UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q/A

Amendment No. 2

 

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended: March 31, 2024

 

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from ____________ to _____________

 

NEXT TECHNOLOGY HOLDINGS INC
(Exact name of small business issuer as specified in its charter)

 

Wyoming    

(State or other jurisdiction of

incorporation or organization)

   (I.R.S. Tax. I.D. No.)

 

Room 519, 05/F Block T3

Qianhai Premier Finance Centre Unit 2

Guiwan Area, Nanshan District, Shenzhen

(Address of Principal Executive Offices)

 

(86) 158 2117 2322

(Registrant’s Telephone Number, Including Area Code)

 

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

 

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

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

 

Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated Filer ☐ Smaller Reporting Company ☒
Emerging growth company ☐    

 

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

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐   No ☒

 

As of December 12, 2024, there were 6,976,410 shares of common stock outstanding.

 

 

 

 

 

 

Explanatory Note

 

Next Technology Holding Inc (formerly known as WeTrade Group Inc. (the “Company”)) is filing this Amendment No.2 (the “Amendment No.2”) to the Quarterly Report on Form 10-Q for the period ended March 31, 2024, originally filed with the Securities and Exchange Commission (the “SEC”) on May 20, 2024 (the “Original Filing”), to amend our consolidated financial statements.

 

This Amendment No.2 amends the Original Filing, and the Amended Quarterly Report on Form 10-Q/A of the Company for the quarter ended March 31, 2024 filed on September 12, 2024 (the “Amendment No.1”). This Amendment No.2 is being filed to revise disclosure in “Note 8 – Prepayments” in connection with the BTC Contract (as defined below), and to include the restatement of previously issued financial statements describing the natures of all affected financial statements as restated that affect for the period ended March 31, 2024.

 

In accordance with applicable SEC rules, this Amendment No.2 includes new certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as amended, from our Chief Executive Officer and Chief Financial Officer.

 

Except as described above, this Form 10-Q/A does not amend, update or change any other items or disclosures contained in the Original Filing, and accordingly, this Form 10-Q/A does not reflect or purport to reflect any information or events occurring after the original filing date of the Original Filing or modify or update those disclosures affected by subsequent events. Accordingly, this Form 10-Q/A should be read in conjunction with the Original Filing and the Company’s other filings with the SEC

 

 

 

 

TABLE OF CONTENTS

 

Cautionary Note Regarding Forward-Looking Statements ii
   
PART I – Financial Information 1
     
Item 1. Financial Statements 1
  Unaudited Condensed Consolidated Balance Sheets as of March 31, 2024 and Audited Condensed Consolidated Balance Sheets as of December 31, 2023 1
  Unaudited Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2024 and March 31, 2023 2
  Unaudited Condensed Consolidated Statement of Changes in Stockholders’ Equity for the Three Months Ended March 31, 2024 and March 31, 2023 3
  Unaudited Condensed Consolidated Statements of Cash Flows for the Three Months ended March 31, 2024 and March 31, 2023 4
  Notes to Unaudited Consolidated Financial Statements as of March 31, 2024 5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 19
Item 3. Quantitative and Qualitative Disclosures about Market Risk 22
Item 4. Controls and Procedures 22
     
PART II – Other Information 23
     
Item 1. Legal Proceedings 23
Item 1A. Risk Factors 24
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 24
Item 3. Defaults Upon Senior Securities 24
Item 4. Mine Safety Disclosures 24
Item 5. Other information 24
Item 6. Exhibits 25
     
Signatures 26

 

i

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”). These forward-looking statements are generally located in the material set forth under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” but may be found in other locations as well. These forward-looking statements are subject to risks and uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. You should not unduly rely on these statements.

 

We identify forward-looking statements by use of terms such as “may,” “will,” “expect,” “anticipate,” “estimate,” “hope,” “plan,” “believe,” “predict,” “envision,” “intend,” “will,” “continue,” “potential,” “should,” “confident,” “could” and similar words and expressions, although some forward-looking statements may be expressed differently. You should be aware that our actual results could differ materially from those contained in the forward-looking statements.

 

Forward-looking statements are based on information available at the time the statements are made and involve known and unknown risks, uncertainties and other factors that may cause our results, levels of activity, performance or achievements to be materially different from the information expressed or implied by the forward-looking statements in this report. These factors include, among others:

 

  ● our ability to execute on our growth strategies;
     
  ● our ability to find manufacturing partners on favorable terms;
     
  ● declines in general economic conditions in the markets where we may compete;
     
  ● our anticipated needs for working capital; and

 

Where we express an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis.

 

Forward-looking statements speak only as of the date of this report or the date of any document incorporated by reference in this report. Except to the extent required by applicable law or regulation, we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events.

 

ii

 

 

PART I – FINANCIAL INFORMATION

 

Item 1. Financial Statements

 

NEXT TECHNOLOGY HOLDINGS INC

CONDENSED CONSOLIDATED BALANCE SHEETS

(UNAUDITED)

 

(All amounts shown in U.S. Dollars)  As of
March 31,
2024		  

As of
December 31,
2023

(audited)

 
   Restated   Restated 
ASSETS        
Current assets:        
Cash and cash equivalents  $668,387   $668,387 
*Digital assets   59,156,975    35,137,576 
Accounts receivable- non related parties, net   1,130,664    1,133,117 
Prepayments   12,125,500    12,125,500 
           
Total current assets   73,081,526    49,064,580 
Total assets   73,081,526   $49,064,580 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
Current liabilities:          
Account payables   924,127    926,456 
****Amount due to related parties   1,733,732    1,693,098 
**Tax payable   130,934    130,942 
***Other payables   1,889,500    1,600,000 
Total current liabilities   4,678,293    4,350,496 
           
Non-current liabilities:          
**Deferred tax liabilities   4,142,759    
-
 
Total liabilities   8,821,052    4,350,496 
           
Stockholders’ equity:          
Common stock; no par value; 2,625,130 issued and outstanding on March 31, 2024 and December 31, 2023 respectively   56,348,650    56,348,650 
Accumulated other comprehensive loss   (113)   (8)
*****Retained Earnings/(Accumulated Deficit)   7,911,937    (11,634,558)
Total stockholders’ equity   64,260,474    44,714,084 
           
Total liabilities and stockholders’ equity  $73,081,526   $49,064,580 

 

* There is an adjustment of $263,947 in digital assets due to over-statement of its fair value of $263,947
** There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses and an adjustment of $130,934 in tax payable.
*** There is a reclassification of $50,020 from accrued expenses to other payables and an adjustment of $520 in other payables due to error recording in other payables.
**** There is an adjustment of $12,000 in the amount due to related parties due to error recording in the amount due to related parties.
*****  There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to an increase in loss of discontinued operation in prior year.

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

1

 

  

NEXT TECHNOLOGY HOLDINGS INC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(UNAUDITED)

 

  

For the
Three

Months End
March 31,
2024

   For the
Three
Months End
March 31,
2023		 
   Restated   Restated 
Revenue:        
Service revenue  $
—
   $
—
 
Total service revenue   
—
    
—
 
Cost of revenue   
—
    
—
 
Gross Profit   
—
    
—
 
           
Operating expenses          
*General and administrative expense   (330,145)   (166,295)
Total operating expenses   (330,145)   (166,295)
           
Loss from operations   (330,145)   (166,295)
**Other income   24,019,399    
—
 
Profit/ (loss) before income taxes   23,689,254    (166,295)
           
***Income tax expenses   (4,142,759)   
—
 
           
Net profit/ (loss) from continuing operation  $19,546,495   $(166,295)
Net loss from discontinued operation   
—
    (775,826)
           
Comprehensive income          
Net profit/ (loss)  $19,546,495   $(942,121)
Other comprehensive income          
*Foreign currency translation adjustment   (105)   310,576 
           
Total comprehensive profit/(loss)  $19,546,390   $(631,545)
           
Earnings /(Loss) per share, basic and diluted from continuing operation  $7.45   $(0.16)
Earnings /(Loss) per share, basic and diluted from discontinued operation   
—
    (0.74)
           
*Weighted-average shares outstanding, basic and diluted   2,625,130    1,054,530 

 

* There is an adjustment of $2 in general and administrative expenses and $8 in foreign currency translation adjustment due to rounding errors.
** There is an adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622.
*** There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

2

 

 

NEXT TECHNOLOGY HOLDINGS INC

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY

(UNAUDITED)

 

Three months ended March 31, 2024 

 

   Common Stock   Additional
Paid in		   (Accumulated Deficit)/ Retained   Accumulated
Other
Comprehensive		   Total
Shareholder		 
   Shares   Amount   Capital   Earnings   Income   Equity 
           (Restated) 
Balance as of December 31, 2023   2,625,130   $
—
   $56,348,650   $(11,634,558)  $(8)  $44,714,084 
Foreign currency translation adjustment   —    
—
    
—
    
—
    (105)   (105)
*Net profit for the period   —    
—
    
—
   $19,546,495    
—
   $19,546,495 
Balance as of March 31, 2024   2,625,130   $
—
   $56,348,650   $7,911,937   $(113)  $64,260,474 

 

*Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.

 

Three months ended March 31, 2023

 

   Common Stock   Additional
Paid in		   Accumulated   Accumulated
Other
Comprehensive		   Total
Shareholder		 
   Shares   Amount   Capital   Deficits   Income   Equity 
           (Restated) 
Balance as of December 31, 2022   1,054,530   $
—
   $43,732,196   $(1,714,858)  $(310,576)  $41,706,762 
Foreign currency translation adjustment   —    
—
    
—
    
—
    310,576    310,576 
*Loss from discontinued operation   —    
—
    
—
    (775,826)   
—
    (775,826)
Net loss for the period   —    
—
    
—
   $(166,295)   
—
   $(166,295)
Balance as of March 31, 2023   1,054,530   $
—
   $43,732,196   $(2,656,979)  $
—
   $41,075,217 

 

*There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to an increase in loss of discontinued operation in prior year.

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

 

3

 

  

NEXT TECHNOLOGY HOLDINGS INC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

 

   For the
Three months
Ended		   For the
Three months
Ended		 
   March 31,
2024		   March 31,
2023		 
   (Restated)     
Cash flows from operating activities:        
*Net Profit/ (loss)  $19,546,495   $(166,295)
**Fair value gain from digital assets   (24,019,399)   
—
 
Loss from discontinued operation   
—
    (775,826)
           
Changes in operating assets and liabilities:          
Accounts receivables   2,452    
—
 
***Account payables   (2,328)   
—
 
****Directors’ fee payable   40,000    
—
 
******Tax payable   (9)   
—
 
******Other payables   289,500    
—
 
*****Deferred tax liabilities   4,142,759    
—
 
Net cash flows used in continued operating activities   (530)   (942,121)
Net cash flows used in discontinued operating activities   
—
    430,349 
Net cash flows used in operating activities   (530)   (511,772)
           
Cash flow from financing activities:          
****Shareholders loan   635    186,000 
Net cash flows provided by financing activities   635    186,000 
           
Effect of exchange rate changes on cash   (105)   310,576 
           
Change in cash and cash equivalents:   
—
    (15,196)
           
Cash and cash equivalents, beginning of period  $668,387   $22,926 
           
Cash and cash equivalents, end of period  $668,387   $7,730 
           
Supplemental cash flow information:          
Cash paid for interest  $
—
   $
—
 
Cash paid for taxes  $
—
   $
—
 

 

* There is an adjustment of $4,142,759 in both tax expenses and an adjustment of 194,622 in other income, therefore resulting in changes in net profit in operating activities.
** There is an adjustment of $194,622 in fair value gain from digital assets due to over-provision of its fair value gain.
*** There is an adjustment of $2 in account payables due to rounding error.
**** There is a reclassification of $40,000 from shareholders’ loan to directors’ fee payable in operating activities.
***** There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.
******  Reclassification of $130,934 from other payables to tax payable

 

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements. 

 

4

 

  

NEXT TECHNOLOGY HOLDINGS INC

NOTES TO CONDEDSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

 

NOTE 1 – NATURE OF BUSINESS

 

Business

 

Next Technology Holdings Inc (formerly known as 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 include 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.

 

5

 

 

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:

 

   Digital asset
original cost basis		   Gain from
digital asset		   Market Value of
digital asset		   Approximate
number of
Bitcoin held		 
Balance on December 31, 2023   24,990,000    10,147,576    35,137,576    833 
Digital asset purchase   
-
    
-
    
-
    - 
Fair value change during the period   
-
    24,019,399    24,019,399    - 
Balance on March 31, 2024   24,990,000    34,166,975    59,156,975    833 

 

Restatement of previously issued financial statement

 

The Company discovered rounding errors and accounting treatment errors in general and administrative expenses, other income, tax expenses, amount due to related parties, deferred tax liabilities and other payables and accrued expenses during the audit review for the period ended March 31, 2024, including rounding error of $2 in general and administrative expenses, over-statement of other income and digital assets, under-provision of tax expenses and deferred tax liabilities of $4,142,759, reclassification of $130,934 tax payable from other payable, and adjustment of $12,000 in amount due to related parties for the three-month period ended March 31, 2024.

