What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-03-31 compared with 2025-03-27 · 471 added, 193 removed, 86 unchanged (89% of the section changed)

8 unchanged sentences

statements as a result of certain factors discussed elsewhere in this annual report .

Next Technology Holding Inc (Formerly known as

“WeTrade Group Inc”) was incorporated in the State of Wyoming on March 28, 2019.

Next Technology Holding 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.

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 include developing, designing, and implementing various SAAS software solutions for businesses of all types, including

industrial and other businesses.

We provide AI-enabled software development services to our potential

customers in USA, Hong Kong, Singapore, Malaysia, Japan and other Asian markets, which included developing, designing and implementing

various SaaS software solutions for business of all types, including industrials and other businesses.

The analytics market is highly competitive and

subject to rapidly changing technology and market conditions.

Our ability to compete successfully depends on a number of factors within

and outside of our control.

Some of these factors include software quality, performance and reliability;

the quality of our service and

support teams;

marketing and prospecting effectiveness;

the ability to incorporate artificial intelligence and other technically advanced

and our ability to differentiate our products.

Failure to perform in these or other areas may reduce the demand for our offerings

and materially adversely affect our revenue from both existing and prospective customers.

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

We view our Bitcoin holdings as held for trading

and expect to continue to accumulating 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.

We hold substantially all of our Bitcoin in custody

accounts at Japanese based, institutional-grade custodians that have demonstrated records of regulatory compliance and information security.

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 being held for

trading 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 financing to purchase additional Bitcoin.

Bitcoin Industry and Market

Bitcoin is a digital asset that is issued by and

transmitted through an open-source protocol, known as the Bitcoin protocol, collectively maintained by a peer-to-peer network of decentralized

This network hosts a public transaction ledger, known as the Bitcoin blockchain, on which Bitcoin holdings and all validated

transactions that have ever taken place on the Bitcoin network are recorded.

Balances of Bitcoin are stored in individual “wallet”

functions, which associate network public addresses with one or more “private keys” that control the transfer of Bitcoin.

The Bitcoin blockchain can be updated without any single entity owning or operating the network.

Creation of New Bitcoin and Limits on Supply

New Bitcoin is created and allocated by the Bitcoin

protocol through a “mining” process that rewards users that validate transactions in the Bitcoin blockchain.

Validated transactions

are added in “blocks” approximately every 10 minutes.

The mining process serves to validate transactions and secure the Bitcoin

Mining is a competitive and costly operation that requires a large amount of computational power to solve complex mathematical

This expenditure of computing power is known as “proof of work.” To incentivize miners to incur the costs of mining

Bitcoin, the Bitcoin protocol rewards miners that successfully validate a block of transactions with newly generated Bitcoin.

The Bitcoin protocol limits the total number of

Bitcoin that can be generated over time to 21 million.

The current reward for miners that successfully validate a block of transactions

is 3.125 Bitcoin per mined block.

Based on current mining rates, we anticipate the reward will decrease by half to 1.5625 Bitcoin per

mined block sometime in 2028.

This decrease in mining reward is referred to as a Bitcoin halving, and it occurs after every 210,000 blocks

are mined, which has historically occurred approximately every four years.

Modifications to the Bitcoin Protocol

Bitcoin is an open-source network that has no

central authority, so no one person can unilaterally make changes to the software that runs the network.

However, there is a core group

of developers that maintain the code for the Bitcoin protocol, and they can propose changes to the source code and release periodic updates

and other changes.

Unlike most software that has a central entity that can push updates to users, Bitcoin is a peer-to-peer network in

which individual network participants, called nodes, decide whether to upgrade the software and accept the new changes.

As a practical

matter, a modification becomes part of the Bitcoin protocol only if the proposed changes are accepted by participants collectively having

the most processing power, known as hash rate, on the network.

If a certain percentage of the nodes reject the changes, then a “fork”

takes place and participants can choose the version of the software they want to run.

Bitcoin Industry Participants

The primary Bitcoin industry participants are

miners, investors and traders, digital asset exchanges and service providers, including custodians, brokers, payment processors, wallet

providers and financial institutions.

Miners range from Bitcoin enthusiasts

to professional mining operations that design and build dedicated mining machines and data centers, including mining pools, which are

groups of miners that act cohesively and combine their processing power to mine Bitcoin blocks.

Investors and Traders.

Bitcoin investors and traders

include individuals and institutional investors who, directly or indirectly, purchase, hold, and sell Bitcoin or Bitcoin-based derivatives.

On January 10, 2024, the Securities and Exchange Commission (“SEC”) issued an order approving several applications for the

listing and trading of shares of spot Bitcoin exchange-traded products (“ETPs”) on U.S.

national securities exchanges.

the SEC had previously approved exchange-traded funds where the underlying assets were Bitcoin futures contracts, this order represents

the first time the SEC has approved the listing and trading of ETPs that acquire, hold and sell Bitcoin directly.

