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Bitdeer Technologies Group

Bitdeer Technologies GroupBTDR決算レポート

Nasdaq · 金融 · 金融サービス

Bitdeer Technologies Group, or simply Bitdeer, is a cryptocurrency company and mining platform based in Singapore. Spun off from the bitcoin-mining chip producer Bitmain, Bitdeer is among the largest miners by computer power and focuses on blockchain and high-performance computing. Bitdeer's U.S. headquarters are located in San Jose, California. The company also operates in other U.S. states as well as Europe and Bhutan.

What changed in Bitdeer Technologies Group's 20-F — 2022 vs 2023

Top changes in Bitdeer Technologies Group's 2023 20-F

612 paragraphs added · 463 removed · 391 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

163 edited+50 added−27 removed567 unchanged
Gen. Stat. 78A-2(11), in North Carolina until they are registered with the North Carolina Secretary of State or are offered for sale pursuant to an exemption from registration under the North Carolina Securities Act, N.C. Gen. Stat. Chapter 78A.
Stat. 78A-2(11), in North Carolina until they are registered with the North Carolina Secretary of State or are offered for sale pursuant to an exemption from registration under the North Carolina Securities Act, N.C. Gen. Stat. Chapter 78A.
We face risks including those related to: ● a decline in the adoption and use of Bitcoin and other similar cryptocurrencies within the technology industry or a decline in value of cryptocurrencies; ● increased costs of complying with existing or new government regulations applicable to cryptocurrencies and other factors; ● a downturn in the market for blockchain hosting space generally, which could be caused by an oversupply of or reduced demand for blockchain space; ● any transition by our customers of blockchain hosting from third-party providers like the Company to customer-owned and operated facilities; ● the rapid development of new technologies or the adoption of new industry standards that render us or our customers’ current products and services obsolete or unmarketable and, in the case of our customers, that contribute to a downturn in their businesses, increasing the likelihood of a default under their service agreements or their becoming insolvent; ● a slowdown in the growth of the internet generally as a medium for commerce and communication; ● availability of an adequate supply of new generation cryptocurrency mining equipment to enable us to mine cryptocurrencies at scale and for customers who want to purchase hash rate from us or host with us to be able to do so; and 14 Table of Contents ● the degree of difficulty in mining cryptocurrencies and the trading price of such assets.
We face risks including those related to: • a decline in the adoption and use of Bitcoin and other similar cryptocurrencies within the technology industry or a decline in value of cryptocurrencies; • increased costs of complying with existing or new government regulations applicable to cryptocurrencies and other factors; • a downturn in the market for blockchain hosting space generally, which could be caused by an oversupply of or reduced demand for blockchain space; • any transition by our customers of blockchain hosting from third-party providers like the Company to customer-owned and operated facilities; • the rapid development of new technologies or the adoption of new industry standards that render us or our customers’ current products and services obsolete or unmarketable and, in the case of our customers, that contribute to a downturn in their businesses, increasing the likelihood of a default under their service agreements or their becoming insolvent; • a slowdown in the growth of the internet generally as a medium for commerce and communication; • availability of an adequate supply of new generation cryptocurrency mining equipment to enable us to mine cryptocurrencies at scale and for customers who want to purchase hash rate from us or host with us to be able to do so; and 15 Table of Contents • the degree of difficulty in mining cryptocurrencies and the trading price of such assets.
Any of these factors, consequently, could have a material adverse effect on our business, prospects, financial condition, and operating results. Moreover, federal law prohibits any U.S. person from knowingly or unknowingly possessing any visual depiction commonly known as child pornography. Recent media reports have suggested that persons have embedded such depictions on one or more blockchains.
Any of these factors, consequently, could have a material adverse effect on our business, prospects, financial condition, and operating results. Moreover, federal law prohibits any U.S. person from knowingly or unknowingly possessing any visual depiction commonly known as child pornography. Media reports have suggested that persons have embedded such depictions on one or more blockchains.
Our global operation exposes us to a number of risks, including: ● a limited customer base and limited sales and relationships with international customers; ● difficulty in managing multinational operations; ● competitors in overseas markets who have stronger ties with local customers and greater resources; ● fluctuations in currency exchange rates; 18 Table of Contents ● challenges in providing customer products and services and support in these markets; ● challenges in managing our overseas sales force and implementing sales strategies effectively; ● unexpected transportation delays or interruptions or increases in international transportation costs; ● difficulties in and costs of exporting products overseas while complying with the different commercial, legal and regulatory requirements of the overseas markets in which we offer our products and services; ● regulations, changes to regulation, regulatory uncertainty in or inconsistent regulations across various jurisdictions that may implicate cryptocurrency mining and other cryptocurrency activities; ● difficulty in ensuring the compliance with the sanctions imposed by The Office of Financial Assets Control of the U.S.
Our global operation exposes us to a number of risks, including: • a limited customer base and limited sales and relationships with international customers; • difficulty in managing multinational operations; • competitors in overseas markets who have stronger ties with local customers and greater resources; • fluctuations in currency exchange rates; • challenges in providing customer products and services and support in these markets; • challenges in managing our overseas sales force and implementing sales strategies effectively; 19 Table of Contents • unexpected transportation delays or interruptions or increases in international transportation costs; • difficulties in and costs of exporting products overseas while complying with the different commercial, legal and regulatory requirements of the overseas markets in which we offer our products and services; • regulations, changes to regulation, regulatory uncertainty in or inconsistent regulations across various jurisdictions that may implicate cryptocurrency mining and other cryptocurrency activities; • difficulty in ensuring the compliance with the sanctions imposed by The Office of Financial Assets Control of the U.S.
Recently, there has been a significant amount of regulatory attention directed toward cryptocurrencies, cryptocurrency networks and other industry participants by United States federal and state governments, foreign governments and self-regulatory agencies. For example, as cryptocurrencies such as Bitcoin have grown in popularity and in market size, the Federal Reserve Board, U.S.
There has been a significant amount of regulatory attention directed toward cryptocurrencies, cryptocurrency networks and other industry participants by United States federal and state governments, foreign governments and self-regulatory agencies. For example, as cryptocurrencies such as Bitcoin have grown in popularity and in market size, the Federal Reserve Board, U.S.
Recently, a number of proposed ICOs have sought to rely on Regulation A and have filed with the SEC a Form 1-A covering a distribution of a digital token. Two such offerings were qualified in July 2019. In addition, some token offerings have been commenced as private securities offerings intended to be exempt from SEC registration.
A number of proposed ICOs have sought to rely on Regulation A and have filed with the SEC a Form 1-A covering a distribution of a digital token. Two such offerings were qualified in July 2019. In addition, some token offerings have been commenced as private securities offerings intended to be exempt from SEC registration.
To the extent we fail to appropriately deal with any such conflicts of interests, it could negatively impact our reputation, the ability to raise additional funds and the willingness of counterparties to do business with us, all of which could have adverse effect on our business, financial condition, results of operations and cash flows. 29 Table of Contents The “halving” of rewards available on the Bitcoin network, or the reduction of rewards on other networks, has had and in the future could have a negative impact on our ability to generate revenue as our customers may not have an adequate incentive to continue transaction processing and customers may cease transaction processing operations altogether, which could have a material adverse effect on our business, financial condition and results of operations.
To the extent we fail to appropriately deal with any such conflicts of interests, it could negatively impact our reputation, the ability to raise additional funds and the willingness of counterparties to do business with us, all of which could have adverse effect on our business, financial condition, results of operations and cash flows. 30 Table of Contents The “halving” of rewards available on the Bitcoin network, or the reduction of rewards on other networks, has had and in the future could have a negative impact on our ability to generate revenue as our customers may not have an adequate incentive to continue transaction processing and customers may cease transaction processing operations altogether, which could have a material adverse effect on our business, financial condition and results of operations.
The price of Class A Ordinary Shares may fluctuate due to a variety of factors, including: ● changes in the industries in which we operate; ● developments involving our competitors; ● changes in laws and regulations affecting our business; ● variations in our operating performance and the performance of our competitors in general; ● actual or anticipated fluctuations in our quarterly or annual operating results; ● publication of research reports by securities analysts about us or our competitors or our industry; ● the public’s reaction to our press releases, our other public announcements and our filings with the SEC; ● actions by holders in respect of any of their Class A Ordinary Shares; ● additions and departures of key personnel; ● commencement of, or involvement in, litigation involving us; ● changes in our capital structure, such as future issuances of securities or the incurrence of debt; 48 Table of Contents ● the volume of Class A Ordinary Shares available for public sale; and ● general economic and political conditions, such as the effects of the COVID-19 outbreak, recessions, volatility in the markets, interest rates, local and national elections, fuel prices, international currency fluctuations, corruption, political instability, and acts of war or terrorism.
The price of Class A Ordinary Shares may fluctuate due to a variety of factors, including: • changes in the industries in which we operate; • developments involving our competitors; • changes in laws and regulations affecting our business; • variations in our operating performance and the performance of our competitors in general; • actual or anticipated fluctuations in our quarterly or annual operating results; • publication of research reports by securities analysts about us or our competitors or our industry; • the public’s reaction to our press releases, our other public announcements and our filings with the SEC; • actions by holders in respect of any of their Class A Ordinary Shares; • additions and departures of key personnel; • commencement of, or involvement in, litigation involving us; • changes in our capital structure, such as future issuances of securities or the incurrence of debt; • the volume of Class A Ordinary Shares available for public sale; and • general economic and political conditions, such as the effects of the COVID-19 outbreak, recessions, volatility in the markets, interest rates, local and national elections, fuel prices, international currency fluctuations, corruption, political instability, and acts of war or terrorism.
For example, recently on March 9, 2023, the Department of the Treasury published General Explanations of the Administration’s Fiscal Year 2024 Revenue Proposals, in which it proposed imposing a 30% excise tax on electricity usage by digital asset miners.
For example, on March 9, 2023, the Department of the Treasury published General Explanations of the Administration’s Fiscal Year 2024 Revenue Proposals, in which it proposed imposing a 30% excise tax on electricity usage by digital asset miners.
Also, if we are unable to generate enough revenue or raise sufficient capital to make adequate research and development investments going forward, our service improvement and relevant research and development initiatives may be restricted or delayed, or we may not be able to keep pace with the latest market trends and satisfy our customers’ needs, which could materially and adversely affect our results of operations. ​ 8 Table of Contents Furthermore, research and development activities are inherently uncertain, and we might encounter practical difficulties in commercializing our research and development results, which could result in excessive research and development expenses or delays.
Also, if we are unable to generate enough revenue or raise sufficient capital to make adequate research and development investments going forward, our service improvement and relevant research and development initiatives may be restricted or delayed, or we may not be able to keep pace with the latest market trends and satisfy our customers’ needs, which could materially and adversely affect our results of operations. 9 Table of Contents Furthermore, research and development activities are inherently uncertain, and we might encounter practical difficulties in commercializing our research and development results, which could result in excessive research and development expenses or delays.
Any such action, if initiated, whether or not it is resolved in our favor, could result in significant expense to us, and divert the efforts of our technical and management personnel, which may have a material adverse effect on our business, financial condition and results of operations. 21 Table of Contents We may face intellectual property infringement claims or other related disputes, which could be time-consuming, costly to defend or settle and result in the loss of significant rights and lower sales.
Any such action, if initiated, whether or not it is resolved in our favor, could result in significant expense to us, and divert the efforts of our technical and management personnel, which may have a material adverse effect on our business, financial condition and results of operations. 22 Table of Contents We may face intellectual property infringement claims or other related disputes, which could be time-consuming, costly to defend or settle and result in the loss of significant rights and lower sales.
As we operate three business lines, we have to decide the allocation of proprietary hash rate between “proprietary mining” and “hash rate sharing” as well as the allocation of mining datacenter capacity among “proprietary mining,” “hash rate sharing” and “hosting.” While allocating more mining resources to “hash rate sharing” and “hosting” services may facilitate cash payback and mining datacenter expansion while lower risk exposure associated with Bitcoin price volatility, we have to forgo our huge appreciation potential to some extent as we could earn more Bitcoins by allocating the same mining resources to “proprietary mining,” and vice versa.
As we operate three business lines, we have to decide the allocation of proprietary hash rate between “self-mining” and “hash rate sharing” as well as the allocation of mining datacenter capacity among “self-mining,” “hash rate sharing” and “hosting.” While allocating more mining resources to “hash rate sharing” and “hosting” services may facilitate cash payback and mining datacenter expansion while lower risk exposure associated with Bitcoin price volatility, we have to forgo our huge appreciation potential to some extent as we could earn more Bitcoins by allocating the same mining resources to “self-mining,” and vice versa.
If we were to be deemed an inadvertent investment company, we may seek to rely on Rule 3a-2 under the 1940 Act, which allows an inadvertent investment company a grace period of one year from the earlier of (a) the date on which the issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis or (b) the date on which the issuer owns or proposes to acquire investment securities having a value exceeding 40% of the value of such issuer’s total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis.
If we were to be deemed an inadvertent investment company, we may seek to rely on Rule 3a-2 under the 1940 Act, which allows an inadvertent investment company a grace period of one year from the earlier of (a) the date on which the issuer owns securities and/or cash having a value exceeding 50% of the issuer’s total assets on either a consolidated or unconsolidated basis or (b) the date on which the issuer owns or proposes to acquire investment securities having a valu e exceeding 40% of the value of such issuer’s total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis.
However, we are dependent on the overall crypto assets industry, and such recent events have contributed, at least in part, to our peers’ stock price as well as the price of Bitcoin.
However, we are dependent on the overall crypto assets industry, and such events have contributed, at least in part, to our peers’ stock price as well as the price of Bitcoin.
We may need additional capital but may not be able to obtain it in a timely manner and on favorable terms or at all. ● We may not be able to maintain our competitive position as cryptocurrency networks experience increases in the total network hash rate. 7 Table of Contents ● We have experienced negative cash flows from operating activities and incurred net losses in the past.
We may need additional capital but may not be able to obtain it in a timely manner and on favorable terms or at all. 8 Table of Contents • We may not be able to maintain our competitive position as cryptocurrency networks experience increases in the total network hash rate. • We have experienced negative cash flows from operating activities and incurred net losses in the past.
Any failure to raise needed funds on terms favorable to us, or at all, could severely restrict our liquidity as well as have a material adverse effect on our business, financial condition and results of operations. ​ 10 Table of Contents We may not be able to maintain our competitive position as cryptocurrency networks experience increases in the total network hash rate.
Any failure to raise needed funds on terms favorable to us, or at all, could severely restrict our liquidity as well as have a material adverse effect on our business, financial condition and results of operations. 11 Table of Contents We may not be able to maintain our competitive position as cryptocurrency networks experience increases in the total network hash rate.
We have experienced and may experience in the future hash rate loss during our operations due to factors beyond our control. We generate hash rate through operating our proprietary mining datacenters.
We have experienced and may experience in the future hash rate loss during our operations due to factors beyond our control. We generate hash rate through operating our mining datacenters.
Any system downtime resulting from insufficient power resources or power outages could have a material adverse effect on our business, financial condition and results of operations. ​ 12 Table of Contents If we fail to accurately estimate the factors upon which we base our contract pricing, we may generate less profit than expected or incur losses on those contracts, which could have a material adverse effect on our business, financial condition and results of operations.
Any system downtime resulting from insufficient power resources or power outages could have a material adverse effect on our business, financial condition and results of operations. 13 Table of Contents If we fail to accurately estimate the factors upon which we base our contract pricing, we may generate less profit than expected or incur losses on those contracts, which could have a material adverse effect on our business, financial condition and results of operations.
We may need to hire more employees or engage outside consultants to comply with these requirements, which will increase our costs and expenses. ​ 50 Table of Contents Changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming.
We may need to hire more employees or engage outside consultants to comply with these requirements, which will increase our costs and expenses. 51 Table of Contents Changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for public companies, increasing legal and financial compliance costs and making some activities more time-consuming.
The COVID-19 pandemic has caused series of consequences from many perspectives and may continue to have a prolonged impact by: ● impairing our ability to renew and maintain our relationships with existing customers; ● causing our existing customers to substantially reduce the quantity of products and services to which they subscribe, seek price concessions, or go out of business, any of which would harm our revenue; ● resulting in some of our customers failing to comply with the terms of their agreements, including payment terms, due to economic uncertainty, financial hardship, and even failure of their businesses, which could result in us being required to take action to collect payments, terminate their subscriptions for our services, and increase accounts receivable and bad debt, any of which would increase our expenses and harm our revenue and results of operations; ● making it more difficult for us to sell increased services or functionality to our existing customers; ● delaying prospective customers’ decisions to subscribe to our solutions, increase the length of sales cycles, or slow the typical growth in the use of our solutions once customers have initially deployed our solutions; ● harming our ability to effectively market and sell our solutions as a result of travel restrictions and social distancing orders; ● delaying the introduction of enhancements to our solutions and market acceptance of any new features and products; 26 Table of Contents ● harming our ability to grow our worldwide sales and operations; ● harming our ability to recruit, onboard and successfully integrate new employees, including members of our direct sales force; ● impacting the health and safety of our employees, including our senior management team, and their ability to perform services; ● causing our management team to continue to commit significant time, attention and resources to monitoring the COVID-19 pandemic and seeking to mitigate its effect on our business and workforce.
The COVID-19 pandemic has caused series of consequences from many perspectives and may continue to have a prolonged impact by: • impairing our ability to renew and maintain our relationships with existing customers; • causing our existing customers to substantially reduce the quantity of products and services to which they subscribe, seek price concessions, or go out of business, any of which would harm our revenue; • resulting in some of our customers failing to comply with the terms of their agreements, including payment terms, due to economic uncertainty, financial hardship, and even failure of their businesses, which could result in us being required to take action to collect payments, terminate their subscriptions for our services, and increase accounts receivable and bad debt, any of which would increase our expenses and harm our revenue and results of operations; • making it more difficult for us to sell increased services or functionality to our existing customers; • delaying prospective customers’ decisions to subscribe to our solutions, increase the length of sales cycles, or slow the typical growth in the use of our solutions once customers have initially deployed our solutions; • harming our ability to effectively market and sell our solutions as a result of travel restrictions and social distancing orders; • delaying the introduction of enhancements to our solutions and market acceptance of any new features and products; • harming our ability to grow our worldwide sales and operations; • harming our ability to recruit, onboard and successfully integrate new employees, including members of our direct sales force; • impacting the health and safety of our employees, including our senior management team, and their ability to perform services; • causing our management team to continue to commit significant time, attention and resources to monitoring the COVID-19 pandemic and seeking to mitigate its effect on our business and workforce. 27 Table of Contents It is uncertain how long and how severely the COVID-19 pandemic may continue to impact us.
In the future, we expect the risks of hash rate loss will remain, which may affect our business and results of operations. ​ 11 Table of Contents We are subject to risks associated with our need for significant electric power and the limited availability of power resources, which could have a material adverse effect on our business, financial condition and results of operations.
In the future, we expect the risks of hash rate loss will remain, which may affect our business and results of operations. 12 Table of Contents We are subject to risks associated with our need for significant electric power and the limited availability of power resources, which could have a material adverse effect on our business, financial condition and results of operations.
We may diversify our business by mining or investing in additional cryptocurrencies which could require significant investment or expose us to trading risks. The field of cryptocurrencies is constantly expanding with around 10,000 types of cryptocurrencies in existence as of December 2022. We intend to evaluate the potential for mining or investing in existing, new and alternative cryptocurrencies.
We may diversify our business by mining or investing in additional cryptocurrencies which could require significant investment or expose us to trading risks. The field of cryptocurrencies is constantly expanding with around 10,000 types of cryptocurrencies in existence as of December 2023. We intend to evaluate the potential for mining or investing in existing, new and alternative cryptocurrencies.
Any of the foregoing results could have a material adverse effect on our business, financial condition and results of operations. ​ 22 Table of Contents The loss of any member of our senior management team, or our failure to attract, train and retain qualified personnel, especially our design and technical personnel, could impair our ability to grow our business and effectively execute our business strategy.
Any of the foregoing results could have a material adverse effect on our business, financial condition and results of operations. 23 Table of Contents The loss of any member of our senior management team, or our failure to attract, train and retain qualified personnel, especially our design and technical personnel, could impair our ability to grow our business and effectively execute our business strategy.
While we face less working capital constraints as we expand our hash rate sharing business, which generates quicker cash payback, the proprietary mining business is nevertheless capital intensive. We may need additional capital if Bitcoin price increases as it will likely push up prices for supplies required for the proprietary mining business.
While we face less working capital constraints as we expand our hash rate sharing business, which generates quicker cash payback, the self-mining business is nevertheless capital intensive. We may need additional capital if Bitcoin price increases as it will likely push up prices for supplies required for the self-mining business.
If the Bitcoin price drops, the expected economic return of Bitcoin mining activities will diminish, thereby resulting in a decrease in demand for our Bitcoin-related services, and in value appreciation from our proprietary mining activities. As a result, we may need to reduce the price of our Cloud Hash Rate and hosting services.
If the Bitcoin price drops, the expected economic return of Bitcoin mining activities will diminish, thereby resulting in a decrease in demand for our Bitcoin-related services, and in value appreciation from our self-mining activities. As a result, we may need to reduce the price of our Cloud Hash Rate and hosting services.
Any widespread delays in the recording of transactions could result in a loss of confidence in that cryptocurrency network, which could adversely impact an investment in us. 33 Table of Contents To the extent that any miners cease to record transactions in solved blocks, such transactions will not be recorded on the blockchain.
Any widespread delays in the recording of transactions could result in a loss of confidence in that cryptocurrency network, which could adversely impact an investment in us. 34 Table of Contents To the extent that any miners cease to record transactions in solved blocks, such transactions will not be recorded on the blockchain.
For example, there is no authority that directly addresses the proper treatment of certain items of the Company’s income, such as income from proprietary cryptocurrency mining, hash rate sharing, or hosting for purposes of the PFIC rules and, although the Company currently treats these items of income as active, such treatment is uncertain.
For example, there is no authority that directly addresses the proper treatment of certain items of the Company’s income, such as income from cryptocurrency self-mining, hash rate sharing, or hosting for purposes of the PFIC rules and, although the Company currently treats these items of income as active, such treatment is uncertain.
The size, nature and complexity of our business could make us susceptible to various claims, both in litigation and binding arbitration proceedings, legal proceedings, and government investigations, due to the heightened regulatory scrutiny following the recent disruptions in the crypto asset markets.
The size, nature and complexity of our business could make us susceptible to various claims, both in litigation and binding arbitration proceedings, legal proceedings, and government investigations, due to the heightened regulatory scrutiny following the disruptions in the crypto asset markets in 2022.
Therefore, a loss may be suffered with respect to our cryptocurrencies which is not covered by insurance and for which no person is liable in damages which could adversely affect our operations and, consequently, an investment in us. 38 Table of Contents Bitcoin mining activities are energy-intensive, which may restrict the geographic locations of mining machines and have a negative environmental impact.
Therefore, a loss may be suffered with respect to our cryptocurrencies which is not covered by insurance and for which no person is liable in damages which could adversely affect our operations and, consequently, an investment in us. Bitcoin mining activities are energy-intensive, which may restrict the geographic locations of mining machines and have a negative environmental impact.
There is no guarantee that we will not face administrative fines or penalties concerning our operations or our subsidiaries, which could have a material adverse impact on our results of operation. ​ 40 Table of Contents If counterfeit products and services are provided under our brand names and trademarks, our reputation and financial results could be materially and adversely affected.
There is no guarantee that we will not face administrative fines or penalties concerning our operations or our subsidiaries, which could have a material adverse impact on our results of operation. If counterfeit products and services are provided under our brand names and trademarks, our reputation and financial results could be materially and adversely affected.
As a consequence of this material weakness, accounting errors were identified in Bitdeer’s combined and consolidated statements of operations and comprehensive loss and cash flows for the years ended December 31, 2020 and 2021 primarily related to revenue presentation in relation to the sales of mining machine business and the cash flow presentation related to the disposal of cryptocurrencies earned from revenue arrangements.
As a consequence of this material weakness, accounting errors were identified in Bitdeer’s combined and consolidated statements of operations and comprehensive loss and cash flows for the year ended December 31, 2021 primarily related to revenue presentation in relation to the sales of mining machine business and the cash flow presentation related to the disposal of cryptocurrencies earned from revenue arrangements.
Prospective holders of Class A Ordinary Shares that may be or become Ten Percent Shareholders should consult their tax advisors with respect to the application of the CFC rules in their particular circumstances. ​ 56 Table of Contents Future changes to tax laws could materially and adversely affect the Company and reduce net returns to the Company’s shareholders.
Prospective holders of Class A Ordinary Shares that may be or become Ten Percent Shareholders should consult their tax advisors with respect to the application of the CFC rules in their particular circumstances. Future changes to tax laws could materially and adversely affect the Company and reduce net returns to the Company’s shareholders.
Any systemic economic or financial crisis could cause revenue for the mining industry as a whole to decline dramatically and could materially and adversely affect our results of operations. ​ 24 Table of Contents Changes in international trade policies and international barriers to trade may have an adverse effect on our business and expansion plans.