 

Effects of the restatement are as follows:

 

Consolidated statement of operation for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed) 		   Adjustment   As Restated 
             
General and administrative expenses  $(330,143)  $(2)  $(330,145)
Other income  $24,214,021   $(194,622)  $24,019,399 
Tax expenses  $
-
   $(4,142,759)  $(4,142,759)
Net profit  $23,883,878   $(4,337,383)  $19,546,495 

 

Consolidated statement of operation for the three-month period ended March 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
General and administrative expenses  $(212,194)  $45,899   $(166,295)
Net loss  $(212,194)  $45,899   $(166,295)

 

Consolidated balance sheet as of March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Digital assets  $59,420,922   $(263,947)  $59,156,975 
Total assets  $73,345,474   $(263,947)  $73,081,526 
                
Amount due to related parties  $(1,721,732)  $(12,000)  $(1,733,732)
Accrued expenses  $(50,020)  $50,020   $
-
 
Deferred tax liabilities  $
-
   $(4,142,759)  $(4,142,759)
Tax payable  $
-
   $(130,934)  $(130,934)
Other payables and accrued expenses  $(1,840,000)  $(49,500)  $(1,889,500)
Total liabilities  $(4,535,879)  $(4,285,173)  $(8,821,052)
                
Accumulated profit  $(12,461,058)  $(4,549,121)  $7,911,937 
Total equity  $68,809,595   $(4,549,121)  $64,260,474 

  

6

 

 

Consolidated balance sheet as of December 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
Accumulated deficit  $(11,422,820)  $(211,738)  $(11,634,558)
Total shareholders’ equity  $44,925,822   $(211,738)  $44,714,084 

 

Consolidated statement of cash flows for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Cash flows from operating activities:            
Net profit  $23,883,878   $(4,337,383)  $19,546,495 
Fair value gain from digital assets  $(24,214,021)  $194,622   $(24,019,399)
Deferred tax liabilities  $
-
   $4,142,759   $4,142,759 
Account payables  $(2,329)  $2   $(2,327)
Directors’ fee payables  $
-
   $40,000   $40,000 
Net cash flow used in operation expenses  $(40,530)  $40,000   $(530)
Cash flows from financing activities:               
Shareholders’ loan  $40,635   $(40,000)  $635 
Net cash flow provided by financing activities   40,635   $(40,000)  $635 

 

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

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 three months ended March 31, 2024 and 2023 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 March 31, 2024, the results of its operations for the three months ended March 31, 2024 and 2023, and its cash flows for the three months ended March 31, 2024 and 2023. 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. 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, 2023.

 

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.

 

Goodwill and Other - Crypto Assets

 

In December 2023, the FASB issued ASU 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, which establishes accounting guidance for crypto assets meeting certain criteria. Bitcoin meets these criteria. The amendments require crypto assets to meet the criteria to be recognized at fair value with changes recognized in net income each reporting period. Upon adoption, a cumulative-effect adjustment is made to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption. ASU 2023-08 is effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. Early adoption is permitted. The Company has early applied ASU 2023-08 and measured crypto assets (presented as digital assets) at fair value with changes recognized in net income this year.

 

The following table summarizes the Company’s digital asset holdings as of:

 

   March 31,
2024		   December 31,
2023		 
Approximate number of bitcoins held   833    833 
Digital assets carrying value  $59,156,975   $35,137,576 
Gain on digital assets during the period/ Year  $24,019,399   $10,147,576 

 

As of March 31, 2024, approximately 833 of the bitcoins held by the Company, which had a carrying value of approximately $59.2 million on the Company’s Consolidated Balance Sheets as of March 31, 2024.

 

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 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 March 31, 2024.

 

   March 31,
2024		   December 31,
2023		 
RMB: US$ exchange rate   7.22    7.09 

 

The balance sheet amounts, with the exception of equity, as of March 31, 2024 and December 31, 2023 were translated at 7.22 RMB and 7.09 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 March 31, 2024 and year ended December 31, 2023 were 7.18 RMB and 7.08 RMB to US$1.00, respectively. Cash flows were also translated at average translation rates for the period 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.

 

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 expected credit loss, valuation of deferred tax assets, and certain accrued liabilities such as contingent liabilities.

 

Accounts Receivable

 

Accounts receivables 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 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.

 

9

 

 

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.

 

10

 

 

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 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.

 

The Company has subsidiaries in Hong Kong and PRC. The Company is subject to tax in Hong Kong 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 Department of Hong Kong and Tax Department of PRC.

 

Earnings / (Loss) Per Share

 

Earnings/(Loss) 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 March 31, 2024, there were no potentially dilutive shares.

 

   For the
period
March 31,
2024		   For the
period
March 31,
2023		 
   (Restated)   (Restated) 
Statement of Operations Summary Information:        
Net Profit/ (Loss)  $19,546,495   $(166,295)
Weighted-average common shares outstanding - basic and diluted   2,625,130    1,054,530 
Earnings / (loss) per share, basic and diluted  $7.45   $(0.16)

 

11

 

 

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 March 31, 2024, there were no revenue generated from SAAS business.

 

12

 

 

NOTE 5 – CASH AND CASH EQUIVALENTS

 

As of March 31, 2024, the Company held cash in bank in the amount of $668,388, which consists of the following: 

  

   March 31,
2024		   December 31,
2023		 
Bank Deposits- Outside USA  $668,387   $668,387 

  

NOTE 6 – DIGITAL ASSETS

 

As of March 31, 2024, digital assets holdings are as follows:

 

   March 31,
2024		   December 31,
2023		 
    (Restated)    (Restated) 
Opening balance  $35,137,576   $
—
 
Purchase of BTC   
—
    24,990,000 
Gain from digital assets   24,019,399    10,147,576 
Ending balance  $59,156,975   $35,137,576 

 

As of March 31, 2024, the Company held approximately 833 BTC at the total cost of $24,990,000. For the three months ended March 31, 2024 and for the year ended December 31, 2023, the Company recognized gain of $24,019,399 and $10,147,576 on digital assets respectively.

 

NOTE 7 – ACCOUNTS RECEIVABLE

 

As of March 31, 2024, accounts receivable are related to the services fee receivable from customers as follow:

 

   March 31,
2024		   December 31,
2023		 
Accounts Receivable  $1,130,664   $1,133,117 

 

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. There is no allowance for expected credit loss as the accounts receivable has been received as at reporting date.

 

13

 

 

NOTE 8 – PREPAYMENTS

 

As of March 31, 2024, prepayments consist of the following:

 

    March 31,
2024		     December 31,
2023		  
Prepayment for digital assets   $ 12,125,500     $ 12,125,500  

  

As previously disclosed in a Form 8-K filed on September 28, 2023, the Company entered into a BTC Trading Contract (the “BTC Contract”) with an autonomous organization (the “Association Seller”), which supports its members in the sale of BTC. While the Association Seller provides services to facilitate the sale of BTC by its members, it does not exert control over them by ownership or contract, nor does it make decisions for its members relating to the sale of BTC. None of the members of the Association Seller hold equity, serve as director or officer, or otherwise has voting power or management rights of the Association Seller.

 

Under the BTC Contract, the Company has the right to purchase up to 6,000 BTC from the members of the Association Seller (each, a “BTC Seller”) through the Association Seller at a locked price of $30,000/BTC over a 12-month period commencing on September 25, 2023, with payment to be made in the form of cash or the Company’s shares. Although the BTC Contract states that the Association Seller (Party B) “owns the virtual currency”, to our knowledge, this statement was mistakenly made. As of the date of the BTC Contract, it were the individual members of the Association Seller, not the Association Seller itself, who own the BTC to be sold under the BTC Contract. We believe the Association Seller will coordinate with its members to fulfill the Company’s purchase of BTC, however, we cannot guarantee that the Company will be able to purchase BTC from the BTC Sellers. The BTC Contract was entered into solely between the Company and the Association Seller and no BTC Sellers owe any legal obligation to the Company in connection with the purchase and sale of BTC.

 

Following the execution of the BTC Contract, the Company purchased 833 BTC from the BTC Sellers and decided to purchase an additional 1,000 BTC (the “1,000 BTC Purchase”). As of December 31, 2023, the Company made a prepayment to the BTC Sellers through the Association Seller of approximately $12,125,500 (the “Prepayment Amount”), representing 40% of the total purchase price for 1000 BTC. The prepayment was made to secure favorable pricing and demonstrate the Company’s commitment to completing the 1,000 BTC Purchase. This prepayment is refundable if the 1,000 BTC Purchase is not completed.

 

While negotiating the terms of the 1,000 BTC Purchase with the BTC Sellers, the Company decided to exercise its right under the BTC Contract to purchase 5,000 BTC (the “5,000 BTC Purchase”), which includes the previously planned 1,000 BTC. To reflect the then price increase in BTC and finalize the transaction details of the 5,000 BTC Purchase, the Company and the Association Seller entered into that certain Amendment Agreement (the “Amendment Agreement”) on May 2, 2024, which was previously disclosed in a Form 8-K filed by the Company on May 6, 2024.

 

According to the Amendment Agreement, the Company agreed to pay the aggregate price for the 5,000 BTC through the issuance of 40,000,000 shares of the Company’s common stock (the “Common Stock”) valued at $3.75 per share, which was the closing market price of the Common Stock as of May 1, 2024 (the “Then FMV”) and warrants to purchase 80,000,000 shares of the Common Stock with the exercise price of $2.6 per share (equal to 70% of the Then FMV). In connection with the 5,000 BTC Purchase, on May 8, 2024, the Company filed a Preliminary Information Statement on Schedule 14C (the “Preliminary 14C”). Subsequently, the Company decided to cease pursuing the 5,000 BTC Purchase due to the market fluctuations in BTC and further discussions with the BTC Sellers, which was previously disclosed on a Form 8-K filed by the Company on June 26, 2024.

 

Despite the cancellation of the 5,000 BTC Purchase, negotiations regarding the original 1,000 BTC Purchase continued. The Company’s original plan was to settle the remaining 60% of the total purchase price for 1,000 BTC through the issuance of the Common Stock at a per share price based on the average market price over a five-day period immediately prior to the date of the completion of the 1,000 BTC Purchase. However, the Board believed in the potential long-term appreciation of the BTC. As a result, it has decided to halt the 1,000 BTC Purchase and instead re-negotiate the terms with the Associate Seller to acquire 5,167 BTC, which represents the maximum number of BTC that the Company was entitled to purchase under the BTC Contract minus the BTC already acquired under the BTC Contract.

 

14

 

 

NOTE 9 – AMOUNT DUE TO RELATED PARTIES

 

   March 31,
2024		   December 31,
2023		 
   (Restated)   (Restated) 
Related parties payable  $282,535   $282,535 
Amount due to shareholders   607,197    606,563 
Director fee payable   844,000    804,000 
   $1,733,732   $1,693,098 

 

The related party balance of $282,535 represented advances from former shareholders for Company’s daily operation.

 

As of March 31, 2024, the amount due to shareholders of $607,197 represented advances and professional expenses paid on behalf by Shareholders, which consist of audit fees, lawyers’ fee and other professional expenses.

 

As of March 31, 2024, the director fee payable of $844,000 represented the accrual of director fees from the appointment date to March 31, 2024.

 

The amount due to related parties are interest free, unsecured and have no fixed repayment period.

 

NOTE 10 – ACCOUNT PAYABLES

 

As of March 31, 2024 and December 31, 2023, account payable are related to the software services fee payables to suppliers as follow: 

 

   December 31,
2023		   December 31,
2023		 
Account payable   $924,127   $926,456 

 

NOTE 11 – OTHER PAYABLES

 

As of March 31, 2024, other payables consist of unpaid professional fee as follows:

 

   March 31,
2024		   December 31,
2023		 
Professional fees  $1,889,500   $1,600,000 

 

Professional fees of $1,889,500 comprise outstanding legal fees in relation to shareholders’ litigation, BTC consultant fee and listing compliance fee owing to professional parties.

 

15

 

 

NOTE 12 – SHAREHOLDERS’ EQUITY

 

The Company has an unlimited number of authorised ordinary shares and has issued 2,625,130 shares with no par value as of March 31, 2024.

 

On March 29, 2019, the Company issued 100,000,000 shares with no par value to thirty-three founders. On September 3, 2019, the Company 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.

 

In September 2023, there were 1,570,600 shares issued with the total amount of $12,616,454, and the Company’s common stock issued has been increased to 2,625,130 shares as of March 31, 2024.

 

16

 

 

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.  

 

There are several subsidiaries were incorporated in Hong Kong and are subject to Hong Kong profits tax at a tax rate of 16.5%.  

 

The Company is currently conducting its certain operations in the PRC through its subsidiaries, which are subject to tax to 25%.

 

NOTE 14 – SUBSEQUENT EVENTS

 

Acquisition of Company

 

On March 1,2024, the Company entered into a share purchase agreement (the “Purchase Agreement”) with certain existing shareholders (the “Sellers”) of Future Dao Group Holding Limited, an exempted company incorporated and existing under the laws of the Cayman Islands(the “Target”),pursuant to which the Company agrees to purchase from the Sellers indirectly through Next Investment Group Limited, a wholly-owned subsidiary of the Company (“Next Investment”), and the Sellers agree to sell to Next Investment, an aggregate of 2,000 ordinary shares (the “Purchased Shares”) of the Target (the “Transaction”) at a per share purchase price of $6,698 per share for an aggregate purchase price of $13,396,000 (the “Purchase Price”). Pursuant to the Purchase Agreement, at the closing of the Transaction, the Company will pay the Purchase Price by issuing to the Sellers an aggregate of 3,940,000 shares of common stock of the Company (the “Next Technology Common Stock”) based on an agreed-upon valuation of $3.40 per share (the “Per Share Price”). The Per Share Price is above $3.19, which is the average price per share of the shares of common stock of the Company traded on Nasdaq Capital Market in the five trading days prior to the signing date of the Purchase Agreement. Pursuant to the Purchase Agreement, each Seller will receive its portion of the Company’s Common Stock proportionate to the number of the Purchased Shares to be sold by such Seller to Next Investment under the Purchase Agreement, the transaction has been completed in end of April 2024.

 

Change of Company name

 

Effective April 2, 2024, the Company has changed its name to Next Technology Holdings Inc. The name change was made pursuant to the Wyoming Business Corporations Act, and an amendment to Article I of the Company’s Amended and Restated Articles of Incorporation was filed with the Wyoming Secretary of State on March 18, 2024 (Amendment ID: 2024-004669585).

 

Our common stock will continue to trade on the NASDAQ Stock Market under the ticker symbol “NXTT”. Outstanding stock certificates for shares of the company are not affected by the name change. They continue to be valid and need not be exchanged.

 

Amended and Restated BTC Trading Contract

 

On September 24, 2024, the Company and the Association Seller entered into an Amended and Restated BTC Trading Contract (the “Amended BTC Contract”), which amended and restated the BTC Contract. Under the Amended BTC Contract, the Company is entitled to purchase up to 5,167 BTC (the “Total BTC”) from the BTC sellers set forth on Schedule I to the Amended BTC Contract (the “Schedule I 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 commencing on the date of the Amended BTC Contract. The purchase price for the Total BTC will be paid by the Company in cash or shares of Common Stock. Although the Amended BTC Contract states that the Association Seller (Party B) “owns the virtual currency”, to our knowledge, this statement was mistakenly made. As of the date of the Amended BTC Contract, it were the Schedule I BTC Sellers who are the individual members of the Association Seller, not the Association Seller itself, who own the BTC to be sold under the Amended BTC Contract.