ETPs can be bought and

sold on a stock exchange like traditional stocks, and provide investors with another means of gaining economic exposure to Bitcoin through

traditional brokerage accounts.

Digital Asset Exchanges.

Digital asset exchanges

provide trading venues for purchases and sales of Bitcoin in exchange for fiat or other digital assets.

Bitcoin can be exchanged for fiat

currencies, such as the U.S.

dollar, at rates of exchange determined by market forces on Bitcoin trading platforms, which are not regulated

in the same manner as traditional securities exchanges.

In addition to these platforms, over-the-counter markets and derivatives markets

for Bitcoin also exist.

The value of Bitcoin within the market is determined, in part, by the supply of and demand for Bitcoin in the

global Bitcoin market, market expectations for the adoption of Bitcoin as a store of value, the number of merchants that accept Bitcoin

as a form of payment, and the volume of peer-to-peer transactions, among other factors.

For a discussion of risks associated with digital

asset exchanges, see “Item 1A.

Risk Factors—Risks Related to Our Bitcoin Acquisition Strategy and Holdings—Due to the

unregulated nature and lack of transparency surrounding the operations of many Bitcoin trading venues, Bitcoin trading venues may experience

greater fraud, security failures or regulatory or operational problems than trading venues for more established asset classes, which may

result in a loss of confidence in Bitcoin trading venues and adversely affect the value of our Bitcoin.”

Service providers.

Service providers offer a multitude

of services to other participants in the Bitcoin industry, including custodial and trade execution services, commercial and retail payment

processing, loans secured by Bitcoin collateral, and financial advisory services.

If adoption of the Bitcoin network continues to materially

increase, we anticipate that service providers may expand the currently available range of services and that additional parties will enter

the service sector for the Bitcoin network.

Change of Officer and Director

On January 31, 2024, approved by the Board of

Directors, the Nominating Committee and the Compensation Committee, Mr.

Liu Wei Hong was appointed as the chief executive officer of the

Company, effective January 31, 2024.

On August 12, 2024, Mr.

Lim Kian Wee tendered

his resignation as a director of the Company and Chair of the Audit Committee, effective August 12, 2024.

On the same day, approved by

the Board of Directors, the Nominating Committee and the Compensation Committee, Mr.

Tian Yang was appointed as the director of the Company

and Chair of the Audit Committee, effective August 12, 2024.

On October 21, 2024, Mr.

Ken Tsang tendered her

resignation as a Chief Financial officer of the Company, effective October 21, 2024.

On the same day, approved by the Board of Directors,

the Nominating Committee and the Compensation Committee, Ms.

Eve Chan was appointed as the Chief Financial Officer of the Company, effective

October 21, 2024.

On December 10, 2025, Mr.

Lichen Dong tendered

his resignation as a Chairman of the Board, the Nominating Committee, Compensation Committee and Audit Committee of the Company, effective

December 10, 2025, which were previously disclosed in a Current Report on Form 8-K filed on December 12, 2025.

As of the end of 2025:

Lichen Dong is the Chairman of the Board.

The Audit Committee of the Company is composed

of all four independent directors (Lichen Dong, Tian Yang, Mahesh Thapaliya and Jianbo Sun) as members, and Tian Yang is the Chair of

the Audit Committee.

Jianbo Sun is the temporary Chairman of the Board after Mr Lichen Dong resigned on December 10, 2025.

The Audit Committee of the Company is composed of all three independent directors (Tian Yang, Jianbo Sun, and Qi Wang) as members, and Tian Yang is the Chair of the Audit Committee.

Lichen Dong resigned as a member of our Board and any committee thereof, effective December 10, 2025.

The Nominating Committee of the Company is

composed of all four independent directors (Lichen Dong, Tian Yang, Mahesh Thapaliya and Jianbo Sun) as members, and Lichen Dong is the

Chair of the Nominating Committee.

The Compensation Committee of the Company is

composed of all four independent directors (Lichen Dong, Tian Yang, Mahesh Thapaliya and Jianbo Sun) as members, and Jianbo Sun is the

Chair of the Compensation Committee.

Each of Lichen Dong, Tian Yang, Mahesh Thapaliya

and Jianbo Sun qualifies as an independent director under rules of The Nasdaq Stock Market, and does not have a family relationship with

any director or executive officer of the Company, and has not been involved in any transaction with the Company during the past two years

that would require disclosure under Item 404(a) of Regulation S-K.

composed of all three independent directors (Tian Yang, Jianbo Sun, and Qi Wang) as members, and Qi Wang is the Chair of the Nominating

Lichen Dong resigned as a member of our Board and any committee thereof, effective December 10, 2025.

The Compensation Committee of the Company is composed of all three independent directors (Tian Yang, Jianbo Sun, and Qi Wang) as members, and Jianbo Sun is the Chair of the Compensation Committee.