Any systemic economic or financial crisis could cause revenue for the mining industry as a whole to decline dramatically and could materially and adversely affect our results of operations. Changes in international trade policies and international barriers to trade may have an adverse effect on our business and expansion plans.
Although we are not directly connected to the recent cryptocurrency market events, we may still suffer reputational harm due to our association with the cryptocurrency industry in light of the recent disruption in the crypto asset markets.
Although we are not directly connected to the cryptocurrency market events in 2022, we may still suffer reputational harm due to our association with the cryptocurrency industry in light of the disruption in the crypto asset markets.
The cost of such compliance would result in us incurring substantial additional expenses, and the failure to register if required would have a materially adverse impact on our operations. We intend to conduct our operations so that we are not required to register as an investment company under the 1940 Act.
The cost of such compliance would result in us incurring substantial additional expenses, and the failure to register if required would have a materially adverse impact on our operations. 42 Table of Contents We intend to conduct our operations so that we are not required to register as an investment company under the 1940 Act.
As of the date of this annual report, the largest portion of our revenue was generated from our proprietary mining business and hash rate sales through Cloud Hash Rate, which are associated with Bitcoin mining.
As of the date of this annual report, the largest portion of our revenue was generated from our self-mining business and hash rate sales through Cloud Hash Rate, which are associated with Bitcoin mining.
If we experience difficulty in collecting our trade receivables, our liquidity, financial condition and results of operations would be negatively impacted. We derive our revenue from the sale of products and services and are subject to counterparty risks such as our customer’s inability to pay.
If we experience difficulty in collecting our trade receivables, our liquidity, financial condition and results of operations would be negatively impacted. 26 Table of Contents We derive our revenue from the sale of products and services and are subject to counterparty risks such as our customer’s inability to pay.
The existence of forked blockchains could erode user confidence in Bitcoin and could adversely impact our business, results of operations and financial condition. Bitcoin is based on open-source software and has no official developer or group of developers that formally controls the Bitcoin network.
The existence of forked blockchains could erode user confidence in Bitcoin and could adversely impact our business, results of operations and financial condition. 32 Table of Contents Bitcoin is based on open-source software and has no official developer or group of developers that formally controls the Bitcoin network.
In particular, the market price of Class A Ordinary Shares could be subject to extreme volatility and fluctuations in response to industry-wide developments beyond our control, such as continued industry-wide fallout from the recent Chapter 11 bankruptcy filings of cryptocurrency exchanges FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi.
In particular, the market price of Class A Ordinary Shares could be subject to extreme volatility and fluctuations in response to industry-wide developments beyond our control, such as continued industry-wide fallout from the Chapter 11 bankruptcy filings of cryptocurrency exchanges FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi throughout calendar year 2022.
Our proprietary mining operations, and, to our knowledge, the operations of our potential hash rate sharing and hosting customers, are currently designed to primarily support a PoW consensus algorithm.
Our self-mining operations, and, to our knowledge, the operations of our potential hash rate sharing and hosting customers, are currently designed to primarily support a PoW consensus algorithm.
This in turn could adversely affect the market demand for our services and business. Any future significant reductions in the price of Bitcoin will likely have a material and adverse effect on our results of operations and financial condition.
This in turn could adversely affect the market demand for our services and business. 10 Table of Contents Any future significant reductions in the price of Bitcoin will likely have a material and adverse effect on our results of operations and financial condition.
To efficiently increase managing hash rate (i.e., proprietary hash rate and hosting hash rate), our efforts include constructing and expanding mining datacenters in prime locations globally, purchasing the latest mining machine models and continually optimizing operational efficiency of our mining datacenters and mining machines.
To efficiently increase hash rate under management (i.e., proprietary hash rate and hosting hash rate), our efforts include constructing and expanding mining datacenters in prime locations globally, purchasing the latest mining machine models and continually optimizing operational efficiency of our mining datacenters and mining machines.
If we were subject to substantial liabilities that were not covered by our insurance, we could incur costs and losses that could materially and adversely affect our results of operations and financial condition. The cryptocurrencies held by us are not insured.
If we were subject to substantial liabilities that were not covered by our insurance, we could incur costs and losses that could materially and adversely affect our results of operations and financial condition. 39 Table of Contents The cryptocurrencies held by us are not insured.
Our pricing of hash rates may cause significantly lower income than we could have generated through using the same hash rates for proprietary mining.
Our pricing of hash rates may cause significantly lower income than we could have generated through using the same hash rates for self-mining.
Further, digital asset exchanges on which crypto assets trade are relatively new and largely unregulated, and thus may be exposed to fraud and failure. Incorrect or fraudulent cryptocurrency transactions may be irreversible. Bitcoin transactions are entirely digital and, as with any virtual system, are at risk from hackers, malware and operational glitches.
Further, digital asset exchanges on which crypto assets trade are relatively new and largely unregulated, and thus may be exposed to fraud and failure. Incorrect or fraudulent cryptocurrency transactions may be irreversible. 28 Table of Contents Bitcoin transactions are entirely digital and, as with any virtual system, are at risk from hackers, malware and operational glitches.
The failure to implement and maintain effective internal control over financial reporting could result in errors in Bitdeer’s financial statements that could result in a restatement of its financial statements, which in turn could have a material adverse effect on Bitdeer’s financial condition and results of operations.
The failure to implement and maintain effective internal control over financial reporting could result in errors in our financial statements that could result in a restatement of our financial statements, which in turn could have a material adverse effect on our financial condition and results of operations.
If financial accounting standards undergo significant changes, our operating results could be adversely affected. The accounting rules and regulations that we must comply with are complex and subject to interpretation by the IASB, the SEC, and various bodies formed to promulgate and interpret appropriate accounting principles.
If financial accounting standards undergo significant changes, our operating results could be adversely affected. 37 Table of Contents The accounting rules and regulations that we must comply with are complex and subject to interpretation by the IASB, the SEC, and various bodies formed to promulgate and interpret appropriate accounting principles.
Changing laws and regulations and changing enforcement policies and priorities have the potential to cause additional expenditures, restrictions, and delays in connection with our business operations. Federal and state laws and regulations may be subject to change or changes in enforcement policies or priorities, including changes that may result from changes in the political landscape and changing technologies.
Changing laws and regulations and changing enforcement policies and priorities have the potential to cause additional expenditures, restrictions, and delays in connection with our business operations. 47 Table of Contents Federal and state laws and regulations may be subject to change or changes in enforcement policies or priorities, including changes that may result from changes in the political landscape and changing technologies.
In addition, our plan to expand internationally, including into jurisdictions which are considered high-risk from an anti-bribery and anti-corruption perspective, also heightens the corruption risks for us. ​ 39 Table of Contents We require certain approvals, licenses, permits and certifications to operate.
In addition, our plan to expand internationally, including into jurisdictions which are considered high-risk from an anti-bribery and anti-corruption perspective, also heightens the corruption risks for us. We require certain approvals, licenses, permits and certifications to operate.
Bitdeer has identified a material weakness in its internal control over financial reporting. In the event of any failure to maintain an effective system of disclosure controls and internal control over financial reporting, we may not be able to accurately report its financial results or prevent fraud.
We previously identified a material weakness in our internal control over financial reporting. In the event of any failure to maintain an effective system of disclosure controls and internal control over financial reporting, we may not be able to accurately report its financial results or prevent fraud.
Accordingly, there can be no assurances that the Company will not be a PFIC for its current or any future taxable year, and the Company’s U.S. counsel expresses no opinion with respect to the Company’s PFIC status for any taxable year. If the Company is (or is treated with respect to a U.S.
Accordingly, there can be no assurances that the Company will not be a PFIC for its current or any future taxable year, and the Company’s U.S. counsel expresses no opinion with respect to the Company’s PFIC status for any taxable year. 56 Table of Contents If the Company is (or is treated with respect to a U.S.
Revenue generated from customers located in the United States accounted for 12.4%, 16.6% and 5.1% of our total revenue for the years ended December 31, 2020, 2021 and 2022, respectively. Further, we rely on certain overseas suppliers, including suppliers in the United States, for the supply of certain equipment and tools, such as mining machines.
Revenue generated from customers located in the United States accounted for 16.6%, 5.1% and 16.0% of our total revenue for the years ended December 31, 2021, 2022 and 2023, respectively. Further, we rely on certain overseas suppliers, including suppliers in the United States, for the supply of certain equipment and tools, such as mining machines.
As such, we will incur additional legal, accounting and other expenses. These expenses may increase even more if we no longer qualify as an “emerging growth company,” as defined in Section 2(a) of the Securities Act. The Exchange Act requires, among other things, that we file annual and current reports with respect to our business and operating results.
These expenses may increase even more if we no longer qualify as an “emerging growth company,” as defined in Section 2(a) of the Securities Act. The Exchange Act requires, among other things, that we file annual and current reports with respect to our business and operating results.
We believe that since cryptocurrency mining, and the digital asset industry generally, is a relatively new business sector, we are more likely subject to government investigation and regulatory determination, particularly following the recent cryptocurrency market participant bankruptcies described elsewhere herein.
We believe that since cryptocurrency mining, and the digital asset industry generally, is a relatively new business sector, we are more likely subject to government investigation and regulatory determination, particularly following the cryptocurrency market participant bankruptcies throughout calendar year 2022 described elsewhere herein.
Our limited operating history and rapid revenue growth may make it difficult for us to forecast our business and assess the seasonality and volatility in our business. We have achieved rapid growth since our inception. For the years ended December 31, 2020, 2021 and 2022, our total revenue amounted to US$186.4 million, US$394.7 million and US$333.3 million, respectively.
Our limited operating history and rapid revenue growth may make it difficult for us to forecast our business and assess the seasonality and volatility in our business. We have achieved rapid growth since our inception. For the years ended December 31, 2021, 2022 and 2023, our total revenue amounted to US$394.7 million, US$333.3 million and US$368.6 million, respectively.
We have experienced negative cash flows from operating activities and incurred net losses in the past. We can provide no assurance of our future operating results. We had negative cash flows from operating activities in the amount of US$109.2 million, US$52.5 million and US$268.0 million for the years ended December 31, 2020, 2021 and 2022, respectively.
We have experienced negative cash flows from operating activities and incurred net losses in the past. We can provide no assurance of our future operating results. We had negative cash flows from operating activities in the amount of US$52.5 million, US$268.0 million and US$271.8 million for the years ended December 31, 2021, 2022 and 2023, respectively.
Power outage or shortages, labor disputes and other factors may result in constraints on our business activities. Historically, we have not experienced constraints on our business activities, including at our mining datacenters, due to power outage or shortages, labor disputes or other factors.
Historically, we have not experienced constraints on our business activities, including at our mining datacenters, due to power outage or shortages, labor disputes or other factors.
As of December 31, 2021 and 2022, the balance of prepayments we made to our suppliers amounted to US$14.5 million and US$9.7 million, respectively. The amount of our prepayment can significantly increase as we continue to pursue technological advancement. We are subject to counterparty risk exposure to our suppliers.
As of December 31, 2022 and 2023, the balance of prepayments we made to our suppliers amounted to US$9.7 million and US$35.2 million, respectively. The amount of our prepayment can significantly increase as we continue to pursue technological advancement. We are subject to counterparty risk exposure to our suppliers.
We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of the Business Combination, (b) in which we have total annual gross revenues of at least US$1.235 billion, (c) or in which we are deemed to be a large accelerated filer, which means the market value of our shares that is held by non-affiliates exceeds US$700 million as of the last business day of our prior second fiscal quarter, and (ii) the date on which we issued more than US$1.0 billion in non-convertible debt during the prior three-year period.
As a result, holders of Ordinary Shares may not have access to certain information that they may deem important. 55 Table of Contents We will remain an emerging growth company until the earlier of (i) the last day of the fiscal year (a) following the fifth anniversary of the closing of the Business Combination, (b) in which we have total annual gross revenues of at least US$1.235 billion, (c) or in which we are deemed to be a large accelerated filer, which means the market value of our shares that is held by non-affiliates exceeds US$700 million as of the last business day of our prior second fiscal quarter, and (ii) the date on which we issued more than US$1.0 billion in non-convertible debt during the prior three-year period.
These events have also negatively impacted the liquidity of the digital assets markets as certain entities affiliated with FTX engaged in significant trading activity. We have not been directly impacted by any of the recent bankruptcies in the crypto asset space, as we have no contractual privity or relationship to the relevant parties.
These events have also negatively impacted the liquidity of the digital assets markets as certain entities affiliated with FTX engaged in significant trading activity. 29 Table of Contents We have not been directly impacted by any of the bankruptcies in the crypto asset space throughout calendar year 2022, as we have no contractual privity or relationship to the relevant parties.
In an August 2021 interview, SEC Chairman Gensler signaled the SEC is contemplating a robust regulatory regime for cryptocurrencies and reiterated the SEC’s position that many cryptocurrencies are unregulated securities. The SEC has been active in asserting its jurisdiction over ICOs and cryptocurrencies and in bringing enforcement cases. The SEC has directed enforcement activity toward cryptocurrencies, and more specifically, ICOs.
In an August 2021 interview, SEC Chairman Gensler signaled the SEC is contemplating a robust regulatory regime for cryptocurrencies and reiterated the SEC’s position that many cryptocurrencies are unregulated securities. 46 Table of Contents The SEC has been active in asserting its jurisdiction over ICOs and cryptocurrencies and in bringing enforcement cases.
We incurred a net loss of US$55.8 million and US$60.4 million for the years ended December 31, 2020 and 2022, respectively, and generated a net profit of US$82.6 million for the year ended December 31, 2021.
We incurred a net loss of US$60.4 million and US$56.7 million for the years ended December 31, 2022 and 2023, respectively, and generated a net profit of US$82.6 million for the year ended December 31, 2021.
We incurred a net loss of US$55.8 million and US$60.4 million for the years ended December 31, 2020 and 2022, respectively, and generated a net profit of US$82.6 million for the year ended December 31, 2021.
We incurred a net loss of US$60.4 million and US$56.7 million for the years ended December 31, 2022 and 2023, respectively, and generated a net profit of US$82.6 million for the year ended December 31, 2021.
While we have been devoting a substantial amount of time and resources to various compliance initiatives and risk management measures, including but not limited to, recruiting a dedicated team of compliance expertise, we cannot assure you the practical application and effectiveness of our compliance program and risk management measures, nor that there will not be a failure in detecting regulatory compliance issues or managing risk exposure, which may adversely affect our reputation, business, financial condition and results of operations.
While we have been devoting a substantial amount of time and resources to various compliance initiatives and risk management measures, including but not limited to, recruiting a dedicated team of compliance expertise, we cannot assure you the practical application and effectiveness of our compliance program and risk management measures, nor that there will not be a failure in detecting regulatory compliance issues or managing risk exposure, which may adversely affect our reputation, business, financial condition and results of operations. 48 Table of Contents Risks Related to Our Securities A market for Class A Ordinary Shares may not develop, which would adversely affect the liquidity and price of Class A Ordinary Shares.
The threats to network and data security are increasingly diverse and sophisticated. Despite our efforts and processes to prevent breaches, our computer servers and computer systems may be vulnerable to cybersecurity risks, including denial-of-service attacks, physical or electronic break-ins, employee theft or misuse and similar disruptions from unauthorized tampering with our computer servers and computer systems.
Despite our efforts and processes to prevent breaches, our computer servers and computer systems may be vulnerable to cybersecurity risks, including denial-of-service attacks, physical or electronic break-ins, employee theft or misuse and similar disruptions from unauthorized tampering with our computer servers and computer systems.
We are a leading cryptocurrency mining service provider with a strong global presence. As of December 31, 2022, we operate five prime mining datacenters in the United States and Norway and served users across over 100 countries and regions around the globe, and may continue to expand our operations to more countries and regions.
We are a leading cryptocurrency mining service provider with a strong global presence. As of February 29, 2024, we operate six prime mining datacenters in the United States, Norway and Bhutan and served users across around 100 countries and regions around the globe, and may continue to expand our operations to more countries and regions.
Our business is highly dependent on acquiring a sufficient number of cryptocurrency mining equipment from our suppliers. We may not be able to obtain new mining hardware or purchase such hardware at competitive prices during times of high demand, which could have a material adverse effect on our business, financial condition and results of operations.
We may not be able to obtain new mining hardware or purchase such hardware at competitive prices during times of high demand, which could have a material adverse effect on our business, financial condition and results of operations.
While we do not believe that we are more likely to be affected by market volatility than other public companies, recent stock run-ups, divergences in valuation ratios relative to those seen during traditional markets, high short interest or short squeezes, and strong and atypical retail investor interest in the markets may impact the demand for the Class A Ordinary Shares. ​ 52 Table of Contents A possible “short squeeze” due to a sudden increase in demand of Class A Ordinary Shares that largely exceeds supply may lead to price volatility in the Class A Ordinary Shares.
While we do not believe that we are more likely to be affected by market volatility than other public companies, recent stock run-ups, divergences in valuation ratios relative to those seen during traditional markets, high short interest or short squeezes, and strong and atypical retail investor interest in the markets may impact the demand for the Class A Ordinary Shares.
Accordingly, we do not believe that we are an “orthodox” investment company as described in the first bullet point above. ​ 41 Table of Contents While certain cryptocurrencies may be deemed to be securities, we do not believe that certain other cryptocurrencies, in particular Bitcoin, are securities; therefore, we believe that less than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis will comprise cryptocurrencies that could be considered investment securities.
While certain cryptocurrencies may be deemed to be securities, we do not believe that certain other cryptocurrencies, in particular Bitcoin, are securities; therefore, we believe that less than 40% of our total assets (exclusive of U.S. government securities and cash items) on an unconsolidated basis will comprise cryptocurrencies that could be considered investment securities.
As of December 31, 2021 and 2022, our trade receivables amounted to US$8.2 million, and US$18.3 million respectively.
As of December 31, 2022 and 2023, our trade receivables amounted to US$18.3 million and US$17.3 million, respectively.
Although we implement a number of security procedures with various elements such as two-factor verification, segregated accounts and secured facilities and plan to implement the maintenance of data on computers and/or storage media that is not directly connected to, or accessible from, the internet and/or networked with other computers, or “cold storage,” to minimize the risk of loss, damage and theft, and we update such security procedures whenever reasonably practicable, there is no guarantee that the prevention of such loss, damage or theft, whether caused intentionally, accidentally or by an act of God. ​ 32 Table of Contents Additionally, outside parties may attempt to fraudulently induce our employees to disclose sensitive information in order to gain access to our infrastructure.
Although we implement a number of security procedures with various elements such as two-factor verification, segregated accounts and secured facilities and plan to implement the maintenance of data on computers and/or storage media that is not directly connected to, or accessible from, the internet and/or networked with other computers, or “cold storage,” to minimize the risk of loss, damage and theft, and we update such security procedures whenever reasonably practicable, there is no guarantee that the prevention of such loss, damage or theft, whether caused intentionally, accidentally or by an act of God.
To the extent government enforcement authorities literally enforce these and other laws and regulations that are impacted by decentralized distributed ledger technology, we may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which could harm our reputation and could have a material adverse effect on our business, prospects, financial condition, and operating results. 37 Table of Contents Our mining datacenters may be located on property whose owner has not obtained the approval of relevant authorities, and we may be ordered to relocate from that property.
To the extent government enforcement authorities literally enforce these and other laws and regulations that are impacted by decentralized distributed ledger technology, we may be subject to investigation, administrative or court proceedings, and civil or criminal monetary fines and penalties, all of which could harm our reputation and could have a material adverse effect on our business, prospects, financial condition, and operating results.
Our business is highly dependent upon cryptocurrency mining equipment suppliers providing an adequate supply of new generation cryptocurrency mining machines at economical prices to support our proprietary mining, hash rate sharing and hosting business lines and our customers’ mining activities.
While we plan to install our own mining machines as part of our plan to expand our self-mining business, our business is highly dependent upon cryptocurrency mining equipment suppliers providing an adequate supply of new generation cryptocurrency mining machines at economical prices to support our self-mining, hash rate sharing and hosting business lines and our customers’ mining activities.
We plan to expand our footprints to more mining datacenters across the globe to increase our total capacity to approximately 1,524MW, including 179MW power supply currently under construction and 550MW power supply “in the pipeline,” contracted or negotiated but not yet under active construction.
We plan to expand our footprints to more mining datacenters across the globe to increase our total capacity to approximately 1,970MW, including 575MW power supply currently under construction and 500MW power supply “in the pipeline,” contracted or negotiated but not yet under active construction, as of February 29, 2024.
Additionally, FinCEN has increased its enforcement efforts involving cryptocurrency creators regarding compliance with anti-money laundering and Know-Your-Customer laws. ​ 47 Table of Contents To the extent that any of these creators make misleading and/or fraudulent disclosures or do not comply with federal, state or foreign laws, or if we are unable to uncover all material information about these cryptocurrencies and/or their creators, we may not be able to make a fully informed business decision relating to our transacting in or otherwise involving such cryptocurrencies, which could have a material adverse effect on our business, financial condition and results of operations.
To the extent that any of these creators make misleading and/or fraudulent disclosures or do not comply with federal, state or foreign laws, or if we are unable to uncover all material information about these cryptocurrencies and/or their creators, we may not be able to make a fully informed business decision relating to our transacting in or otherwise involving such cryptocurrencies, which could have a material adverse effect on our business, financial condition and results of operations.
Although, as mentioned elsewhere in this annual report, we have no exposure to any of the cryptocurrency market participants that recently filed for Chapter 11 bankruptcy, or who are known to have experienced excessive redemptions, suspended redemptions or have crypto assets of their customers unaccounted for; and we do not have any assets, material or otherwise, that may not be recovered due to these bankruptcies or excessive or suspended redemptions; the price of Class A Ordinary Shares may still not be immune to unfavorable investor sentiment resulting from these recent developments in the broader cryptocurrency industry and you may experience depreciation of price of Class A Ordinary Shares.
Although, as mentioned elsewhere in this annual report, we have no exposure to any of the cryptocurrency market participants that filed for Chapter 11 bankruptcy in 2022, or who are known to have experienced excessive redemptions, suspended redemptions or have crypto assets of their customers unaccounted for; and we do not have any assets, material or otherwise, that may not be recovered due to these bankruptcies or excessive or suspended redemptions; the price of Class A Ordinary Shares may still not be immune to unfavorable investor sentiment resulting from these developments in the broader cryptocurrency industry and you may experience depreciation of price of Class A Ordinary Shares. 49 Table of Contents We are a “controlled company” within the meaning of the applicable Nasdaq listing rules and, as a result, will qualify for exemptions from certain corporate governance requirements.
Unless we are able to make timely alternative arrangements for relocating, we may not be able to fulfill purchase orders received, which may have a material and adverse effect on our business, results of operations and financial condition.
If we are evicted from such property, we may need to find alternative properties and relocate our mining datacenters. Unless we are able to make timely alternative arrangements for relocating, we may not be able to fulfill purchase orders received, which may have a material and adverse effect on our business, results of operations and financial condition.
However, if anything were to happen that would cause us to be deemed to be an investment company under the 1940 Act, requirements imposed by the 1940 Act, including limitations on our capital structure, ability to transact business with affiliates and ability to compensate key employees, could make it impractical for us to continue our business as currently conducted, impair the agreements and arrangements between and among us and our senior management team and materially and adversely affect our business, financial condition and results of operations. 42 Table of Contents There is no one unifying principle governing the regulatory status of cryptocurrencies nor whether cryptocurrencies are securities in any particular context.
However, if anything were to happen that would cause us to be deemed to be an investment company under the 1940 Act, requirements imposed by the 1940 Act, including limitations on our capital structure, ability to transact business with affiliates and ability to compensate key employees, could make it impractical for us to continue our business as currently conducted, impair the agreements and arrangements between and among us and our senior management team and materially and adversely affect our business, financial condition and results of operations.
Although we do not intend to be engaged in the offer or sale of securities in the form of ICO offerings, and we do not believe our planned mining activities would require registration for us to conduct such activities and accumulate cryptocurrencies, the SEC, CFTC, Nasdaq, IRS or other governmental or quasi-governmental agency or organization may conclude that our activities involve the offer or sale of “securities,” or ownership of “investment securities,” and we may be subject to regulation or registration requirements under various federal laws and related rules.
Section 5(c) of the Securities Act provides a similar prohibition against offers to sell, or offers to buy, unless a registration statement has been filed. 44 Table of Contents Although we do not intend to be engaged in the offer or sale of securities in the form of ICO offerings, and we do not believe our planned mining activities would require registration for us to conduct such activities and accumulate cryptocurrencies, the SEC, CFTC, Nasdaq, IRS or other governmental or quasi-governmental agency or organization may conclude that our activities involve the offer or sale of “securities,” or ownership of “investment securities,” and we may be subject to regulation or registration requirements under various federal laws and related rules.
Whereas it is believed that individual operators in past years were more likely to hold cryptocurrencies for more extended periods, the immediate selling of newly transacted cryptocurrencies by operators may increase the supply of such cryptocurrencies on the applicable exchange market, which could create downward pressure on the price of the cryptocurrencies and, in turn, could have a material adverse effect on our business, financial condition and results of operations. ​ 35 Table of Contents To the extent that the profit margins of cryptocurrency mining operations are not high, mining participants are more likely to sell their earned Bitcoin, which could constrain Bitcoin prices.