 

To our knowledge, the Association Seller entered into a cooperation agreement with each Schedule I BTC Sellers (the “Cooperation Agreement”) on the same day when the Amended BTC Contract was entered. Under the Cooperation Agreement, each Schedule I BTC Seller agrees to transfer a specified number of BTC (as set forth in the Cooperation Agreement) to a BTC wallet address designated by the Association Seller for the transactions contemplated under the Amended BTC Contract.

 

While we believe the Association Seller will be able to coordinate with its members to fulfill the Company’s purchase of BTC if the Company so decides, we cannot guarantee that the Company will successfully acquire BTC pursuant to the Amended BTC Contract. The Amended BTC Contract was entered into solely between the Company and the Association Seller and no Schedule I BTC Sellers owe any legal obligation to the Company in connection with the purchase and sale of BTC. Furthermore, as the Company is not a party to the Cooperation Agreement, it cannot enforce the terms of the Cooperation Agreement against any Schedule I BTC Sellers should such Schedule I BTC Sellers do not perform their obligations under the Cooperation Agreement. For example, if a Schedule I BTC Seller does not transfer its committed BTC to the Association Seller pursuant to the Cooperation Agreement, we may not be able to purchase such BTC from the Association Seller pursuant to the Amended BTC Contract. 

 

17

 

 

At the time when the Amended BTC Contract was signed, the Company indicated its intent to exercise the option to purchase 5,000 BTC 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 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”).

 

The value of $1.02 per share for the Shares is equal to the sum of (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) immediately preceding the signing of the Amended BTC Contract, and (ii) $0.01. Using the same per value valuation, the warrants are worth approximately $300,000,000.

 

Pursuant to the Amended BTC Contract, the Company shall exercise its option to purchase BTC thereunder prior to September 24, 2025. While the Company’s purchase option thereunder is time-limited, the Amended BTC Contract itself will remain in effect without a defined expiration date, unless otherwise terminated. In the event of a breach by either party, the non-breaching party has the right to terminate the agreement. In such case, the breaching party will be obligated to pay a penalty of $18,000,000 to the non-breaching party.

 

The above description of the Amended BTC Contract does not purport to be complete, and is qualified in its entirety by reference to the full text of the Amended BTC Contract, a copy of which is attached to the Company’s Current Report on Form 8-K as Exhibit 10.1, filed with the SEC on September 27, 2024, which is incorporated by reference herein.

 

Impact on Company’s Capitalization and Stockholder Approval

 

The issuance of securities pursuant to the Amended BTC Contract will not affect the rights of the Company’s existing stockholders, but such issuances will have a significant dilutive effect on the Company’s existing stockholders, including the voting power of the existing stockholders.

 

As of the date of this report, there were 6,976,410 issued and outstanding shares of the Common Stock. Immediately after the issuance of the Shares (assuming no exercise of the Warrants), there will be 142,147,488 issued and outstanding shares of the Common Stock, and the ownership percentage of the Company’s existing stockholders in the Company will be diluted to approximately 4.91%. Assuming full exercise of the Warrants concurrently with the issuance of the Shares, immediately after the issuance of the Shares, there will be 436,265,135 issued and outstanding shares of Common Stock, and the ownership percentage of the Company’s existing stockholders in the Company will be further diluted to approximately 1.60%.

 

Pursuant to Nasdaq Rule 5635(a), if an issuer intends to issue common stock or securities convertible into or exercisable for common stock, in connection with the acquisition of stock or assets of another company, which may equal or exceed 20% of the outstanding common stock or voting power on a pre-transaction basis, the issuer generally must obtain the prior approval of its stockholders. Pursuant to Nasdaq Rule 5635(d), if an issuer intends to issue common stock or securities convertible into or exercisable for common stock, other than in a public offering, which may equal or exceed 20% of the outstanding common stock or voting power on a pre-transaction basis for a price that is lower than (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) immediately preceding the signing of a binding agreement; or (ii) the average Nasdaq Official Closing Price of the common stock (as reflected on Nasdaq.com) for the five trading days immediately preceding the signing of the binding agreement for such common stock, the issuer generally must obtain the prior approval of its stockholders.

 

The Shares to be issued to the Schedule I BTC Sellers in the Amended 5,000 BTC Transaction exceeds the threshold for which stockholder approval is required under Nasdaq Rule 5635(a), and the Warrant Shares to be issued to the Schedule I BTC Sellers upon the full exercise of the Warrants could result in the issuance of a number of shares exceeding the threshold and pricing for which stockholder approval is required under Nasdaq 5635(d). As such, the Company is required to obtain requisite stockholder approval for the Amended 5,000 BTC Transaction.

 

As disclosed in a Preliminary Information Statement on Schedule 14C filed by the Company on October 3, 2024, the Company has obtained the requisite stockholder approval for the Amended 5,000 BTC Transaction in accordance with the Company’s articles of incorporation and bylaws on September 24, 2024.

 

18

 

 

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

The following discussion and analysis of financial condition and results of operations should be read in conjunction with our financial statements and related notes included elsewhere in this report. This discussion contains forward-looking statements that involve risks, uncertainties and assumptions. See “Cautionary Note Regarding Forward-Looking Statements.” Our actual results could differ materially from those anticipated in the forward-looking statements as a result of certain factors discussed elsewhere in this report.

 

Business

 

Next Technology Holdings Inc (formerly known as “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 include 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.

 

19

 

 

Results of Operations

 

Results of Operations for the Three months period Ended March 31, 2024 and 2023

 

The following tables provide a comparison of a summary of our results of operations for the three months period ended March 31, 2024 and 2023.

 

   For the
period
March 31,
2024		   From the
period
March 31,
2023		 
   (Restated)   (Restated)  
Revenue:        
Service revenue  $—   $— 
Cost of Revenue   —    — 
Gross profit   —    — 
Operating Expenses:          
Gain from digital assets   24,019,399    — 
General and administrative expenses   (330,145)   (166,295)
Net profit/ (loss) before income tax   23,689,254    (166,295)
Income tax expense   (4,142,759)   — 
Net profit/ (loss)   19,546,495    (166,295)

 

Revenue from Operations

 

For the three-month period ended March 31, 2024 and 2023, total revenue were $nil respectively.

  

General and Administrative Expenses

 

For the three months period ended March 31, 2024 and 2023, general and administrative expenses were $330,145 and $166,295 respectively. The increase is mainly due to increase in BTC consulting fee during the period.

 

Other Income

 

The other income of $24,019,399 is mainly due to gain from digital assets during the period.

 

Net Profit

 

As a result of the factors described above, there was a net profit of $19,546,495 and net loss of $166,295 for the period ended March 31, 2024 and 2023, respectively. The increase in net profit is mainly due to gain from digital assets during the period.

 

Liquidity and Capital Resources

 

As of March 31, 2024, we had cash on hand of $668,388. There is no change in cash held during the period.

 

20

 

 

Operating activities

 

As of March 31, 2024, our cash flow used in operating activities is $530 for the period ended March 31, 2024 as compared to the cash flow used in operating activities of $511,772 in prior period. The decrease was mainly due to higher fair value gain in BTC were made in prior period.

 

Financing activities

 

Cash provided by our financing activities was $635 for the period ended March 31, 2024 as compared to cash provided by financing activities of $186,000. The decrease is mainly due to lesser in shareholders’ advance during the period as compare to the prior period.

 

Inflation

 

Inflation does not materially affect our business or the results of our operations.

 

Off-Balance Sheet Arrangements

 

We do not have any off-balance sheet arrangements.

 

Critical Accounting Policies

 

We prepare our financial statements in accordance with generally accepted accounting principles of the United States (“GAAP”). GAAP represents a comprehensive set of accounting and disclosure rules and requirements. The preparation of our financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Our actual results could differ from those estimates. We use historical data to assist in the forecast of our future results. Deviations from our projections are addressed when our financials 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.

 

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. 

 

21

 

 

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

We are a “smaller reporting company” as defined by Item 10(f)(1) of Regulation S-K, and as such are not required to provide the information contained in this item pursuant to Item 305 of Regulation S-K.

 

ITEM 4. CONTROLS AND PROCEDURES

 

Disclosure Controls and Procedures.

 

The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. The Company’s internal control over financial reporting is a process designed under the supervision of the Company’s Chief Executive Officer and Chief Financial Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s financial statements for external purposes in accordance with U.S. generally accepted accounting principles.

 

With respect to the period ended March 31, 2024, under the supervision and with the participation of our management, we conducted an evaluation of the effectiveness of the design and operations of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) promulgated under the Securities Exchange Act of 1934.

 

Based upon our evaluation regarding the period ended March 31, 2024, the Company’s management, including its Principal Executive Officer, has concluded that its disclosure controls and procedures were not effective due to the Company’s limited internal resources and lack of ability to have multiple levels of transaction review. Material weaknesses noted are lack of an audit committee, lack of a majority of outside directors on the board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; and management is dominated by two individuals, without adequate compensating controls. However, management believes the financial statements and other information presented herewith are materially correct.

 

Our management assessed the effectiveness of our internal control over financial reporting as of March 31, 2024. In making this assessment, our management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in Internal Control - Integrated Framework - Guidance for Smaller Public Companies (the COSO criteria). Based on our assessment, management identified material weaknesses related to: (i) our internal audit functions; (ii) a lack of segregation of duties within accounting functions; and the lack of multiple levels of review of our accounting data. Based on this evaluation, our management concluded that as of March 31, 2024, we did not maintain effective internal control over financial reporting.

 

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with any policies and procedures may deteriorate. Due to our size and nature, segregation of all conflicting duties may not always be possible and may not be economically feasible. To the extent possible, we will implement procedures to assure that the initiation of transactions, the custody of assets and the recording of transactions will be performed by separate individuals. With proper funding we plan on remediating the significant deficiencies identified above, and we will continue to monitor the effectiveness of these steps and make any changes that our management deems appropriate.

 

A material weakness is a control deficiency (within the meaning of Public Company Accounting Oversight Board Auditing Standard No. 5) or combination of control deficiencies, that results in a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis.

 

Changes in Internal Control over Financial Reporting

 

There were no changes in our internal control over financial reporting that occurred during our most recently completed fiscal quarter that has materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

22

 

 

PART II – OTHER INFORMATION

 

 

ITEM 1. LEGAL PROCEEDINGS

 

Since mid-September 2023, Mr. Zheng Dai, Mr. Pijun Liu, and certain individuals under their control (the “Unauthorized Persons”) had been falsely and repeatedly holding themselves out as representing and/or authorized to represent the Company. For example, the Unauthorized Persons caused to be filed certain current reports on Forms 8-K dated September 28, 2023 and October 10, 2023, in which they purported to appoint new officers and directors. These filings were false and should be disregarded.

 

On September 28, 2023, a derivative lawsuit was filed by certain purported shareholders affiliated with the Unauthorized Persons in the United States District Court for the District of Wyoming against certain officers and directors of the Company, seeking control of the Company. This case was dismissed without prejudice on October 18, 2023.

 

On October 18, 2023, the same individuals who filed the above-described derivative suit filed a direct action against the Company in the Chancery Court of the State of Wyoming (the “Chancery Court”), again seeking control of the Company. The Company responded to the lawsuit, sought a temporary restraining order restraining the plaintiff-shareholders and their affiliates (including the Unauthorized Persons) from claiming be in control of the Company.

 

On November 7, 2023, the Chancery Court issued a temporary restraining order substantially restraining the plaintiff-shareholders and their affiliates from claiming to act on behalf of the Company. The lawsuit remains pending as at reporting date.

 

On November 30, 2023, the Company responded to plaintiffs’ arguments that they controlled the Company, pointing out that plaintiffs’ case (Mr. Dai Zheng and his affiliates) was largely built upon forged signatures and other fabricated materials. In response, the plaintiffs withdrew their opposition to the Company’s request for an injunction.

 

On January 5, 2024, the Chancery Court entered a preliminary injunction order (attached hereto). Specifically, the order restrained Mr. Dai Zheng and his affiliates from the following conduct:

 

(i)acting as or holding themselves out as majority shareholders, directors, executives, or employees of the Company and its affiliates;

 

(ii)making any attempts to contact the SEC, Nasdaq, government authorities, or make any filing or press release on behalf of the Company;

 

(iii)making any attempts to change the board composition and executive team;

 

(iv)disseminating false statements regarding the Company and its leadership;

 

(v)making any attempts to contact the Company’s service providers, including auditors, stock transfer agents, and filing agents;

 

(vi)making any attempts to issue the Company’s shares.

 

23

 

 

ITEM 1A. RISK FACTORS

 

We are a “smaller reporting company” as defined by Item 10(f)(1) of Regulation S-K, and as such are not required to provide the information contained in this item.

 

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

 

None.

 

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

 

No senior securities were issued and outstanding during the nine months ended March 31, 2024.

 

ITEM 4. MINE SAFETY DISCLOSURES

 

Not applicable to our Company.

 

ITEM 5. OTHER INFORMATION

 

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. The total issued and outstanding shares of the Company’s common stock decreased from 195,057,503 to 1,054,364 shares, with the par value unchanged at zero.

 

The Reverse Stock Split is intended to more expediently enable the Company to regain compliance to achieve a minimum bid price of $1.00 per share for continued listing on Nasdaq, as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Minimum Bid Requirement”). As a result of the Reverse Stock Split, every one-for-one hundred and eighty-five (185) shares of the Company’s Common Stock then issued and outstanding will automatically, and without any action of the Company or any holder thereof, be combined, converted, and changed into one (1) validly issued and non-assessable share of Common Stock. No fractional shares will be issued to any shareholder, and in lieu of issuing any such fractional shares, the fractional shares resulting from the Reverse Stock Split will be rounded up to the nearest whole share of Common Stock.

 

In September, 2023, there were 1,570,600 shares issued with the total amount of $12,616,454, and the Company’s common stock issued has been increased to 2,625,130 shares as of March 31, 2024.

