 $ — $ 6,197,520 $ 7,551,523 $ 187,388 $ 13,936,431 Share cancellation ( 120,418,995 ) — — — — — Stock issued during the period 10,000,000 — 37,057,176 — — 37,057,176 Stock compensation 25,000 — 477,500 — — 477,500 Foreign currency translation adjustment — — — — ( 187,388 ) ( 187,388 ) Disposition of discontinued operation — — — ( 8,733,966 ) — ( 8,733,966 ) Net gain from discontinued operations 1,738,568 1,738,568 Net profit for the period — — — $ ( 8,657,091 ) — $ ( 8,657,091 ) Balance as of September 30, 2022 195,057,503 $ — $ 43,732,196 $ ( 8,100,966 ) $ — $ 35,631,230 Nine months ended September 30, 2022 Common Stock Additional Paid in Retained Accumulated Other Comprehensive Total Shareholder Shares Amount Capital Earnings Income Equity Balance as of December 31, 2021 305,451,498 $ — $ 6,197,520 $ 7,433,305 $ 898,497 $ 14,529,322 Share cancellation ( 120,418,995 ) — — — — — Stock issued during the period 10,000,000 — 37,057,176 — — 37,057,176 Stock compensation 25,000 — 477,500 — — 477,500 Foreign currency translation adjustment — — — — ( 898,497 ) ( 898,497 ) Disposition of discontinued operations — — — ( 8,733,966 ) — ( 8,733,966 ) Net gain from discontinued operations 1,738,568 1,738,568 Net loss for the period — — — $ ( 8,538,873 ) — $ ( 8,538,873 ) Balance as of September 30, 2022 195,057,503 $ — $ 43,732,196 $ ( 8,100,966 ) $ — $ 35,631,230 The accompanying notes are an integral part of these unaudited condensed consolidated f inancial statements. 4 WETRADE GROUP INC CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) For the Nine months Ended For the Nine months Ended September 30, 2023 September 30, 2022 Cash flows from operating activities: Net loss $ ( 9,455,304 ) $ ( 8,538,873 ) Gain from discontinued operation 1,124,675 — Loss from disposal operation ( 6,545,912 ) ( 6,418,752 ) Digital assets impairment loss 2,591,489 Amortization of intangible asset — 4,633 Depreciation — 36,641 Changes in operating assets and liabilities: Accounts receivables 6,044,289 592,924 Account receivable- related parties 549,606 3,043,409 Other receivables-related parties ( 5,805,500 ) — Other receivables 288,143 ( 118,958 ) Prepaid expenses 287,715 ( 12,936,012 ) Prepaid expenses- related parties 1,914,515 ( 2,312,339 ) Account payables ( 20,644 ) 2,161,958 Account payable- related parties ( 86,956 ) ( 74,027 ) Accrued expenses ( 27,730 ) ( 102,753 ) Right of use assets — 2,580,579 Lease liabilities — ( 2,789,981 ) Tax payables ( 130,200 ) ( 489,844 ) Other payables ( 2,276,992 ) 17,882 Assets related to discontinued operations 3,018,129 6,418,752 Net cash flows provided by operating activities: ( 8,530,677 ) ( 18,924,761 ) Cash flow from investing activities: Digital assets ( 24,990,000 ) — Loan receivables 1,614,841 1,662,363 Amortised expenses — ( 816,340 ) Net cash used in investing activities: ( 23,375,159 ) 846,023 Cash flow from financing activities: Proceed from issuance of common stock 12,616,454 37,534,676 Shareholders loan 382,387 330,832 Net cash flows provided by financing activities: 12,998,841 37,865,508 Effect of exchange rate changes on cash 298,400 ( 141,482 ) Change in cash and cash equivalents: ( 18,608,595 ) 19,645,288 Cash and cash equivalents, beginning of period $ 20,025,480 $ 616,594 Cash and cash equivalents, end of period $ 1,416,885 $ 20,261,882 Supplemental cash flow information: Cash paid for interest $ — $ — Cash paid for taxes $ — $ — The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 5 WETRADE GROUP INC NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) NOTE 1 – NATURE OF BUSINESS Business WeTrade Group, Inc was incorporated in the State of Wyoming on March 28, 2019. We currently pursue two corporate strategies. One business strategy is to continue providing software development services, and the other strategy is to acquire and hold bitcoin. Software development We provide AI-enabled software development services to our customers, which included developing, designing, and implementing various SAAS software solutions for businesses of all types, including industrial and other businesses. Bitcoin Acquisition Strategy Our bitcoin acquisition strategy generally involves acquiring bitcoin with our liquid assets that exceed working capital requirements, and from time to time, subject to market conditions, issuing debt or equity securities or engaging in other capital raising transactions with the objective of using the proceeds to purchase bitcoin. We view our bitcoin holdings as long-term holdings and expect to continue to accumulate bitcoin. We have not set any specific target for the amount of bitcoin we seek to hold, and we will continue to monitor market conditions in determining whether to engage in additional financings to purchase additional bitcoin. This overall strategy also contemplates that we may (i) periodically sell bitcoin for general corporate purposes, including