Whereas it is believed that individual operators in past years were more likely to hold cryptocurrencies for more extended periods, the immediate selling of newly transacted cryptocurrencies by operators may increase the supply of such cryptocurrencies on the applicable exchange market, which could create downward pressure on the price of the cryptocurrencies and, in turn, could have a material adverse effect on our business, financial condition and results of operations.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Vacant Land Purchase and Sale Agreement for the Mining Datacenter in Pangborn, Washington On August 3, 2017, we entered into the Vacant Land Purchase and Sale Agreement with Blackhawk Development Inc through Ant Creek, LLC, our subsidiary, pursuant to which we purchased from Blackhawk Development Inc a tract of land of 3 acres located at BLA of Parent Parcel 93700000002, East Wenatchee, WA 98802 for a consideration of US$0.4 million.
Vacant Land Purchase and Sale Agreement for the Mining Datacenter in Pangborn, Washington In August 2017, we entered into the Vacant Land Purchase and Sale Agreement with Blackhawk Development Inc through Ant Creek, LLC, our subsidiary, pursuant to which we purchased from Blackhawk Development Inc a tract of land of 3 acres located at BLA of Parent Parcel 93700000002, East Wenatchee, WA 98802 for a consideration of US$0.4 million.
While we remain engaged in proprietary mining business to capture the high appreciation potential of cryptocurrency, we strategically allocate a significant amount of proprietary hash rate to hash rate sales through Cloud Hash Rate , to enable instant cash payback upon customers’ subscription to our hash rate plans.
While we remain engaged in self-mining business to capture the high appreciation potential of cryptocurrency, we strategically allocate a significant amount of proprietary hash rate to hash rate sales through Cloud Hash Rate, to enable instant cash payback upon customers’ subscription to our hash rate plans.
Land Lease Agreement for the Molde Mining Datacenter in Fræna Municipality, Norway On November 15, 2019, we entered into the Land Lease Agreement with Troll Housing AS through Norway Hash Technologies AS, our subsidiary, as amended by Addendum No. 1 to the Land Lease Agreement, dated December 6, 2020 (the “Molde Lease Addendum No. 1”), Addendum No. 2 to the Land Lease Agreement, dated March 22, 2021 (the “Molde Lease Addendum No. 2”), and Addendum No. 3 to the Land Lease Agreement, dated March 22, 2021 (the “Molde Lease Addendum No. 1”) (collectively, the “Molde Lease Agreement”), pursuant to which we lease land located at Klempertåsvegen 1, 6440 Elnesvågen, Norway to support our Molde mining datacenter with 67MW capacity.
Land Lease Agreement for the Molde Mining Datacenter in Fræna Municipality, Norway In November 2019, we entered into the Land Lease Agreement with Troll Housing AS through Norway Hash Technologies AS, our subsidiary, as amended by Addendum No. 1 to the Land Lease Agreement, dated December 6, 2020 (the “Molde Lease Addendum No. 1”), Addendum No. 2 to the Land Lease Agreement, dated March 22, 2021 (the “Molde Lease Addendum No. 2”), and Addendum No. 3 to the Land Lease Agreement, dated March 22, 2021 (the “Molde Lease Addendum No. 1”) (collectively, the “Molde Lease Agreement”), pursuant to which we lease land located at Klempertåsvegen 1, 6440 Elnesvågen, Norway to support our Molde mining datacenter with 67MW capacity.
Commercial Purchase and Sale Agreement for the Mining Datacenter in Knoxville, Tennessee On February 26, 2018, Bitmain Inc. entered into the Commercial Purchase and Sale Agreement with Kemet Foil Manufacturing LLC, FKA Cornell Dublilier pursuant to which it purchased from Kemet Foil Manufacturing LLC, FKA Cornell Dublilier a tract of land of approximately 9.88 acres improved with a 77,678 square foot industrial building together with all fixtures, landscaping, improvements, and appurtenances, located at 5101 S.
Commercial Purchase and Sale Agreement for the Mining Datacenter in Knoxville, Tennessee In February 2018, Bitmain Inc. entered into the Commercial Purchase and Sale Agreement with Kemet Foil Manufacturing LLC, FKA Cornell Dublilier pursuant to which it purchased from Kemet Foil Manufacturing LLC, FKA Cornell Dublilier a tract of land of approximately 9.88 acres improved with a 77,678 square foot industrial building together with all fixtures, landscaping, improvements, and appurtenances, located at 5101 S.
History and Development of the Company We were created as Bitdeer Technologies Holding Company in January 2021 to separate the Cloud Hash Rate business, the proprietary mining business and the business of providing dynamic hosting solutions (collectively, the “Bitdeer Business”) and the mining pool business, including the ownership of and registration right to the domain name btc.com (the “BTC.com Pool Business” or “BTC”), following a corporate reorganization of BitMain Technologies Holding Company (collectively with its subsidiaries, “Bitmain”).
History and Development of the Company We were created as Bitdeer Technologies Holding Company in January 2021 to separate the Cloud Hash Rate business, the self-mining business and the business of providing dynamic hosting solutions (collectively, the “Bitdeer Business”) and the mining pool business, including the ownership of and registration right to the domain name btc.com (the “BTC.com Pool Business” or “BTC”), following a corporate reorganization of BitMain Technologies Holding Company (collectively with its subsidiaries, “Bitmain”).
We have obtained patents to support key technologies underpinning our operations. Our technology capabilities drive the differentiation of our business. In particular, the following technologies enable us to constantly improve our proprietary mining efficiency, offer differentiated and quality products and services, and minimize impacts to the environment. ● Hash rate slicing.
We have obtained patents to support key technologies underpinning our operations. Our technology capabilities drive the differentiation of our business. In particular, the following technologies enable us to constantly improve our self-mining efficiency, offer differentiated and quality products and services, and minimize impacts to the environment. • Hash rate slicing.
We have taken various measures to increase the ratio of clean energy in support of the operations of our mining datacenters. As of March 31, 2023, our non-carbon energy supply ratio was approximately 62%. Our research and development team has started the feasibility assessment of the use of solar power to support our mining datacenters.
We have taken various measures to increase the ratio of clean energy in support of the operations of our mining datacenters. As of December 31, 2023, our non-carbon energy supply ratio was approximately 62 %. Our research and development team has started the feasibility assessment of the use of solar power to support our mining datacenters.
Seasonality Our hash rate level is typically slightly lower in summer as temperature affects mining machine performance regarding hash rate generation. 72 Table of Contents Government Regulation Due to the relatively short history of cryptocurrencies, and their emergence as a new asset class, government regulation of blockchain and cryptocurrencies is constantly evolving, with increased interest expressed by U.S. and internal regulators.
Seasonality Our hash rate level is typically slightly lower in summer as temperature affects mining machine performance regarding hash rate generation. Government Regulation Due to the relatively short history of cryptocurrencies, and their emergence as a new asset class, government regulation of blockchain and cryptocurrencies is constantly evolving, with increased interest expressed by U.S. and internal regulators.
Through years of experience in and deep insight into the global power supply market, we are able to discover outstanding mining construction resources that are both cost-efficient and environmentally friendly. We stick with high environmental, social and governance (ESG) standards and strive to constantly increase the ratio of power supply generated from carbon-free energy.
Through years of experience in and deep insight into the global power supply market, we are able to discover outstanding mining construction resources that are both cost-efficient and environmentally friendly. 71 Table of Contents We stick with high environmental, social and governance (ESG) standards and strive to constantly increase the ratio of power supply generated from carbon-free energy.
Therefore, we are able to continuously grow our proprietary hash rate by funding the purchase of additional mining fleets with the instant cash collected from hash rate sales using our existing mining fleets, significantly reducing our payback period to one month, compared to the long payback period associated with cryptocurrency mining activities, which is typically from 6 to 18 months, according to Frost & Sullivan.
Therefore, we are able to continuously grow our proprietary hash rate by funding the purchase of additional mining fleets with the instant cash collected from hash rate sales using our existing mining fleets, significantly reducing our payback period to one month, compared to the long payback period associated with cryptocurrency mining activities, which is typically from 6 to 18 months.
This unique model of selling cloud hash rate allows us to smooth the impact of Bitcoin price volatility as our income from hash rate sales are less directly related to cryptocurrency price compared to proprietary mining.
This unique model of selling cloud hash rate allows us to smooth the impact of Bitcoin price volatility as our income from hash rate sales are less directly related to cryptocurrency price compared to self-mining.
All crypto transactions will be monitored by Matrixport Group’s central security system. If an unusual transaction is identified, an alert will be issued to the relevant customer in real time for transaction verification purposes. 67 Table of Contents All withdrawal and transfer of assets shall be permitted by applicable laws and regulations and Matrixport Group’s internal policies and procedures.
All crypto transactions will be monitored by Matrixport Group’s central security system. If an unusual transaction is identified, an alert will be issued to the relevant customer in real time for transaction verification purposes. All withdrawal and transfer of assets shall be permitted by applicable laws and regulations and Matrixport Group’s internal policies and procedures.
Risk Factors — Risks Related to Cryptocurrencies — If we were deemed an ‘investment company’ under the Investment Company Act of 1940, as amended, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business.” Our Cryptocurrencies Storage and Custodial Practices During the years ended December 31, 2020, 2021 and 2022, substantially all of our cryptocurrencies were held in custody by Matrixport Group and our disposal of cryptocurrencies, at spot price on the date of disposal, was primarily to Matrixport Group, a related party.
Risk Factors - Risks Related to Cryptocurrencies - If we were deemed an ‘investment company’ under the Investment Company Act of 1940, as amended, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business.” 67 Table of Contents Our Cryptocurrencies Storage and Custodial Practices During the years ended December 31, 2021, 2022 and 2023, substantially all of our cryptocurrencies were held in custody by Matrixport Group and our disposal of cryptocurrencies, at spot price on the date of disposal, was primarily to Matrixport Group, a related party.
Please see the section entitled “— Our Cryptocurrencies Storage and Custodial Practices” below for more details on the related procedures in this regard. ​ 65 Table of Contents Prior to June 30, 2021, we did not leverage cryptocurrencies that we held, including Bitcoin, to generate additional income, through lending, hedging or otherwise, nor did we convert our fiat currencies into cryptocurrencies for the same purposes.
Please see the section entitled “- Our Cryptocurrencies Storage and Custodial Practices” below for more details on the related procedures in this regard. Prior to June 30, 2021, we did not leverage cryptocurrencies that we held, including Bitcoin, to generate additional income, through lending, hedging or otherwise, nor did we convert our fiat currencies into cryptocurrencies for the same purposes.
Historically, around 50% to 60% of our proprietary hash rate was utilized to support our proprietary mining, with the rest available for sale to customers through Cloud Hash Rate . However, we retain the flexibility to allocate our proprietary hash rate to either proprietary mining or Cloud Hash Rate , primarily based on our view of the Bitcoin market trends.
Historically, around 50% to 80% of our proprietary hash rate was utilized to support our self-mining, with the rest available for sale to customers through Cloud Hash Rate. However, we retain the flexibility to allocate our proprietary hash rate to either self-mining or Cloud Hash Rate, primarily based on our view of the Bitcoin market trends.
We believe that focusing on General Hosting and Membership Hosting services will enable us to maximize assets utilization with minimal capital expenditure for our growing mining datacenter capacity, maximize overall scale of hash rate supported by our software platform Minerplus which may lead to future business opportunities, and improve the operational efficiency by serving professional customers.
We believe that hosting services will enable us to maximize assets utilization with minimal capital expenditure for our growing mining datacenter capacity, maximize overall scale of hash rate supported by our software platform Minerplus which may lead to future business opportunities, and improve the operational efficiency by serving professional customers.
With our hash rate slicing and hash rate scheduling technologies, we are able to maintain a less than 1% fluctuation for 98% of our hash rate contracts as of March 31, 2023, and provide our customers 100% continuous online computing power for series of cryptocurrencies, including Bitcoin, Filecoin, Litecoin, Nervos CKB, Zcash, etc., subject to stable electricity supply.
With our hash rate slicing and hash rate scheduling technologies, we are able to maintain a less than 1% fluctuation for 99% of our hash rate contracts as of December 31, 2023, and provide our customers 100% continuous online computing power for series of cryptocurrencies, including Bitcoin, Filecoin, Litecoin, Nervos CKB, Zcash, etc., subject to stable electricity supply.
Our ability to generate a minimum hash rate unit of 1TH/s enables us to adjust hash rate allocation accurately and dynamically, and optimize operating metrics automatically in order to minimize fluctuations in terms of quantum in hash rate supply under Cloud Hash Rate . ● Hash rate scheduling.
Our ability to generate a minimum hash rate unit of 1TH/s enables us to adjust hash rate allocation accurately and dynamically, and optimize operating metrics automatically in order to minimize fluctuations in terms of quantum in hash rate supply under Cloud Hash Rate. 72 Table of Contents • Hash rate scheduling.
To date, we primarily operate three business lines — “proprietary mining,” “hash rate sharing” and “hosting.” Proprietary mining refers to cryptocurrency mining for our own account, which allows us to directly capture the high appreciation potential of cryptocurrency. We offer two types of hash rate sharing solutions, Cloud Hash Rate and Hash Rate Marketplace .
To date, we primarily operate three business lines - “self-mining,” “hash rate sharing” and “hosting.” Self-mining refers to cryptocurrency mining for our own account, which allows us to directly capture the high appreciation potential of cryptocurrency. We offer two types of hash rate sharing solutions, Cloud Hash Rate and Hash Rate Marketplace.
Revenue generated from Hash Rate Marketplace was immaterial prior to December 31, 2022. 61 Table of Contents Hosting We offer three types of hosting services, Cloud Hosting , General Hosting and Membership Hosting , to meet customers’ diverse demands for professional hosting solutions and lower the prohibitive upfront investment costs associated with mining datacenter construction, deployment and operation. ● Cloud Hosting .
Revenue generated from Hash Rate Marketplace was immaterial prior to December 31, 2023. Hosting We offer three types of hosting services, Cloud Hosting, General Hosting and Membership Hosting, to meet customers’ diverse demands for professional hosting solutions and lower the prohibitive upfront investment costs associated with mining datacenter construction, deployment and operation. • Cloud Hosting .
Through Cloud Hash Rate , customers enter into hash rate contracts with us to subscribe to the hash rate derived from our proprietary mining machines, saving themselves from purchasing, installing or hosting mining machines.
Through Cloud Hash Rate, customers enter into hash rate contracts with us to subscribe to the hash rate derived from our self-owned mining machines, saving themselves from purchasing, installing or hosting mining machines.
The ratio of our carbon-free power supply reached approximately 62% as of March 31, 2023, and is expected to be remain at around 59% upon completing the construction of all mining datacenters “in the pipeline”.
The ratio of our carbon-free power supply reached approximately 62% as of December 31, 2023, and is expected to be remain at around 69% upon completing the construction of all mining datacenters “in the pipeline”.
Our Business Lines and Software Infrastructure To date, we primarily operate three business lines — “proprietary mining,” “hash rate sharing” and “hosting,” all of which are supported by Minerplus , our self-developed integrated intelligent software platform, to enhance operational efficiency. 60 Table of Contents Proprietary mining We mine cryptocurrencies, primarily Bitcoins, for our own account.
Our Business Lines and Software Infrastructure To date, we primarily operate three business lines - “self-mining,” “hash rate sharing” and “hosting,” all of which are supported by Minerplus , our self-developed integrated intelligent software platform, to enhance operational efficiency. Self-mining We mine cryptocurrencies, primarily Bitcoins, for our own account.
If we need to add new facilities or expand existing facilities as we add employees, we believe that suitable additional space will be available to accommodate any such expansion of our operations. For our proprietary mining datacenters, see the section entitled “Item 4. Information on the Company –– B. Business Overview––Our Proprietary Mining Datacenters.” ITEM 4A. UNRESOLVED STAFF COMMENTS None.
If we need to add new facilities or expand existing facilities as we add employees, we believe that suitable additional space will be available to accommodate any such expansion of our operations. For our mining datacenters, see the section entitled “Item 4. Information on the Company -- B. Business Overview--Our Mining Datacenters.”
This unique model also allows us to smooth the impact of cryptocurrency price volatility as our proceeds from hash rate sales are less directly related to cryptocurrency price compared to proprietary mining. Ample power supply and low electricity cost secured by global mining datacenters We strategically opened five mining datacenters in the United States and Norway.
This unique model also allows us to smooth the impact of cryptocurrency price volatility as our proceeds from hash rate sales are less directly related to cryptocurrency price compared to self-mining. Ample power supply and low electricity cost secured by global mining datacenters 60 Table of Contents We strategically opened six mining datacenters in the United States, Norway and Bhutan.
Recent industry-wide developments, including the continued industry-wide fallout from the recent Chapter 11 bankruptcy filings of cryptocurrency exchange FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi, are beyond our control.
Industry-wide developments such as the industry-wide fallout from the Chapter 11 bankruptcy filings of cryptocurrency exchange FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi throughout calendar year 2022 are beyond our control.
Proprietary mining allows us to capture the high appreciation potential of cryptocurrency to support our future expansion and operation. For the years ended December 31, 2020, 2021 and 2022, respectively, we generated US$88.5 million, US$191.7 million and US$62.4 million in revenue from proprietary mining.
Self-mining allows us to capture the high appreciation potential of cryptocurrency to support our future expansion and operation. For the years ended December 31, 2021, 2022 and 2023, respectively, we generated US$191.7 million, US$62.4 million and US$111.7 million in revenue from self-mining.
A prevailing strategy to profit from proprietary hash rate is mining. The cryptocurrencies mined can be sold at a profit when their market value is high enough to cover the cost of mining machines, electricity fees and other mining-related expenses.
The cryptocurrencies mined can be sold at a profit when their market value is high enough to cover the cost of mining machines, electricity fees and other mining-related expenses.
Our mining datacenter in Rockdale, Texas became operational in February 2019 and had 563MW electricity capacity in use and 179MW electricity capacity under construction as of March 31, 2023. · Norway Mining Datacenters.
Our mining datacenter in Rockdale, Texas became operational in February 2019 and had 563MW electricity capacity in use and 179MW electricity capacity under construction as of February 29, 2024. • Norway Mining Datacenters.
Agreements Related to Our Proprietary Mining Datacenters Lease Agreement for the Mining Datacenter in Rockdale, Texas On June 6, 2018, Dory Creek, LLC, our subsidiary (formerly as Bitmain Inc.’s subsidiary), entered into the Lease Agreement with Alcoa USA Corp.
Agreements Related to Our Mining Datacenters Lease Agreement for the Mining Datacenter in Rockdale, Texas 69 Table of Contents In June 2018, Dory Creek, LLC, our subsidiary (formerly as Bitmain Inc.’s subsidiary), entered into the Lease Agreement with Alcoa USA Corp.
We have also spent considerable efforts in minimizing the impact on the local environment. For example, instead of building new plants from the ground, we renovated abandoned or deserted plants on sites when constructing our mining datacenters in Tennessee and Texas.
We have also spent considerable efforts in minimizing the impact on the local environment. For example, instead of building new plants from the ground, we renovated abandoned or deserted plants on sites when constructing our mining datacenters in Tennessee and Texas. See the section entitled “- Energy” above for more details.
Some of our competitors may also have stronger brand names, greater access to capital, longer histories, longer relationships with their suppliers or customers and more resources than we do. Furthermore, these competitors may be able to adapt to changes in the industry more promptly and efficiently. As such, we expect that competition in our markets will continue to be intense.
Some of our competitors may also have stronger brand names, greater access to capital, longer histories, longer relationships with their suppliers or customers and more resources than we do. Furthermore, these competitors may be able to adapt to changes in the industry more promptly and efficiently.
Business Overview The following discussion reflects the business of Bitdeer. Unless the context otherwise requires, all references in this section to the “Company,” “we,” “us,” “our” or “Bitdeer” refer collectively to Bitdeer Technologies Holding Company and its subsidiaries. Overview We are a world-leading technology company for the cryptocurrency mining community.
Business Overview The following discussion reflects the business of Bitdeer. Unless the context otherwise requires, all references in this section to the “Company,” “we,” “us,” “our” or “Bitdeer” refer collectively to Bitdeer Technologies Holding Company and its subsidiaries. 58 Table of Contents Overview We are a world-leading technology company for blockchain and high-performance computing.
We also provide standalone Minerplus service to third-party mining datacenters. 63 Table of Contents Measures to prevent unauthorized or impermissible customer access We have established anti-money laundering (“AML”) processes, know your customer (“KYC”) procedures and IP address geo-blocking measures, to prevent unauthorized and impermissible access to our hash rate products by U.S. customers and customers from other jurisdictions where we have identified laws or regulations that restrict the offering of our hash rate products.
Measures to prevent unauthorized or impermissible customer access We have established anti-money laundering (“AML”) processes, know your customer (“KYC”) procedures and IP address geo-blocking measures, to prevent unauthorized and impermissible access to our hash rate products by U.S. customers and customers from other jurisdictions where we have identified laws or regulations that restrict the offering of our hash rate products.
World’s leading scale of proprietary hash rate As of March 31, 2023, our proprietary hash rate operated in our global mining datacenters reached 5.7 EH/s. Our proprietary hash rate provides us with a clear edge across our business lines and anchors our unique business model. High proprietary hash rate increases our chance of success in obtaining cryptocurrency rewards.
World’s leading scale of proprietary hash rate As of February 29, 2024, our proprietary hash rate operated in our global mining datacenters reached 8.4 EH/s. Our proprietary hash rate provides us with a clear edge across our business lines and anchors our unique business model. High proprietary hash rate increases our chance of success in obtaining cryptocurrency rewards.
The remaining mining yield were generated from Zcash, Ethereum, Dogecoin, Litecoin and other cryptocurrencies that are less mainstream, as illustrated below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2020 ​ 2021 ​ 2022 ​ US$ % US$ % US$ % ​ ​ (in thousands, except for percentages) BTC 85,355 96.5 185,656 96.9 59,845 96.1 ZEC 1,419 1.6 3,220 1.7 902 1.4 ETH 781 0.9 14 0.0 8 0.0 LTC 252 0.3 597 0.3 248 0.4 BCH 204 0.2 180 0.1 22 0.0 CKB 177 0.2 272 0.1 41 0.1 DCR 153 0.2 54 0.0 106 0.2 ETC 138 0.1 — — 4 0.0 DASH 14 0.0 — — — — DOGE — — 1,239 0.6 590 0.9 XCH — — 165 0.1 73 0.1 HNS — — 137 0.1 47 0.1 FIL — — 129 0.1 458 0.7 SC — — 30 0.0 — — NMC — — — — 11 0.0 ELA — — — — 4 0.0 Total 88,493 100.0 191,693 100.0 62,359 100.0 ​ 84.5%, 93.4% and 95.7% of our Cloud Hash Rate revenue for the years ended December 31, 2020, 2021 and 2022 respectively were generated from hash rate plans subscribed for Bitcoin mining.
The remaining mining yield were generated from Zcash, Ethereum, Dogecoin, Litecoin and other cryptocurrencies that are less mainstream, as illustrated below: For the Year Ended December 31, 2023 2022 2021 US$ % US$ % US$ % (in thousands, except for percentages) BTC 110,386 98.8 59,845 96.1 185,656 96.9 ZEC 454 0.4 902 1.4 3,220 1.7 DOGE 371 0.4 590 0.9 1,239 0.6 LTC 194 0.2 248 0.4 597 0.3 FIL 183 0.2 458 0.7 129 0.1 XCH 37 0.0 73 0.1 165 0.1 DCR 13 0.0 106 0.2 54 0.0 ETC 9 0.0 4 0.0 - - BCH 9 0.0 22 0.0 180 0.1 CKB 9 0.0 41 0.1 272 0.1 QUBIC 6 0.0 - - - - HNS 5 0.0 47 0.1 137 0.1 ELA 4 0.0 4 0.0 - - NMC 2 0.0 11 0.0 - - SC 1 0.0 - - 30 0.0 ETH - - 8 0.0 14 0.0 Total 111,683 100.0 62,359 100.0 191,693 100.0 93.4%, 95.7% and 99.1% of our Cloud Hash Rate revenue for the years ended December 31, 2021, 2022 and 2023 respectively were generated from hash rate plans subscribed for Bitcoin mining.