 

24

 

 

ITEM 6. EXHIBITS

 

Exhibit No.   Description
10.1  

BTC Trading Contract, dated September 25, 2023, between Next Technology Holdings Inc., as Party A (Buyer) and Party B (Seller) (Incorporated by reference to Exhibit 10.1 to Form 8-K filed on September 28, 2023)

10.2   Amendment Agreement, dated May 2, 2024, between Next Technology Holdings Inc., as Party A (Buyer) and Party B (Seller) (Incorporated by reference to Exhibit 10.1 to Form 8-K filed on May 6, 2024)
10.3   Contract Cancellation Agreement, dated June 20, 2024, between Next Technology Holdings Inc., as Party A (Buyer) and Party B (Seller) (Incorporated by reference to Exhibit 10.4 to Form 10Q/A for the period ended September 30, 2024, filed on December 9, 2024)
10.4   Amended and Restated BTC Trading Contract, dated September 24, 2024, between Next Technology Holdings Inc., as Party A (Buyer) and Party B (Seller) (Incorporated by reference to Exhibit 10.1 to Form 8-K filed on September 27, 2024)
31.1   Certification of Principal Executive Officer filed pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith
31.2   Certification of Principal Financial Officer filed pursuant to Exchange Act Rules 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith
32.1   Certification of Chief Executive Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Filed herewith
32.2   Certification of Chief Financial Officer furnished pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Filed herewith
101   Financial statements from the quarterly report on Form 10-Q of Next Technology Holdings Inc for the fiscal quarter ended March 31, 2024, formatted in XBRL: (i) the Balance Sheet; (ii) the Statement of Income; (iii) the Statement of Cash Flows; and (iv) the Notes to the Financial Statements Filed herewith
104   Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101

 

25

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  NEXT TECHNOLOGY HOLDINGS INC
     
Dated December 12, 2024 By: /s/ Wei Hong Liu
    Wei Hong Liu
    Chief Executive Officer

 

  /s/ Eve Chan
  Eve Chan
  Chief Financial Officer

 

 

26

 

 

Next Technology Holding Inc. 00-0000000 CN There is an adjustment of $263,948in digital assets due to over-statement of its fair value of $263,948 There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses and adjustment of $130,934 in tax payable. There is reclassification of $50,020 from accrued expenses to other payables and adjustment of $520 in other payables due to error recording in other payables. There is an adjustment of $12,000 in amount due to related parties due to error recording in amount due to related parties. There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to increase in loss of discontinued operation in prior year. There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities. There is reclassification of $40,000 from shareholders’ loan to directors’ fee payables in operating activities. true --12-31 Q1 100020 0001784970 001-41450 0001784970 2024-01-01 2024-03-31 0001784970 2024-12-12 0001784970 2024-03-31 0001784970 2023-12-31 0001784970 us-gaap:NonrelatedPartyMember 2024-03-31 0001784970 us-gaap:NonrelatedPartyMember 2023-12-31 0001784970 us-gaap:RelatedPartyMember 2024-03-31 0001784970 us-gaap:RelatedPartyMember 2023-12-31 0001784970 us-gaap:ServiceMember 2024-01-01 2024-03-31 0001784970 us-gaap:ServiceMember 2023-01-01 2023-03-31 0001784970 2023-01-01 2023-03-31 0001784970 us-gaap:CommonStockMember 2023-12-31 0001784970 us-gaap:AdditionalPaidInCapitalMember 2023-12-31 0001784970 us-gaap:RetainedEarningsMember 2023-12-31 0001784970 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2023-12-31 0001784970 us-gaap:CommonStockMember 2024-01-01 2024-03-31 0001784970 us-gaap:AdditionalPaidInCapitalMember 2024-01-01 2024-03-31 0001784970 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EXHIBIT 31.1

 

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO 15 U.S.C. SECTION 7241, AS

ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Liu Wei Hong, certify that:

 

1 I have reviewed the quarterly report on Form 10-Q/A of Next Technology Holdings Inc., a Wyoming corporation, for the period ended March 31, 2024, as filed with the Securities and Exchange Commission;
   
2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
   
3 Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for, the periods presented in this report;
   
4 The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5 The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: December 12, 2024 /s/ Wei Hong Liu
  Liu Wei Hong
  Chief Executive Officer

  

EXHIBIT 31.2

 

 

CERTIFICATION BY THE CHIEF FINANCIAL OFFICER

PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Eve Chan, certify that:

 

1 I have reviewed the Quarterly Report on Form 10-Q/A of Next Technology Holdings Inc., a Wyoming corporation, for the period ended March 31, 2024, as filed with the Securities and Exchange Commission;
   
2 Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
   
3 Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of and for, the periods presented in this report;
   
4 The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

 

  (a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
     
  (b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
     
  (c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
     
  (d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an Annual Report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

 

5 The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

 

  (a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
     
  (b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

 

Date: December 12, 2024 /s/ Eve Chan
  Eve Chan
  Chief Financial Officer

 

 

EXHIBIT 32.1

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Liu Wei Hong, Director and Chief Executive Officer of Next Technology Holdings Inc. (the “Company”), do hereby certify, in connection with Quarterly Report on Form 10-Q/A for the quarter ended March 31, 2024 (the “Report”) of the Company, the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
   
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: December 12, 2024 By: /s/ Wei Hong Liu
    Liu Wei Hong
    Chief Executive Officer
    (principal executive officer)

 

 

EXHIBIT 32.2

 

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Eve Chan, Director and Chief Financial Officer of Next Technology Holdings Inc . (the “Company”), do hereby certify, in connection with Quarterly Report on Form 10-Q/A for the quarter ended March 31, 2024 (the “Report”) of the Company, the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and
   
2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

Date: December 12, 2024 By: /s/ Eve Chan
    Eve Chan
    Chief Financial Officer
    (principal financial officer)

 

 

 

 

 

 

 

 

 

v3.24.3
Cover - shares
 3 Months Ended
Mar. 31, 2024
Dec. 12, 2024
Document Information [Line Items]    
Document Type 10-Q/A  
Document Quarterly Report true  
Document Transition Report false  
Entity Interactive Data Current Yes  
Amendment Flag true  
Amendment Description Next Technology Holding Inc (formerly known as WeTrade Group Inc. (the “Company”)) is filing this Amendment No.2 (the “Amendment No.2”) to the Quarterly Report on Form 10-Q for the period ended March 31, 2024, originally filed with the Securities and Exchange Commission (the “SEC”) on May 20, 2024 (the “Original Filing”), to amend our consolidated financial statements.This Amendment No.2 amends the Original Filing, and the Amended Quarterly Report on Form 10-Q/A of the Company for the quarter ended March 31, 2024 filed on September 12, 2024 (the “Amendment No.1”). This Amendment No.2 is being filed to revise disclosure in “Note 8 – Prepayments” in connection with the BTC Contract (as defined below), and to include the restatement of previously issued financial statements describing the natures of all affected financial statements as restated that affect for the period ended March 31, 2024.In accordance with applicable SEC rules, this Amendment No.2 includes new certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002, as amended, from our Chief Executive Officer and Chief Financial Officer.Except as described above, this Form 10-Q/A does not amend, update or change any other items or disclosures contained in the Original Filing, and accordingly, this Form 10-Q/A does not reflect or purport to reflect any information or events occurring after the original filing date of the Original Filing or modify or update those disclosures affected by subsequent events. Accordingly, this Form 10-Q/A should be read in conjunction with the Original Filing and the Company’s other filings with the SEC  
Document Period End Date Mar. 31, 2024  
Document Fiscal Year Focus 2024  
Document Fiscal Period Focus Q1  
Entity Information [Line Items]    
Entity Registrant Name Next Technology Holding Inc.  
Entity Central Index Key 0001784970  
Entity File Number 001-41450  
Entity Tax Identification Number 00-0000000  
Entity Incorporation, State or Country Code WY  
Current Fiscal Year End Date --12-31  
Entity Current Reporting Status Yes  
Entity Shell Company false  
Entity Filer Category Non-accelerated Filer  
Entity Small Business true  
Entity Emerging Growth Company false  
Entity Contact Personnel [Line Items]    
Entity Address, Address Line One Room 519, 05/F Block T3  
Entity Address, Address Line Two Qianhai Premier Finance Centre Unit 2  
Entity Address, Address Line Three Guiwan Area  
Entity Address, City or Town Shenzhen  
Entity Address, Country CN  
Entity Address, Postal Zip Code 100020  
Entity Phone Fax Numbers [Line Items]    
City Area Code (86)  
Local Phone Number 158 2117 2322  
Entity Listings [Line Items]    
Entity Common Stock, Shares Outstanding   6,976,410
v3.24.3
Condensed Consolidated Balance Sheets (Unaudited) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Current assets:    
Cash and cash equivalents $ 668,387 $ 668,387
Digital assets [1] 59,156,975 35,137,576
Prepayments 12,125,500 12,125,500
Total current assets 73,081,526 49,064,580
Total assets 73,081,526 49,064,580
Current liabilities:    
Account payables 924,127 926,456
Tax payable [2] 130,934 130,942
Other payables [3] 1,889,500 1,600,000
Total current liabilities 4,678,293 4,350,496
Non-current liabilities:    
Deferred tax liabilities [2] 4,142,759
Total liabilities 8,821,052 4,350,496
Stockholders’ equity:    
Common stock; no par value; 2,625,130 issued and outstanding on March 31, 2024 and December 31, 2023 respectively 56,348,650 56,348,650
Accumulated other comprehensive loss (113) (8)
Retained Earnings/(Accumulated Deficit) [4] 7,911,937 (11,634,558)
Total stockholders’ equity 64,260,474 44,714,084
Total liabilities and stockholders’ equity 73,081,526 49,064,580
Nonrelated Parties    
Current assets:    
Accounts receivable- non related parties, net 1,130,664 1,133,117
Related Parties    
Current liabilities:    
Amount due to related parties [5] $ 1,733,732 $ 1,693,098
[1] There is an adjustment of $263,948in digital assets due to over-statement of its fair value of $263,948
[2] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses and adjustment of $130,934 in tax payable.
[3] There is reclassification of $50,020 from accrued expenses to other payables and adjustment of $520 in other payables due to error recording in other payables.
[4] There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to increase in loss of discontinued operation in prior year.
[5] There is an adjustment of $12,000 in amount due to related parties due to error recording in amount due to related parties.
v3.24.3
Condensed Consolidated Balance Sheets (Unaudited) (Parentheticals) - $ / shares
Mar. 31, 2024
Dec. 31, 2023
Statement of Financial Position [Abstract]    
Common stock, par value (in Dollars per share)
Common stock, shares issued 2,625,130 2,625,130
Common stock, shares outstanding 2,625,130 2,625,130
v3.24.3
Condensed Consolidated Statements of Operations and Comprehensive Loss (Unaudited) - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Revenue:    
Total service revenue
Cost of revenue
Gross Profit
Operating expenses    
General and administrative expense [1] (330,145) (166,295)
Total operating expenses (330,145) (166,295)
Loss from operations (330,145) (166,295)
Other income [2] 24,019,399
Profit/ (loss) before income taxes 23,689,254 (166,295)
Income tax expenses [3] (4,142,759)
Net profit/ (loss) from continuing operation [5] 19,546,495 [4] (166,295)
Net loss from discontinued operation (775,826)
Comprehensive income    
Net profit/ (loss) 19,546,495 (942,121)
Other comprehensive income    
Foreign currency translation adjustment [1] (105) 310,576
Total comprehensive profit/(loss) $ 19,546,390 $ (631,545)
Earnings /(Loss) per share, basic from continuing operation (in Dollars per share) $ 7.45 $ (0.16)
Earnings /(Loss) per share, diluted from continuing operation (in Dollars per share) 7.45 (0.16)
Earnings /(Loss) per share, basic from discontinued operation (in Dollars per share) (0.74)
Earnings /(Loss) per share, diluted from discontinued operation (in Dollars per share) $ (0.74)
Weighted-average shares outstanding, basic (in Shares) [1] 2,625,130 1,054,530
Weighted-average shares outstanding, diluted (in Shares) [1] 2,625,130 1,054,530
Service Revenue    
Revenue:    
Total service revenue
[1] There is an adjustment of $2 in general and administrative expenses and $8 in foreign currency translation adjustment due to rounding errors.
[2] There is an adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622.
[3] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.
[4] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
[5] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
v3.24.3
Condensed Consolidated Statement of Changes In Stockholders’ Equity (Unaudited) - USD ($)
Common Stock
Additional Paid in Capital
(Accumulated Deficit)/ Retained Earnings
Accumulated Other Comprehensive Income
Total
Balance at Dec. 31, 2022 $ 43,732,196 $ (1,714,858) $ (310,576) $ 41,706,762
Balance (in Shares) at Dec. 31, 2022 1,054,530        
Foreign currency translation adjustment 310,576 310,576
Loss from discontinued operation [1] (775,826) (775,826)
Net profit/ (loss) (166,295) (166,295) [2]
Balance at Mar. 31, 2023 43,732,196 (2,656,979) 41,075,217
Balance (in Shares) at Mar. 31, 2023 1,054,530        
Balance at Dec. 31, 2023 56,348,650 (11,634,558) (8) $ 44,714,084
Balance (in Shares) at Dec. 31, 2023 2,625,130       2,625,130
Foreign currency translation adjustment (105) $ (105)
Loss from discontinued operation        
Net profit/ (loss) [3] 19,546,495 19,546,495 [2]
Balance at Mar. 31, 2024 $ 56,348,650 $ 7,911,937 $ (113) $ 64,260,474
Balance (in Shares) at Mar. 31, 2024 2,625,130       2,625,130
[1] There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to increase in loss of discontinued operation in prior year.
[2] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
[3] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
v3.24.3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Cash flows from operating activities:    
Net Profit/ (loss) [2] $ 19,546,495 [1] $ (166,295)
Fair value gain from digital assets [3] (24,019,399)
Loss from discontinued operation (775,826) [4]
Changes in operating assets and liabilities:    
Accounts receivables 2,452
Account payables [5] (2,328)
Directors’ fee payable [6] 40,000
Tax payable [7] (9)
Other payables [7] 289,500
Deferred tax liabilities [8] 4,142,759
Net cash flows used in continued operating activities (530) (942,121)
Net cash flows used in discontinued operating activities 430,349
Net cash flows used in operating activities (530) (511,772)
Cash flow from financing activities:    
Shareholders loan [6] 635 186,000
Net cash flows provided by financing activities 635 186,000
Effect of exchange rate changes on cash (105) 310,576
Change in cash and cash equivalents (15,196)
Cash and cash equivalents, beginning of period 668,387 22,926
Cash and cash equivalents, end of period 668,387 7,730
Supplemental cash flow information:    
Cash paid for interest
Cash paid for taxes
[1] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
[2] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
[3] There is an adjustment of $194,622 in fair value gain from digital assets due to over-provision of its fair value gain.
[4] There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to increase in loss of discontinued operation in prior year.
[5] There is an adjustment of $2 in account payables due to rounding error.
[6] There is reclassification of $40,000 from shareholders’ loan to directors’ fee payables in operating activities.
[7] Reclassification of $130,934 from other payables to tax payable
[8] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.
v3.24.3
Nature of Business
 3 Months Ended
Mar. 31, 2024
Nature of Business [Abstract]  
NATURE OF BUSINESS

NOTE 1 – NATURE OF BUSINESS

 

Business

 

Next Technology Holdings Inc (formerly known as 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 include 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.