to generate cash for treasury management or in connection with strategies that generate tax benefits in accordance with applicable law, (ii) enter into additional capital raising transactions that are collateralized by our bitcoin holdings, and (iii) consider pursuing additional strategies to create income streams or otherwise generate funds using our bitcoin holdings. We believe that, due to its limited supply, bitcoin offers the opportunity for appreciation in value if its adoption increases and has the potential to serve as a hedge against inflation in the long-term. 6 The following table presents a roll-forward of our bitcoin holdings, including additional information related to our bitcoin purchases, and digital asset impairment losses during the period: Schedule of digital asset impairment losses Source of capital used to purchase Bitcoin Digital asset original cost basis Digital asset impairment losses Digital asset carrying amount Approximate number of Bitcoin held Balance at December 31, 2022 - - - - - Digital asset purchase (a) 24,990,000 - 24,990,000 833 Digital asset impairment loss - ( 2,591,490 ) - - Balance at September 30, 2023 24,990,000 ( 2,591,490 ) 22,398,510 833 NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Cautionary Statement This Form 10-Q has not undergone external audit review. The information presented herein is the responsibility of the Company’s management and has not been verified for accuracy by independent auditors. On completion of the review of auditors, the company will file an amended 10-Q/A upon the completion of audit review. Basis of Preparation of Financial Statements The condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”). The condensed consolidated financial statements include the financial statements of the Company and its subsidiaries. All significant inter-company transactions and balances have been eliminated in consolidation. The condensed consolidated financial statements of the Company as of and for the nine months ended September 30, 2023 and 2022 are unaudited. In the opinion of management, all adjustments (including normal recurring adjustments) that have been made are necessary to fairly present the financial position of the Company as of September 30, 2023, the results of its operations for the nine months ended September 30, 2023 and 2022, and its cash flows for the nine months ended September 30, 2023 and 2022. Operating results for the quarterly periods presented are not necessarily indicative of the results to be expected for a full fiscal year. The statements and related notes have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been omitted pursuant to such rules and regulations. These financial statements should be read in conjunction with the financial statements and other information included in the Company’s Annual Report on Form 10-K as filed with the SEC for the fiscal year ended December 31, 2022. 7 Revenue recognition The Company follows the guidance of Accounting Standards Codification (ASC) 606, Revenue from Contracts . ASC 606 creates a five-step model that requires entities to exercise judgment when considering the terms of contracts, which includes (1) identifying the contracts or agreements with a customer, (2) identifying our performance obligations in the contract or agreement, (3) determining the transaction price, (4) allocating the transaction price to the separate performance obligations, and (5) recognizing revenue as each performance obligation is satisfied. The Company only applies the five-step model to contracts when it is probable that the Company will collect the consideration it is entitled to in exchange for the services it transfers to its clients. Digital Assets The Company accounts for its digital assets, which are comprised solely of bitcoin, as indefinite-lived intangible assets in accordance with Accounting Standards Codification (“ASC”) 350, Intangibles—Goodwill and Other. The Company’s digital assets are initially recorded at cost. Subsequently, they are measured at cost, net of any impairment losses incurred since acquisition. Impairment losses are recognized as “Digital asset impairment losses” in the Company’s Consolidated Statement of Operations in the period in which the impairment occurs. Gains (if any) are not recorded until realized upon sale, at which point they are presented net of any impairment losses in the Company’s Consolidated Statements of Operations. In determining the gain to be recognized upon sale, the Company calculates the difference between the sales price and carrying value of the specific bitcoins sold immediately prior to sale. The following table summarizes the Company’s digital asset holdings as of: Schedule of digital asset holdings September 30, 2023 December 31, 2022 Approximate number of bitcoins held 833 .19 — Digital assets carrying value $ 22,398,510 $ — Cumulative asset impairment losses $ 2,591,490 $ — As of September 30, 2023, approximately 833 .19 of the bitcoins held by the Company, which had a carrying value of approximately $22.4 22,398,510 million on the Company’s Consolidated Balance Sheet as of September 30, 2023. 