The table below shows the type and amount of digital assets held as of the end of each year: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2020 ​ 2021 ​ 2022 ​ US$ % US$ % US$ % ​ ​ (in thousands, except for percentages) BTC 6,536 68.2 692 11.2 208 9.6 ETH 452 4.7 13 0.2 5 0.2 USDT 1,414 14.8 3,904 63.1 162 7.4 BCH 247 2.6 4 0.1 2 0.1 LTC 292 3.0 5 0.1 8 0.4 BSV 194 2.0 137 2.2 — — ZEC 337 3.5 11 0.2 1 0.0 DASH 26 0.3 0* 0.0 0* 0.0 DCR 1 0.0 2 0.0 0* 0.0 DOGE 10 0.1 1 0.0 6 0.4 ETC 7 0.1 0* 0.0 0* 0.0 ETN 0* 0.0 0* 0.0 — 0.0 USDC 55 0.6 99 1.6 89 4.1 BCHA — — 25 0.4 — — CKB 9 0.1 0* 0.0 0* 0.0 BTM 2 0.0 — — — — FIL — — 1,257 20.3 1,692 77.8 XCH — — 37 0.6 1 0.0 ELA — — — — 1 0.0 NMC — — — — 0* 0.0 SC — — — — 0* 0.0 Total 9,582 100.0 6,187 100.0 2,175 100.0 * Less than US$500 but not nil ​ We generally use service provided by Matrix Finance and Technologies Holding Group and its subsidiaries (“Matrixport Group”) for cryptocurrencies custody purpose.
The table below shows the type and amount of digital assets held as of the end of each year: 65 Table of Contents As of December 31, 2023 2022 2021 US$ % US$ % US$ % (in thousands, except for percentages) BTC 6,729 43.8 208 9.6 692 11.2 ETH 3,992 26.0 5 0.2 13 0.2 USDT 3,733 24.3 162 7.4 3,904 63.1 FIL 844 5.5 1,692 77.8 1,257 20.3 USDC 34 0.2 89 4.1 99 1.6 LMR 13 0.1 - - - - LTC 8 0.1 8 0.4 5 0.1 BCH 7 0.0 2 0.1 4 0.1 DOGE 5 0.0 6 0.4 1 0.0 ZEC 3 0.0 1 0.0 11 0.2 ELA 3 0.0 1 0.0 - - DASH 0 * 0.0 0 * 0.0 0 * 0.0 DCR 0 * 0.0 0 * 0.0 2 0.0 ETC 0 * 0.0 0 * 0.0 0 * 0.0 ETN - - - - 0 * 0.0 BCHA 0 * 0.0 - - 25 0.4 CKB 0 * 0.0 0 * 0.0 0 * 0.0 XCH 0 * 0.0 1 0.0 37 0.6 NMC 0 * 0.0 0 * 0.0 - - BSV - - - - 137 2.2 SC - - 0 * 0.0 - - Total 15,371 100.0 2,175 100.0 6,187 100.0 * Less than US$500 but not nil We generally use service provided by Matrix Finance and Technologies Holding Group and its subsidiaries (“Matrixport Group”) for cryptocurrencies custody purpose.
We generated revenue of US$2.9 million, US$7.6 million and US$12.7 million for the year ended December 31, 2020, 2021 and 2022, respectively, from Cloud Hosting . We did not generate any revenue from mining profit sharing from plans under Cloud Hosting ’s “accelerated payback mode” for the years ended December 31, 2021 and 2022. ● General Hosting.
We generated revenue of US$7.6 million, US$12.7 million and US$3.2 million for the years ended December 31, 2021, 2022 and 2023, respectively, from Cloud Hosting. We did not generate any revenue from mining profit sharing from plans under Cloud Hosting’s “accelerated payback mode” for the years ended December 31, 2021, 2022 and 2023. 62 Table of Contents • General Hosting.
We incurred adjusted loss of US$55.8 million for the year ended December 31, 2020, and incurred adjusted profits of US$171.0 million and US$30.3 million for the year ended December 31, 2021 and 2022, respectively, where adjusted profit/(loss) is defined as profit/(loss) adjusted to exclude share-based payment expenses. The crypto asset market, especially the price of Bitcoin, has been highly volatile.
We incurred adjusted profits of US$171.0 million, US$30.3 million and US$22.0 million for the years ended December 31, 2021, 2022 and 2023, respectively, where adjusted profit/(loss) is defined as profit/(loss) adjusted to exclude the listing fee and share-based payment expenses under IFRS 2. The crypto asset market, especially the price of Bitcoin, has been highly volatile.
We incurred approximately US$0.3 million and US$0.4 million service fees, respectively, including primarily custody fees, to Matrixport Group for the years ended December 31, 2021 and 2022, while the service fees we paid to Matrixport Group for the year ended December 31, 2020 were immaterial.
We incurred approximately US$0.3 million, US$0.4 million and US$0.2 million service fees, respectively, including primarily custody fees, to Matrixport Group for the years ended December 31, 2021, 2022 and 2023.
Presently, we do not believe any U.S. or State regulatory body has taken any action or position adverse to our main cryptocurrency, Bitcoin, with respect to its production, sale, and use as a medium of exchange; however, future changes to existing regulations or entirely new regulations may affect our business in ways it is not presently possible for us to predict with any reasonable degree of reliability.
Presently, we do not believe any U.S. or State regulatory body has taken any action or position adverse to our main cryptocurrency, Bitcoin, with respect to its production, sale, and use as a medium of exchange; however, future changes to existing regulations or entirely new regulations may affect our business in ways it is not presently possible for us to predict with any reasonable degree of reliability. 74 Table of Contents As the regulatory and legal environment evolves, we may become subject to new laws, such as further regulation by the SEC and other agencies, which may affect our mining and other activities.
Our Proprietary Mining Datacenters We have built and currently operate three proprietary mining datacenters in the United States and two in Norway with an aggregate electricity capacity of 795MW in use as of March 31, 2023. We have initiated the expansion of our existing mining datacenters and expect to achieve access to a total electricity capacity of 1,524MW thereafter.
Our Mining Datacenters We have built and currently operate three mining datacenters in the United States, two in Norway and one in Bhutan with an aggregate electricity capacity of 895MW in use as of February 29, 2024. We have initiated the expansion of our existing mining datacenters and expect to achieve access to a total electricity capacity of 1,970MW thereafter.
As of March 31, 2023, our mining datacenters had a power supply of 795MW. We plan to expand our footprints across the globe to increase our total electricity capacity to approximately 1,524MW, including 179MW power supply under construction and 550MW power supply “in the pipeline,” contracted or negotiated but not yet under active construction.
As of February 29, 2024, our mining datacenters had a power supply of 895MW. We plan to expand our footprints across the globe to increase our total electricity capacity to approximately 1,970MW, including 575MW power supply under construction and 500MW power supply “in the pipeline,” contracted or negotiated but not yet under active construction, as of February 29, 2024.
The term of the Molde Lease Agreement is from December 1, 2019 to December 31, 2029, renewable within the term. 69 Table of Contents Land Lease Agreement for the Tydal Mining Datacenter in Tydal Municipality, Norway On April 8, 2021, we entered into the Land Lease Agreement with Tydal Datacenter AS through Norway Hash Technologies AS, our subsidiary (the “Tydal Lease Agreement”), pursuant to which we lease land located at Kirkvollen Industriområde, 7590 Tydal, Norway to support our Tydal mining datacenter.
Land Lease Agreement for the Tydal Mining Datacenter in Tydal Municipality, Norway 70 Table of Contents In April 2021, we entered into the Land Lease Agreement with Tydal Datacenter AS through Norway Hash Technologies AS, our subsidiary (the “Tydal Lease Agreement”), pursuant to which we lease land located at Kirkvollen Industriområde, 7590 Tydal, Norway to support our Tydal mining datacenter.
The land lease for the corresponding expansion will be invoiced upon the relevant mining datacenter expansions are finished and delivered to us, the expansion passes the inspection before power-on and the power grid company completes the corresponding 132-22kV transformer upgrade.
The land lease for the corresponding expansion will be invoiced upon the relevant mining datacenter expansions are finished and delivered to us, the expansion passes the inspection before power-on and the power grid company completes the corresponding 132-22kV transformer upgrade. The term of the Molde Lease Agreement is from December 1, 2019 to December 31, 2029, renewable within the term.
We generated revenue of US$78.3 million, US$124.2 million and US$121.3 million for the year ended December 31, 2020, 2021 and 2022, respectively, from Cloud Hash Rate . ● Hash Rate Marketplace .
We generated revenue of US$124.2 million, US$121.3 million and US$67.9 million for the years ended December 31, 2021, 2022 and 2023, respectively, from Cloud Hash Rate. 61 Table of Contents • Hash Rate Marketplace .
To be more specific, it is calculated by dividing (x) the sum of ratio of carbon-free power supply multiple by electricity capacity at each of our datacenters, by (y) the total electricity capacity contributed by all our datacenters. ​ 70 Table of Contents According to the latest available statistics regarding energy structure of power supply from respective local authorities or suppliers as of March 31, 2023, (i) the power supply in our mining datacenter in Pangborn, Washington was 100% carbon-free, almost entirely supported by hydroelectric resources, (ii) the power supply in our mining datacenters in Molde and Tydal, Norway was 100% carbon-free, primarily supported by wind and hydroelectric resources, (iii) the power supply in our mining datacenter in Rockdale, Texas was approximately 52% carbon-free, supported by clean energy resources such as wind, nuclear, solar and hydroelectric, as well as traditional energy resources such as gas and coal, and (iv) the power supply in our mining datacenter in Knoxville, Tennessee was approximately 60% carbon-free, supported by clean energy resources, such as unclear, hydroelectric and solar, as well as traditional energy resources such as clean- burning natural gas units.
According to the latest available statistics regarding energy structure of power supply from respective local authorities or suppliers as of December 31, 2023, (i) the power supply in our mining datacenter in Pangborn, Washington was 100% carbon-free, almost entirely supported by hydroelectric resources, (ii) the power supply in our mining datacenters in Molde and Tydal, Norway was 100% carbon-free, primarily supported by wind and hydroelectric resources, (iii) the power supply in our mining datacenter in Rockdale, Texas was approximately 46% carbon-free, supported by clean energy resources such as wind, nuclear, solar and hydroelectric, as well as traditional energy resources such as gas and coal, (iv) the power supply in our mining datacenter in Knoxville, Tennessee was approximately 60% carbon-free, supported by clean energy resources, such as unclear, hydroelectric and solar, as well as traditional energy resources such as clean- burning natural gas units, and (v) the power supply in our mining datacenter in Gedu, Bhutan was 100% carbon-free, almost entirely supported by hydroelectric resources.
We are also exploring other sites for constructions of our mining datacenters with an initial focus on North America, Northern Europe, Central Asia and Southeast Asia.
We expect to generate 500MW power supply “in the pipeline” from Bhutan. We are also exploring other sites for constructions of our mining datacenters with an initial focus on North America, Northern Europe, Central Asia and Southeast Asia.
United States of America 100% Brock Creek LLC United States of America 100% ​ * Other subsidiaries of the Company, including BSGA, have been omitted because, in the aggregate, they would not be a “significant subsidiary” as defined in rule 1-02(w) of Regulation S-X as of the completion of the Business Combination. D.
Singapore 100% * Other subsidiaries of the Company, including BSGA, have been omitted because, in the aggregate, they would not be a “significant subsidiary” as defined in rule 1-02(w) of Regulation S-X as of the date of this annual report. D.
It is possible that a change in the governing administration or the appointment of new SEC commissioners could substantially impact the views of the SEC and its staff. 66 Table of Contents Thus, a particular digital asset’s status as a “security” in any relevant jurisdiction is subject to a high degree of uncertainty and if a regulator disagrees with our characterization of a digital asset, we may be subject to regulatory scrutiny, investigations, fines, and other penalties, which may adversely affect our business, operating results and financial condition.
Thus, a particular digital asset’s status as a “security” in any relevant jurisdiction is subject to a high degree of uncertainty and if a regulator disagrees with our characterization of a digital asset, we may be subject to regulatory scrutiny, investigations, fines, and other penalties, which may adversely affect our business, operating results and financial condition.
In addition to proprietary hash rate, we also generate hosting hash rate, the other category of our total managing hash rate, from mining machines that are hosted in our mining datacenters. Together with the 12.6 EH/s hosting hash rate, we managed a total of 18.3 EH/s hash rate as of March 31, 2023.
In addition to proprietary hash rate, we also generate hosting hash rate, the other category of our total hash rate under management, from mining machines that are hosted in our mining datacenters. Together with the 13.6 EH/s hosting hash rate, we managed a total of 22.0 EH/s hash rate as of February 29, 2024.
We are open to more options to generate additional income by leveraging our cryptocurrencies and fiat currencies in the future; however, we prioritize our operating activities in terms of cash usage and will ensure that our cash, short-term investment and anticipated proceeds from disposal of cryptocurrencies in connection with our principal business will be sufficient to meet our current and anticipated working capital requirements and capital expenditures for at least the next 18 months from the date of this annual report.
In light of recent concerns over the lack of regulations with regards to digital asset based products in general, we do not anticipate entering into any digital asset based lending or wealth management products with Matrixport Group or otherwise in the foreseeable future. 66 Table of Contents We are open to more options to generate additional income by leveraging our cryptocurrencies and fiat currencies in the future; however, we prioritize our operating activities in terms of cash usage and will ensure that our cash, short-term investment and anticipated proceeds from disposal of cryptocurrencies in connection with our principal business will be sufficient to meet our current and anticipated working capital requirements and capital expenditures for at least the next 18 months from the date of this annual report.
See the section entitled “— Energy” above for more details. 71 Table of Contents Competition For our proprietary mining business, we compete with mining operations throughout the world. We compete to solve new blocks on the basis of our total number of mining machines, the degree of mining difficulty and the efficiency of our mining.
Competition For our self-mining business, we compete with mining operations throughout the world. We compete to solve new blocks on the basis of our total number of mining machines, the degree of mining difficulty and the efficiency of our mining.
Our mining datacenter in Knoxville, Tennessee became operational in May 2020 and had 86MW electricity capacity in use as of March 31, 2023. · Washington Mining Datacenter.
Our mining datacenter in Knoxville, Tennessee became operational in May 2020 and had 86MW electricity capacity in use as of February 29, 2024. • Washington Mining Datacenter. Our mining datacenter in Pangborn, Washington became operational in May 2018 and had 13MW electricity capacity in use as of February 29, 2024. • Bhutan Mining Datacenter.
Our mining datacenter in Pangborn, Washington became operational in May 2018 and had 13MW electricity capacity in use as of March 31, 2023. 68 Table of Contents We have accumulated knowledge and expertise in the global landscape of electric power supply, which enables us to select prime locations to construct mining datacenters.
Our mining datacenter in Gedu, Bhutan became operational in the third quarter of 2023 and had 100MW electricity capacity in use as of February 29, 2024. We have accumulated knowledge and expertise in the global landscape of electric power supply, which enables us to select prime locations to construct mining datacenters.
Our ability to secure ample power supply with low electricity cost is underpinned by our top-notch experience and capabilities in global mining datacenters deployment and operation. We pioneer in deploying and operating mining datacenters globally.
Our premier mining datacenters allowed us to reach an average electricity cost of our mining datacenters to US$38/MWh for the year ended December 31, 2023. Our ability to secure ample power supply with low electricity cost is underpinned by our top-notch experience and capabilities in global mining datacenters deployment and operation. We pioneer in deploying and operating mining datacenters globally.
We generally do not hold cryptocurrencies obtained through business operation, including mining and otherwise, and promptly convert them into fiat currency. The cryptocurrencies held by us as of December 31, 2020, 2021 and 2022 were US$9.6 million, US$6.2 million and US$2.2 million, respectively and accounted for 5.2%, 1.6% and 0.7% of our total revenue in the corresponding periods.
We generally do not hold cryptocurrencies obtained through business operation, including mining and otherwise, and promptly convert them into fiat currency prior to December 31, 2023. The cryptocurrencies held by us as of December 31, 2021, 2022 and 2023 were US$6.2 million, US$2.2 million and US$ 15.4 million, respectively.
The locations of our mining datacenters in use, under construction and “in the pipeline,” as of March 31, 2023, are illustrated in the diagram below. ​ (1) As of March 31, 2023, 179MW capacity under construction to be completed (2) As of March 31, 2023 (3) “In the pipeline” includes 550MW power supply contracted or negotiated but not yet under active construction · Texas Mining Datacenter.
The locations of our mining datacenters in use, under construction and “in the pipeline,” as of February 29, 2024, are illustrated in the diagram below. 68 Table of Contents (1) “In the pipeline” includes 500MW power supply contracted or negotiated but not yet under active construction • Texas Mining Datacenter.
Minerplus enables intelligent management of our proprietary mining business and enhances product and service quality of Cloud Hash Rate and our hosting services.
Minerplus enables intelligent management of our self-mining business and enhances product and service quality of Cloud Hash Rate and our hosting services. We also provide standalone Minerplus service to third-party mining datacenters.
As of March 31, 2023, we operated five proprietary mining datacenters in the United States and Norway to support our proprietary and hosting hash rate. ​ 59 Table of Contents Unique business model powers organic hash rate expansion by generating instant and continuous cash We have established a business model that allows us to constantly reinforce our market-leading position and outpace our competitors in terms of scaling up our proprietary hash rate.
Unique business model powers organic hash rate expansion by generating instant and continuous cash We have established a business model that allows us to constantly reinforce our market-leading position and outpace our competitors in terms of scaling up our proprietary hash rate. A prevailing strategy to profit from proprietary hash rate is mining.
Hosting service Sources of mining machines Target customers Fees Cloud Hosting ​ Mining machines from our existing mining fleets ​ Retail miners ​ – Upfront payment for subscription of computing power from our mining machines ​ ​ ​ ​ ​ ​ ​ – Maintenance fees throughout the service process ​ General Hosting ​ Mining machines from target customers ​ Professional miners ​ – Monthly payment for hosting service based on actual consumption of our mining datacenter resources, such as electricity ​ Membership Hosting ​ Mining machines from target customers ​ Large-scale miners ​ – Upfront payment to secure our capacity ​ ​ ​ ​ ​ ​ ​ – Monthly payment for management service based on the actual consumption of our mining datacenter resources, such as electricity, after the delivery of capacity. ​ ​ In the near future, we expect to focus on further expanding General Hosting and Membership Hosting by allocating a greater portion of our growing mining datacenter capacity.
The major differences among Cloud Hosting, General Hosting and Membership Hosting are the sources of mining machines, the target customers and the customers’ payment of hosting fees, as summarized below. 63 Table of Contents Hosting service Sources of mining machines Target customers Fees Cloud Hosting Mining machines from our existing mining fleets Retail miners - Upfront payment for subscription of computing power from our mining machines - Maintenance fees throughout the service process General Hosting Mining machines from target customers Professional miners - Monthly payment for hosting service based on actual consumption of our mining datacenter resources, such as electricity - Additional variable consideration based on the customers’ mining yield Membership Hosting Mining machines from target customers Large-scale miners - Upfront payment to secure our capacity - Monthly payment for management service based on the actual consumption of our mining datacenter resources, such as electricity, after the delivery of capacity.
In February 2021, we established Blockchain Alliance Technologies Holding Company (“Blockchain Alliance”) to separate the BTC.com Pool Business following a corporate reorganization of our group.
In February 2021, we established Blockchain Alliance Technologies Holding Company (“Blockchain Alliance”) to separate the BTC.com Pool Business following a corporate reorganization of our group. The separation was consummated on April 15, 2021, when we distributed by way of dividend in kind the shares of Blockchain Alliance to the then existing shareholders of our group.
Together with the 12.6 EH/s hosting hash rate generated from mining machines hosted in our mining datacenters, we possessed a total of 18.3 EH/s of managing hash rate as of March 31, 2023.
Together with the 13.6 EH/s hosting hash rate generated from mining machines hosted in our mining datacenters, we possessed a total of 22.0 EH/s of hash rate under management as of February 29, 2024.
Our mining datacenters in Fræna municipality (Molde mining datacenter) and Tydal municipality (Tydal mining datacenter), Norway became operational in December 2019 and had 134MW electricity capacity in use as of March 31, 2023. We plan to add additional 175MW of electricity capacity from the expansion of facilities of the mining datacenter in Tydal, Norway. · Tennessee Mining Datacenter.
Our mining datacenters in Fræna municipality (Molde mining datacenter) and Tydal municipality (Tydal mining datacenter), Norway became operational in December 2019 and had 134MW electricity capacity in use as of February 29, 2024. • Tennessee Mining Datacenter.
LLC United States of America 100% Ant Creek, LLC United States of America 100% Dory Creek, LLC United States of America 100% Z Engineers, LLC United States of America 100% Bitdeer Sales (USA) Inc.
LLC United States of America 100% Ant Creek, LLC United States of America 100% Dory Creek, LLC United States of America 100% Z Engineers, LLC United States of America 100% Bitdeer Sales (USA) Inc. United States of America 100% Asia Freeport Holdings Pte. Ltd. Singapore 100% Le Freeport Real Estate Pte. Ltd. Singapore 100% Le Freeport Management Pte. Ltd.
The following diagram depicts a simplified organizational structure of the Company as of the date hereof. These subsidiaries are also set forth in Exhibit 8.1 to this annual report. ​ ​ ​ ​ ​ ​ ​ % of Ownership Interest Held by Name* Jurisdiction Bitdeer Technologies Group Bitdeer Technologies Holding Company Cayman Islands 100% STRAITDEER PTE. LTD.
These subsidiaries are also set forth in Exhibit 8.1 to this annual report. % of Ownership Interest Held by Name* Jurisdiction Bitdeer Technologies Group Bitdeer Technologies Holding Company Cayman Islands 100% STRAITDEER PTE. LTD. Singapore 100% Sharpening Technology Limited British Virgin Islands 100% Bitdeer Technologies Limited Hong Kong 100% Bitdeer Netherlands B.V.
Singapore 100% Sharpening Technology Limited British Virgin Islands 100% Bitdeer Technologies Limited Hong Kong 100% Bitdeer Netherlands B.V. Netherlands 100% Bitdeer Norway AS Norway 100% Norway Hash Technologies AS Norway 100% Bitdeer Inc. United States of America 100% Bitdeer Equipment (Canada) Inc. Canada 100% Carpenter Creek.
Netherlands 100% Bitdeer Norway AS Norway 100% Norway Hash Technologies AS Norway 100% Bitdeer Inc. United States of America 100% Bitdeer Equipment (Canada) Inc. Canada 100% Carpenter Creek.
We incurred net loss of US$55.8 million for the year ended December 31, 2020, generated net profit of US$82.6 million for the year ended December 31, 2021, and incurred net loss of US$60.4 million for the year ended December 31, 2022.
For the years ended December 31, 2021, 2022 and 2023, our total net revenue was US$394.7 million, US$333.3 million and US$368.6 million, respectively. We generated net profit of US$82.6 million for the year ended December 31, 2021, and incurred net loss of US$60.4 million and US$56.7 million for the years ended December 31, 2022 and 2023.
However, we believe that, as compared to many other participants in the crypto assets markets, we are more resilient to cryptocurrency price volatility as our “hash rate sharing” and “hosting” businesses allow us to smooth the impact of cryptocurrency price volatility, as compared to “proprietary mining.” Our Strengths We believe that the following strengths contribute to our success and differentiate us from our competitors.
We are not directly affected by these incidents, as we do not have any counterparty credit exposure to the above-mentioned firms nor expect their potential bankruptcy to have any direct impact on our business or operations. 59 Table of Contents We believe that, as compared to many other participants in the crypto assets markets, we are more resilient to cryptocurrency price volatility as our “hash rate sharing” and “hosting” businesses allow us to smooth the impact of cryptocurrency price volatility, as compared to “self-mining.” Our Strengths We believe that the following strengths contribute to our success and differentiate us from our competitors.
While we intend to enrich our product and service portfolio by providing mining services covering new crypto protocols, including PoS, DPoS, PoST and PoC, we have not determined the type of cryptocurrency to expand our operations. ​ 64 Table of Contents Policies and Procedures Related to Our Cryptocurrencies We obtain cryptocurrencies from proprietary mining and also generally accept cryptocurrencies as payments for services available to customers, such as Cloud Hash Rate , Cloud Hosting , General Hosting and Membership Hosting .
While we intend to enrich our product and service portfolio by providing mining services covering new crypto protocols, including PoS, DPoS, PoST and PoC, we have not determined the type of cryptocurrency to expand our operations.
We generated no revenue prior to December 31, 2020 and revenue of US$18.3 million and US$99.3 million for the year ended December 31, 2021 and 2022, respectively, from General Hosting . ​ 62 Table of Contents ● Membership Hosting.
We generated no revenue prior to December 31, 2021 and revenue of US$26.1 million and US$79.9 million for the years ended December 31, 2022 and 2023, from Membership Hosting.
As a result, we successfully lowered our average energy consumption from 47.3j/T as of December 31, 2020 to 39.2j/T as of December 31, 2021, to 36.5j/T as of December 31, 2022 and further to 34.5j/T as of March 31, 2023.
We constantly monitor the operation of our mining machines and replace old mining machines models with new ones periodically to optimize energy efficiency. As a result, we successfully lowered our average energy consumption from 39.2j/T as of December 31, 2021 to 36.5j/T as of December 31, 2022 and further to 31.7j/T as of December 31, 2023.
Box 472, Harbour Place, 2nd Floor, 103 South Church Street, George Town, Grand Cayman KY1-1106, Cayman Islands, and our principal executive office is 08 Kallang Avenue, Aperia tower 1, #09-03/04, Singapore 339509. Our principal website address is https://www.bitdeer.com.