Lichen Dong resigned as a member of our Board and any committee thereof, effective December 10, 2025.

Each of Tian Yang, Jianbo Sun, and Qi Wang qualifies

as an independent director under rules of The Nasdaq Stock Market, and does not have a family relationship with any director or executive

officer of the Company, and has not been involved in any transaction with the Company during the past two years that would require disclosure

under Item 404(a) of Regulation S-K.

On March 9, 2026, we held our annual meeting of stockholders (the “Annual

At the Annual Meeting, the stockholders of us elected Wenbo Li, Guang Cui, Gwanggeun Jo, and Hsiu Wu (collectively, the

“Directors”) to serve on the Board of Directors (the “Board”) of us until our next annual meeting of stockholders

and until their respective successors have been duly elected and qualified, or until their earlier resignation or removal.

Directors is an independent director as defined under Nasdaq listing standards and SEC rules.

Result of Operations

1 unchanged sentence

summary of our results of operations for the fiscal years ended December 31, 2025 and 2024.

Results of Operations for the fiscal years ended

December 31, 2024 and 2023

For the year ended

For the Years Ended December 31, 2025 and 2024

For the years ended

Service revenue

2 unchanged sentences

General and administrative expenses

(66,722,208 )

(65,635,404 )

Selling and marketing expenses

Research and development expenses

(14,482,899 )

Total operating expenses

(81,955,291 )

(80,868,487 )

Loss from operations

(80,198,697 )

(80,181,893 )

Impairment of long-term investment

(13,396,000 )

Income before income taxes

Income tax expense

Income before income tax expenses

$ 199,548,691

Income tax expenses

(56,383,743 )

(48,149,240 )

Net income from continuing operation

* In July 2024, we dissolved its subsidiary, WeTrade Technology

(Shanghai) Co., Ltd.

in the PRC, which qualified as a discontinued operation under ASC 205-20.

We retrospectively adjusted the above

comparative consolidated results of operations in prior year.

In July 2024, we dissolved our subsidiary, WeTrade Technology (Shanghai) Co., Ltd.

in the PRC, which qualified as a discontinuing operation under ASC 205-20.

We retrospectively adjusted the above comparative statements of change in stockholders’ equity for the year ended December 31, 2024.

On September 16, 2025, we effected a 200-for-1 reverse stock split of its common stock, resulting in the consolidation of every two hundred issued and outstanding shares into one share.

The reverse stock split reduced the number of outstanding shares from approximately 566,265,135 to approximately 2,862,556.

Revenue from Operations

For the fiscal year ended December 31, 2024 and

2023, total revenue was US$1.80 million and US$2.50 million, respectively.

The revenue is mainly generated from the AI software development

and SAAS software solutions for industrial and other businesses users.

Revenue is primarily derived from AI software

development services and SaaS software solutions provided to industrial and other business customers.

For the years ended December 31, 2025 and 2024, we generated total

revenue of $11.61million and $1.80 million, respectively.

The significant increase in revenue for the year ended December 31, 2025 compared

to 2024 was primarily driven by the execution of four commercial customer agreements during 2025 with customers operating in the hotel

management, smart water-system management, and cryptocurrency mining industries.

Under these agreements, we provide AI-enabled

monitoring and management systems built on our proprietary technology platform, along with related customization, implementation, training,

and ongoing support services tailored to each customer’s specific operational requirements.

These arrangements generally include

recurring subscription and service fees payable in installments over the contract term.

The aggregate committed contract value of these

four agreements is approximately $12.59 million.

Revenue under these contracts is recognized over time as we perform services and deliver

customized solutions.

As a result, revenue growth in 2025 reflects both new contract execution and progress made toward completion of

performance obligations during the year.

Cost of revenue

Cost of revenue mainly consists of staff payroll,

system development costs and outsourcing staff cost for system development, which is in line with the increase in revenue during the period.

Cost of revenue primarily consists of personnel-related

expenses, including salaries, benefits, and share-based compensation for employees involved in system development and implementation,

as well as costs associated with outsourced development personnel and third-party vendors.

These expenses also include other direct system

development and delivery costs.

For the fiscal year ended December 31, 2025,

cost of revenue was $9.86 million, compared to $0.73 million for the fiscal year ended December 31, 2024.

The notable rise of $9.13 million was mainly driven by increased utilization of external vendors and outsourced development resources,

as well as higher personnel expenses resulting from an increase in headcount to support revenue growth.

Our gross profit increased by $0.69 million, or 64.2%, from $1.07

million for the year ended December 31, 2024 to $1.76 million for the year ended December 31, 2025.

The gross margin decreased from 59.4%

for the year ended December 31,2024 to 15.1% for the year ended December 31, 2025.

The decrease in gross margin was primarily due to a

shift in our project mix toward more complex and resource-intensive engagements during the year.