 

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:

 

   Digital asset
original cost basis		   Gain from
digital asset		   Market Value of
digital asset		   Approximate
number of
Bitcoin held		 
Balance on December 31, 2023   24,990,000    10,147,576    35,137,576    833 
Digital asset purchase   
-
    
-
    
-
    - 
Fair value change during the period   
-
    24,019,399    24,019,399    - 
Balance on March 31, 2024   24,990,000    34,166,975    59,156,975    833 

 

Restatement of previously issued financial statement

 

The Company discovered rounding errors and accounting treatment errors in general and administrative expenses, other income, tax expenses, amount due to related parties, deferred tax liabilities and other payables and accrued expenses during the audit review for the period ended March 31, 2024, including rounding error of $2 in general and administrative expenses, over-statement of other income and digital assets, under-provision of tax expenses and deferred tax liabilities of $4,142,759, reclassification of $130,934 tax payable from other payable, and adjustment of $12,000 in amount due to related parties for the three-month period ended March 31, 2024.

 

Effects of the restatement are as follows:

 

Consolidated statement of operation for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed) 		   Adjustment   As Restated 
             
General and administrative expenses  $(330,143)  $(2)  $(330,145)
Other income  $24,214,021   $(194,622)  $24,019,399 
Tax expenses  $
-
   $(4,142,759)  $(4,142,759)
Net profit  $23,883,878   $(4,337,383)  $19,546,495 

 

Consolidated statement of operation for the three-month period ended March 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
General and administrative expenses  $(212,194)  $45,899   $(166,295)
Net loss  $(212,194)  $45,899   $(166,295)

 

Consolidated balance sheet as of March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Digital assets  $59,420,922   $(263,947)  $59,156,975 
Total assets  $73,345,474   $(263,947)  $73,081,526 
                
Amount due to related parties  $(1,721,732)  $(12,000)  $(1,733,732)
Accrued expenses  $(50,020)  $50,020   $
-
 
Deferred tax liabilities  $
-
   $(4,142,759)  $(4,142,759)
Tax payable  $
-
   $(130,934)  $(130,934)
Other payables and accrued expenses  $(1,840,000)  $(49,500)  $(1,889,500)
Total liabilities  $(4,535,879)  $(4,285,173)  $(8,821,052)
                
Accumulated profit  $(12,461,058)  $(4,549,121)  $7,911,937 
Total equity  $68,809,595   $(4,549,121)  $64,260,474 

  

Consolidated balance sheet as of December 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
Accumulated deficit  $(11,422,820)  $(211,738)  $(11,634,558)
Total shareholders’ equity  $44,925,822   $(211,738)  $44,714,084 

 

Consolidated statement of cash flows for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Cash flows from operating activities:            
Net profit  $23,883,878   $(4,337,383)  $19,546,495 
Fair value gain from digital assets  $(24,214,021)  $194,622   $(24,019,399)
Deferred tax liabilities  $
-
   $4,142,759   $4,142,759 
Account payables  $(2,329)  $2   $(2,327)
Directors’ fee payables  $
-
   $40,000   $40,000 
Net cash flow used in operation expenses  $(40,530)  $40,000   $(530)
Cash flows from financing activities:               
Shareholders’ loan  $40,635   $(40,000)  $635 
Net cash flow provided by financing activities   40,635   $(40,000)  $635 
v3.24.3
Summary of Significant Accounting Policies
 3 Months Ended
Mar. 31, 2024
Summary of Significant Accounting Policies [Abstract]  
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

 

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 three months ended March 31, 2024 and 2023 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 March 31, 2024, the results of its operations for the three months ended March 31, 2024 and 2023, and its cash flows for the three months ended March 31, 2024 and 2023. 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. 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, 2023.

 

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.

 

Goodwill and Other - Crypto Assets

 

In December 2023, the FASB issued ASU 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, which establishes accounting guidance for crypto assets meeting certain criteria. Bitcoin meets these criteria. The amendments require crypto assets to meet the criteria to be recognized at fair value with changes recognized in net income each reporting period. Upon adoption, a cumulative-effect adjustment is made to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption. ASU 2023-08 is effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. Early adoption is permitted. The Company has early applied ASU 2023-08 and measured crypto assets (presented as digital assets) at fair value with changes recognized in net income this year.

 

The following table summarizes the Company’s digital asset holdings as of:

 

   March 31,
2024		   December 31,
2023		 
Approximate number of bitcoins held   833    833 
Digital assets carrying value  $59,156,975   $35,137,576 
Gain on digital assets during the period/ Year  $24,019,399   $10,147,576 

 

As of March 31, 2024, approximately 833 of the bitcoins held by the Company, which had a carrying value of approximately $59.2 million on the Company’s Consolidated Balance Sheets as of March 31, 2024.

 

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 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 March 31, 2024.

 

   March 31,
2024		   December 31,
2023		 
RMB: US$ exchange rate   7.22    7.09 

 

The balance sheet amounts, with the exception of equity, as of March 31, 2024 and December 31, 2023 were translated at 7.22 RMB and 7.09 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 March 31, 2024 and year ended December 31, 2023 were 7.18 RMB and 7.08 RMB to US$1.00, respectively. Cash flows were also translated at average translation rates for the period 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.

 

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 expected credit loss, valuation of deferred tax assets, and certain accrued liabilities such as contingent liabilities.

 

Accounts Receivable

 

Accounts receivables 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 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.

 

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.

 

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 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.

 

The Company has subsidiaries in Hong Kong and PRC. The Company is subject to tax in Hong Kong 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 Department of Hong Kong and Tax Department of PRC.

 

Earnings / (Loss) Per Share

 

Earnings/(Loss) 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 March 31, 2024, there were no potentially dilutive shares.

 

   For the
period
March 31,
2024		   For the
period
March 31,
2023		 
   (Restated)   (Restated) 
Statement of Operations Summary Information:        
Net Profit/ (Loss)  $19,546,495   $(166,295)
Weighted-average common shares outstanding - basic and diluted   2,625,130    1,054,530 
Earnings / (loss) per share, basic and diluted  $7.45   $(0.16)

 

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.
v3.24.3
Recent Accounting Pronouncements
 3 Months Ended
Mar. 31, 2024
Recent Accounting Pronouncements [Abstract]  
RECENT ACCOUNTING PRONOUNCEMENTS

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.
v3.24.3
Revenue
 3 Months Ended
Mar. 31, 2024
Revenue [Abstract]  
REVENUE

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 March 31, 2024, there were no revenue generated from SAAS business.
v3.24.3
Cash and Cash Equivalents
 3 Months Ended
Mar. 31, 2024
Cash and Cash Equivalents [Abstract]  
CASH AND CASH EQUIVALENTS

NOTE 5 – CASH AND CASH EQUIVALENTS

 

As of March 31, 2024, the Company held cash in bank in the amount of $668,388, which consists of the following: 

  

   March 31,
2024		   December 31,
2023		 
Bank Deposits- Outside USA  $668,387   $668,387 
v3.24.3
Digital Assets
 3 Months Ended
Mar. 31, 2024
Digital Assets [Abstract]  
DIGITAL ASSETS

NOTE 6 – DIGITAL ASSETS

 

As of March 31, 2024, digital assets holdings are as follows:

 

   March 31,
2024		   December 31,
2023		 
    (Restated)    (Restated) 
Opening balance  $35,137,576   $
—
 
Purchase of BTC   
—
    24,990,000 
Gain from digital assets   24,019,399    10,147,576 
Ending balance  $59,156,975   $35,137,576 

 

As of March 31, 2024, the Company held approximately 833 BTC at the total cost of $24,990,000. For the three months ended March 31, 2024 and for the year ended December 31, 2023, the Company recognized gain of $24,019,399 and $10,147,576 on digital assets respectively.
v3.24.3
Accounts Receivable
 3 Months Ended
Mar. 31, 2024
Accounts Receivable [Abstract]  
ACCOUNTS RECEIVABLE

NOTE 7 – ACCOUNTS RECEIVABLE

 

As of March 31, 2024, accounts receivable are related to the services fee receivable from customers as follow:

 

   March 31,
2024		   December 31,
2023		 
Accounts Receivable  $1,130,664   $1,133,117 

 

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. There is no allowance for expected credit loss as the accounts receivable has been received as at reporting date.
v3.24.3
Prepayments
 3 Months Ended
Mar. 31, 2024
Prepayments [Abstract]  
PREPAYMENTS

NOTE 8 – PREPAYMENTS

 

As of March 31, 2024, prepayments consist of the following:

 

    March 31,
2024		     December 31,
2023		  
Prepayment for digital assets   $ 12,125,500     $ 12,125,500  

  

As previously disclosed in a Form 8-K filed on September 28, 2023, the Company entered into a BTC Trading Contract (the “BTC Contract”) with an autonomous organization (the “Association Seller”), which supports its members in the sale of BTC. While the Association Seller provides services to facilitate the sale of BTC by its members, it does not exert control over them by ownership or contract, nor does it make decisions for its members relating to the sale of BTC. None of the members of the Association Seller hold equity, serve as director or officer, or otherwise has voting power or management rights of the Association Seller.

 

Under the BTC Contract, the Company has the right to purchase up to 6,000 BTC from the members of the Association Seller (each, a “BTC Seller”) through the Association Seller at a locked price of $30,000/BTC over a 12-month period commencing on September 25, 2023, with payment to be made in the form of cash or the Company’s shares. Although the BTC Contract states that the Association Seller (Party B) “owns the virtual currency”, to our knowledge, this statement was mistakenly made. As of the date of the BTC Contract, it were the individual members of the Association Seller, not the Association Seller itself, who own the BTC to be sold under the BTC Contract. We believe the Association Seller will coordinate with its members to fulfill the Company’s purchase of BTC, however, we cannot guarantee that the Company will be able to purchase BTC from the BTC Sellers. The BTC Contract was entered into solely between the Company and the Association Seller and no BTC Sellers owe any legal obligation to the Company in connection with the purchase and sale of BTC.

 

Following the execution of the BTC Contract, the Company purchased 833 BTC from the BTC Sellers and decided to purchase an additional 1,000 BTC (the “1,000 BTC Purchase”). As of December 31, 2023, the Company made a prepayment to the BTC Sellers through the Association Seller of approximately $12,125,500 (the “Prepayment Amount”), representing 40% of the total purchase price for 1000 BTC. The prepayment was made to secure favorable pricing and demonstrate the Company’s commitment to completing the 1,000 BTC Purchase. This prepayment is refundable if the 1,000 BTC Purchase is not completed.

 

While negotiating the terms of the 1,000 BTC Purchase with the BTC Sellers, the Company decided to exercise its right under the BTC Contract to purchase 5,000 BTC (the “5,000 BTC Purchase”), which includes the previously planned 1,000 BTC. To reflect the then price increase in BTC and finalize the transaction details of the 5,000 BTC Purchase, the Company and the Association Seller entered into that certain Amendment Agreement (the “Amendment Agreement”) on May 2, 2024, which was previously disclosed in a Form 8-K filed by the Company on May 6, 2024.

 

According to the Amendment Agreement, the Company agreed to pay the aggregate price for the 5,000 BTC through the issuance of 40,000,000 shares of the Company’s common stock (the “Common Stock”) valued at $3.75 per share, which was the closing market price of the Common Stock as of May 1, 2024 (the “Then FMV”) and warrants to purchase 80,000,000 shares of the Common Stock with the exercise price of $2.6 per share (equal to 70% of the Then FMV). In connection with the 5,000 BTC Purchase, on May 8, 2024, the Company filed a Preliminary Information Statement on Schedule 14C (the “Preliminary 14C”). Subsequently, the Company decided to cease pursuing the 5,000 BTC Purchase due to the market fluctuations in BTC and further discussions with the BTC Sellers, which was previously disclosed on a Form 8-K filed by the Company on June 26, 2024.

 

Despite the cancellation of the 5,000 BTC Purchase, negotiations regarding the original 1,000 BTC Purchase continued. The Company’s original plan was to settle the remaining 60% of the total purchase price for 1,000 BTC through the issuance of the Common Stock at a per share price based on the average market price over a five-day period immediately prior to the date of the completion of the 1,000 BTC Purchase. However, the Board believed in the potential long-term appreciation of the BTC. As a result, it has decided to halt the 1,000 BTC Purchase and instead re-negotiate the terms with the Associate Seller to acquire 5,167 BTC, which represents the maximum number of BTC that the Company was entitled to purchase under the BTC Contract minus the BTC already acquired under the BTC Contract.
v3.24.3
Amount Due to Related Parties
 3 Months Ended
Mar. 31, 2024
Amount Due to Related Parties [Abstract]  
AMOUNT DUE TO RELATED PARTIES

NOTE 9 – AMOUNT DUE TO RELATED PARTIES

 

   March 31,
2024		   December 31,
2023		 
   (Restated)   (Restated) 
Related parties payable  $282,535   $282,535 
Amount due to shareholders   607,197    606,563 
Director fee payable   844,000    804,000 
   $1,733,732   $1,693,098 

 

The related party balance of $282,535 represented advances from former shareholders for Company’s daily operation.