Our registered office is Ogier Global (Cayman) Limited, 89 Nexus Way, Camana Bay, Grand Cayman, KY1-9009, Cayman Islands, and our principal executive office is 08 Kallang Avenue, Aperia tower 1, #09-03/04, Singapore 339509. Our principal website address is https://www.bitdeer.com.
As a market player who is able to obtain a hash rate unit of 1TH/s through our hash rate slicing technology, we have been successfully maintaining a less than 1% fluctuation for 98% of our hash rate sales contracts as of March 31, 2023. ​ 58 Table of Contents As of March 31, 2023, we generated 5.7 EH/s proprietary hash rate from our proprietary mining machines and operated mining datacenters with an aggregate electricity capacity of 795MW.
We stay at the forefront of technology development. As a market player who is able to obtain a hash rate unit of 1TH/s through our hash rate slicing technology, we have been successfully maintaining a less than 1% fluctuation for 99% of our hash rate sales contracts as of December 31, 2023.
Our adjusted EBITDA increased by 479.2% from US$48.7 million for the year ended December 31, 2020 to US$281.8 million for the year ended December 31, 2021. For the year ended December 31, 2022, our adjusted EBITDA was US$93.2 million.
For the years ended December 31, 2021, 2022 and 2023, our adjusted EBITDA was US$281.8 million, US$93.2 million and US$100.3 million, respectively.
Intellectual Property As of March 31, 2023, we owned eight registered patents, 11 registered copyrights, 151 registered trademarks and 196 registered domain names. We are also in the process of applying for nine registered patents.
As such, we expect that competition in our markets will continue to be intense. 73 Table of Contents Intellectual Property As of December 31, 2023, we owned 13 registered patents, 11 registered copyrights, 252 registered trademarks and 233 registered domain names. We are also in the process of applying for nine registered patents.
We use the land to support the operation of our mining datacenter in Pangborn, Washington. Energy We have built, and will continue to make significant investment in building strong partnerships with local electricity experts and power enterprises.
Energy We have built, and will continue to make significant investment in building strong partnerships with local electricity experts and power enterprises. Through these partnerships, we reached an average electricity cost of our mining datacenters to US$38/MWh for the year ended December 31, 2023.
Additionally, our hash rate sharing business may be deemed as securities offerings in other jurisdictions where it is offered.” Our Cryptocurrencies Cryptocurrencies and Protocols Involved in Our Business 96.5%, 96.9% and 96.1% of our proprietary mining revenue for the years ended December 31, 2020, 2021 and 2022 respectively were generated from Bitcoin mining.
Our Cryptocurrencies Cryptocurrencies and Protocols Involved in Our Business 96.9%, 96.1% and 98.8% of our self-mining revenue for the years ended December 31, 2021, 2022 and 2023 respectively were generated from Bitcoin mining.
Through these partnerships, we reached an average electricity cost of our proprietary mining datacenters to US$50/MWh for the year ended December 31, 2022 and US$36/MWh for the three months ended March 31, 2023. We entered into electric power supply agreements with electricity suppliers to secure low electricity costs for our mining datacenters in Rockdale, Texas and in Norway.
We entered into electric power supply agreements with electricity suppliers to secure low electricity costs for our mining datacenters in Rockdale, Texas and in Norway.
The separation was consummated on April 15, 2021, when we distributed by way of dividend in kind the shares of Blockchain Alliance to the then existing shareholders of our group. ​ 57 Table of Contents In April 2023, the Business Combination was completed, upon which Bitdeer Technologies Group became the ultimate corporate parent of our group, and the Class A Ordinary Shares were listed on the Nasdaq under the symbol “BTDR.” See the section entitled “Explanatory Note” in this annual report for additional information regarding the Company and the Business Combination.
In April 2023, the Business Combination was completed, upon which Bitdeer Technologies Group became the ultimate corporate parent of our group, and the Class A Ordinary Shares were listed on the Nasdaq under the symbol “BTDR.” Certain additional information about us is set forth in “Item 4.B - Business Overview” and is incorporated herein by reference.

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Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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We spend great efforts in making decisions in the Company’s best interest, taking into account Bitcoin price, network hash rate, the amount of cash we need and our view on the market opportunities for acquiring mining machines or expanding mining datacenters at low cost, etc.
We spend great efforts in making decisions in our company’s best interest, taking into account Bitcoin price, network hash rate, the amount of cash we need and our view on the market opportunities for acquiring mining machines or expanding mining datacenters at low cost, etc.
We recorded other net gain of US$2.5 million for the year ended December 31, 2021, which primarily included a net gain of approximately US$4.5 million on settlement of balances with Bitmain, partially offset by a one-off impairment loss of approximately US$2.0 million resulting from a pre-mature investment.
Other Net Gain We recorded other net gain of US$2.5 million for the year ended December 31, 2021, which primarily included a net gain of approximately US$4.5 million on settlement of balances with Bitmain, partially offset by a one-off impairment loss of approximately US$2.0 million resulting from a pre-mature investment.
Net Profit/(Loss) As a result of the foregoing, we incurred a net loss of US$60.4 million for the year ended December 31, 2022 and a net profit of US$82.6 million for the year ended December 31, 2021.
Net Profit/(Loss) As a result of the foregoing, we incurred a net profit of US$82.6 million for the year ended December 31, 2021 and a net loss of US$60.4 million for the year ended December 31, 2022.
The difference between our net loss of US$60.4 million and the net cash used in operating activities was primarily attributable to (i) adjustments for revenues recognized on acceptance of cryptocurrencies of US$305.0 million, (ii) changes in prepayments and other assets of US$21.9 million primarily associated with deposits and prepayments made to suppliers following the expansion of our business during this period, (iii) changes in deferred revenue of US$9.2 million primarily associated with the recognition of revenue, (iv) income tax prepaid of US$20.0 million, and (v) an adjustment for income tax benefit of US$4.4 million, partially offset by (i) an adjustment for share-based payment expenses of US$90.6 million for the issuance of options following the adoption of the Bitdeer’s 2021 Share Incentive Plan in July 2021, and (ii) an adjustment for depreciation and amortization of US$66.4 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period.
The difference between our net loss of US$60.4 million and the net cash used in operating activities was primarily attributable to (i) adjustments for revenues recognized on acceptance of cryptocurrencies of US$305.0 million, (ii) changes in prepayments and other assets of US$21.9 million primarily associated with deposits and prepayments made to suppliers following the expansion of our business during this period, (iii) changes in deferred revenue of US$9.2 million primarily associated with the recognition of revenue, (iv) income tax prepaid of US$20.0 million, and (v) an adjustment for income tax benefit of US$4.4 million, partially offset by (i) an adjustment for share-based payment expenses of US$90.6 million for the issuance of options following the adoption of Bitdeer’s 2021 Share Incentive Plan in July 2021, and (ii) an adjustment for depreciation and amortization of US$66.4 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period.
Investing Activities Net cash generated from investing activities was US$133.8 million for the year ended December 31, 2022, primarily attributable to proceeds from disposal of cryptocurrencies of US$561.0 million, partially offset by (i) purchase of cryptocurrencies of US$286.0 million for investment (lending and purchase of wealth management product) purposes, (ii) purchase of property, plant and equipment and intangible assets of US$63.2 million, (iii) net fiat currency investment cash outflow of US$30.8 million in unlisted debt instruments, redeemable on demand, (iv) investment in unlisted equity instruments of US$29.5 million and (v) cash paid for asset acquisition, net of cash acquired of US$26.7 million.
Net cash generated from investing activities was US$133.8 million for the year ended December 31, 2022, primarily attributable to proceeds from disposal of cryptocurrencies of US$561.0 million, partially offset by (i) purchase of cryptocurrencies of US$286.0 million for investment (lending and purchase of wealth management product) purposes, (ii) purchase of property, plant and equipment and intangible assets of US$63.2 million, (iii) net fiat currency investment cash outflow of US$30.8 million in unlisted debt instruments, redeemable on demand, (iv) investment in unlisted equity instruments of US$29.5 million and (v) cash paid for asset acquisition, net of cash acquired of US$26.7 million.
Financing Activities Net cash used in financing activities was US$3.9 million for the year ended December 31, 2022, which was entirely attributable to capital element of lease rentals paid.
Net cash used in financing activities was US$3.9 million for the year ended December 31, 2022, which was entirely attributable to capital element of lease rentals paid.
However, there are a number of other factors that contribute to changes in Bitcoin price and volatility, including, but not limited to, Bitcoin market sentiment, macroeconomic factors, utility of Bitcoin, and idiosyncratic events such as exchange outages or social media. These factors have contributed to the depreciation of Bitcoin.
There are a number of other factors that contribute to changes in Bitcoin price and volatility, including, but not limited to, Bitcoin market sentiment, macroeconomic factors, utility of Bitcoin, and idiosyncratic events such as exchange outages or social media. These factors have contributed to the depreciation of Bitcoin.
We expect to remain flexible in allocating hash rate between proprietary mining and hash rate sales through Cloud Hash Rate , depending on the market condition. · Revenue generated from sales of mining machines decreased by 98.5% from US$45.7 million for the year ended December 31, 2021 to US$0.7 million for the year ended December 31, 2022, which was mainly attributable to a decrease in the number of mining machines we sold for the year ended December 31, 2022 as we had sold most of our mining machines of older models for the year ended December 31, 2021.
We expect to remain flexible in allocating hash rate between self-mining and hash rate sales through Cloud Hash Rate, depending on the market condition. • Revenue generated from sales of mining machines decreased by 98.5% from US$45.7 million for the year ended December 31, 2021 to US$0.7 million for the year ended December 31, 2022, which was mainly attributable to a decrease in the number of mining machines we sold for the year ended December 31, 2022 as we had sold most of our mining machines of older models for the year ended December 31, 2021.
We include such additional consideration in the transaction price and recognizes revenues when we can reasonably calculate the amount and determine it is probable a significant reversal will not occur. We did not generate any revenue from the additional consideration from Cloud Hosting arrangements offered under the “accelerated payback mode” for the years ended December 31, 2020, 2021 and 2022.
We include such additional consideration in the transaction price and recognizes revenues when we can reasonably calculate the amount and determine it is probable a significant reversal will not occur. We did not generate any revenue from the additional consideration from Cloud Hosting arrangements offered under the “accelerated payback mode” for the years ended December 31, 2021, 2022 and 2023.
Our proprietary mining business breaks even so long as it is economically beneficial for us to continue to operate our mining machines, and that is essentially when the mining machines contribute positive cash flow (i.e., when the variable cost to mine one Bitcoin, namely the electricity cost, equals the market price of a Bitcoin, which we refer to as “shutdown Bitcoin price” for our proprietary mining business).
Our self-mining business breaks even so long as it is economically beneficial for us to continue to operate our mining machines, and that is essentially when the mining machines contribute positive cash flow (i.e., when the variable cost to mine one Bitcoin, namely the electricity cost, equals the market price of a Bitcoin, which we refer to as “shutdown Bitcoin price” for our self-mining business).
Holding Company Structure Bitdeer Technologies Group is a limited liability company incorporated in the Cayman Islands on December 8, 2021 with no material operations of its own. We currently conduct our operations primarily through our subsidiaries. As a result, our ability to pay dividends primarily depends upon dividends paid by our subsidiaries.
Holding Company Structure Bitdeer Technologies Group is an exempted company with limited liability incorporated in the Cayman Islands on December 8, 2021 with no material operations of its own. We currently conduct our operations primarily through our subsidiaries. As a result, our ability to pay dividends primarily depends upon dividends paid by our subsidiaries.
The change was mainly driven by (i) the price drop of Bitcoin, the most significant type of cryptocurrency involved in our business operation and (ii) a decrease in the comparative number of Bitcoin mined from proprietary mining, resulting from a decrease in the amount of hash rate allocated to our proprietary mining business as a percentage of the total network hash rate.
The change was mainly driven by (i) the price drop of Bitcoin, the most significant type of cryptocurrency involved in our business operation and (ii) a decrease in the comparative number of Bitcoin mined from self-mining, resulting from a decrease in the amount of hash rate allocated to our self-mining business as a percentage of the total network hash rate.
Our ability to procure mining machines at a lower cost Depreciation of mining machines remained one of the few largest costs we incurred in our business operations for the years ended December 31, 2020, 2021 and 2022. Depreciation of mining machines is directly affected by the purchase price of these machines.
Our ability to procure mining machines at a lower cost Depreciation of mining machines remained one of the few largest costs we incurred in our business operations for the years ended December 31, 2021, 2022 and 2023. Depreciation of mining machines is directly affected by the purchase price of these machines.
Results of Operations The following tables summarizes our results of operations, revenue breakdown, and expenses by nature for the years ended December 31, 2020, 2021 and 2022. This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report.
Results of Operations The following tables summarizes our results of operations, revenue breakdown, and expenses by nature for the years ended December 31, 2023, 2022, and 2021. This information should be read together with our consolidated financial statements and related notes included elsewhere in this annual report.
While allocating more mining resources to “hash rate sharing” and “hosting” services may facilitate cash payback and mining datacenter expansion, we have to forgo Bitcoin’s huge appreciation potential to some extent as we could earn more Bitcoins by allocating the same mining resources to “proprietary mining”, and vice versa.
While allocating more mining resources to “hash rate sharing” and “hosting” services may facilitate cash payback and mining datacenter expansion, we have to forgo Bitcoin’s huge appreciation potential to some extent as we could earn more Bitcoins by allocating the same mining resources to “self-mining”, and vice versa.
We occupy most of our office premises and certain mining datacenter under lease arrangements, which generally have an initial lease term between one and a half to seven years. Lease contracts are typically made for fixed periods but may have extension options.
We occupy most of our office premises and certain mining datacenter under lease arrangements, which generally have an initial lease term between one and a half to 30 years. Lease contracts are typically made for fixed periods but may have extension options.
Price and volatility of Bitcoin We derive, and expect to continue to derive, a significant portion of revenue from proprietary mining of cryptocurrency, primarily Bitcoin. Hence, our ability to generate revenue from this business line is directly affected by the market price of Bitcoin. The Bitcoin price may also impact the use of our mining machines.
Price and volatility of Bitcoin We derive, and expect to continue to derive, a significant portion of revenue from self-mining of cryptocurrency, primarily Bitcoin. Hence, our ability to generate revenue from this business line is directly affected by the market price of Bitcoin. The Bitcoin price may also impact the use of our mining machines.
Compensation Expenses Incurred by Mining Datacenter Personnel The compensation expenses incurred by mining datacenter personnel consists primarily of (i) share- based payment expenses related to mining datacenter personnel as a result of the grant of options under the 2021 Share Incentive Plan and (ii) staff costs, including salaries, wages and other benefits in relation to mining datacenter personnel.
Compensation Expenses Incurred by Mining Datacenter Personnel The compensation expenses incurred by mining datacenter personnel consists primarily of (i) share- based payment expenses related to mining datacenter personnel as a result of the grant of options under the 2023 Share Incentive Plan and (ii) staff costs, including salaries, wages and other benefits in relation to mining datacenter personnel.
Our ability to effectively maintain our leadership position in the global electricity cost curve Electricity cost was the other largest cost, besides depreciation of mining machines, that we incurred in our business operations for the years ended December 31, 2020, 2021 and 2022.
Our ability to effectively maintain our leadership position in the global electricity cost curve Electricity cost was the other largest cost, besides depreciation of mining machines, that we incurred in our business operations for the years ended December 31, 2021, 2022 and 2023.
Depreciation of mining datacenters is calculated using the straight-line method based on the estimated useful lives of the assets comprised thereof, such as buildings, machinery, electronic equipment and leasehold improvement, and is recorded under depreciation of property, plant, and equipment.
Depreciation of mining datacenters is calculated using the straight-line method based on the estimated useful lives of the assets comprised thereof, such as buildings, machinery, electronic equipment, leasehold improvements and property improvements, and is recorded under depreciation of property, plant, and equipment.
The hash rate used for proprietary mining, calculated on a twelve-month monthly average basis, was approximately 2.4EH/s for the year ended December 31, 2022, which slightly increased compared to 2.2EH/s for the year ended December 31, 2021.
The hash rate used for self-mining, calculated on a twelve-month monthly average basis, was approximately 2.4EH/s for the year ended December 31, 2022, which slightly increased compared to 2.2EH/s for the year ended December 31, 2021.
If any adverse development in such new businesses arises, we may not be able to develop those new businesses as successfully as contemplated, or at all, and our results of operations and prospects may be significantly and negatively affected as a result. 78 Table of Contents Regulatory environment We are a leading cryptocurrency mining service provider with a strong global presence.
If any adverse development in such new businesses arises, we may not be able to develop those new businesses as successfully as contemplated, or at all, and our results of operations and prospects may be significantly and negatively affected as a result. Regulatory environment We are a leading cryptocurrency mining service provider with a strong global presence.
Therefore, we are able to continuously grow our proprietary hash rate by funding the purchase of additional mining fleets with the instant cash collected from hash rate sales using our existing mining fleets, significantly reducing our payback period to one month, compared to the long payback period associated with cryptocurrency mining activities, which is typically from 6 to 18 months, according to Frost & Sullivan.
Therefore, we are able to continuously grow our proprietary hash rate by funding the purchase of additional mining fleets with the instant cash collected from hash rate sales using our existing mining fleets, significantly reducing our payback period to one month, compared to the long payback period associated with cryptocurrency mining activities, which is typically from 6 to 18 months.
We currently do not expect to sell mining machines in the near-future. · Revenue generated from Cloud Hash Rate decreased by 2.3% from US$124.2 million for the year ended December 31, 2021 to US$121.3 million for the year ended December 31, 2022, which was mainly attributable to an increase in (i) revenue from hash rate subscription and (ii) revenue from electricity subscription, offset by a decrease in revenue from additional consideration from acceleration plan arrangements.
We currently do not expect to sell mining machines in the near-future. 90 Table of Contents • Revenue generated from Cloud Hash Rate decreased by 2.3% from US$124.2 million for the year ended December 31, 2021 to US$121.3 million for the year ended December 31, 2022, which was mainly attributable to an increase in (i) revenue from hash rate subscription and (ii) revenue from electricity subscription, offset by a decrease in revenue from additional consideration from acceleration plan arrangements.
As we operate three business lines, we have to decide the allocation of proprietary hash rate between “proprietary mining” and “hash rate sharing” as well as the allocation of mining datacenter capacity among “proprietary mining”, “hash rate sharing” and “hosting”.
As we operate three business lines, we have to decide the allocation of proprietary hash rate between “self-mining” and “hash rate sharing” as well as the allocation of mining datacenter capacity among “self-mining”, “hash rate sharing” and “hosting”.
However, we cannot guarantee that our decisions could bring the Company the best results every time, and we anticipate our business judgments will continue to affect the results of our operations. Our ability to upgrade and expand our offerings Crypto-economy is characterized by continuous fluctuations and frequent innovations.
However, we cannot guarantee that our decisions could bring the Company the best results every time, and we anticipate our business judgments will continue to affect the results of our operations. 80 Table of Contents Our ability to upgrade and expand our offerings Crypto-economy is characterized by continuous fluctuations and frequent innovations.
Other Net Gain/(Loss) Other net gain/loss primarily consist of (i) loss in fair value change of financial assets at fair value through profit or loss, (ii) net gain on disposal of other financial assets, (iii) net gain on disposal of property, plant and equipment and intangible assets, (iv) impairment loss of a pre-matured investment, and (v) net gain on settlement of balances between Bitmain.
Other Net Gain Other net gain primarily consist of (i) changes in fair value of financial assets at fair value through profit or loss, (ii) net gain on disposal of property, plant and equipment and intangible assets, (iii) impairment loss of a pre-matured investment, and (iv) net gain on settlement of balances between Bitmain.
While we have seen clear growth in both of our proprietary mining and Cloud Hash Rate business, we have limited ability to predict Bitcoin price and its volatility, which we expect to continue to affect our future earnings and cash flows.
While we have seen clear growth in both of our self-mining and Cloud Hash Rate business historically, we have limited ability to predict Bitcoin price and its volatility, which we expect to continue to affect our future earnings and cash flows.
Purchase of property, plant and equipment and intangible assets. Purchase of property, plant and equipment and intangible assets primarily consist of the purchase of machinery, equipment and other expenditure associated with mining datacenter construction and operations.
Purchase of property, plant and equipment, investment properties and intangible assets primarily consist of the purchase of machinery, equipment and other expenditure associated with mining datacenter construction and operations.
Key Components of Our Results of Operations Revenue We generate revenue from (i) proprietary mining, (ii) hash rate sales through Cloud Hash Rate , (iii) Cloud Hosting , (iv) General Hosting , (v) Membership Hosting , (vi) sales of mining machines and (vii) others, which mainly consist of the provision of technical and human resources service, repairment services of hosted mining machines, lease of investment properties and the sale of mining machine peripherals.
Key Components of Our Results of Operations Revenue We generate revenue from (i) self-mining, (ii) hash rate sales through Cloud Hash Rate, (iii) Cloud Hosting, (iv) General Hosting, (v) Membership Hosting, (vi) sales of mining machines and (vii) others, which mainly consist of the provision of technical and human resources service, repairment services of hosted mining machines, lease of investment properties, the sale of mining machine peripherals and the sale of containerized solution products.
We have determined that we still retain control over the mining machines and consequently, the mining machines under the Cloud Hosting arrangements were not derecognized from our book. General Hosting We provide General Hosting services that enable our customers to run blockchain computing operations.
We have determined that we still retain control over the mining machines and consequently, the mining machines under the Cloud Hosting arrangements were not derecognized from our book. 82 Table of Contents General Hosting We provide General Hosting services that enable our customers to run blockchain computing operations.
Recent Accounting Pronouncements As from January 1, 2022, we adopted the following recently issued or amended standards.
Recent Accounting Pronouncements As from January 1, 2023, we adopted the following recently issued or amended standards.
The total cash outflow for leases, including the capital element of lease rentals paid and interests paid on leases for the years ended December 31, 2020, 2021 and 2022 was approximately US$5.4 million, US$5.4 million and US$6.3 million, respectively.
The total cash outflow for leases, including the capital element of lease rentals paid and interests paid on leases for the years ended December 31, 2021, 2022 and 2023 was approximately US$5.4 million, US$6.3 million and US$7.8 million, respectively.
Cost of Revenue Our cost of revenue consists primarily of (i) electricity expenses incurred for operating our mining machines in its revenue-generating activities, (ii) depreciation expense from the mining machines and datacenters hosting those mining machines, (iii) costs of mining machines sold to customers and (iv) compensation expenses incurred by mining datacenter personnel.
Cost of Revenue Our cost of revenue consists primarily of (i) electricity expenses incurred for operating our mining machines in its revenue-generating activities, (ii) depreciation expense from the mining machines and datacenters hosting those mining machines, (iii) compensation expenses incurred by mining datacenter personnel, (iv) share-based payment expenses related to mining datacenter personnel, and (v) costs of mining machines sold to customers.
Cost of Revenue Our cost of revenue increased by 63.1% from US$153.3 million for the year ended December 31, 2021 to US$250.1 million for the year ended December 31, 2022, primarily driven by an increase in (i) electricity cost in operating mining machines, (ii) salaries, wages and other benefits and (iii) depreciation of property, plant and equipment, partially offset by a decrease in (i) depreciation of mining machines and (ii) cost of mining machines sold and accessories sold. ● Depreciation of mining machines decreased by 33.3% from US$43.9 million for the year ended December 31, 2021 to US$29.3 million for the year ended December 31, 2022, primarily because (i) a significant number of the mining machines procured prior to 2021 as a result of our expanded hash rate capacity are fully depreciated by 2021, and (ii) we changed the useful life for mining machines from one year to two years for the mining machines of newer models that were purchased starting from July 2021, which leads to lower depreciation afterwards. 85 Table of Contents ● Electricity cost in operating mining machines increased by 138.9% from US$58.4 million for the year ended December 31, 2021 to US$139.5 million for the year ended December 31, 2022, which was attributed to the increased overall energy consumption related to the expansion of our mining datacenter operations in North America and Norway. ● Cost of mining machines sold and accessories sold decreased by 83.3% from US$6.0 million for the year ended December 31, 2021 to US$1.0 million for the year ended December 31, 2022, primarily driven by the decrease in the number of mining machines we sold for the year ended December 31, 2022 as we had sold most of our mining machines of older models for the year ended December 31, 2021.