Several key projects required accelerated

delivery schedules and specialized technical capabilities that were not available internally within the required timeframe.

we engaged certain third-party vendors with the necessary expertise, which increased our cost of revenue.

These incremental costs were

specific to the projects undertaken during the year and are not expected to represent a structural change in our long-term cost profile.

Selling and Marketing Expenses

Selling and marketing expenses primarily include:

(i) advertising and promotion expenses, (ii) compensation and benefits for sales personnel, and (iii) travel and other routine office

All expenses are recognized in the period in which the related services occur or the benefits are received.

For the fiscal year ended December 31, 2025,

selling and marketing expenses was $0.75 million, compared to nil for the fiscal year ended December 31, 2024.

The increase was primarily

attributable to:(i) higher payroll and bonus expenses, as we recorded performance-based bonuses for sales management personnel in line

with the significant increase in sales revenue and cash collections during the year;

and (ii) increased advertising and promotional expenses,

reflecting expanded marketing activities to support revenue growth and customer acquisition.

We believe that the increase in selling and marketing expenses is consistent

with our business expansion and revenue growth strategy.

The performance-based compensation structure aligns sales incentives with operating

results and cash recovery, supporting sustainable growth.

Research and Development Expenses

Research and development expenses primarily consist

(i) fees for outsourced software development services, (ii) research activities in new technology domains, and (iii) personnel-related

costs for employees, including salaries, bonus, and share-based compensation.

For the fiscal year ended December 31, 2025, research

and development expenses was $14.48 million, compared to nil for the fiscal year ended December 31, 2024.

The notable increase of $14.48

million is primarily attributed to:

(i) share-based compensation expenses of $12.89 million, reflecting equity incentives granted to attract

and retain key technical personnel;

and (ii) Professional service fees of $1.57 million, mainly related to outsourced software development

and technical consulting services.

The significant increase in R&D expenses reflects our strategic

commitment to expanding its research capabilities and investing in new technology domains.

We believe that these investments are critical

to enhancing product innovation, strengthening long-term competitiveness, and supporting sustainable growth.

While such expenditures increased

operating expenses in the current period, they are expected to generate long-term value by accelerating technology development and market

General and Administrative Expenses

General and administrative expenses also consisted

of (i) salary, welfare and share-based compensation for general and administrative personnel, (ii) office expense, and (iii) professional

service fees and others.

For the fiscal year ended December 31, 2025, general

and administrative expenses was US$1.09 million, compared to US$2.67 million for the fiscal year ended December 31, 2023.

decrease of US$1.58 million is primarily attributed to reductions in compliance fees, annual block chain consulting fees, and other professional

service fees.

and administrative expenses was $66.72 million, compared to $1.09 million for the fiscal year ended December 31, 2024.

The significant

increase was primarily attributable to:

(i) a substantial increase in share-based compensation expenses,

resulting from the grant of equity awards to certain individuals who made significant contributions to the Company’s survival,

strategic transformation, and long-term development.

The recognition of these equity awards led to a material increase in non-cash compensation

expenses during the fiscal year ended December 31, 2025;

(ii) Higher professional service fees, as we engaged professionals to support key strategic initiatives and corporate development activities, including strategic advisory, legal, and consulting

We believe that these expenditures were necessary

to strengthen our governance structure, enhance capital market readiness, and support its long-term strategic objectives.

While such expenses

materially increased operating costs for the year ended December 31, 2025, they reflect the Company’s continued investment in organizational

capability and capital formation efforts.

Impairment of long-term investment

In April 2024, there were 3,940,000 shares issued

with the total amount of US$13.40 million for the acquisition of 20% of an associate company.

We have conducted an impairment test on this long-term

equity investment in accordance with ASC820 and has fully provided for impairment losses.

For the fiscal year ended December 31, 2024 and

2023, other income were US$43.19 million and US$4.39 million, respectively.

The increase in other income is due to Bitcoin value appreciation

of US$43.18 million and US$10.15 million for the years ended December 31, 2024 and 2023, which offset by waiver of related company loan

of US$5.81 million during the year of 2023.

Income tax expense

with the total amount of $13.40 million for the acquisition of 20% of an associate company.

We have conducted an impairment test on this long-term equity investment

in accordance with ASC820 and has fully provided for impairment losses for the year ended December 31, 2024.

Other income, net

For the fiscal year ended December 31, 2025 and

2023, the Company recorded income tax expense of US$8.23 million and US$0.13 million in 2024 and 2023, respectively.

2024, other income were $279.75 million and $43.19 million, respectively.

The significant increase in other income for the year ended

December 31, 2025 was primarily attributable to the appreciation in the fair value of our Bitcoin holdings, which resulted in higher unrealized

gains recognized during the period.

Fluctuations in Bitcoin market prices materially affect our reported results of operations, and we

expect such volatility to continue to impact our financial performance in future periods.