8 Cash and Cash Equivalents The Company considers all highly liquid debt instruments purchased with a maturity period of three months or less to be cash or cash equivalents. The carrying amounts reported in the accompanying unaudited condensed consolidated balance sheets for cash and cash equivalents approximate their fair value. All of the Company’s cash that is held in bank accounts in Singapore, Hong Kong and PRC are not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance. Foreign Currency The Company’s principal country of operations is the PRC. The accompanying condensed consolidated financial statements are presented in US$. The functional currency of the Company is US$, and the functional currency of the Company’s subsidiaries is RMB. The condensed consolidated financial statements are translated into US$ from RMB at year-end exchange rates as to assets and liabilities and average exchange rates as to revenues and expenses. Capital accounts are translated at their historical exchange rates when the capital transactions occurred. The resulting translation adjustments are recorded as a component of shareholders’ equity included in other comprehensive income. Gains and losses from foreign currency transactions are included in profit or loss. There were no gains and losses from foreign currency transactions from the inception to September 30, 2023. Schedule of exchange rate September 30, 2023 December 31, 2022 RMB: US$ exchange rate 7.27 6.9 0 The balance sheet amounts, with the exception of equity, September 30, 2023 and December 31, 2022 were translated at 7.27 RMB and 6.9 RMB to US$ 1.00 , respectively. The equity accounts were stated at their historical rates. The average translation rates applied to statements of operations and comprehensive income accounts for the period ended September 30, 2023 and year ended December 31, 2022 were 7.05 RMB and 6.75 RMB to US$ 1.00 , respectively. Cash flows were also translated at average translation rates for the year and, therefore, amounts reported on the statement of cash flows would not necessarily agree with changes in the corresponding balances on the condensed consolidated balance sheet. The transactions dominated in SGD are immaterial. Consolidation The Company’s condensed consolidated financial statements include the financial statements of the Group and subsidiaries. All transactions and balances among the Group and its subsidiaries have been eliminated upon consolidation. Use of Estimates The preparation of financial statements in conformity with US GAAP requires management to make judgement estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Management believes that the estimates used in preparing the financial statements are reasonable and prudent; however, actual results could differ from these estimates. Significant accounting estimates include the allowance for doubtful accounts, useful lives of intangible asset, valuation of deferred tax assets, and certain accrued liabilities such as contingent liabilities. 9 Accounts Receivable Accounts receivables are presented net of allowance for doubtful accounts. The Company uses specific identification in providing for bad debts when facts and circumstances indicate that collection is doubtful and based on factors listed in the following paragraph. If the financial conditions of its customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowance may be required. The Company maintains an allowance for doubtful accounts which reflects its best estimate of amounts that potentially will not be collected. The Company determines the allowance for doubtful accounts on general basis taking into consideration various factors including but not limited to historical collection experience and credit-worthiness of the customers as well as the age of the individual receivables balance. Additionally, the Company makes specific bad debt provisions based on any specific knowledge the Company has acquired that might indicate that an account is uncollectible. The facts and circumstances of each account may require the Company to use substantial judgment in assessing its collectability. 10 Leases The Company adopted Accounting Standards Update No. 2016-02, Leases (Topic 842) (ASU 2016-02), and generally requires lessees to recognize operating and financing lease liabilities and corresponding right-of-use (ROU) assets on the balance sheet and to provide enhanced disclosures surrounding the amount, timing and uncertainty of cash flows arising from leasing arrangements. Operating leases are included in operating lease right-of-use (“ROU”) assets and short-term and long-term lease liabilities in our condensed consolidated balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our condensed consolidated balance sheets. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As most of the leases do not provide an implicit rate, we use the industry incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. The operating lease ROU asset also includes any lease payments made and excludes lease incentives. The lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term. ASU 2016-02 requires that public companies use a secured incremental browning rate for the present value of lease payments when the rate implicit in the contract is not readily determinable. We determine a secured rate on a quarterly basis and update the weighted average discount rate accordingly. Software Development Costs We apply ASC 985-20, Software—Costs of Software to Be Sold, Leased, or Marketed, in analyzing our software development costs. ASC 985-20 requires the capitalization of certain software development costs subsequent to the establishment of technological feasibility for a software product in development. Research and development costs associated with establishing technological feasibility are expensed as incurred. Based on our software development process, technological feasibility is established upon the completion of a working model. In addition, we apply this to our review of development projects related to software used exclusively for our SaaS subscription offerings. In these reviews, 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. 11 Income Tax Income taxes are determined in accordance with the provisions of ASC Topic 740, “Income Taxes” (“ASC Topic 740”). Under this method, 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 basis. Deferred tax assets and liabilities are measured using enacted income tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. Any 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. ASC 740 prescribes a comprehensive model for how companies should recognize, measure, present, and disclose in their financial statements uncertain tax positions taken or expected to be taken on a tax return. Under ASC 740, tax positions must initially be recognized in the financial statements when it is more likely than not the position will be sustained upon examination by the tax authorities. Such tax positions must initially and subsequently be measured as the largest amount of tax benefit that has a greater than 50 % likelihood of being realized upon ultimate settlement with the tax authority assuming full knowledge of the position and relevant facts. The Company has subsidiaries in Singapore and PRC. The Company is subject to tax in Singapore and PRC jurisdictions. As a result of its future business activities, the Company will be required to file tax returns that are subject to examination by the Inland Revenue Authority of Singapore and Tax Department of PRC. Loss Per Share Basic net income per share of common stock attributable to common stockholders is calculated by dividing net income attributable to common stockholders by the weighted-average shares of common stock outstanding for the period. Potentially dilutive shares, which are based on the weighted-average shares of common stock underlying outstanding stock-based awards, warrants, options, or convertible debt using the treasury stock method or the if-converted method, as applicable, are included when calculating diluted net income (loss) per share of common stock attributable to common stockholders when their effect is dilutive. Potential dilutive securities are excluded from the calculation of diluted EPS in profit periods as their effect would be anti-dilutive. As of September 30, 2023, there were no potentially dilutive shares. Schedule of potentially diluted shares For the period September 30, 2023 For the period September 30, 2022 Statement of Operations Summary Information: Net Loss $ ( 9,455,304 ) $ ( 8,496,543 ) Weighted-average common shares outstanding - basic and diluted 114,844,076 233,072,453 Net loss per share, basic and diluted $ ( 0.08 ) $ ( 0.04 ) 12 Fair Value Measurements The Company follows guidance for accounting for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted guidance for fair value measurement related to non-financial items that are recognized and disclosed at fair value in the financial statements on a non-recurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows: Level 1 inputs are 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 are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability. The carrying amounts of financial assets such as cash approximate their fair values because of the short maturity of these instruments. NOTE 3 – RECENT ACCOUNTING PRONOUNCEMENTS Recent accounting pronouncements issued by the FASB (including its Emerging Issues Task Force) and