Cost of Revenue Our cost of revenue increased by 63.1% from US$153.3 million for the year ended December 31, 2021 to US$250.1 million for the year ended December 31, 2022, primarily driven by an increase in (i) electricity cost in operating mining machines, (ii) salaries, wages and other benefits and (iii) depreciation of property, plant and equipment, partially offset by a decrease in (i) depreciation of mining machines and (ii) cost of mining machines sold and accessories sold. • Electricity cost in operating mining machines increased by 138.9% from US$58.4 million for the year ended December 31, 2021 to US$139.5 million for the year ended December 31, 2022, which was attributed to the increased overall energy consumption related to the expansion of our mining datacenter operations in North America and Norway. • Depreciation of mining machines decreased by 33.3% from US$43.9 million for the year ended December 31, 2021 to US$29.3 million for the year ended December 31, 2022, primarily because (i) a significant number of the mining machines procured prior to 2021 as a result of our expanded hash rate capacity are fully depreciated by 2021, and (ii) we changed the useful life for mining machines from one year to two years for the mining machines of newer models that were purchased starting from July 2021, which leads to lower depreciation afterwards. • Depreciation of property, plant and equipment attributed to cost of revenue increased by 114.3% from US$14.0 million for the year ended December 31, 2021 to US$30.0 million for the year ended December 31, 2022, primarily as a result of the expansion of our mining datacenters and mining facilities in North America and Norway. • Salaries, wages and other benefits attributed to cost of revenue increased by 89.4% from US$9.4 million for the year ended December 31, 2021 to US$17.8 million for the year ended December 31, 2022, which was due to the increase in employees and in salaries, wages and other benefits to attract and retain quality employees as a result of the expansion of our mining datacenter operations in North America. • Cost of mining machines sold and accessories sold decreased by 83.3% from US$6.0 million for the year ended December 31, 2021 to US$1.0 million for the year ended December 31, 2022, primarily driven by the decrease in the number of mining machines we sold for the year ended December 31, 2022 as we had sold most of our mining machines of older models for the year ended December 31, 2021.
If our existing subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us. 93 Table of Contents
If our existing subsidiaries or any newly formed ones incur debt on their own behalf in the future, the instruments governing their debt may restrict their ability to pay dividends to us.
Liquidity and Capital Resources As of December 31, 2022, we had cash and cash equivalents of US$231.4 million and fiat currency investment of US$31.1 million in unlisted debt instruments, redeemable on demand. Since our separation from Bitmain, we have financed our operations primarily with cash flow from disposal of cryptocurrencies earned from principal business operations.
Liquidity and Capital Resources As of December 31, 2023, we had cash and cash equivalents of US$144.7 million and fiat currency investment of US$1.0 million in unlisted debt instruments, redeemable on demand. Since our separation from Bitmain, we have financed our operations primarily with cash flow from disposal of cryptocurrencies earned from principal business operations.
Research and Development Expenses Our research and development expenses primarily consist of (i) staff costs, including wages, bonuses and benefits to research and development personnel, and (ii) share-based payment expenses related to research and development personnel.
Research and Development Expenses Our research and development expenses primarily consist of (i) staff costs, including wages, bonuses and benefits to research and development personnel, (ii) share-based payment expenses related to research and development personnel, and (iii) technical service fee.
Recent Developments Recent events impacting our business are as follows: 74 Table of Contents Business Combination We consummated the Business Combination on April 13, 2023.
Recent Developments Recent events impacting our business are as follows: Business Combination We consummated the Business Combination on April 13, 2023.
We also generate a large percentage of revenue from Cloud Hash Rate, which offers hash rate to be utilized by third-party miners. As a result, revenue from this business line is also correlated with Bitcoin price and volatility.
We also generate a large percentage of revenue from Cloud Hash Rate, which offers hash rate to be utilized by third-party miners. As a result, revenue from this business line is also correlated with Bitcoin price and volatility. 78 Table of Contents The prices of Bitcoin have experienced substantial volatility.
Selling Expenses Our selling expenses increased from US$8.4 million for the year ended December 31, 2021 to US$11.7 million for the year ended December 31, 2022, primarily due to (i) the US$2.3 million increase in share-based payment expenses as a result of the new grant of options to sales personnel in 2022 under the 2021 Share Incentive Plan approved in July 2021, and (ii) the US$0.4 million increase in staff costs, including salaries, wages and benefits to sales personnel.
We currently do not expect to sell mining machines in the near-future. 91 Table of Contents Selling Expenses Our selling expenses increased from US$8.4 million for the year ended December 31, 2021 to US$11.7 million for the year ended December 31, 2022, primarily due to (i) the US$2.3 million increase in share-based payment expenses as a result of the new grant of options to sales personnel in 2022 under the 2021 Share Incentive Plan approved in July 2021, and (ii) the US$0.4 million increase in staff costs, including salaries, wages and benefits to sales personnel.
Profit/(Loss) from Operations As a result of the foregoing, we recorded a loss from operations of US$60.6 million for the year ended December 31, 2022 and a profit from operations of US$130.8 million for the year ended December 31, 2021.
Profit/(Loss) from Operations As a result of the foregoing, we recorded a loss from operations of US$60.6 million for the year ended December 31, 2022 and US$52.2 million for the year ended December 31, 2023.
As such, we see electricity cost a key indicator of our business performance. Our premier mining datacenters allowed us to reach an average electricity cost of our mining datacenters to US$50/MWh for the year ended December 31, 2022 and US$36/MWh for the three months ended March 31, 2023.
As such, we see electricity cost a key indicator of our business performance. Our premier mining datacenters allowed us to reach an average electricity cost of our mining datacenters to US$38/MWh for the year ended December 31, 2023.
One exahash equals one quintillion hashes per second. As of March 31, 2023, we possessed proprietary hash rate of 5.7 EH/s. Electricity Capacity Electricity capacity is another key metric to evaluate our business and operation given the energy intensive nature of cryptocurrency mining.
One exahash equals one quintillion hashes per second. As of February 29, 2024, we possessed proprietary hash rate of 8.4 EH/s. Electricity Capacity Electricity capacity is another key metric to evaluate our business and operation given the energy intensive nature of cryptocurrency mining.
As a result, the growth of our business, such as proprietary mining and hash rate sales through Cloud Hash Rate, relies on a sustainable and increasing supply of a significant amount of electricity, which is currently supported by our proprietary mining datacenters. As of March 31, 2023, our electricity capacity was 795MW.
As a result, the growth of our business, such as self-mining and hash rate sales through Cloud Hash Rate, relies on a sustainable and increasing supply of a significant amount of electricity, which is currently supported by our mining datacenters. As of February 29, 2024, our electricity capacity was 895MW.
We were able to optimize our electricity cost structure and reach an average electricity cost of our proprietary mining datacenters to US$50/MWh for the year ended December 31, 2022 and US$36/MWh for the three months ended March 31, 2023.
We were able to optimize our electricity cost structure and reach an average electricity cost of our mining datacenters to US$38/MWh for the year ended December 31, 2023.
We believe the accounting policies related to the depreciation of mining machines, cryptocurrency accounting, revenue from the proprietary mining business, income taxes, share-based payments, fair value of financial assets at fair value through profit or loss, and assessment of the asset acquisition for the years ended December 31, 2020 and 2021 and 2022 involve significant judgments and estimates used in the preparation of our financial statements.
We believe the accounting policies related to revenue from the self-mining business, income taxes, share-based payments, fair value of financial assets at fair value through profit or loss, and assessment of the asset acquisition involve significant judgments and estimates used in the preparation of our financial statements.
The difference between our net profit of US$82.6 million and the net cash used in operating activities was primarily attributable to (i) adjustments for the revenue recognized on acceptance of cryptocurrencies of US$333.7 million and (ii) gain on disposal of cryptocurrencies of US$18.7 million, partially offset by (i) an adjustment for share-based payment expenses of US$88.4 million, (ii) an adjustment for depreciation and amortization of US$63.1 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period and (iii) an adjustment for income tax expenses of US$48.2 million. 91 Table of Contents Net cash used in operating activities was US$109.2 million in the year ended December 31, 2020.
The difference between our net profit of US$82.6 million and the net cash used in operating activities was primarily attributable to (i) adjustments for the revenue recognized on acceptance of cryptocurrencies of US$333.7 million and (ii) gain on disposal of cryptocurrencies of US$18.7 million, partially offset by (i) an adjustment for share-based payment expenses of US$88.4 million, (ii) an adjustment for depreciation and amortization of US$63.1 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period and (iii) an adjustment for income tax expenses of US$48.2 million. 95 Table of Contents Investing Activities Net cash generated from investing activities was US$199.9 million for the year ended December 31, 2023, primarily attributable to proceeds from disposal of cryptocurrencies of US$299.1 million and proceeds from disposal of financial assets at fair value through profit or loss US$31.1 million, partially offset by (i) purchase of property, plant and equipment, investment properties and intangible assets of US$63.3 million, (ii) purchase of mining machines of US$63.0 million and (iii) purchase of financial assets at fair value through profit or loss of US$4.4 million.
As of March 31, 2023, we operated five prime mining datacenters in the United States and Norway and had served users across over 100 countries and regions around the globe, and may continue to expand our operations to more countries and regions.
As of February 29, 2024, we operated six prime mining datacenters in the United States, Norway and Bhutan and had served users across around 100 countries and regions around the globe, and may continue to expand our operations to more countries and regions.
We recognize revenue from sales of mining machines to customers at the point in time when control of the mining machines is transferred to our customers, which generally occurs upon shipment of the mining machines as defined in the contract. We accept both cryptocurrency and fiat currency as payments for mining machine purchase.
We recognize revenue from sales of mining machines to customers at the point in time when control of the mining machines is transferred to our customers, which generally occurs upon shipment of the mining machines as defined in the contract.
Gross Profit/(Loss) Our gross profit or loss is primarily affected by (i) Bitcoin prices, which have a significant and direct effect on the amount of revenue we recognized from our operations, (ii) depreciation of mining machines, which is directly related to the mining machine purchases we made, (iii) electricity costs, (iv) staff cost, including salaries, wages and other benefits and (v) share-based payment expenses.
Gross Profit/(Loss) Our gross profit or loss is primarily affected by (i) Bitcoin prices, which have a significant and direct effect on the amount of revenue we recognized from our operations, (ii) depreciation of mining machines, which is directly related to the mining machine purchases we made, (iii) electricity costs, (iv) staff cost, including salaries, wages and other benefits and (v) share-based payment expenses. 84 Table of Contents Operating Expenses/(Income) Selling Expenses Our selling expenses primarily consist of (i) staff costs, including wages, bonuses and benefits to sales personnel, (ii) promotional expenses, which primarily represent expenses incurred for online and offline marketing activities and other promotional activities to reach more customers, and (iii) share-based payment expenses related to marketing personnel.
The following table sets forth a breakdown by nature of our cost of revenue, selling, general and administrative, and research and development expenses for the years indicated. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2020 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (Restated) ​ 2021 ​ 2022 ​ US$ % US$ % US$ % ​ (in thousands, except for percentages) Staff costs: salaries, wages and other benefits 33,041 13.5 37,730 13.4 50,132 12.8 Share-based payments — — 88,355 31.4 90,648 23.2 Amortization of intangible assets 111 0.0 146 0.1 97 0.0 Depreciation: Mining machines 98,136 40.0 43,857 15.6 29,281 7.5 Property, plant and equipment 9,807 4.0 14,416 5.1 30,438 7.8 Investment properties — — — — 1,237 0.3 Right-of-use assets 3,983 1.6 4,636 1.7 5,371 1.4 Electricity cost in operating mining machines 72,078 29.4 58,447 20.8 139,469 35.7 Cost of mining machines sold 17,537 7.2 5,978 2.1 1,002 0.3 Consulting service fee 1,039 0.4 8,787 3.1 6,797 1.7 Tax and surcharge 3,085 1.3 2,202 0.8 3,355 0.9 Advertising expenses 2,189 0.9 880 0.3 737 0.2 Office expenses 543 0.2 2,219 0.8 3,124 0.8 Research and development technical service fees 681 0.3 1,964 0.7 1,313 0.3 Expenses of low-value consumables 971 0.4 1,662 0.6 4,025 1.0 Expenses of variable payment lease — — 610 0.2 639 0.2 Expenses of short-term leases 372 0.2 351 0.1 527 0.1 Impairment loss of mining machines — — 106 0.0 — — Logistic expenses 339 0.1 1,391 0.5 3,060 0.8 Travel expenses 52 0.0 1,393 0.5 3,202 0.8 Insurance fee 459 0.2 983 0.3 3,446 0.9 Others 766 0.3 4,826 1.9 12,756 3.3 Total cost of revenue, selling, general and administrative and research and development expenses 245,189 100.0 280,939 100.0 390,656 100.0 ​ Comparison of Years Ended December 31, 2021 and 2022 Revenue Our revenue decreased by 15.6% from US$394.7 million for the year ended December 31, 2021 to US$333.3 million for the year ended December 31, 2022, primarily driven by (i) a decrease in revenue generated from proprietary mining, (ii) a decrease in revenue generated from sales of mining machines and (iii) a decrease in revenue generated from Cloud Hash Rate , partially offset by (i) an increase in revenue generated from Cloud Hosting , (ii) an increase in revenue generated from General Hosting , and (iii) Membership Hosting which began to generate revenue in the second half of 2022. 84 Table of Contents · Revenue generated from our proprietary mining business decreased by 67.4% from US$191.7 million for the year ended December 31, 2021 to US$62.4 million for the year ended December 31, 2022.
For the Year Ended December 31, 2023 2022 2021 US$ % US$ % US$ % (in thousands, except for percentages) Staff costs: salaries, wages and other benefits 52,873 13.4 50,132 12.8 37,730 13.4 Share-based payments 45,488 11.5 90,648 23.2 88,355 31.4 Amortization of intangible assets 754 0.2 97 0.0 146 0.1 Depreciation: Mining machines 25,663 6.5 29,281 7.5 43,857 15.6 Property, plant and equipment 39,899 10.1 30,438 7.8 14,416 5.1 Investment properties 2,601 0.7 1,237 0.3 - - Right-of-use assets 6,624 1.7 5,371 1.4 4,636 1.7 Electricity cost in operating mining machines 180,565 45.7 139,469 35.7 58,447 20.8 Cost of mining machines sold 4 0.0 1,002 0.3 5,978 2.1 Consulting service fee 9,757 2.5 6,797 1.7 8,787 3.1 Tax and surcharge 5,442 1.4 3,355 0.9 2,202 0.8 Advertising expenses 1,383 0.4 737 0.2 880 0.3 Office expenses 3,987 1.0 3,124 0.8 2,219 0.8 Research and development technical service fees 2,854 0.7 1,313 0.3 1,964 0.7 Expenses of low-value consumables 2,557 0.6 4,025 1.0 1,662 0.6 Expenses of variable payment lease 224 0.1 639 0.2 610 0.2 Expenses of short-term leases 286 0.1 527 0.1 351 0.1 Impairment loss of mining machines - - - - 106 0.0 Logistic expenses 557 0.1 3,060 0.8 1,391 0.5 Travel expenses 2,843 0.7 3,202 0.8 1,393 0.5 Insurance fee 2,427 0.6 3,446 0.9 983 0.3 Others 8,191 2.0 12,756 3.3 4,826 1.9 Total cost of revenue, selling, general and administrative and research and development expenses 394,979 100.0 390,656 100.0 280,939 100.0 Comparison of Years Ended December 31, 2022 and 2023 Revenue Our revenue increased by 10.6% from US$333.3 million for the year ended December 31, 2022 to US$368.6 million for the year ended December 31, 2023, primarily driven by the increase of revenue generated from our self-mining and Membership Hosting, which began to generate revenue in the second half of 2022. 87 Table of Contents • Revenue generated from our self-mining business increased by 79.1% from US$62.4 million for the year ended December 31, 2022 to US$111.7 million for the year ended December 31, 2023.
These contracts are signed with the same customer at or near the same time, and they are combined and accounted for as a single contract. 80 Table of Contents Unlike General Hosting where the customer’s access to mining datacenter capacity is subject to the availability of such capacity at the time the request was raised, a customer under Membership Hosting will be designated of certain capacity (i.e., designated capacity) exclusive for use by such customer, by signing a standard membership program agreement.
Unlike General Hosting where the customer’s access to mining datacenter capacity is subject to the availability of such capacity at the time the request was raised, a customer under Membership Hosting will be designated of certain capacity (i.e., designated capacity) exclusive for use by such customer, by signing a standard membership program agreement.
In particular, we have established a business model that allows us to constantly reinforce our market-leading position and outpace our competitors in terms of scaling up our proprietary hash rate.
In particular, we have established a business model that allows us to constantly reinforce our market-leading position and outpace our competitors in terms of scaling up our proprietary hash rate. We strategically allocate proprietary hash rate to hash rate sales through our Cloud Hash Rate business, to enable instant cash payback upon customers’ subscription to our hash rate plans.
As a result, we do not present disaggregated revenue information on block rewards and transaction verification fees. 79 Table of Contents Cloud Hash Rate Through Cloud Hash Rate, customers can subscribe to a specified amount of computing power derived from the mining machines held by us for a period of time through a wide selection of hash rate subscription plans offered by us, differentiated by plan duration and the type of cryptocurrency to be mined.
Cloud Hash Rate Through Cloud Hash Rate, customers can subscribe to a specified amount of computing power derived from the mining machines held by us for a period of time through a wide selection of hash rate subscription plans offered by us, differentiated by plan duration and the type of cryptocurrency to be mined.
Other Operating Income /(Expenses) We incurred other operating expenses of US$2.0 million and generated other operating income of US$14.6 million for the years ended December 31, 2020 and 2021, respectively.
Other Operating Income/(Expenses) We incurred other operating expenses of US$3.6 million and generated other operating income of US$3.8 million for the years ended December 31, 2022 and 2023, respectively.
As of December 31, 2022, lease liabilities mature based on contractual undiscounted payments within 12 months and over 12 months were US$7.5 million and US$80.6 million, respectively. Borrowings.
As of December 31, 2023, lease liabilities mature based on contractual undiscounted payments within 12 months and over 12 months were US$7.8 million and US$78.9 million, respectively. 93 Table of Contents Borrowings.
Our Class A Ordinary Shares commenced trading on the Nasdaq on April 14, 2023, under the symbol “BTDR.” Key Performance Metrics We regularly review a number of metrics, including the key metrics presented below, to evaluate our business and performance. Hash Rate We believe hash rate is an important metric for assessing the strength of our business.
Key Performance Metrics We regularly review a number of metrics, including the key metrics presented below, to evaluate our business and performance. Hash Rate We believe hash rate is an important metric for assessing the strength of our business.
If there are significant changes from previously estimated useful lives, the amount of depreciation expenses may change.
If there are significant changes from previously estimated useful lives, the amount of depreciation expenses may change. We estimated the useful lives of our mining machines to be one to five years.
You should read the descriptions of these significant judgments and estimates in conjunction with other disclosures included in this annual report. Emerging Growth Company Status We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of reduced reporting requirements that are otherwise applicable to public companies.
Emerging Growth Company Status We are an “emerging growth company,” as defined in the JOBS Act, and we may take advantage of reduced reporting requirements that are otherwise applicable to public companies.
Historically, we only accepted cryptocurrency for Cloud Hosting . For our other products and services available to customers, we accept both fiat currency and cryptocurrencies as payments. Proprietary Mining We enter into contracts with mining pool operators to provide computing power generated from our own mining machines to the mining pools.
For our other products and services available to customers, we accept both fiat currency and cryptocurrencies as payments. 81 Table of Contents Self-Mining We enter into contracts with mining pool operators to provide computing power generated from our own mining machines to the mining pools. The contracts with mining pool operators are terminable at any time by either party.
For example, recent industry-wide developments, including the continued industry- wide fallout from the recent Chapter 11 bankruptcy filings of cryptocurrency exchanges FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi, have led to a drop in Bitcoin price.
For example, throughout calendar year 2022, a number of companies in the digital assets industry have declared bankruptcy, including cryptocurrency exchanges FTX (including its affiliated hedge fund Alameda Research LLC), crypto hedge fund Three Arrows, crypto miners Compute North and Core Scientific and crypto lenders Celsius Network, Voyager Digital and BlockFi.
Our material cash requirements as of December 31, 2022 and any subsequent interim period primarily include our purchase of plant, property and equipment, lease obligations, and borrowings. Other than those as discussed below, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2022.
Other than those as discussed below, we did not have any significant capital and other commitments, long-term obligations or guarantees as of December 31, 2023. Purchase of property, plant and equipment, investment properties and intangible assets.
We encourage you to review our financial information in its entirety and not rely on a single financial measure. 75 Table of Contents The following table presents a reconciliation of profit/(loss) for the relevant period to adjusted EBITDA and adjusted profit/(loss), for the years ended December 31, 2020, 2021 and 2022. ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31 ​ ​ 2020 ​ 2021 ​ 2022 ​ US$ US$ US$ ​ ​ (in thousands) Adjusted EBITDA Profit/(loss) for the year (55,826) 82,643 (60,366) Add: ​ ​ ​ ​ ​ ​ Depreciation and amortization 112,037 63,055 66,424 Income tax expenses/(benefit) (7,961) 48,246 (4,400) Interest expense/(income), net 404 (504) 912 Share-based payment expenses — 88,355 90,648 Adjusted EBITDA 48,654 281,795 93,218 Adjusted Profit/(Loss) ​ ​ ​ ​ ​ ​ Profit/(loss) for the year (55,826) 82,643 (60,366) Add: ​ ​ ​ ​ ​ ​ Share-based payment expenses — 88,355 90,648 Adjusted profit/(loss) (55,826) 170,998 30,282 ​ Key Factors Affecting Our Results of Operations The following factors are the principal factors that have affected and will continue to affect our business, financial condition, results of operations and prospects.
For the Year Ended December 31 2023 2022 2021 US$ US$ US$ (in thousands) Adjusted EBITDA Profit/(loss) for the year (56,656 ) (60,366 ) 82,643 Add: Depreciation and amortization 75,541 66,424 63,055 Income tax (benefit)/expenses 5,685 (4,400 ) 48,246 Interest (income)/expenses, net (2,872 ) 912 (504 ) Listing fee 33,151 - - Share-based payment expenses 45,488 90,648 88,355 Adjusted EBITDA 100,337 93,218 281,795 Adjusted Profit Profit/(loss) for the year (56,656 ) (60,366 ) 82,643 Add: Listing fee 33,151 - - Share-based payment expenses 45,488 90,648 88,355 Adjusted profit 21,983 30,282 170,998 Key Factors Affecting Our Results of Operations The following factors are the principal factors that have affected and will continue to affect our business, financial condition, results of operations and prospects.
This change was primarily because we recorded US$18.7 million gain on disposal of cryptocurrencies for the year ended December 31, 2021, compared to US$3.1 million loss on disposal of cryptocurrencies for the year ended December 31, 2022, which is associated with Bitcoin price drop prior to such disposal given we typically sell Bitcoins earned from our principal business lines within the next few days. 86 Table of Contents Other Net Gain/(Loss) We recorded other net gain of US$0.36 million for the year ended December 31, 2022, which primarily included (i) net gains on disposal of property, plant and equipment and intangible assets of US$0.66 million and (ii) other gains of US$0.5 million, which mainly included return of wealth management product and other minor gains from disposal of investments in unlisted debt instruments, partially offset by the loss of US$0.8 million which mainly included the fair value change of investments in unlisted equity and debt instruments.
This change was primarily driven by the net gain on disposal of cryptocurrencies and the change in fair value of cryptocurrency-settled receivables and payables, partially offset by the loss on disposal of mining machines. 89 Table of Contents Other Net Gain We recorded other net gain of US$0.36 million for the year ended December 31, 2022, which primarily included (i) net gains on disposal of property, plant and equipment and intangible assets of US$0.66 million and (ii) other gains of US$0.5 million, which mainly included return of wealth management product and other minor gains from disposal of investments in unlisted debt instruments, partially offset by the loss of US$0.8 million which mainly included the fair value change of investments in unlisted equity and debt instruments.
We invest significant research and development resources in improving technology related to our Cloud Hash Rate business including hash rate slicing, developing Hash Rate Marketplace and improve our Minerplus features like virus detection and hash rate monitoring.
We invest significant research and development resources in improving technology related to our Cloud Hash Rate business including hash rate slicing, developing and testing our Bitcoin mining chip and improving our Minerplus features like virus detection and hash rate monitoring. We also spent R&D efforts on utilizing renewable energy and increasing energy efficiency.
For example, in light of the recent decrease and volatility of Bitcoin price, we are in the process of establishing a fund to purchase mining machines from financially distressed miners, if the value and quality of such mining machines are satisfactory to us. 77 Table of Contents However, whether we are able to successfully procure mining machines at a low price is subject to a number of factors, including our brand strength, our mining machine purchase channels, and supply and demand of mining machines, some of which may not be entirely within our control.
However, whether we are able to successfully procure mining machines at a low price is subject to a number of factors, including our brand strength, our mining machine purchase channels, and supply and demand of mining machines, some of which may not be entirely within our control.
Electricity Cost in Operating Mining Machines We incur electricity costs when (i) operating proprietary mining machines for cryptocurrency mining, (ii) generating hash rate for sales under Cloud Hash Rate , (iii) operating specified mining machines for customers under Cloud Hosting and (iv) operating customer-owned mining machines during the provision of General Hosting and Membership Hosting services. 81 Table of Contents Depreciation of Mining Machines and Mining Datacenters Depreciation on our mining machines is calculated using the straight-line method to allocate costs up to residual values over the estimated useful lives of the assets.
Electricity Cost in Operating Mining Machines We incur electricity costs when (i) operating mining machines for cryptocurrency mining, (ii) generating hash rate for sales under Cloud Hash Rate, (iii) operating specified mining machines for customers under Cloud Hosting and (iv) operating customer-owned mining machines during the provision of General Hosting and Membership Hosting services.