 

As of March 31, 2024, the amount due to shareholders of $607,197 represented advances and professional expenses paid on behalf by Shareholders, which consist of audit fees, lawyers’ fee and other professional expenses.

 

As of March 31, 2024, the director fee payable of $844,000 represented the accrual of director fees from the appointment date to March 31, 2024.

 

The amount due to related parties are interest free, unsecured and have no fixed repayment period.
v3.24.3
Account Payables
 3 Months Ended
Mar. 31, 2024
Account Payables [Abstract]  
ACCOUNT PAYABLES

NOTE 10 – ACCOUNT PAYABLES

 

As of March 31, 2024 and December 31, 2023, account payable are related to the software services fee payables to suppliers as follow: 

 

   December 31,
2023		   December 31,
2023		 
Account payable   $924,127   $926,456 
v3.24.3
Other Payables
 3 Months Ended
Mar. 31, 2024
Other Payables [Abstract]  
OTHER PAYABLES

NOTE 11 – OTHER PAYABLES

 

As of March 31, 2024, other payables consist of unpaid professional fee as follows:

 

   March 31,
2024		   December 31,
2023		 
Professional fees  $1,889,500   $1,600,000 

 

Professional fees of $1,889,500 comprise outstanding legal fees in relation to shareholders’ litigation, BTC consultant fee and listing compliance fee owing to professional parties.
v3.24.3
Shareholders’ Equity
 3 Months Ended
Mar. 31, 2024
Shareholders’ Equity [Abstract]  
SHAREHOLDERS’ EQUITY

NOTE 12 – SHAREHOLDERS’ EQUITY

 

The Company has an unlimited number of authorised ordinary shares and has issued 2,625,130 shares with no par value as of March 31, 2024.

 

On March 29, 2019, the Company issued 100,000,000 shares with no par value to thirty-three founders. On September 3, 2019, the Company 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.

 

In September 2023, there were 1,570,600 shares issued with the total amount of $12,616,454, and the Company’s common stock issued has been increased to 2,625,130 shares as of March 31, 2024.
v3.24.3
Income Taxes
 3 Months Ended
Mar. 31, 2024
Income Taxes [Abstract]  
INCOME TAXES

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.  

 

There are several subsidiaries were incorporated in Hong Kong and are subject to Hong Kong profits tax at a tax rate of 16.5%.  

 

The Company is currently conducting its certain operations in the PRC through its subsidiaries, which are subject to tax to 25%.
v3.24.3
Subsequent Events
 3 Months Ended
Mar. 31, 2024
Subsequent Events [Abstract]  
SUBSEQUENT EVENTS

NOTE 14 – SUBSEQUENT EVENTS

 

Acquisition of Company

 

On March 1,2024, the Company entered into a share purchase agreement (the “Purchase Agreement”) with certain existing shareholders (the “Sellers”) of Future Dao Group Holding Limited, an exempted company incorporated and existing under the laws of the Cayman Islands(the “Target”),pursuant to which the Company agrees to purchase from the Sellers indirectly through Next Investment Group Limited, a wholly-owned subsidiary of the Company (“Next Investment”), and the Sellers agree to sell to Next Investment, an aggregate of 2,000 ordinary shares (the “Purchased Shares”) of the Target (the “Transaction”) at a per share purchase price of $6,698 per share for an aggregate purchase price of $13,396,000 (the “Purchase Price”). Pursuant to the Purchase Agreement, at the closing of the Transaction, the Company will pay the Purchase Price by issuing to the Sellers an aggregate of 3,940,000 shares of common stock of the Company (the “Next Technology Common Stock”) based on an agreed-upon valuation of $3.40 per share (the “Per Share Price”). The Per Share Price is above $3.19, which is the average price per share of the shares of common stock of the Company traded on Nasdaq Capital Market in the five trading days prior to the signing date of the Purchase Agreement. Pursuant to the Purchase Agreement, each Seller will receive its portion of the Company’s Common Stock proportionate to the number of the Purchased Shares to be sold by such Seller to Next Investment under the Purchase Agreement, the transaction has been completed in end of April 2024.

 

Change of Company name

 

Effective April 2, 2024, the Company has changed its name to Next Technology Holdings Inc. The name change was made pursuant to the Wyoming Business Corporations Act, and an amendment to Article I of the Company’s Amended and Restated Articles of Incorporation was filed with the Wyoming Secretary of State on March 18, 2024 (Amendment ID: 2024-004669585).

 

Our common stock will continue to trade on the NASDAQ Stock Market under the ticker symbol “NXTT”. Outstanding stock certificates for shares of the company are not affected by the name change. They continue to be valid and need not be exchanged.

 

Amended and Restated BTC Trading Contract

 

On September 24, 2024, the Company and the Association Seller entered into an Amended and Restated BTC Trading Contract (the “Amended BTC Contract”), which amended and restated the BTC Contract. Under the Amended BTC Contract, the Company is entitled to purchase up to 5,167 BTC (the “Total BTC”) from the BTC sellers set forth on Schedule I to the Amended BTC Contract (the “Schedule I 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 commencing on the date of the Amended BTC Contract. The purchase price for the Total BTC will be paid by the Company in cash or shares of Common Stock. Although the Amended BTC Contract states that the Association Seller (Party B) “owns the virtual currency”, to our knowledge, this statement was mistakenly made. As of the date of the Amended BTC Contract, it were the Schedule I BTC Sellers who are the individual members of the Association Seller, not the Association Seller itself, who own the BTC to be sold under the Amended BTC Contract.

 

To our knowledge, the Association Seller entered into a cooperation agreement with each Schedule I BTC Sellers (the “Cooperation Agreement”) on the same day when the Amended BTC Contract was entered. Under the Cooperation Agreement, each Schedule I BTC Seller agrees to transfer a specified number of BTC (as set forth in the Cooperation Agreement) to a BTC wallet address designated by the Association Seller for the transactions contemplated under the Amended BTC Contract.

 

While we believe the Association Seller will be able to coordinate with its members to fulfill the Company’s purchase of BTC if the Company so decides, we cannot guarantee that the Company will successfully acquire BTC pursuant to the Amended BTC Contract. The Amended BTC Contract was entered into solely between the Company and the Association Seller and no Schedule I BTC Sellers owe any legal obligation to the Company in connection with the purchase and sale of BTC. Furthermore, as the Company is not a party to the Cooperation Agreement, it cannot enforce the terms of the Cooperation Agreement against any Schedule I BTC Sellers should such Schedule I BTC Sellers do not perform their obligations under the Cooperation Agreement. For example, if a Schedule I BTC Seller does not transfer its committed BTC to the Association Seller pursuant to the Cooperation Agreement, we may not be able to purchase such BTC from the Association Seller pursuant to the Amended BTC Contract. 

 

At the time when the Amended BTC Contract was signed, the Company indicated its intent to exercise the option to purchase 5,000 BTC 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 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”).

 

The value of $1.02 per share for the Shares is equal to the sum of (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) immediately preceding the signing of the Amended BTC Contract, and (ii) $0.01. Using the same per value valuation, the warrants are worth approximately $300,000,000.

 

Pursuant to the Amended BTC Contract, the Company shall exercise its option to purchase BTC thereunder prior to September 24, 2025. While the Company’s purchase option thereunder is time-limited, the Amended BTC Contract itself will remain in effect without a defined expiration date, unless otherwise terminated. In the event of a breach by either party, the non-breaching party has the right to terminate the agreement. In such case, the breaching party will be obligated to pay a penalty of $18,000,000 to the non-breaching party.

 

The above description of the Amended BTC Contract does not purport to be complete, and is qualified in its entirety by reference to the full text of the Amended BTC Contract, a copy of which is attached to the Company’s Current Report on Form 8-K as Exhibit 10.1, filed with the SEC on September 27, 2024, which is incorporated by reference herein.

 

Impact on Company’s Capitalization and Stockholder Approval

 

The issuance of securities pursuant to the Amended BTC Contract will not affect the rights of the Company’s existing stockholders, but such issuances will have a significant dilutive effect on the Company’s existing stockholders, including the voting power of the existing stockholders.

 

As of the date of this report, there were 6,976,410 issued and outstanding shares of the Common Stock. Immediately after the issuance of the Shares (assuming no exercise of the Warrants), there will be 142,147,488 issued and outstanding shares of the Common Stock, and the ownership percentage of the Company’s existing stockholders in the Company will be diluted to approximately 4.91%. Assuming full exercise of the Warrants concurrently with the issuance of the Shares, immediately after the issuance of the Shares, there will be 436,265,135 issued and outstanding shares of Common Stock, and the ownership percentage of the Company’s existing stockholders in the Company will be further diluted to approximately 1.60%.

 

Pursuant to Nasdaq Rule 5635(a), if an issuer intends to issue common stock or securities convertible into or exercisable for common stock, in connection with the acquisition of stock or assets of another company, which may equal or exceed 20% of the outstanding common stock or voting power on a pre-transaction basis, the issuer generally must obtain the prior approval of its stockholders. Pursuant to Nasdaq Rule 5635(d), if an issuer intends to issue common stock or securities convertible into or exercisable for common stock, other than in a public offering, which may equal or exceed 20% of the outstanding common stock or voting power on a pre-transaction basis for a price that is lower than (i) the Nasdaq Official Closing Price (as reflected on Nasdaq.com) immediately preceding the signing of a binding agreement; or (ii) the average Nasdaq Official Closing Price of the common stock (as reflected on Nasdaq.com) for the five trading days immediately preceding the signing of the binding agreement for such common stock, the issuer generally must obtain the prior approval of its stockholders.

 

The Shares to be issued to the Schedule I BTC Sellers in the Amended 5,000 BTC Transaction exceeds the threshold for which stockholder approval is required under Nasdaq Rule 5635(a), and the Warrant Shares to be issued to the Schedule I BTC Sellers upon the full exercise of the Warrants could result in the issuance of a number of shares exceeding the threshold and pricing for which stockholder approval is required under Nasdaq 5635(d). As such, the Company is required to obtain requisite stockholder approval for the Amended 5,000 BTC Transaction.

 

As disclosed in a Preliminary Information Statement on Schedule 14C filed by the Company on October 3, 2024, the Company has obtained the requisite stockholder approval for the Amended 5,000 BTC Transaction in accordance with the Company’s articles of incorporation and bylaws on September 24, 2024.
v3.24.3
Pay vs Performance Disclosure - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Pay vs Performance Disclosure    
Net Income (Loss) $ 19,546,495 $ (942,121)
v3.24.3
Insider Trading Arrangements
 3 Months Ended
Mar. 31, 2024
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.3
Accounting Policies, by Policy (Policies)
 3 Months Ended
Mar. 31, 2024
Summary of Significant Accounting Policies [Abstract]  
Basis of Preparation of Financial Statements

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 three months ended March 31, 2024 and 2023 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 March 31, 2024, the results of its operations for the three months ended March 31, 2024 and 2023, and its cash flows for the three months ended March 31, 2024 and 2023. 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. 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, 2023.

 
Revenue recognition

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.
Goodwill and Other - Crypto Assets

Goodwill and Other - Crypto Assets

In December 2023, the FASB issued ASU 2023-08, Intangibles - Goodwill and Other - Crypto Assets (Subtopic 350-60): Accounting for and Disclosure of Crypto Assets, which establishes accounting guidance for crypto assets meeting certain criteria. Bitcoin meets these criteria. The amendments require crypto assets to meet the criteria to be recognized at fair value with changes recognized in net income each reporting period. Upon adoption, a cumulative-effect adjustment is made to the opening balance of retained earnings as of the beginning of the annual reporting period of adoption. ASU 2023-08 is effective for fiscal years beginning after December 15, 2024, including interim periods within those fiscal years. Early adoption is permitted. The Company has early applied ASU 2023-08 and measured crypto assets (presented as digital assets) at fair value with changes recognized in net income this year.

The following table summarizes the Company’s digital asset holdings as of:

   March 31,
2024		   December 31,
2023		 
Approximate number of bitcoins held   833    833 
Digital assets carrying value  $59,156,975   $35,137,576 
Gain on digital assets during the period/ Year  $24,019,399   $10,147,576 

As of March 31, 2024, approximately 833 of the bitcoins held by the Company, which had a carrying value of approximately $59.2 million on the Company’s Consolidated Balance Sheets as of March 31, 2024.

 
Cash and Cash Equivalents

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 Hong Kong and PRC are not protected by Federal Deposit Insurance Corporation (“FDIC”) insurance.
Foreign Currency

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 March 31, 2024.

   March 31,
2024		   December 31,
2023		 
RMB: US$ exchange rate   7.22    7.09 

The balance sheet amounts, with the exception of equity, as of March 31, 2024 and December 31, 2023 were translated at 7.22 RMB and 7.09 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 March 31, 2024 and year ended December 31, 2023 were 7.18 RMB and 7.08 RMB to US$1.00, respectively. Cash flows were also translated at average translation rates for the period 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.
Consolidation

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

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 expected credit loss, valuation of deferred tax assets, and certain accrued liabilities such as contingent liabilities.
Accounts Receivable

Accounts Receivable

Accounts receivables 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 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.

 
Leases

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

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.

 
Income Tax

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 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.

The Company has subsidiaries in Hong Kong and PRC. The Company is subject to tax in Hong Kong 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 Department of Hong Kong and Tax Department of PRC.
Earnings / (Loss) Per Share

Earnings / (Loss) Per Share

Earnings/(Loss) 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 March 31, 2024, there were no potentially dilutive shares.