the United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s present or future financial statements. NOTE 4 – REVENUE We are in the business of providing AI-enabled software development services for industrial and other customers. As of and for the period ended September 30, 2023, we generated revenues from customers amounting $2,229,009 2,229,999 as follow: Schedule of revenue September 30, 2023 September 30, 2022 Ycloud-SAAS business $ 596,163 $ 9,197,681 Software development and industrial SAAS business 1,633,836 — $ 2,229,999 $ 9,197,681 13 NOTE 5 – CASH AND CASH EQUIVALENTS As of September 30, 2023, the Company held cash in bank in the amount of $ 1,416,885 , which consist of the following: Schedule of held cash in bank in the amount September 30, 2023 December 31, 2022 Bank Deposits-USA $ — $ 22,926 Bank Deposits- Outside USA 1,416,885 — $ 1,416,885 $ 22,926 NOTE 6 – DIGITAL ASSETS As of September 30, 2023, digital assets holdings are as follow: Schedule of digital assets holdings September 30, 2023 December 31, 2022 Opening balance $ — $ — Purchase of BTC 24,990,000 — Impairment losses of digital assets ( 2,591,490 ) — Ending balance $ 22,398,510 $ — As of September 30, 2023, the Company has purchase approximately 833 BTC at the total cost of $24,990,000 22,398,510 . For the nine months ended September 30, 2023, the Company recognized impairment loss of $ 2,591,490 on digital assets. NOTE 7 – ACCOUNT RECEIVABLES, NET As of September 30, 2023, accounts receivable are related to the services fee receivables from customers as follow: Schedule of account receivable September 30, 2023 December 31, 2022 Accounts Receivables $ 129,765 $ — The Company does not require collateral for accounts receivable. The Company maintains an allowance for its doubtful accounts receivable due to estimated credit losses. The Company records the allowance against bad debt expense through the condensed consolidated statements of operations, included in general and administrative expense, up to the amount of revenues recognized to date. Receivables are written off and charged against the recorded allowance when the Company has exhausted collection efforts without success. 14 NOTE 8 – PREPAYMENTS As of September 30, 2023, prepayments consist of the following: Schedule of prepayments September 30, 2023 December 31, 2022 Digital assets $ 12,125,500 $ — Others — 50,000 $ 12,125,500 $ 50,000 As of September 30, 2023, there are prepayment of approximately $ 12,125,500 for the 40% prepayment of 1000 BTC, which is expected to be delivered by end of November 2023 with the lock up price of $30,000 per BTC. NOTE 9 – AMOUNT DUE TO RELATED PARTIES Schedule of due to related parties September 30, 2023 December 31, 2022 Related parties payable $ 719,683 $ 521,296 Director fee payable 954,000 770,000 $ 1,673,683 $ 1,291,296 The related party balance of $ 719,683 represented advances and professional expenses paid on behalf by Shareholders, which consist of audit fees, lawyers’ fee and other professional expenses. As of September 30, 2023, the director fee payable of $ 954,000 represented the accrual of director fees from the appointment date to September 30, 2023. NOTE 10 – ACCRUED EXPENSES As of September 30, 2023, accrued expenses consists of outsourcing expenses of software developments as follow: Schedule of accrued expenses September 30, 2023 December 31, 2022 Software development fee for outsource staffs $ 270,864 $ — 15 NOTE 11 – DISCONTINUED OPERATIONS On September 29, 2023, the Company’s Board of Directors passed a resolution to dissolve the operation of WeTrade Information System Limited and its wholly owned subsidiaries, resulting in a gain on disposal of $ 1,124,675 . Loss from discontinued operations for the period ended September 30, 2023 and 2022 was as follows: Schedule of discontinued operations Nine Months ended September 30 2023 Nine Months ended September 30 2022 Revenue: Service revenue $ 596,162 $ — Cost of revenue ( 993,127 ) — Gross loss ( 396,965 ) — Operating expenses: General and Administrative 11,998,681 — Operations Loss ( 11,998,681 ) — Other (expenses)/ revenue 11,302,830 — Loss from discontinued operations before income tax ( 1,092,816 ) — Income tax expense ( 31,860 ) — Gain from discontinued operation after tax 1,124,676 — Loss on disposal of discontinued operation ( 6,545,912 ) ( 6,418,752 ) LOSS FROM DISCONTINUED OPERATION $ ( 5,421,236 ) $ ( 6,418,752 ) The major components of assets and liabilities related to discontinued operations are summarized below: Schedule of assets and liabilities related to discontinued operations September 30, 2023 December 31, 2022 ASSETS Current assets: Cash and cash equivalents $ 938 $ 13 Accounts receivables — 654,139 Loan receivables 7,246,164 Prepayments 3,394,583 747,717 Property and equipment, net 736,995 70,493 Intangible asset 18,365 230 Other receivables 708,702 2,899 