Standard/Interpretation Application Date for our group IFRS 17, Insurance Contracts and Amendments to Address Concerns and Implementation Challenges ​ January 1, 2023 ​ Amendments to IFRS 4, Expiry Date of the Deferral Approach ​ January 1, 2023 ​ Amendments to IAS 1, Making Materiality Judgement ​ January 1, 2023 ​ Amendments to IAS 1 and IFRS Practice Statement 2, Disclosure of Accounting Policies ​ January 1, 2023 ​ Amendments to IAS 8, Definition of Accounting Estimates ​ January 1, 2023 ​ Amendments to IAS 12, Deferred Tax related to Assets and Liabilities arising from a Single Transaction ​ January 1, 2023 ​ Initial Application of IFRS 17 and IFRS 9 – Comparative Information ​ January 1, 2023 ​ Amendments to IAS 1, Classification of Liabilities as Current or Non-current and Disclosure of Accounting Policies ​ January 1, 2024 ​ Amendments to IAS 1, Classification of Debt with Covenants ​ January 1, 2024 ​ Amendments to IFRS 16, Subsequent Measurement of Sale and Leaseback Transactions by a Seller-lessee ​ January 1, 2024 ​ ​ Critical Accounting Policies and Significant Judgments and Estimates We prepare our consolidated financial statements for the years ended December 31, 2020, 2021 and 2022 in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
Standard/Interpretation Application Date for our group Amendments to IAS 1, Classification of Liabilities as Current or Non-current and Disclosure of Accounting Policies January 1, 2024 Amendments to IAS 1, Classification of Debt with Covenants January 1, 2024 Amendments to IFRS 16, Subsequent Measurement of Sale and Leaseback Transactions by a Seller-lessee January 1, 2024 Amendments to IAS 7 and IFRS 7, Supplier Finance Arrangements January 1, 2024 IFRS S2, Climate-related Disclosures January 1, 2024 IFRS S1, General Requirements for Disclosure of Sustainability-related Financial Information January 1, 2024 Amendments to IAS 21, Lack of Exchangeability January 1, 2025 Critical Accounting Policies and Significant Judgments and Estimates We prepare our consolidated financial statements for the years ended December 31, 2021, 2022 and 2023 in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”).
By then, we consider it is highly probable that a significant reversal in the amount of revenues will not occur and includes such variable consideration in the transaction price. Providing computing power is an output of our ordinary activities and the only performance obligation in our contracts with mining pool operators.
We can reasonably estimate the amount of mining rewards by the end of a given day based on the actual amount of computing power provided to the mining pool operators. By then, we consider it is highly probable that a significant reversal in the amount of revenues will not occur and includes such variable consideration in the transaction price.
The variable consideration is constrained until we can reasonably estimate the amount of mining rewards by the end of a given day based on the actual amount of computing power provided to the mining pool operators.
We can reasonably estimate the amount of mining rewards by the end of a given day based on the actual amount of computing power provided to the mining pool operators. By then, we consider it is highly probable that a significant reversal in the amount of revenues will not occur and includes such variable consideration in the transaction price.
Although we expect these investments to benefit our business over the long term, we also expect our total operating expenses will increase for the foreseeable future.
Upgrading existing offerings and commencing new businesses may incur significant costs and experience a prolonged ramp-up period. Although we expect these investments to benefit our business over the long term, we also expect our total operating expenses will increase for the foreseeable future.
Net Profit/(Loss) As a result of the foregoing, we recorded a net loss of US$55.8 million for the year ended December 31, 2020 and a net profit of US$82.6 million for the year ended December 31, 2021.
Net Profit/(Loss) As a result of the foregoing, we incurred a net loss of US$60.4 million for the year ended December 31, 2022 and a net loss of US$56.7 million for the year ended December 31, 2023.
Cash Flows The following table presents our consolidated statements of cash flows for the years ended December 31, 2020, 2021 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ For the Year Ended December 31, ​ ​ 2020 ​ 2021 ​ 2022 ​ US$ US$ US$ ​ ​ (in thousands) Net cash used in operating activities (109,176) (52,466) (268,037) Net cash generated from investing activities 62,742 394,569 133,793 Net cash generated from / (used in) financing activities 30,776 (14,426) (3,884) Net (decrease) / increase in cash and cash equivalents (15,658) 327,677 (138,128) Cash and cash equivalents at the beginning of the period 59,826 44,753 372,088 Effect of movements in exchange rates on cash and cash equivalents held 585 (342) (2,598) Cash and cash equivalents at the end of the year 44,753 372,088 231,362 ​ Operating Activities Net cash used in operating activities was US$268.0 million for the year ended December 31, 2022.
We do not have any variable interest in any unconsolidated entity that provides financing, liquidity, market risk or credit support to us or engages in leasing, hedging or product development services with us. 94 Table of Contents Cash Flows The following table presents our consolidated statements of cash flows for the years ended December 31, 2021, 2022 and 2023: For the Year Ended December 31, 2023 2022 2021 US$ US$ US$ (in thousands) Net cash used in operating activities (271,787 ) (268,037 ) (52,466 ) Net cash generated from investing activities 199,854 133,793 394,569 Net cash used in financing activities (13,493 ) (3,884 ) (14,426 ) Net increase / (decrease) in cash and cash equivalents (85,426 ) (138,128 ) 327,677 Cash and cash equivalents at the beginning of the year 231,362 372,088 44,753 Effect of movements in exchange rates on cash and cash equivalents held (1,207 ) (2,598 ) (342 ) Cash and cash equivalents at the end of the year 144,729 231,362 372,088 Operating Activities Net cash used in operating activities was US$271.8 million for the year ended December 31, 2023.
Our borrowings as of December 31, 2022 represented a commitment of US$29.8 million relating to the principal amount and interests in connection with the issuance of the Bitdeer Convertible Note, a US$30 million convertible note, on July 23, 2021, bearing an annual interest rate of 8%, which will mature on July 23, 2023. 90 Table of Contents We intend to fund our existing and future material cash requirements primarily with our cash, short-term investment and anticipated proceeds from disposal of cryptocurrencies in connection with our principal business, which is classified as an investing activity.
Our borrowings as of December 31, 2023 represented a commitment of US$22.6 million relating to the principal amount, net of unamortized discount and interests in connection with the issuance of the Bitdeer Convertible Note, a US$30 million convertible note, on July 23, 2021, bearing an annual interest rate of 8%, which will mature on July 23, 2023.
We strategically allocate a significant amount of proprietary hash rate to hash rate sales through our Cloud Hash Rate business, to enable instant cash payback upon customers’ subscription to our hash rate plans. We generally generate proceeds from hash rate sales under long-term hash rate subscription plans that approximate the purchase cost of mining machines.
We generally generate proceeds from hash rate sales under long- term hash rate subscription plans that approximate the purchase cost of mining machines.
Membership Hosting We offer Membership Hosting services to our large-scale miner customers by entering into a series of contracts, which includes a membership program agreement and a management services agreement.
Revenue from the general hosting service is recognized across each service cycle. We accept both cryptocurrency and fiat currency as payments for the hosting services. Membership Hosting We offer our large-scale miner customers membership hosting services by entering into a series of contracts, which includes a membership program agreement and a management services agreement.
Others We also generate from other operations, mainly including the provision of technical and human resources service, repairment services of hosted mining machines, lease of investment properties and the sale of mining machine peripherals. The revenue generated from these operations was individually immaterial for all periods under discussion.
We accept both cryptocurrency and fiat currency as payments for mining machine purchase. 83 Table of Contents Others We also generate from other operations, mainly including the provision of technical and human resources service, repairment services of hosted mining machines, lease of investment properties, the sale of mining machine peripherals and the sale of containerized solution products.
The difference between our net loss of US$55.8 million and the net cash used in operating activities was primarily attributable to an adjustment for revenue recognized on acceptance of cryptocurrencies of US$170.2 million, partially offset by an adjustment for depreciation and amortization of US$112.0 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period.
The difference between our net loss of US$56.7 million and the net cash used in operating activities was primarily attributable to (i) adjustments for revenue recognized on acceptance of cryptocurrencies of US$342.3 million, (ii) changes in prepayments and other assets of US$49.2 million primarily associated with deposits and prepayments made to suppliers following the expansion of our business during this period, and (iii) changes in other payables and accruals of US$5.1 million, partially offset by (i) an adjustment for depreciation and amortization of US$75.5 million primarily relating to the depreciation of mining machines used in our principal business operations and property, plant and equipment used in connection with the expansion of our mining datacenters during this period, (ii) an adjustment for share-based payment expenses of US$45.5 million for the issuance of options pursuant to our share incentive plans and (iii) an adjustment for listing fee of US$33.2 million.
We compensate for these limitations by reconciling these non-IFRS financial measures to the nearest IFRS performance measure, all of which should be considered when evaluating our performance.
As a result, you should not consider these measures in isolation from, or as a substitute analysis for, our profit/(loss) for the periods, as determined in accordance with IFRS. 77 Table of Contents We compensate for these limitations by reconciling these non-IFRS financial measures to the nearest IFRS performance measure, all of which should be considered when evaluating our performance.

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Yang served as a partner for CGP Investment, one of the leading Asia based fund of funds. Prior to that, he served various financial advisory and investment roles at Macquarie Capital Group, China Renaissance, and CVC Capital from 2006 to 2010. Mr. Yang obtained his bachelor’s degree of Commerce and bachelor’s degree of Law from Melbourne University in 2006. B.
Yang served as a partner for CGP Investment, one of the leading Asia based fund of funds. Prior to that, he served various financial advisory and investment roles at Macquarie Capital Group, China Renaissance, and CVC Capital from 2006 to 2010. Mr. Yang obtained his bachelor’s degree of Commerce and bachelor’s degree of Law from Melbourne University in 2006.
Awards requiring exercise will have a maximum term not to exceed ten years from the date of grant. 97 Table of Contents Effect of a Change in Capital Structure In the event of a change in capital structure, the Committee may make such proportionate and equitable adjustments as it may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the 2023 Plan; (b) the terms and conditions of any issued and outstanding awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant or exercise price per share for any issued and outstanding awards under the 2023 Plan.
Awards requiring exercise will have a maximum term not to exceed ten years from the date of grant. 107 Table of Contents Effect of a Change in Capital Structure In the event of a change in capital structure, the Committee may make such proportionate and equitable adjustments as it may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the 2023 Plan; (b) the terms and conditions of any issued and outstanding awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant or exercise price per share for any issued and outstanding awards under the 2023 Plan.
The Committee will be authorized to award restricted shares under the 2023 Plan. Each award of restricted share will be subject to the terms and conditions established by the Committee, including any dividend or voting rights.
Restricted Share Awards. The Committee will be authorized to award restricted shares under the 2023 Plan. Each award of restricted share will be subject to the terms and conditions established by the Committee, including any dividend or voting rights.
Our compensation committee will be responsible for, among other things: · reviewing, evaluating and, if necessary, revising our overall compensation policies; 99 Table of Contents · reviewing and evaluating the performance of our directors and relevant executive officers and determining the compensation of relevant executive officers; · reviewing and approving our executive officers’ employment agreements with our company; · setting performance targets for relevant executive officers with respect to our incentive compensation plan and equity-based compensation plans; · administering our equity-based compensation plans in accordance with the terms thereof; and · such other matters that are specifically delegated to the compensation committee by our board of directors from time to time.
Our compensation committee will be responsible for, among other things: • reviewing, evaluating and, if necessary, revising our overall compensation policies; • reviewing and evaluating the performance of our directors and relevant executive officers and determining the compensation of relevant executive officers; • reviewing and approving our executive officers’ employment agreements with our company; • setting performance targets for relevant executive officers with respect to our incentive compensation plan and equity-based compensation plans; • administering our equity-based compensation plans in accordance with the terms thereof; and • such other matters that are specifically delegated to the compensation committee by our board of directors from time to time.
Mr. Sirimongkolkasem obtained his Bachelor’s Degree of Arts in Economics from Durham University (United Kingdom) in 2012. ​ 94 Table of Contents Sheldon Trainor-DeGirolamo has served on our board of directors since April 2023. He served as the Non-Executive Director of Foxconn Interconnect Technology Ltd (6088.HK), a publicly traded company on the Hong Kong Stock Exchange, since May 2019.
Mr. Sirimongkolkasem obtained his Bachelor’s Degree of Arts in Economics from Durham University (United Kingdom) in 2012. Sheldon Trainor-DeGirolamo has served on our board of directors since April 2023. He served as the Non-Executive Director of Foxconn Interconnect Technology Ltd (6088.HK), a publicly traded company on the Hong Kong Stock Exchange, since May 2019.
Our officers are elected by and serve at the discretion of our board of directors. 100 Table of Contents Board Diversity Matrix The table below provides certain information regarding the diversity of our board of directors as of the date of this annual report, pursuant to Nasdaq’s Board Diversity Rule.
Our officers are elected by and serve at the discretion of our board of directors. Board Diversity Matrix The table below provides certain information regarding the diversity of our board of directors as of the date of this annual report, pursuant to Nasdaq’s Board Diversity Rule.
The audit committee will be responsible for, among other things: · selecting the independent auditor; · pre-approving auditing and non-auditing services permitted to be performed by the independent auditor; · annually reviewing the independent auditor’s report describing the auditing firm’s internal quality control procedures, any material issues raised by the most recent internal quality control review, or peer review, of the independent auditors and all relationships between the independent auditor and our company; · reviewing responsibilities, budget, compensation and staffing of our internal audit function; · reviewing with the independent auditor any audit problems or difficulties and management’s response; · reviewing and, if material, approving all related party transactions on an ongoing basis; · reviewing and discussing the annual audited financial statements with management and the independent auditor; · reviewing and discussing with management and the independent auditors major issues regarding accounting principles and financial statement presentations; · reviewing reports prepared by management or the independent auditors relating to significant financial reporting issues and judgments; · discussing earnings press releases with management, as well as financial information and earnings guidance provided to analysts and rating agencies; · reviewing with management and the independent auditors the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on our financial statements; · discussing policies with respect to risk assessment and risk management with management and internal auditors; · timely reviewing reports from the independent auditor regarding all critical accounting policies and practices to be used by us, all alternative treatments of financial information within IFRS that have been discussed with management and all other material written communications between the independent auditor and management; · establishing procedures for the receipt, retention and treatment of complaints received from our employees regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters; · such other matters that are specifically delegated to our audit committee by our board of directors from time to time; and · meeting separately, periodically, with management, internal auditors and the independent auditor.
The audit committee will be responsible for, among other things: • selecting the independent auditor; • pre-approving auditing and non-auditing services permitted to be performed by the independent auditor; • annually reviewing the independent auditor’s report describing the auditing firm’s internal quality control procedures, any material issues raised by the most recent internal quality control review, or peer review, of the independent auditors and all relationships between the independent auditor and our company; • reviewing responsibilities, budget, compensation and staffing of our internal audit function; • reviewing with the independent auditor any audit problems or difficulties and management’s response; • reviewing and, if material, approving all related party transactions on an ongoing basis; • reviewing and discussing the annual audited financial statements with management and the independent auditor; • reviewing and discussing with management and the independent auditors major issues regarding accounting principles and financial statement presentations; • reviewing reports prepared by management or the independent auditors relating to significant financial reporting issues and judgments; • discussing earnings press releases with management, as well as financial information and earnings guidance provided to analysts and rating agencies; • reviewing with management and the independent auditors the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on our financial statements; • discussing policies with respect to risk assessment and risk management with management and internal auditors; • timely reviewing reports from the independent auditor regarding all critical accounting policies and practices to be used by us, all alternative treatments of financial information within IFRS that have been discussed with management and all other material written communications between the independent auditor and management; • establishing procedures for the receipt, retention and treatment of complaints received from our employees regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters; • such other matters that are specifically delegated to our audit committee by our board of directors from time to time; and • meeting separately, periodically, with management, internal auditors and the independent auditor. 110 Table of Contents Compensation Committee Our compensation committee consists of Jihan Wu, Linghui Kong and Guang Yang.
The following paragraphs summarize the principal terms of our 2023 Plan. Shares Available for Awards Subject to adjustment for specified changes in our capitalization as set forth in the 2023 Plan, the maximum aggregate number of shares of common share that may be issued under the 2023 Plan will be equal to 21,877,912.
The following paragraphs summarize the principal terms of our 2023 Plan. 105 Table of Contents Shares Available for Awards Subject to adjustment for specified changes in our capitalization as set forth in the 2023 Plan, the maximum aggregate number of shares of common share that may be issued under the 2023 Plan will be equal to 21,877,912.
Payment in respect of the exercise of an option may be made in cash or by check, or the Committee may, in its discretion and to the extent permitted by law, allow the payment to be made through a broker-assisted cashless exercise mechanism, a share tender exercise, or by any other method that the Committee determines to be appropriate. 96 Table of Contents Restricted Share Awards.
Payment in respect of the exercise of an option may be made in cash or by check, or the Committee may, in its discretion and to the extent permitted by law, allow the payment to be made through a broker-assisted cashless exercise mechanism, a share tender exercise, or by any other method that the Committee determines to be appropriate.
None of our non-executive directors has a service contract with us that provides for benefits upon termination of service. Committees of the Board of Directors We have established an audit committee, a compensation committee and a nominating and corporate governance committee. We have adopted a charter for each of these committees. Each committee’s members and functions are described below.
None of our non-executive directors has a service contract with us that provides for benefits upon termination of service. Committees of the Board of Directors We have established an audit committee, a compensation committee and a nominating and corporate governance committee. We have adopted a charter for each of these committees.
Compensation Committee Our compensation committee consists of Jihan Wu, Linghui Kong and Guang Yang. Jihan Wu will be the chairperson of the compensation committee. Guang Yang satisfies the independence requirements under Rule 5605(a)(2) of the Nasdaq Stock Market Rules.
Jihan Wu will be the chairperson of the compensation committee. Guang Yang satisfies the independence requirements under Rule 5605(a)(2) of the Nasdaq Stock Market Rules.
Specifically, each executive officer has agreed not to (i) engage in, or otherwise directly or indirectly being employed by or acting as a consultant or lender to, or being a director, officer, employee, principal, agent, stockholder, member, owner or partner of, or permitting the executive officer’s name to be used in connection with the activities of, any other business or organization which competes, directly or indirectly, with us; (ii) solicit from any customer doing business with us during the term; or (iii) otherwise interfere with the business or accounts of us. 95 Table of Contents We have also entered into indemnification agreements with each of our directors and executive officers.
Specifically, each executive officer has agreed not to (i) engage in, or otherwise directly or indirectly being employed by or acting as a consultant or lender to, or being a director, officer, employee, principal, agent, stockholder, member, owner or partner of, or permitting the executive officer’s name to be used in connection with the activities of, any other business or organization which competes, directly or indirectly, with us; (ii) solicit from any customer doing business with us during the term; or (iii) otherwise interfere with the business or accounts of us.
Of the 183 full-time employees as of December 31, 2022, approximately 34 were engaged in research and development activities and 149 were engaged in business development, finance, information system, facilities, human resources or administrative support. Most of our employees are located in Singapore and United States.
Of the 211 full-time employees as of December 31, 2023, approximately 54 were engaged in research and development activities and 157 were engaged in business development, finance, information system, facilities, human resources or administrative support. Most of our employees are located in Singapore and United States.
Share Ownership The following table sets forth information regarding the beneficial ownership of Ordinary Shares as of April 21, 2023: · each person known by us to be the beneficial owner of more than 5% of Ordinary Shares; · each of our directors and executive officers; and · all our directors and executive officers as a group.
Share Ownership The following table sets forth information regarding the beneficial ownership of Ordinary Shares as of February 2, 2024: • each person known by us to be the beneficial owner of more than 5% of Ordinary Shares; • each of our directors and executive officers; and 112 Table of Contents • all our directors and executive officers as a group.
Employees Following and as a result of the contemplation of the Business Combination, the business of the Company is conducted through Bitdeer Technologies Holding Company. We had approximately 142 and 183 full-time employees as of December 2021 and 2022, respectively.
Employees Following and as a result of the contemplation of the Business Combination, the business of the Company is conducted through Bitdeer Technologies Holding Company. We had approximately 142, 183 and 211 full-time employees as of December 31, 2021, 2022 and 2023, respectively. We also hire part-time employees from time to time.
Each of Guang Yang, Sheldon Trainor-DeGirolamo and Naphat Sirimongkolkasem satisfies the independence requirements under Rule 5605(c)(2) of the Nasdaq Stock Market Rules and meets the criteria for independence set forth in Rule 10A-3 of the Exchange Act, as well as the criteria of an audit committee financial expert as set forth under the applicable rules of the SEC. 98 Table of Contents Our audit committee will oversee our company’s accounting and financial reporting processes and the audits of our financial statements.
Each of Guang Yang, Sheldon Trainor-DeGirolamo and Naphat Sirimongkolkasem satisfies the independence requirements under Rule 5605(c)(2) of the Nasdaq Stock Market Rules and meets the criteria for independence set forth in Rule 10A-3 of the Exchange Act, as well as the criteria of an audit committee financial expert as set forth under the applicable rules of the SEC.
The Committee will be authorized to award restricted share unit awards under the 2023 Plan. The Committee will determine the terms of the restricted share units, including any dividend rights (and any performance goals and/or criteria upon whose attainment the restricted period shall lapse in part or full).
The Committee will determine the terms of the restricted share units, including any dividend rights (and any performance goals and/or criteria upon whose attainment the restricted period shall lapse in part or full).
He co-founded BitMain Technologies Holding Company (“BitMain”) in 2013, and served as the Chairman and Chief Executive Officer of BitMain from September 2018 to January 2021. Mr. Wu has been a director of Matrixport Group since 2019. Mr. Wu obtained dual bachelor’s degrees in both Economics and Psychology from Peking University in 2009.
He has served as our Chief Executive Officer since March 2024. He co-founded BitMain Technologies Holding Company (“BitMain”) in 2013, and served as the Chairman and Chief Executive Officer of BitMain from September 2018 to January 2021. Mr. Wu has been a director of Matrixport Group since 2019. Mr.
Jianchun Liu has served as the Chief Financial Officer of Bitdeer and then our Chief Financial Officer since January 2021, responsible for business operations. Mr. Liu also served on our board of directors since March 2023. He has been a director of BitMain since January 2021. Prior to that, Mr.
Mr. Liu also served on our board of directors since March 2023. He has been a director of BitMain since January 2021. Prior to that, Mr. Liu served as the financial director of BitMain from 2016 to 2021. Mr.
As of April 21, 2023, to our knowledge, approximately 0.81% of our total issued and outstanding Class A Ordinary Shares were held by three record shareholders in the United States, and none of our Class V Ordinary Shares were held by record shareholders in the United States.
As of February 29, 2024, to our knowledge, approximately 74.8% of our total issued and outstanding Class A Ordinary Shares were held by one record shareholder in the United States, and none of our Class V Ordinary Shares were held by record shareholders in the United States.
In fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association, as amended and restated from time to time. A shareholder has the right to seek damages if a duty owed by the directors is breached.
In fulfilling their duty of care to us, our directors must ensure compliance with our memorandum and articles of association, as amended and restated from time to time.
Audit Committee Our audit committee consists of Guang Yang, Sheldon Trainor-DeGirolamo and Naphat Sirimongkolkasem. Sheldon Trainor-DeGirolamo is the chairperson of our audit committee.
Each committee’s members and functions are described below. 109 Table of Contents Audit Committee Our audit committee consists of Guang Yang, Sheldon Trainor-DeGirolamo and Naphat Sirimongkolkasem. Sheldon Trainor-DeGirolamo is the chairperson of our audit committee.
As of the date of this annual report, the maximum aggregate number of Class A Ordinary Shares that may be granted under the 2023 Plan is 21,877,912. As of April 21, 2023, awards to purchase a total of 10,753,878 Class A Ordinary Shares have been granted and outstanding, excluding awards that were forfeited or cancelled after the relevant grant dates.
As of the date of this annual report, 2024, awards to purchase a total of 12,543,503 Class A Ordinary Shares have been granted and outstanding, excluding awards that were forfeited or cancelled after the relevant grant dates.
Linghui Kong has served as the Chief Executive Officer of Bitdeer and then our Chief Executive Officer since January 2021. Mr. Kong also served on our board of directors since March 2023. He served as the head of Application Software Department of BitMain from April 2018 to December 2020. Prior to that, Mr.
Kong also served on our board of directors since March 2023. He served as the head of Application Software Department of BitMain from April 2018 to December 2020. Prior to that, Mr. Kong served as a senior software architect of Tencent Technology Beijing Co., Ltd. from April 2011 to March 2018. Mr.