Income tax expenses

For the fiscal years ended December 31, 2025 and 2024, we recorded

income tax expenses of $56.38 million and $8.23 million, respectively.

The increase in income tax expenses was primarily due to the significant

increase in our taxable income, mainly driven by higher other income recognized from Bitcoin value appreciation in 2025.

Our income tax

expenses may continue to fluctuate in future periods depending on changes in our profitability, the fair value movements of digital assets,

and applicable tax regulations.

Net income from continuing operation

As a result of the factors described above, for

the fiscal year ended December 31, 2024 and 2023, there was a net income from continuing operation of US$21.54 million and US$3.02 million,

respectively.

The increase is mainly due to gain in fair value in digital assets and offset by increase in income tax expense and impairment

loss of long-term investment.

The following chart provides a summary of our

balance sheets for the fiscal years ended December 31, 2024 and 2023.

It should be read in conjunction with the financial statements,

and notes thereto.

As a result of the factors described above, for the fiscal years ended

December 31, 2025 and 2024, there was a net income from continuing operation of $143.16 million and $21.54 million, respectively.

increase is mainly due to gain in fair value in digital assets and offset by increase in income tax expenses and impairment loss of long-term

The following chart provides a summary of our balance sheets as

of December 31, 2025 and 2024, respectively.

It should be read in conjunction with the financial statements, and notes thereto.

Balance Sheets Analysis

Cash and cash equivalents

Digital assets

Accounts receivable, net

Prepayments and prepaid expenses

$ 524,131,414

Accounts payable

Amount due to related parties

Other liabilities

Income tax payable

Accrued expense and other payables

Deferred tax liabilities

1 unchanged sentence

Total stockholders’ equity

* In July 2024, we dissolved its subsidiary, WeTrade Technology

(Shanghai) Co., Ltd.

$ 455,579,409

In July 2024, we dissolved its subsidiary, WeTrade Technology (Shanghai) Co., Ltd.

in the PRC, which qualified as a discontinued operation under ASC 205-20.

We retrospectively adjusted the above

comparative consolidated balance sheets in prior year.

As of December 31, 2024, we had total assets of

US$92.92 million, which mainly consisted of US$0.67 million in cash, US$78.32 million in digital assets, and US$13.93 million in other

receivables and prepayments;

we had total liabilities of US$11.29 million which consisted of US$0.73 million in accounts payable, US$0.97

million in amount due to related parties,US$1.35 million in other liabilities and US$8.24million in deferred tax liabilities;

stockholders’ equity of US$81.63million.

As of December 31, 2023, we had total assets of

US$48.93 million, which mainly consisted of US$0.67 million in cash, US$35.14 million in digital assets, and US$13.12 million in other

receivables and prepayments;

we had total liabilities of US$4.22million which consisted of US$0.80 million in accounts payable, US$1.69

million in amount due to related parties and US$1.73 million in other liabilities;

we had total stockholders’ equity of US$44.71

The following table sets forth a summary of the

Company’s cash flows for the years indicated:

For the year ended

We retrospectively adjusted the above comparative consolidated balance sheets in prior year.

On September 16, 2025, we effected a 200-for-1 reverse stock split of its common stock, resulting in the consolidation of every two hundred issued and outstanding shares into one share.

The reverse stock split reduced the number of outstanding shares from approximately 566,265,135 to approximately 2,862,556.

As of December 31, 2025, we had total assets of $524.13 million, which

mainly consisted of $5.62 million in cash and cash equivalents, $516.15 million in digital assets, and $2.35 million in accounts receivable,

net and prepayments and prepaid expenses;

we had total liabilities of $68.55 million which consisted of $0.75 million in accounts payable,

$0.66 million in amount due to related parties, $0.13 million in income tax payable, $2.39 million in accrued expense and other payables

and $64.62 million in deferred tax liabilities;

we had total stockholders’ equity of $455.58 million.

As of December 31, 2024, we had total assets

of $92.92 million, which mainly consisted of $0.67 million in cash, $78.32 million in digital assets, and $13.93 million in other

receivables and prepayments and prepaid expenses;

we had total liabilities of $11.29 million which consisted of $0.73 million in

accounts payable, $0.97 million in amount due to related parties, $0.13 million in income tax payable, $1.22 million in accrued

expense and other payables and $8.24 million in deferred tax liabilities;

we had total stockholders’ equity of $81.63

Liquidity and Capital Resources

Our primary sources of liquidity have been through

the operation of our business and financing activities, which have historically been sufficient to meet our working capital, our business

needs, as well as our capital expenditure requirements.

As of December 31, 2025, we had cash and cash equivalents of $5.62 million.

of and for the year ended December 31, 2025, we had a positive working capital of $520.20

million, net cash used in operating activities of $3.07 million, and a net income of $143.16 million.