Total assets related to discontinued operations 12,105,747 1,475,491 Account payables $ 212,173 $ 194,179 Other payables 7,460,121 38,881 Total liabilities related to discontinued operations $ 7,672,294 $ 233,060 16 NOTE 12 – SHAREHOLDERS’ EQUITY The Company has an unlimited number of ordinary shares authorized, and has issued 2,625,130 shares with no par value as of September 30, 2023. On March 29, 2019, the Company has issued 100,000,000 shares with no par value to thirty-three founders. On September 3, 2019, the Company has issued a total 74,000 shares at $ 3 each to 5 non-US shareholders. The total outstanding shares has increased to 100,074,000 shares as of December 31, 2019. In February 2020, there are 1,666,666 shares were issued at $ 3 per share to 2 new shareholders. On July 10, 2020, the Company issued another 26,000 shares at $ 3 per share to 2 new shareholders and the total outstanding shares has increased to 101,766,666 shares. On September 15, 2020, the Wyoming Secretary of State approved the Company’s certificate of amendment to amend its Articles of Incorporation to effect 3 for 1 forward stock split . The total issued and outstanding shares of the Company’s common stock has been increased from 101,766,666 to 305,299,998 shares, with the par value unchanged at zero. On September 21, 2020, there are 151,500 shares issued at $ 5 per share to 303 new shareholders, the Company’s common stock issued has been increased to 305,451,498 shares as of December 31, 2020. On April 13, 2022, the Company and 15 shareholders entered into that certain Share Exchange Agreement (the “Share Exchange Agreement”), pursuant to which Company and the 15 Shareholders have cancelled 120,418,995 shares of Common Stock (“Cancellation Shares”). Upon completion of the transaction, the outstanding shares of the Company’s Common Stock has been decreased from 305,451,498 shares to 185,032,503 shares as of June 30, 2022. On July 21, 2022, the Company completed uplisting of its common stock to the Nasdaq Capital Market, and the closing of its public offering of 10,000,000 shares of common stock with the gross proceeds of $ 40,000,000 and net proceeds of $ 37,057,176 after deducting the total offering cost of $ 2,942,824 . The shares were priced at $ 4.00 per share, and the offering was conducted on a firm commitment basis. The shares continue to trade under the stock symbol “WETG.” The Company’s total issued and outstanding common stock has been increased to 195,032,503 shares after the offering. On July 22, 2022, the Company issued 25,000 shares of common stock to certain service providers for services in connection with the public offering, the fair value of the share was $ 477,500 . The Company’s total issued and outstanding common stock has been increased to 195,057,503 shares in 2022. On June 9, 2023, the Wyoming Secretary of State approved the Company’s certificate of amendment to amend its Articles of Incorporation to effect 1 for 185 reverse stock split (“Reverse Stock Split”). The total issued and outstanding shares of the Company’s common stock decreased from 195,057,503 to 1,054,530 shares, with the par value unchanged at zero 0 . In September, 2023, there are 1,570,600 shares issued with the total amount of $ 12,616,454 , the Company’s common stock issued has been increased to 2,625,130 shares as of September 30, 2023. NOTE 13 – INCOME TAXES The Company is subject to U.S. Federal tax laws. The Company has not recognized an income tax benefit for its operating losses in the United States because the Company does not expect to commence active operations in the United States. UTour Pte Ltd (“UTour”) was incorporated in Singapore and is subject to Singapore profits tax at a tax rate of 17 % . Since UTour had no taxable income during the reporting period, it has not paid Singapore profits taxes. UTour has not recognized an income tax benefit for its operating losses in Singapore because it does not expect to commence active operations in Singapore. 17 WeTrade Bit Technology Limited (“WBIT”) was incorporated in Hong Kong and is subject to Hong Kong profits tax at a tax rate of 16.5 % . Since WBIT had no taxable income during the reporting period, it has not paid Hong Kong profits taxes. WITL has not recognized an income tax benefit for its operating losses in Hong Kong because the Company does not expect to commence active operations in Hong Kong. The Company is currently conducting its major operations in the PRC through its subsidiaries, which are subject to tax from 15 % to 25 % . NOTE 14- SUBSEQUENT EVENTS In accordance with FASB ASC 855-10 Subsequent Events, the Company has analyzed its operations subsequent to September 30, 2023, to the date these unaudited condensed consolidated financial statements were issued and has determined that it does not have any material subsequent events to disclose in these consolidated financial