   For the
period
March 31,
2024		   For the
period
March 31,
2023		 
   (Restated)   (Restated) 
Statement of Operations Summary Information:        
Net Profit/ (Loss)  $19,546,495   $(166,295)
Weighted-average common shares outstanding - basic and diluted   2,625,130    1,054,530 
Earnings / (loss) per share, basic and diluted  $7.45   $(0.16)

 
Fair Value Measurements

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.
v3.24.3
Nature of Business (Tables)
 3 Months Ended
Mar. 31, 2024
Nature of Business [Abstract]  
Schedule of Digital Asset Impairment Losses 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:
   Digital asset
original cost basis		   Gain from
digital asset		   Market Value of
digital asset		   Approximate
number of
Bitcoin held		 
Balance on December 31, 2023   24,990,000    10,147,576    35,137,576    833 
Digital asset purchase   
-
    
-
    
-
    - 
Fair value change during the period   
-
    24,019,399    24,019,399    - 
Balance on March 31, 2024   24,990,000    34,166,975    59,156,975    833 
Schedule of Consolidated Statement of Operation
Consolidated statement of operation for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed) 		   Adjustment   As Restated 
             
General and administrative expenses  $(330,143)  $(2)  $(330,145)
Other income  $24,214,021   $(194,622)  $24,019,399 
Tax expenses  $
-
   $(4,142,759)  $(4,142,759)
Net profit  $23,883,878   $(4,337,383)  $19,546,495 
Consolidated statement of operation for the three-month period ended March 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
General and administrative expenses  $(212,194)  $45,899   $(166,295)
Net loss  $(212,194)  $45,899   $(166,295)
Schedule of Consolidated Balance Sheet
Consolidated balance sheet as of March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Digital assets  $59,420,922   $(263,947)  $59,156,975 
Total assets  $73,345,474   $(263,947)  $73,081,526 
                
Amount due to related parties  $(1,721,732)  $(12,000)  $(1,733,732)
Accrued expenses  $(50,020)  $50,020   $
-
 
Deferred tax liabilities  $
-
   $(4,142,759)  $(4,142,759)
Tax payable  $
-
   $(130,934)  $(130,934)
Other payables and accrued expenses  $(1,840,000)  $(49,500)  $(1,889,500)
Total liabilities  $(4,535,879)  $(4,285,173)  $(8,821,052)
                
Accumulated profit  $(12,461,058)  $(4,549,121)  $7,911,937 
Total equity  $68,809,595   $(4,549,121)  $64,260,474 

  

Consolidated balance sheet as of December 31, 2023  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
             
Accumulated deficit  $(11,422,820)  $(211,738)  $(11,634,558)
Total shareholders’ equity  $44,925,822   $(211,738)  $44,714,084 
Schedule of Consolidated Statement of Cash Flows
Consolidated statement of cash flows for the three-month period ended March 31, 2024  Previously
Reported
(Not reviewed)		   Adjustment   As Restated 
Cash flows from operating activities:            
Net profit  $23,883,878   $(4,337,383)  $19,546,495 
Fair value gain from digital assets  $(24,214,021)  $194,622   $(24,019,399)
Deferred tax liabilities  $
-
   $4,142,759   $4,142,759 
Account payables  $(2,329)  $2   $(2,327)
Directors’ fee payables  $
-
   $40,000   $40,000 
Net cash flow used in operation expenses  $(40,530)  $40,000   $(530)
Cash flows from financing activities:               
Shareholders’ loan  $40,635   $(40,000)  $635 
Net cash flow provided by financing activities   40,635   $(40,000)  $635 
v3.24.3
Summary of Significant Accounting Policies (Tables)
 3 Months Ended
Mar. 31, 2024
Summary of Significant Accounting Policies [Abstract]  
Schedule of Summarizes the Company’s Digital Asset The following table summarizes the Company’s digital asset holdings as of:
   March 31,
2024		   December 31,
2023		 
Approximate number of bitcoins held   833    833 
Digital assets carrying value  $59,156,975   $35,137,576 
Gain on digital assets during the period/ Year  $24,019,399   $10,147,576 
Schedule of No Gains and Losses from Foreign Currency Transactions There were no gains and losses from foreign currency transactions from the inception to March 31, 2024.
   March 31,
2024		   December 31,
2023		 
RMB: US$ exchange rate   7.22    7.09 
Schedule of No Potentially Dilutive Shares. As of March 31, 2024, there were no potentially dilutive shares.
   For the
period
March 31,
2024		   For the
period
March 31,
2023		 
   (Restated)   (Restated) 
Statement of Operations Summary Information:        
Net Profit/ (Loss)  $19,546,495   $(166,295)
Weighted-average common shares outstanding - basic and diluted   2,625,130    1,054,530 
Earnings / (loss) per share, basic and diluted  $7.45   $(0.16)

 
v3.24.3
Cash and Cash Equivalents (Tables)
 3 Months Ended
Mar. 31, 2024
Cash and Cash Equivalents [Abstract]  
Schedule of Cash Held in Bank As of March 31, 2024, the Company held cash in bank in the amount of $668,388, which consists of the following:
   March 31,
2024		   December 31,
2023		 
Bank Deposits- Outside USA  $668,387   $668,387 
v3.24.3
Digital Assets (Tables)
 3 Months Ended
Mar. 31, 2024
Digital Assets [Abstract]  
Schedule of Digital Assets Holdings As of March 31, 2024, digital assets holdings are as follows:
   March 31,
2024		   December 31,
2023		 
    (Restated)    (Restated) 
Opening balance  $35,137,576   $
—
 