We believe that our existing cash and cash equivalents,

cash flow we expect to generate from future operating activities, net proceeds we expect to receive from the issuance of ordinary shares,

capital allocation strategy, will be sufficient to meet our anticipated working capital requirements, and capital expenditures in the

ordinary course of business for the next 12 months.

We may, however, need additional cash resources

in the future if we experience changes in business conditions or other developments, or if we find and wish to pursue opportunities for

investments, acquisitions, capital expenditures or similar actions.

If we determine that our cash requirements exceed the amount of cash

and cash equivalents we have on hand at the time, we may seek to issue equity or debt securities or obtain additional credit facilities.

The issuance and sale of additional equity would result in further dilution to our shareholders.

The incurrence of indebtedness would

result in increased fixed obligations and could result in operating covenants that would restrict our operations.

We cannot assure you

that financing will be available in amounts or on terms acceptable to us, if at all.

Cash Flows Analysis

The following table sets forth a summary of our

cash flows for the years indicated:

For the years ended

Net cash flows used in continued operating activities:

$ (3,074,693 )

Net cash flows provided by discontinued operating activities:

Net cash flows provided by operating activities:

Net cash flows used in discontinued operating activities:

Net cash flows used in operating activities:

Net cash flow used in continued investing activities:

(37,115,500 )

Net cash flows provided by discontinued investing activities:

Net cash flow used in discontinued investing activities:

Net cash flows used in investing activities:

(32,615,500 )

Net cash provided by continued financing activities

5 unchanged sentences

Cash and Cash Equivalents, End of Year

* In July 2024, we dissolved its subsidiary, WeTrade Technology

(Shanghai) Co., Ltd.

In July 2024, we dissolved its subsidiary, WeTrade Technology (Shanghai) Co., Ltd.

in the PRC, which qualified as a discontinued operation under ASC 205-20.

We retrospectively adjusted the above

comparative consolidated cash flows in prior year.

We retrospectively adjusted the above comparative consolidated cash flows in prior year.

Operating activities

Net cash flows used in continued operating activities

was nil in 2024, primarily due to net income from continuing operation of US$21.54 million, adjusted for (i) fair value gain on digital

asset of US$43.18 million, (ii) impairment of long-term investment of US$13.40 million, (iii) deferred tax expense of US$8.23 million,

and (iv)an increase in assets of US$0.8 million and an decrease in liabilities of US$0.81 million.

Net cash flows used in continued operating activities

was US$12.70 million in 2023, primarily due to net income from continuing operation of US$3.02 million and net loss from discontinued

operation of US$12.95 million, adjusted for (i) fair value gain on digital asset of US$10.15 million, (ii)loss on amount due from a related

party of US$5.81 million, (iii) an increase in assets of US$0.95 million, and (iv) an increase in liabilities of US$2.51 million.

For the year ended December 31, 2025, net cash

flows used in continuing operating activities amounted to $3.07 million.

This resulted from net income from continuing operations of $143.16

million, adjusted for non-cash and working capital items.

Positive adjustments to operating cash flows included $76.80 million of share-based

compensation, $56.38 million of deferred tax expense, and a $0.88 million decrease in liabilities.

These were partially offset by a $279.75

million non-cash fair value gain on digital assets and a $0.55 million increase in assets.

Net cash flows used in continued operating

activities was nil in 2024, primarily due to net income from continuing operation of $21.54 million, adjusted for (i) fair value

gain on digital asset of $43.18 million, (ii) impairment of long-term investment of $13.40 million, (iii) deferred tax expense of

$8.23 million, and (iv) an increase in assets of $0.8 million and an decrease in liabilities of $0.81 million.

Investing activities

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Our continuing cash flow used in investing activities

was US$37.12 million for the fiscal year ended December 31, 2023.It was primarily attributable to our acquisition of 833 Bitcoin amounting

to US$24.99 million and prepayment for Bitcoin with the amount of US$12.13 million during the year.

was nil for the fiscal year ended December 31, 2024.

Financing activities

Cash generated from financing activities was $8,030,250

for the year ended December 31, 2025.

Cash generated from financing activities was nil

for the year ended December 31, 2024.

Cash generated from financing activities was US$13.05

million for the year ended December 31, 2023, which was primarily attributable to:

(i) we received proceeds US$12.61 million by issuing

shares, (ii) we borrowed US$0.44 million from the former executives.

Capital Expenditures

There were no capital expenditures during the fiscal years ended December

31, 2025 and 2024.

However, future capital expenditures will be made to support the expected growth of the business.

As of December 31, 2025 and 2024, we did not have any commitments.

Capital commitments

As of December 31, 2025 and 2024, we did not have any capital

Inflation does not materially affect our business

or the results of our operations.

Post-Balance Sheet Events

On March 9, 2026, we held our annual meeting of stockholders (the “Annual Meeting”).