Purchase of BTC   
—
    24,990,000 
Gain from digital assets   24,019,399    10,147,576 
Ending balance  $59,156,975   $35,137,576 
v3.24.3
Accounts Receivable (Tables)
 3 Months Ended
Mar. 31, 2024
Accounts Receivable [Abstract]  
Schedule of Accounts Receivable As of March 31, 2024, accounts receivable are related to the services fee receivable from customers as follow:
   March 31,
2024		   December 31,
2023		 
Accounts Receivable  $1,130,664   $1,133,117 
v3.24.3
Prepayments (Tables)
 3 Months Ended
Mar. 31, 2024
Prepayments [Abstract]  
Schedule of Prepayments As of March 31, 2024, prepayments consist of the following:
    March 31,
2024		     December 31,
2023		  
Prepayment for digital assets   $ 12,125,500     $ 12,125,500  
v3.24.3
Amount Due to Related Parties (Tables)
 3 Months Ended
Mar. 31, 2024
Amount Due to Related Parties [Abstract]  
Schedule of Amount Due to Related Parties
   March 31,
2024		   December 31,
2023		 
   (Restated)   (Restated) 
Related parties payable  $282,535   $282,535 
Amount due to shareholders   607,197    606,563 
Director fee payable   844,000    804,000 
   $1,733,732   $1,693,098 
v3.24.3
Account Payables (Tables)
 3 Months Ended
Mar. 31, 2024
Account Payables [Abstract]  
Schedule of Account Payables As of March 31, 2024 and December 31, 2023, account payable are related to the software services fee payables to suppliers as follow:
   December 31,
2023		   December 31,
2023		 
Account payable   $924,127   $926,456 
v3.24.3
Other Payables (Tables)
 3 Months Ended
Mar. 31, 2024
Other Payables [Abstract]  
Schedule of Other Payables As of March 31, 2024, other payables consist of unpaid professional fee as follows:
   March 31,
2024		   December 31,
2023		 
Professional fees  $1,889,500   $1,600,000 
v3.24.3
Nature of Business (Details) - Previously Reported [Member]
 3 Months Ended
Mar. 31, 2024
USD ($)
Nature of Business [Line Items]  
General and administrative expenses $ 2
Deferred tax liabilities 4,142,759
Tax payable 130,934
Amount due to related parties $ 12,000
v3.24.3
Nature of Business (Details) - Schedule of Digital Asset Impairment Losses
 3 Months Ended
Mar. 31, 2024
USD ($)
Schedule of Digital Asset Impairment Losses [Line Items]  
Approximate number of Bitcoin held, Beginning Balance 833
Approximate number of Bitcoin held, Ending Balance 833
Digital asset original cost basis [Member]  
Schedule of Digital Asset Impairment Losses [Line Items]  
Digital asset, Beginning Balance $ 24,990,000
Digital asset purchase
Digital asset, Fair value change during the period
Digital asset, Ending Balance 24,990,000
Gain from digital asset [Member]  
Schedule of Digital Asset Impairment Losses [Line Items]  
Digital asset, Beginning Balance 10,147,576
Digital asset purchase
Digital asset, Fair value change during the period 24,019,399
Digital asset, Ending Balance 34,166,975
Market Value of digital asset [Member]  
Schedule of Digital Asset Impairment Losses [Line Items]  
Digital asset, Beginning Balance 35,137,576
Digital asset purchase
Digital asset, Fair value change during the period 24,019,399
Digital asset, Ending Balance $ 59,156,975
v3.24.3
Nature of Business (Details) - Schedule of Consolidated Statement of Operation - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Condensed Income Statements, Captions [Line Items]    
General and administrative expenses [1] $ (330,145) $ (166,295)
Other income 24,019,399  
Tax expenses [2] (4,142,759)
Net profit/ (loss) from continuing operation [4] 19,546,495 [3] (166,295)
Previously Reported [Member]    
Condensed Income Statements, Captions [Line Items]    
General and administrative expenses (330,143) (212,194)
Other income 24,214,021  
Tax expenses  
Net profit/ (loss) from continuing operation 23,883,878 (212,194)
Adjustment [Member]    
Condensed Income Statements, Captions [Line Items]    
General and administrative expenses (2) 45,899
Other income (194,622)  
Tax expenses (4,142,759)  
Net profit/ (loss) from continuing operation $ (4,337,383) $ 45,899
[1] There is an adjustment of $2 in general and administrative expenses and $8 in foreign currency translation adjustment due to rounding errors.
[2] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.
[3] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
[4] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
v3.24.3
Nature of Business (Details) - Schedule of Consolidated Balance Sheet - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Mar. 31, 2023
Dec. 31, 2022
Condensed Balance Sheet Statements, Captions [Line Items]        
Digital assets [1] $ 59,156,975 $ 35,137,576    
Total assets 73,081,526 49,064,580    
Accrued expenses      
Deferred tax liabilities [2] (4,142,759)    
Tax payable [2] (130,934) (130,942)    
Other payables and accrued expenses (1,889,500)      
Total liabilities (8,821,052) (4,350,496)    
Accumulated profit [3] 7,911,937 (11,634,558)    
Total equity 64,260,474 44,714,084 $ 41,075,217 $ 41,706,762
Related Party [Member]        
Condensed Balance Sheet Statements, Captions [Line Items]        
Amount due to related parties [4] (1,733,732) (1,693,098)    
Previously Reported [Member]        
Condensed Balance Sheet Statements, Captions [Line Items]        
Digital assets 59,420,922      
Total assets 73,345,474      
Accrued expenses (50,020)      
Deferred tax liabilities      
Tax payable      
Other payables and accrued expenses (1,840,000)      
Total liabilities (4,535,879)      
Accumulated profit (12,461,058) (11,422,820)    
Total equity 68,809,595 44,925,822    
Previously Reported [Member] | Related Party [Member]        
Condensed Balance Sheet Statements, Captions [Line Items]        
Amount due to related parties (1,721,732)      
Adjustment [Member]        
Condensed Balance Sheet Statements, Captions [Line Items]        
Digital assets (263,947)      
Total assets (263,947)      
Accrued expenses 50,020      
Deferred tax liabilities (4,142,759)      
Tax payable (130,934)      
Other payables and accrued expenses (49,500)      
Total liabilities (4,285,173)      
Accumulated profit (4,549,121) (211,738)    
Total equity (4,549,121) $ (211,738)    
Adjustment [Member] | Related Party [Member]        
Condensed Balance Sheet Statements, Captions [Line Items]        
Amount due to related parties $ (12,000)      
[1] There is an adjustment of $263,948in digital assets due to over-statement of its fair value of $263,948
[2] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses and adjustment of $130,934 in tax payable.
[3] There is a prior year adjustment of $211,738 in FY 2023 accumulated deficit due to increase in loss of discontinued operation in prior year.
[4] There is an adjustment of $12,000 in amount due to related parties due to error recording in amount due to related parties.
v3.24.3
Nature of Business (Details) - Schedule of Consolidated Statement of Cash Flows - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Condensed Cash Flow Statements, Captions [Line Items]    
Net profit [2] $ 19,546,495 [1] $ (166,295)
Fair value gain from digital assets [3] (24,019,399)
Deferred tax liabilities [4] 4,142,759
Account payables (2,327)  
Directors’ fee payables [5] 40,000
Net cash flow used in operation expenses (530) (511,772)
Shareholders’ loan 635  
Net cash flow provided by financing activities 635 186,000
Previously Reported [Member]    
Condensed Cash Flow Statements, Captions [Line Items]    
Net profit 23,883,878 $ (212,194)
Fair value gain from digital assets (24,214,021)  
Deferred tax liabilities  
Account payables (2,329)  
Directors’ fee payables  
Net cash flow used in operation expenses (40,530)  
Shareholders’ loan 40,635  
Net cash flow provided by financing activities 40,635  
Adjustment [Member]    
Condensed Cash Flow Statements, Captions [Line Items]    
Net profit (4,337,383)  
Fair value gain from digital assets 194,622  
Deferred tax liabilities 4,142,759  
Account payables 2  
Directors’ fee payables 40,000  
Net cash flow used in operation expenses 40,000  
Shareholders’ loan (40,000)  
Net cash flow provided by financing activities $ (40,000)  
[1] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
[2] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
[3] There is an adjustment of $194,622 in fair value gain from digital assets due to over-provision of its fair value gain.
[4] There is an adjustment of $4,142,759 in both tax expenses and deferred tax liabilities due to under-provision of tax expenses.
[5] There is reclassification of $40,000 from shareholders’ loan to directors’ fee payables in operating activities.
v3.24.3
Summary of Significant Accounting Policies (Details)
 3 Months Ended
Mar. 31, 2024
USD ($)
Dec. 31, 2023
USD ($)
$ / shares
Summary of Significant Accounting Policies [Line Items]    
Digital assets (in Dollars) | $ [1] $ 59,156,975 $ 35,137,576
Exchange rate 7.22 7.09
Exchange rate amount (in Dollars per share)   $ 1
Tax benefit 50.00%  
RMB [Member]    
Summary of Significant Accounting Policies [Line Items]    
Exchange rate 7.18 7.08
US [Member]    
Summary of Significant Accounting Policies [Line Items]    
Exchange rate amount (in Dollars per share)   $ 1
Digital Assets [Member]    
Summary of Significant Accounting Policies [Line Items]    
Bitcoins held by the Company 833  
[1] There is an adjustment of $263,948in digital assets due to over-statement of its fair value of $263,948
v3.24.3
Summary of Significant Accounting Policies (Details) - Schedule of Summarizes the Company’s Digital Asset
 3 Months Ended 12 Months Ended
Mar. 31, 2024
USD ($)
Dec. 31, 2023
USD ($)
Schedule of Summarizes the Company’s Digital Asset [Abstract]    
Approximate number of bitcoins held 833 833
Digital assets carrying value [1] $ 59,156,975 $ 35,137,576
Gain on digital assets during the period/ Year $ 24,019,399 $ 10,147,576
[1] There is an adjustment of $263,948in digital assets due to over-statement of its fair value of $263,948
v3.24.3
Summary of Significant Accounting Policies (Details) - Schedule of No Gains and Losses from Foreign Currency Transactions
Mar. 31, 2024
Dec. 31, 2023
Schedule of Gains and Losses from Foreign Currency Transactions [Abstract]    
Exchange rate 7.22 7.09
v3.24.3
Summary of Significant Accounting Policies (Details) - Schedule of No Potentially Dilutive Shares. - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Statement of Operations Summary Information:    
Net Profit/ (Loss) [2] $ 19,546,495 [1] $ (166,295)
Weighted-average common shares outstanding - basic [3] 2,625,130 1,054,530
Weighted-average common shares outstanding - diluted [3] 2,625,130 1,054,530
Earnings / (loss) per share, basic $ 7.45 $ (0.16)
Earnings / (loss) per share, diluted $ 7.45 $ (0.16)
[1] Adjustment of $194,622 in other income due to error recording and over-statement of other income of $194,622 and there is an adjustment of $4,142,759 in both tax expenses due to under-provision of tax expenses.
[2] There is an adjustment of $4,142,759 in both tax expenses and adjustment of 194,622 in other income, therefore result in changes in net profit in operating activities.
[3] There is an adjustment of $2 in general and administrative expenses and $8 in foreign currency translation adjustment due to rounding errors.
v3.24.3
Revenue (Details) - USD ($)
 3 Months Ended
Mar. 31, 2024
Mar. 31, 2023
Revenue [Abstract]    
Revenue
v3.24.3
Cash and Cash Equivalents (Details)
Mar. 31, 2024
USD ($)
Cash and Cash Equivalents [Abstract]  
Held cash bank amount $ 668,388
v3.24.3
Cash and Cash Equivalents (Details) - Schedule of Cash Held in Bank - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Bank Deposits- Outside USA [Member]    
Cash and Cash Equivalents [Line Items]    
Cash and cash equivalents $ 668,387 $ 668,387
v3.24.3
Digital Assets (Details) - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Digital Assets [Line Items]    
Recognized gain of digital assets $ 24,019,399 $ 10,147,576
Crypto Asset, Other [Member]    
Digital Assets [Line Items]    
Total cost $ 24,990,000  
v3.24.3
Digital Assets (Details) - Schedule of Digital Assets Holdings - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Schedule of Digital Assets Holdings [Abstract]    
Opening balance $ 35,137,576
Purchase of BTC 24,990,000
Gain from digital assets 24,019,399 10,147,576
Ending balance $ 59,156,975 $ 35,137,576
v3.24.3
Accounts Receivable (Details) - Schedule of Accounts Receivable - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Nonrelated Party [Member]    
Accounts, Notes, Loans and Financing Receivable [Line Items]    
Accounts Receivable $ 1,130,664 $ 1,133,117
v3.24.3
Prepayments (Details) - USD ($)
 3 Months Ended 12 Months Ended
Mar. 31, 2024
Dec. 31, 2023
Prepayments [Line Items]    
Prepayment amount $ 12,125,500 $ 12,125,500
Prepayment, percentage   40.00%
Crypto asset prepayment description In connection with the 5,000 BTC Purchase, on May 8, 2024, the Company filed a Preliminary Information Statement on Schedule 14C (the “Preliminary 14C”). Subsequently, the Company decided to cease pursuing the 5,000 BTC Purchase due to the market fluctuations in BTC and further discussions with the BTC Sellers, which was previously disclosed on a Form 8-K filed by the Company on June 26, 2024.  
Fair market value, percentage 70.00%  
Crypto assets transaction description Despite the cancellation of the 5,000 BTC Purchase, negotiations regarding the original 1,000 BTC Purchase continued. The Company’s original plan was to settle the remaining 60% of the total purchase price for 1,000 BTC through the issuance of the Common Stock at a per share price based on the average market price over a five-day period immediately prior to the date of the completion of the 1,000 BTC Purchase. However, the Board believed in the potential long-term appreciation of the BTC. As a result, it has decided to halt the 1,000 BTC Purchase and instead re-negotiate the terms with the Associate Seller to acquire 5,167 BTC, which represents the maximum number of BTC that the Company was entitled to purchase under the BTC Contract minus the BTC already acquired under the BTC Contract.  
Warrant [Member]    
Prepayments [Line Items]    
Warrants purchase 294,117,647  
Class of Warrant or Right, Exercise Price of Warrants or Rights $ 0.01  
Common Stock [Member]    
Prepayments [Line Items]    
Common stock shares issuance 135,171,078  
Common Stock value per share $ 1.02  
Common Stock [Member] | Warrant [Member]    
Prepayments [Line Items]    
Warrants purchase 80,000,000  
Class of Warrant or Right, Exercise Price of Warrants or Rights $ 2.6  
BTC [Member]    
Prepayments [Line Items]    
Crypto asset prepayment description The prepayment was made to secure favorable pricing and demonstrate the Company’s commitment to completing the 1,000 BTC Purchase. This prepayment is refundable if the 1,000 BTC Purchase is not completed.While negotiating the terms of the 1,000 BTC Purchase with the BTC Sellers, the Company decided to exercise its right under the BTC Contract to purchase 5,000 BTC (the “5,000 BTC Purchase”), which includes the previously planned 1,000 BTC. To reflect the then price increase in BTC and finalize the transaction details of the 5,000 BTC Purchase, the Company and the Association Seller entered into that certain Amendment Agreement (the “Amendment Agreement”) on May 2, 2024, which was previously disclosed in a Form 8-K filed by the Company on May 6, 2024.  
Amendment Agreement [Member] | Common Stock [Member]    
Prepayments [Line Items]    
Common stock shares issuance 40,000,000  
Common Stock value per share $ 3.75  
v3.24.3
Prepayments (Details) - Schedule of Prepayments - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Schedule of Prepayments [Abstract]    
Prepayment for digital assets $ 12,125,500 $ 12,125,500
v3.24.3
Amount Due to Related Parties (Details) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Amount Due to Related Parties [Line Items]    
Advances from former shareholders $ 282,535  
Related Party [Member]    
Amount Due to Related Parties [Line Items]    
Professional expenses paid 607,197  
Director fee payable 844,000 $ 804,000
Director [Member]    
Amount Due to Related Parties [Line Items]    
Director fee payable $ 844,000  
v3.24.3
Amount Due to Related Parties (Details) - Schedule of Amount Due to Related Parties - Related Party [Member] - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Related Party Transaction [Line Items]    
Related parties payable $ 282,535 $ 282,535
Amount due to shareholders 607,197 606,563
Director fee payable 844,000 804,000
Total [1] $ 1,733,732 $ 1,693,098
[1] There is an adjustment of $12,000 in amount due to related parties due to error recording in amount due to related parties.
v3.24.3
Account Payables (Details) - Schedule of Account Payables - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Schedule of Accounts Payable [Abstract]    
Account payables $ 924,127 $ 926,456
v3.24.3
Other Payables (Details) - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Other Payables [Abstract]    
Professional fees amount $ 1,889,500 $ 1,600,000
v3.24.3
Other Payables (Details) - Schedule of Other Payables - USD ($)
Mar. 31, 2024
Dec. 31, 2023
Schedule of Other Payables [Abstract]    
Professional fees $ 1,889,500 $ 1,600,000
v3.24.3
Shareholders’ Equity (Details)
 1 Months Ended 3 Months Ended
Sep. 30, 2023
USD ($)
shares
Jul. 22, 2022
USD ($)
shares
Jul. 21, 2022
USD ($)
$ / shares
shares
Sep. 21, 2020
$ / shares
shares
Jul. 10, 2020
$ / shares
shares
Sep. 03, 2019
$ / shares
shares
Mar. 29, 2019
shares
Feb. 29, 2020
$ / shares
shares
Mar. 31, 2024
$ / shares
shares
Dec. 31, 2023
shares
Jun. 09, 2023
shares
Mar. 31, 2023
shares
Dec. 31, 2022
shares
Jun. 30, 2022
shares
Apr. 13, 2022
shares
Dec. 31, 2020
shares
Sep. 15, 2020
shares
Dec. 31, 2019
shares
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                 2,625,130 2,625,130                
Par value (in Dollars per share) | $ / shares                                  
Shares price (in Dollars per share) | $ / shares         $ 3 $ 3                        
New shareholders         2 5   2                    
Outstanding shares                 2,625,130 2,625,130                
Total outstanding shares         101,766,666                          
Total amount (in Dollars) | $   $ 477,500                                
Reverse stock split                 1 for 185                  
Consideration of share issued (in Dollars) | $ $ 12,616,454                                  
Minimum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                                 101,766,666  
Outstanding shares                                 101,766,666  
Maximum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                                 305,299,998  
Outstanding shares                                 305,299,998  
Common Stock [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued   25,000             2,625,130             305,451,498    
Shares issued         26,000 74,000                        
Outstanding shares                 2,625,130 2,625,130   1,054,530 1,054,530          
Common Stock [Member] | Maximum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                         195,057,503          
Outstanding shares                         195,057,503          
Reverse Stock Split [Member] | Minimum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                     1,054,530              
Outstanding shares                     1,054,530              
Reverse Stock Split [Member] | Maximum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                     195,057,503              
Outstanding shares                     195,057,503              
Share Exchange Agreement [Member]                                    
Shareholders’ Equity [Line Items]                                    
Outstanding shares                                   100,074,000
Cancelled shares                             120,418,995      
Share Exchange Agreement [Member] | Minimum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Outstanding shares                           185,032,503        
Share Exchange Agreement [Member] | Maximum [Member]                                    
Shareholders’ Equity [Line Items]                                    
Outstanding shares                           305,451,498        
Share Exchange Agreement [Member] | Common Stock [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued     195,032,503                              
Outstanding shares     195,032,503                              
Certificate Amendment [Member]                                    
Shareholders’ Equity [Line Items]                                    
Stock split                 3 for 1 forward stock split                  
Founders [Member]                                    
Shareholders’ Equity [Line Items]                                    
Shares issued             100,000,000                      
Shareholders [Member]                                    
Shareholders’ Equity [Line Items]                                    
Shares issued       151,500       1,666,666                    
Shares price (in Dollars per share) | $ / shares       $ 5       $ 3                    
New shareholders       303                            
Common Stock [Member]                                    
Shareholders’ Equity [Line Items]                                    
Common stock shares, issued                 142,147,488                  
Shares issued                 135,171,078                  
Outstanding shares                 142,147,488                  
Shares issued 1,570,600                                  
IPO [Member]                                    
Shareholders’ Equity [Line Items]                                    
Shares issued     10,000,000                              
Shares price (in Dollars per share) | $ / shares     $ 4                              
Gross proceeds (in Dollars) | $     $ 40,000,000                              
Net proceed from initial public offering (in Dollars) | $     37,057,176                              
Offering costs (in Dollars) | $     $ 2,942,824                              
v3.24.3
Income Taxes (Details)
 3 Months Ended
Mar. 31, 2024
Hong Kong [Member]  
Income Taxes [Line Items]  
Tax rate 16.50%
PRC [Member]  
Income Taxes [Line Items]  
Tax rate 25.00%
v3.24.3
Subsequent Events (Details) - USD ($)
 3 Months Ended
Mar. 01, 2024
Mar. 31, 2024
Dec. 31, 2023
Subsequent Events [Line Items]      
Purchase price (in Dollars) $ 13,396,000    
Number of trading days   5 days  
Trading contract description   Under the Amended BTC Contract, the Company is entitled to purchase up to 5,167 BTC (the “Total BTC”) from the BTC sellers set forth on Schedule I to the Amended BTC Contract (the “Schedule I 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 commencing on the date of the Amended BTC Contract.  
Common stock shares issued   2,625,130 2,625,130
Common stock shares outstanding   2,625,130 2,625,130
Percentage stockholder ownerships   4.91%  
Percentage outstanding common stock   20.00%  
Common stock trading days   5 days  
Amended BTC Contract [Member]      
Subsequent Events [Line Items]      
Shares price (in Dollars per share)   $ 1.02  
Breach of contract (in Dollars)   $ 18,000,000  
Purchased Shares [Member]      
Subsequent Events [Line Items]      
Aggregate ordinary shares 2,000    
Valuation per share price (in Dollars per share) $ 3.19    
Purchase Price [Member]      
Subsequent Events [Line Items]      
Valuation per share price (in Dollars per share) $ 6,698    
Next Technology Common Stock [Member]      
Subsequent Events [Line Items]      
Aggregate ordinary shares 3,940,000    
Valuation per share price (in Dollars per share) $ 3.4    
Warrant [Member]      
Subsequent Events [Line Items]      
Purchase of warrants   294,117,647  
Warrant price (in Dollars per share)   $ 0.01  
Issuance of warrants (in Dollars)   $ 300,000,000  
Common stock shares issued   6,976,410  
Common stock shares outstanding   6,976,410  
Common Stock [Member]      
Subsequent Events [Line Items]      
Issuance of common stock   135,171,078  
Shares price (in Dollars per share)   $ 1.02  
Common stock shares issued   142,147,488  
Common stock shares outstanding   142,147,488  
Percentage stockholder ownerships   1.60%  
Percentage outstanding common stock   20.00%  
Common Stock [Member] | Warrant [Member]      
Subsequent Events [Line Items]      
Purchase of warrants   80,000,000  
Warrant price (in Dollars per share)   $ 2.6  
Common stock shares issued   436,265,135  
Common stock shares outstanding   436,265,135  
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