At the Annual Meeting, the stockholders

of us elected Wenbo Li, Guang Cui, Gwanggeun Jo, and Hsiu Wu (collectively, the “Directors”) to serve on the Board of Directors

(the “Board”) of us until our next annual meeting of stockholders and until their respective successors have been duly elected

and qualified, or until their earlier resignation or removal.

Each of the Directors is an independent director as defined under Nasdaq

listing standards and SEC rules.

On March 25, 2026, the Company entered into a registered direct offering agreement with twenty investors,

pursuant to which the Company agreed to issue and sell 71,381,818 shares of its common stock at a purchase price of USD 1.10 per share.

In addition, the Company agreed to issue to the investors up to 71,381,818 pre-funded warrants, each at a purchase price of USD 1.099.

The total gross proceeds from the offering approximately was US$157 million.

The transaction was completed on March 26, 2026.

31, 2026, there were 76,264,374 shares of common stock outstanding.

Critical Accounting Policies

We prepare our financial statements in accordance

with generally accepted accounting principles of the United States (“GAAP”).

with generally accepted accounting principles of the United States (“U.S.

GAAP represents a comprehensive set of accounting

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Deviations from our projections are addressed when

our financials are reviewed on a monthly basis.

our financial statements are reviewed on a monthly basis.

This allows us to be proactive in our approach to managing our business.

It also allows

us to rely on proven data rather than having to make assumptions regarding our estimates.

also allows us to rely on proven data rather than having to make assumptions regarding our estimates.

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.

We apply ASC Topic 606, Revenue from Contracts

with Customers (“ASC 606”), for all periods presented.

Under ASC 606, revenue is recognized when we transfer promised

services to a customer in an amount that reflects the consideration to which we expect to be entitled in exchange for those services.

ASC 606 requires us to apply a five-step model

to recognize revenue:

(i) identify the contract with a customer;

(ii) identify the performance obligations;

(iii) determine the transaction

(iv) allocate the transaction price to the performance obligations;

and (v) recognize revenue as the performance obligations are

We report all of our revenues on a gross basis.

This determination is based on our assessment that it is the principal in our revenue arrangements.

We control delivery of customized

development services through its proprietary platform, is primarily responsible for fulfillment, sets pricing, and bears credit risk.

We provide development, design, and implementation

services built on its proprietary pre-existing technology platform.

The platform license and related development activities are highly

interdependent and are accounted for as a single performance obligation.

Revenue is recognized over time because the services create a

customized asset with no alternative use and we have an enforceable right to payment for performance completed to date.

Progress is measured

using the cost-to-cost input method (actual costs incurred relative to total estimated costs).

Contracts do not contain return or refund

We provide assurance-type warranties only;

related costs are recorded in cost of revenue and have not been material historically.

We provide stand-alone maintenance and support

that is separately priced and contracted and constitutes a distinct performance obligation.

These services are billed monthly in arrears,

and revenue is recognized ratably over the monthly service period as the services are provided.

Amounts billed in arrears are recorded

as accounts receivable when the service is provided.

Advance billings, when applicable, are recorded as contract liabilities, which are

not significant given our usual billing practices.

Accounts receivable represent unconditional rights

to consideration for services provided in accordance with contractual billing schedules, which are typically monthly in arrears.

liabilities primarily relate to any advance billings and are not significant.

For the years ended December 31, 2025 and 2024,

all revenue recognized over time amounted to $11,614,772 and $1,800,000, respectively.

For the years ended December 31, 2025 and

2024, all revenue from software development services amounted to $11,614,772 and $1,800,000, respectively.

Use of Estimate

The preparation of financial statements in conformity

with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure

of contingent assets and liabilities at the date of the financial statements, and the reported amounts of expenses during the reporting

Actual results could differ from those estimates.

GAAP requires management to make judgement estimates and assumptions that affect the amounts reported in the consolidated

financial statements and accompanying notes.

Management believes that the estimates used in preparing the financial statements are reasonable

however, actual results could differ from these estimates.

Significant accounting estimates include revenue recognition,

the allowance for expected credit losses, recognition and measurement of share-based compensation, deferred tax liabilities, deferred

tax assets and valuation allowance.

Accounts receivable

Accounts receivable are presented net of allowance

for expected credit loss.

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 expected

credit loss which reflects its best estimate of amounts that potentially will not be collected.

The Company determines the allowance for

expected credit loss on general basis taking into consideration various factors including but not limited to the 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 acquires 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.

Accounts receivable represents those receivables

derived in the ordinary course of business, net of an allowance for any potentially uncollectible amounts.

We make estimates of expected

credit and collectability trends for the allowance for credit losses based upon our assessment of various factors, including historical

experience, the age of the accounts receivable balances, credit quality of our customers, current economic conditions, reasonable and

supportable forecasts of future economic conditions that may vary by geography, customer-type, or industry sub-vertical, and other factors

that may affect its ability to collect from customers.

Expected credit losses are recorded as general and administrative expenses on our

consolidated statements of comprehensive income.

Although we have historically not experienced

significant credit losses, we may experience increasing credit loss risks from accounts receivable in future periods if our customers

are adversely affected by economic pressures or uncertainty associated with local or global economic recessions, or other customer-specific

factors, and actual experience in the future may differ from our past experiences or current assessment.

As of December 31, 2025 and 2024, accounts receivable

from customers amounted to $354,772 and $1,800,000, respectively, there is no allowance provided as the receivables has been settled in

Share-based compensation

We grant our common stocks to eligible employees

and non-employees.

We account for share-based awards issued to employees in accordance with ASC Topic 718 Compensation – Stock

Compensation.

Employees’ share-based awards and non-employees’

share-based awards are measured at the grant date fair value of the awards and recognized as expenses:

a) immediately at grant date if

no vesting conditions are required;

or b) using graded vesting method, net of estimated forfeitures, over the requisite service period,

which is the vesting period.

We recognize the estimated compensation cost of

RSUs and common stocks based on the fair value of common stocks on the date of the grant.

We recognize the compensation cost, net of estimated

forfeitures, over a vesting term for service-based RSUs.

We also recognize the compensation cost of performance-based

share awards, net of estimated forfeitures, if it is probable that the performance condition will be achieved at the end of each reporting

Forfeitures are estimated at the time of grant and revised in the subsequent periods if actual forfeitures differ from those estimates.

Deferred income tax assets and deferred income tax liabilities

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

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 that 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.

Our Company in Wyoming is subject to U.S.

income tax at 21% and a state income tax rate of nil.

We have considered U.S.

withholding tax implications in our deferred tax liability

calculations for unremitted earnings of U.S.

subsidiaries.

A deferred tax liability has been recognized for the withholding tax that would

be due upon distribution of earnings to foreign shareholders.

For the periods presented, no additional capital gain tax provision is required

as there is no plan to dispose of the investment in foreign subsidiaries.

We have a subsidiary in Hong Kong and BVI.

Hong Kong subsidiary is subject to tax in Hong Kong, and the BVI subsidiary is generally not subject to income tax under BVI laws.

a result of our future business activities, we will be required to file tax returns that are subject to examination by the Inland Revenue

Authority of Hong Kong.

Recent Accounting Pronouncements

We have reviewed all the recently issued, but

not yet effective, accounting pronouncements and we do not believe any of these pronouncements will have a material impact on the Company

financial statements.

Post-Balance Sheet Events

The Company entered into an Amended and Restated BTC Trading Contract

(the “Amended BTC Contract”), dated as of September 24, 2024, with an autonomous organization (the “Association Seller”),

which supports its members in the sale of Bitcoins.

Under the Amended BTC Contract, the Company is entitled to purchase up to 5,167 BTC

(the “Total BTC”) from certain members of the Association Seller set forth on Schedule I of the Amended BTC Contract (the

“BTC Sellers”) through the Association Seller at a purchase price of US$30,000 per BTC (subject to an additional purchase

price by issuance of warrants to purchase shares of Common Stock at a nominal exercise price as described below) over a 12-month period

ending on September 24, 2025.

At the time when the Amended BTC Contract was signed, the Company indicated its intent to exercise the option

to purchase 5,000 Bitcoin out of the Total BTC pursuant to the Amended BTC Contract (the “Amended 5,000 BTC Transaction”).

According to the terms of the Amended BTC Contract, the previously-made prepayment amount of $12,125,500 will be applied towards the total

purchase price for the Amended 5,000 BTC Transaction and the Company will pay the remaining balance through (i) the issuance of 135,171,078

shares of Common Stock (the “Shares”) valued at $1.02 per share and (ii) the issuance of warrants to purchase 294,117,647

shares of Common Stock at a nominal exercise price (the “Warrants”, and the shares issuable under the Warrants, the “Warrant

Using the same per share valuation, the Warrants are worth approximately $300,000,000.

The exercise period for each Warrant

is five (5) years from the initial exercise of such Warrant.

On March 12, 2025 (the “Closing Date”),

the Company consummated the Amended 5,000 BTC Transaction pursuant to which the Company acquired 5,000 Bitcoin and in exchange it issued

the Shares and the Warrants.

Concurrently with the issuance of the Warrants, the BTC Sellers indicated to the Company of their intent

to immediately exercise the Warrants to purchase all of the Warrant Shares thereunder.

Accordingly, the Company issued to each BTC Seller

the respective Warrant Shares at the Closing Date.

The total outstanding shares of the Company increased to 436,265,135 shares on the

Closing Date.

A list of recent relevant accounting pronouncements

is included in Note 2 “Summary of Principal Accounting Policies” of our financial statements.

QUANTITATIVE AND QUALITATIVE DISCLOSURES

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What changed 10-K

Item 7. Management’s Discussion and Analysis