As of April 21, 2023, there are 62,888,683 Class A Ordinary Shares and 48,399,922 Class V Ordinary Shares issued and outstanding. 101 Table of Contents Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to all shares of voting shares beneficially owned by them. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Class A ​ Class V ​ % of Total ​ % of ​ ​ Ordinary ​ Ordinary ​ Ordinary ​ Voting ​ ​ Shares ​ Shares ​ Shares ​ Power (2) Directors and Executive Officers (1) Jihan Wu (3) — 48,399,922 41.0 87.4 Linghui Kong — — — — Xiaoni Meng — — — — Jianchun Liu — — — — Huaxin Wen — — — — Naphat Sirimongkolkasem — — — — Sheldon Trainor-Degirolamo — — — — Guang Yang — — — — All executive officers and directors as a group (eight individuals) — 48,399,922 41.0 87.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ 5.0% Shareholders Zhaofeng Zhao (4) 15,326,416 — 13.0 2.8 Yuesheng Ge (5) 10,214,395 — 8.7 1.8 Yishuo Hu (6) 10,214,395 — 8.7 1.8 ​ (1) The business address for our directors and executive officers of the Company will be 08 Kallang Avenue, Aperia tower 1, #09-03/04, Singapore 339509.
Class A Class V % of Total % of Ordinary Ordinary Ordinary Voting Shares Shares Shares Power(2) Directors and Executive Officers(1) Jihan Wu(3) - 48,399,922 41.8 87.8 Linghui Kong * - * * Jianchun Liu * - * * Chao Suo * - * * Naphat Sirimongkolkasem * - * * Sheldon Trainor-Degirolamo * - * * Guang Yang * - * * Haris Basit * - * * All executive officers and directors as a group (eight individuals) 880,179 48,399,922 42.3 87.8 5.0% Shareholders Zhaofeng Zhao(4) 15,326,416 - 13.2 2.8 Yuesheng Ge(5) 9,115,319 - 7.9 1.7 Yishuo Hu(6) 10,158,844 - 8.8 1.8 (1) The business address for our directors and executive officers of the Company will be 08 Kallang Avenue, Aperia tower 1, #09-03/04, Singapore 339509.
Each Class V Ordinary Share shall automatically convert into one (1) Class A Ordinary Share if transferred from a Founder Entity to a non-Founder Entity, except under certain circumstances. (3) Represents Class V Ordinary Shares held through Victory Courage Limited. (4) Represents Class A Ordinary Shares held through Shinning Stone Invest Co., Ltd.
Each Class V Ordinary Share shall automatically convert into one (1) Class A Ordinary Share if transferred from a Founder Entity to a non-Founder Entity, except under certain circumstances. (3) Represents 48,399,922 Class V Ordinary Shares directly held by Victory Courage Limited (“Victory Courage”) as reported on Schedule 13D filed by Victory Courage on May 31, 2023.
Directors and Senior Management Our board of directors and executive officers as of the date of this annual report are as follows. ​ ​ ​ ​ ​ Name Age Position Jihan Wu 37 Chairman of the Board Linghui Kong 41 Director and Chief Executive Officer Xiaoni Meng 38 Director Jianchun Liu 45 Director and Chief Financial Officer, Business Operations Huaxin Wen 43 Chief Financial Officer, Capital Market Naphat Sirimongkolkasem 33 Director Sheldon Trainor-Degirolamo 59 Director Guang Yang 40 Director ​ Jihan Wu has served as the sole director of Bitdeer and then Chairman of our board of directors since January 2021.
Name Age Position Jihan Wu 38 Chairman of the Board and Chief Executive Officer Linghui Kong 42 Director and Chief Business Officer Chao Suo 39 Director Jianchun Liu 46 Director and Chief Financial Officer, Business Operations Naphat Sirimongkolkasem 34 Director Sheldon Trainor-Degirolamo 60 Director Guang Yang 41 Director Haris Basit 62 Chief Strategy Officer Jihan Wu has served as the sole director of Bitdeer and then Chairman of our board of directors since January 2021.
Compensation Historical Compensation of Bitdeer’s Directors and Executive Officers For the year ended December 31, 2022, an aggregate of approximately US$12.0 million in cash and benefits was paid to Bitdeer’s executive officers and director.
He also earned a BSEE from University of Illinois, Urbana-Champaign in 1984. 104 Table of Contents B. Compensation Historical Compensation of Bitdeer’s Directors and Executive Officers For the year ended December 31, 2023, an aggregate of approximately US$9.0 million in cash and benefits was provided to Bitdeer’s executive officers and director.
Liu served as the financial director of BitMain from 2016 to 2021. Mr. Liu obtained an MBA from University of Chinese Academy of Sciences in 2017 and a bachelor’s degree in Economics from Renmin University of China in 2000.
Liu obtained an MBA from University of Chinese Academy of Sciences in 2017 and a bachelor’s degree in Economics from Renmin University of China in 2000. Chao Suo has served as on our board of directors since October 2023.
Restricted share awards are shares of common share that generally are non-transferable and subject to other restrictions determined by the Committee for a specified period. Unless the Committee determines otherwise or specifies otherwise in an award agreement, if the participant terminates employment or services during the restricted period, then any unvested restricted share is forfeited. Restricted Share Units .
Restricted share awards are shares of common share that generally are non-transferable and subject to other restrictions determined by the Committee for a specified period.
Terms of Directors and Executive Officers Our directors may be appointed by an ordinary resolution of our shareholders.
A shareholder has the right to seek damages if a duty owed by the directors is breached. 111 Table of Contents Terms of Directors and Executive Officers Our directors may be appointed by an ordinary resolution of our shareholders.
The following table summarizes, as of April 21, 2023 the closing date of the Business Combination, the options granted under our share incentive plans to several of our executive officers, excluding awards that were forfeited or cancelled after the relevant grant dates. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Class A Ordinary ​ ​ ​ ​ ​ Shares Underlying ​ Exercise Price ​ Date of ​ Date of Name ​ Awards ​ (US$/Share) ​ Grant ​ Expiration Jihan Wu — — — — Linghui Kong * 3.5 August 1, 2021 August 1, 2031 ​ * 3.5 January 1, 2022 January 1, 2032 ​ * 3.5 January 1, 2023 January 1, 2033 Xiaoni Meng * 3.5 November 1, 2021 November 1, 2031 ​ * 3.5 January 1, 2023 January 1, 2033 Jianchun Liu * 3.5 August 1, 2021 August 1, 2031 ​ * 3.5 January 1, 2022 January 1, 2032 Huaxin Wen ​ * ​ 3.5 ​ August 1, 2021 ​ August 1, 2031 Naphat Sirimongkolkasem ​ — ​ — ​ — ​ — Sheldon Trainor-Degirolamo — — — — Guang Yang — — — — * Less than 1% of our total issued and outstanding ordinary shares.
Class A Ordinary Shares Underlying Exercise Price Date of Date of Name Awards (US$/Share) Grant Expiration Jihan Wu - - - - Linghui Kong * 3.5 August 1, 2021 August 1, 2031 * 3.5 January 1, 2022 January 1, 2032 * 3.5 January 1, 2023 January 1, 2033 Chao Suo * 3.5 August 1, 2021 August 1, 2031 * 3.5 January 1, 2022 January 1, 2032 * 3.5 January 1, 2023 January 1, 2033 * 3.5 January 1, 2023 January 1, 2033 Jianchun Liu * 3.5 August 1, 2021 August 1, 2031 * 3.5 January 1, 2022 January 1, 2032 Naphat Sirimongkolkasem * 7.03 July 1, 2023 July 1, 2033 Sheldon Trainor-Degirolamo * 7.03 July 1, 2023 July 1, 2033 Guang Yang * 7.03 July 1, 2023 July 1, 2033 Haris Basit * 5.51 July 1, 2023 July 1, 2033 * Less than 1% of our total issued and outstanding ordinary shares. 2023 Performance Share Plan In June 2023, our board of directors approved our 2023 Performance Share Plan (the “2023 Performance Plan”), which became effective on October 11, 2023.
Kong served as a senior software architect of Tencent Technology Beijing Co., Ltd. from April 2011 to March 2018. Mr. Kong obtained a master’s degree in Telecommunication and Information System from Beijing University of Posts and Telecommunications in 2008 and a bachelor’s degree in Telecommunication Engineering from Beijing University of Posts and Telecommunications in 2005.
Kong obtained a master’s degree in Telecommunication and Information System from Beijing University of Posts and Telecommunications in 2008 and a bachelor’s degree in Telecommunication Engineering from Beijing University of Posts and Telecommunications in 2005. 103 Table of Contents Jianchun Liu has served as the Chief Financial Officer of Bitdeer and then our Chief Financial Officer since January 2021, responsible for business operations.
(5) Represents Class A Ordinary Shares held through Mega Galaxy International Limited. (6) Represents Class A Ordinary Shares held through Golden Navigate Investments Limited.
(6) Represents 10,158,844 Class A Ordinary Shares directly held by Golden Navigate Investments Limited (“Golden Navigate”) as reported on Schedule 13G/A filed by Golden Navigate on February 5, 2024.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A.
ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES A. Directors and Senior Management Our board of directors and executive officers as of the date of this annual report are as follows.
Removed
Huaxin Wen has served as the Chief Financial Officer of Bitdeer and then our Chief Financial Officer since April 2021, responsible for capital market. He served as a financial officer of Fangdd Network Group Ltd. (Nasdaq: DUO), a property technology company, from 2014 to 2021. Prior to that, Mr.
Added
Wu obtained dual bachelor’s degrees in both Economics and Psychology from Peking University in 2009. Linghui Kong has served as the Chief Executive Officer of Bitdeer and then our Chief Executive Officer since January 2021. He transitioned from our Chief Executive Officer to the role of Chief Business Officer since March 2024. Mr.
Removed
Wen served as a senior manager of KPMG Huazhen LLP, one of the big four accounting firms, from 2009 to 2014. Mr. Wen obtained a bachelor’s degree of Arts in English from South China University of Technology in 2001. Xiaoni Meng has served on our board of directors since March 2023.
Added
She has over ten years of experience in human resources, including HR strategy framework, recruitment, performance management, competency development, compensation & benefit, and labor compliance. Ms. Suo has served as the HR Director of Bitdeer since March 2021. Prior to that, she served as the HR Director of BitMain from 2015 to 2021. Ms.
Removed
She has served as Vice President of BIT Mining Limited (NYSE: BTCM), a cryptocurrency enterprise publicly traded on New York Stock Exchange, from April 2021 to April 2022. Ms. Meng served as the head of mining cloud department of Bitdeer from January 2021 to March 2021. Prior to that, Ms.
Added
Suo obtained a master’s degree in Corporate Management from Communication University of China in 2010 and a bachelor’s degree in Business Administration from Beijing Forestry University in 2008. Naphat Sirimongkolkasem has served on our board of directors since April 2023.
Removed
Meng led the operation of cloud mining business of BitMain from July 2018 to December 2020. Ms. Meng graduated from Xi’an University of Science and Technology in 2006. Naphat Sirimongkolkasem has served on our board of directors since April 2023.
Added
Haris Basit has served as our Chief Strategy Officer since June 2023. Mr. Basit previously worked as the Chief Executive Officer of Averatek Corporation from August 2017 to May 2023. Prior to that, he was the Chief Executive Officer and Director of VIASPACE Inc. from July 2016 to July 2017.
Removed
We did not have full-time employees as of December 31, 2020 as we operated as part of Bitmain until January 2021. We also hire part-time employees from time to time.
Added
He co-founded Almaden Energy Group (AEG), LLC which partners with VIASPACE to grow Giant King Grass in the United States for animal feed. Since 2012, Mr. Basit has been providing Corporate Strategy Consulting to senior executives of publicly traded companies to help identify new growth opportunities and partnerships.
Added
He was a consultant to Liebman and Associates, the premier clean energy lobbying firm in Washington, DC. He has provided entrepreneurship mentoring for University of California Berkeley MBA students.
Added
He started his career as a Staff Engineer at IBM moving on to become a Manager at Rockwell International, a Manager at Bell Labs, Vice President of Business Development for OEA International and then Founder/CEO of both Multigig, Inc. and Mobius Power, LLC. He received his MSEE from the University of Illinois, Urbana-Champaign in 1986.
Added
We have also entered into indemnification agreements with each of our directors and executive officers.
Added
As of the date of this annual report, the maximum aggregate number of Class A Ordinary Shares that may be granted under the 2023 Plan is 21,877,912.
Added
Unless the Committee determines otherwise or specifies otherwise in an award agreement, if the participant terminates employment or services during the restricted period, then any unvested restricted share is forfeited. 106 Table of Contents Restricted Share Units . The Committee will be authorized to award restricted share unit awards under the 2023 Plan.
Added
The following table summarizes, as of February 29, 2024, the options granted under our share incentive plans to several of our executive officers, excluding awards that were forfeited or cancelled after the relevant grant dates.
Added
The 2023 Performance Plan provides for the issuance of initially up to an aggregate of 1,112,886 Class A Ordinary Shares (the “Share Limit”), representing 1% of the total ordinary shares of our company outstanding as of the consummation of the Business Combination on April 13, 2023.
Added
The Share Limit will be adjusted along with the market capitalization of our Company as set forth in the 2023 Performance Share Plan and will not be more than 11,128,861, representing ten percent (10%) of the total ordinary shares of our company as of closing of the Business Combination.
Added
As of the date of this annual report, no awards have been granted under the 2023 Performance Plan. The following paragraphs summarize the principal terms of the 2023 Performance Plan. Types of Awards .
Added
The 2023 Performance Plan permits the awards of options, restricted shares or restricted share units or any award that may consist of one such security or benefit, or two or more than them in any combination or alternative. Plan Administration . The 2023 Performance Plan will be administered by chairman of our company.
Added
The compensation committee of our board of directors or any member of our compensation committee as designated by our board of directors, as applicable, will determine the participants to receive awards, the type and number of awards to be granted to each participant, and the terms and conditions of each grant. 108 Table of Contents Notice of Grant .
Added
Awards granted under the 2023 Performance Plan are evidenced by a notice of grant that sets forth the terms, conditions and limitations for each award, which may include the term of the award, the provisions applicable in the event that the grantee’s employment or service terminates, and our authority to unilaterally or bilaterally amend, modify, suspend, cancel or rescind the award.
Added
Eligibility . Persons eligible to participate in the 2023 Performance Plan include persons recognized by the plan administrator, such as directors, officers and other persons as determined by the plan administrator. Vesting Schedule . The vesting schedule of each award granted under 2023 Performance Plan will be set forth in the relevant notice of grant. Transfer Restrictions .
Added
Awards may not be transferred in any manner by the participant other than in accordance with the exceptions provided in the 2023 Performance Plan or the relevant notice of grant or otherwise determined by the plan administrator. Amendment, Modification and Termination of the 2023 Performance Plan .
Added
Our board of directors has the authority to terminate, amend, modify, alter, suspend or discontinue the 2023 Performance Plan or any portion thereof in accordance with our articles of association.
Added
However, no such action shall adversely affect in any material way any award previously granted pursuant to the 2023 Performance Plan without the prior written consent of the plan participants, except to the extent any such action is made to cause the 2023 Performance Plan to comply with applicable law, stock market or exchange rules and regulations or accounting or tax rules and regulations.
Added
In the event of a change in capital structure, the plan administrator may make such proportionate and equitable adjustments as it may deem appropriate to reflect such change with respect to (a) the aggregate number and type of shares that may be issued under the 2023 Performance Plan; (b) the terms and conditions of any issued and outstanding awards (including, without limitation, any applicable performance targets or criteria with respect thereto); and (c) the grant or exercise price per share for any issued and outstanding awards under the 2023 Performance Plan.
Added
Our audit committee will oversee our company’s accounting and financial reporting processes and the audits of our financial statements.
Added
As of February 29, 2024, there are 67,312,909 Class A Ordinary Shares (606,756 Class A Ordinary Shares that have been repurchased but not cancelled and 6,695,228 Class A Ordinary Shares reserved for future issuances upon the exercise of awards granted under our share incentive plans) and 48,399,922 Class V Ordinary Shares issued and outstanding.
Added
Unless otherwise indicated, we believe that all persons named in the table below have sole voting and investment power with respect to all shares of voting shares beneficially owned by them.
Added
Victory Courage is a British Virgin Islands company wholly owned by Cosmic Gains Global Limited, a company incorporated in the British Virgin Islands wholly owned and managed by VISTRA Trust (Hong Kong) Limited as trustee of an irrevocable trust, with Mr. Jihan Wu as the settlor and Mr. Wu and his family members as the beneficiaries.
Added
Under the terms of such trust, Mr. Wu has the power to direct the trustee with respect to the retention or disposal of, and the exercise of any voting and other rights attached to the shares held by Victory Courage in our company.
Added
(4) Represents 15,326,416 Class A Ordinary Shares directly held by Shinning Stone Invest Co., Ltd (“Shinning Stone”) as reported on Schedule 13D filed by Shinning Stone on March 27, 2024. Shinning Stone is a British Virgin Islands company wholly-owned by Mr. Zhaofeng Zhao. Mr.
Added
Zhao is also the sole director of Shinning Stone. 113 Table of Contents (5) Represents 9,115,319 Class A Ordinary Shares directly held by Mega Galaxy International Limited (“Mega Galaxy”) as reported on Schedule 13G/A filed by Mega Galaxy on February 5, 2024.
Added
Mega Galaxy is a British Virgin Islands company wholly owned by Flourishing Well Limited, a company incorporated in the British Virgin Islands, which in turn is wholly owned and managed by VISTRA Trust (Hong Kong) Limited as trustee of The Sharesun Trust, a Hong Kong reserved powers trust. Mr. Yuesheng Ge is the settlor of such trust and Mr.
Added
Ge and his family members are the beneficiaries. Under the terms of such trust, Mr. Ge has the power to direct the trustee with respect to the retention or disposal of, and the exercise of any voting and other rights attached to the shares held by Mega Galaxy in our company.
Added
Golden Navigate is a British Virgin Islands company wholly owned by Blessing Surplus Limited, a company incorporated in the British Virgin Islands, which is wholly owned and managed by VISTRA Trust (Hong Kong) Limited as trustee of The Zizai Trust, a Hong Kong reserved powers trust. Mr. Yishuo Hu is the settlor of such trust and Mr.
Added
Hu and his family members are the beneficiaries. Under the terms of such trust, Mr. Hu has the power to direct the trustee with respect to the retention or disposal of, and the exercise of any voting and other rights attached to the shares held by Golden Navigate in our company.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

10 edited+3 added−6 removed9 unchanged
During the years ended December 31, 2020, 2021 and 2022, substantially all of Bitdeer’s cryptocurrencies were held in custody by Matrixport Group and Bitdeer’s disposal of cryptocurrencies, at spot price on the date of disposal, was primarily to Matrixport Group.
During the years ended December 31, 2021, 2022 and 2023, substantially all of Bitdeer’s cryptocurrencies were held in custody by Matrixport Group and Bitdeer’s disposal of cryptocurrencies, at spot price on the date of disposal, was primarily to Matrixport Group.
As of December 31, 2020, 2021 and 2022, the loans receivable from Matrixport Group was approximately US$1.3 million, US$1.1 million and US$0.3 million, respectively. In February 2021, Bitdeer signed a loan agreement with Matrixport Group, pursuant to which Bitdeer agreed to grant a revolving line of credit with a maximum amount of US$20 million.
As of December 31, 2021, 2022 and 2023, the loans receivable from Matrixport Group was approximately US$1.1 million, US$0.3 million and nil, respectively. In February 2021, Bitdeer signed a loan agreement with Matrixport Group, pursuant to which Bitdeer agreed to grant a revolving line of credit with a maximum amount of US$20 million.
In addition, no loan shall be made to the Company’s directors, officers or supervisors directly or indirectly. C. Interests of Experts and Counsel None. ​ 104 Table of Contents
In addition, no loan shall be made to the Company’s directors, officers or supervisors directly or indirectly. 115 Table of Contents C. Interests of Experts and Counsel None.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See the section entitled “Item 6. Directors, Senior Management and Employees—E. Share Ownership.” 102 Table of Contents B. Related Party Transactions Employment Agreements and Indemnification Agreements See the section entitled “Item 6. Directors, Senior Management and Employees—B. Compensation.” Share Incentive Plan See the section entitled “Item 6.
ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS A. Major Shareholders See the section entitled “Item 6. Directors, Senior Management and Employees-E. Share Ownership.” B. Related Party Transactions Employment Agreements and Indemnification Agreements See the section entitled “Item 6. Directors, Senior Management and Employees-B. Compensation.” Share Incentive Plan See the section entitled “Item 6. Directors, Senior Management and Employees-B.
Charged with an annual interest of 12.5% by Bitdeer, each tranche of credit utilized shall be repaid within 60 days. The credit line has expired, and the loan has been fully repaid in June 2021.
Charged with an annual interest of 12.5% by Bitdeer, each tranche of credit utilized shall be repaid within 60 days. The credit line has expired, and the loan has been fully repaid in June 2021. Bitdeer received an interest of approximately US$0.8 million associated with the loan.
The service fees charged by Martixport Group for the year ended December 31, 2020 were immaterial, the service fees charged for the year ended December 31, 2021 and 2022 were approximately US$0.3 million and US$0.4 million, respectively. Other transactions with Matrixport Group Bitdeer provided loans to Matrixport Group which are non-interest bearing and due on demand.
The service fees charged to Matrixport Group for the years ended December 31, 2021, 2022 and 2023 were approximately US$0.5 million, US$3.1 million and US$0.8 million, respectively. 114 Table of Contents Other transactions with Matrixport Group Bitdeer provided loans to Matrixport Group which are non-interest bearing and due on demand.
Bitdeer redeemed the product on December 28, 2021, earned an investment income of approximately US$0.7 million, and realized an annual percentage yield of around 13%. During 2022, Bitdeer lent loans in a total amount of approximately US$150.0 million to Matrixport Group and received approximately US$1.5 million interest income.
Bitdeer redeemed the product on December 28, 2021, earned an investment income of approximately US$0.7 million, and realized an annual percentage yield of around 13%. In July 2022, Bitdeer signed an agreement with Matrixport Group to subscribe a limited partner interest in a limited partnership set up by the Matrixport Group and the capital commitment is amounting to US$20 million.
Directors, Senior Management and Employees—B. Compensation.” Other Related Party Transactions Revenue generated from Bitmain and BTC Before the completion date of their respective separations with Bitdeer, Bitdeer generated revenue from Bitmain and BTC from Bitdeer’s normal course of business.
Compensation.” Other Related Party Transactions Revenue generated from Bitmain and BTC Before the completion date of their respective separations with Bitdeer, Bitdeer generated revenue from Bitmain and BTC from Bitdeer’s normal course of business. Revenue generated from Bitmain and BTC was approximately US$73.5 million, nil and nil for the years ended December 31, 2021, 2022 and 2023, respectively.
Related Person Transaction Policy We have adopted a related person transaction policy that sets forth the policies procedures for the identification, review, and approval or ratification of related person transactions. Related person transaction is any transaction involving any “related person”, as defined in the policy, and the Company or its subsidiaries.
Related person transaction is any transaction involving any “related person”, as defined in the policy, and the Company or its subsidiaries.
As of December 31, 2022, the capital contribution made by us to the limited partnership is US$17 million. We recorded approximately US$952,000 loss on change in fair value of financial assets at fair value through profit or loss for the year ended December 31, 2022.
We recorded approximately US$3.5 million gain and US$1.0 million loss on change in fair value of financial assets at fair value through profit or loss for the years ended December 31, 2023 and 2022, respectively. During 2022, Bitdeer lent loans in a total amount of approximately US$150.0 million to Matrixport Group and received approximately US$1.5 million interest income.
Removed
Revenue generated from Bitmain and BTC was approximately US$88.1 million, US$73.5 million and nil for the years ended December 31, 2020, 2021 and 2022, respectively. The associated trade receivables as of December 31, 2020, 2021 and 2022, respectively, was approximately US$1.6 million, nil and nil.
Added
The service fees charged by Matrixport Group for the years ended December 31, 2021, 2022 and 2023 were approximately US$0.3 million, US$0.4 million and US$0.2 million, respectively. Technical and human resources services provided to Matrixport Group During the years ended December 31, 2021, 2022 and 2023, we provided technical and human resources service to Matrixport Group.
Removed
Loans to and borrowings from Bitmain Historically, Bitdeer provided loans to and received borrowings from Bitmain in the year ended December 31, 2020 when Bitdeer operated as part of Bitmain.
Added
We, as a limited partner, do not have control or significant influence over the limited partnership. As of December 31, 2023, the capital contribution made by us to the limited partnership is US$17 million.
Removed
As of December 31, 2020, 2021 and 2022, the balance of loans receivable from Bitmain was approximately US$167.0 million, nil and nil, and the borrowings repayable to Bitmain was approximately US$24.8 million, nil and nil, respectively.
Added
We did not make any lending to or purchase any wealth management products from Matrixport Group thereafter. Related Person Transaction Policy We have adopted a related person transaction policy that sets forth the policies procedures for the identification, review, and approval or ratification of related person transactions.
Removed
Other related party balances associated with Bitmain Other receivables from and other payables to Bitmain represent primarily the amount due from or due to Bitmain arising from Bitmain’s business historically recorded and remained on the books of Bitdeer.
Removed
As of December 31, 2020, 2021 and 2022, the balance of other receivables from Bitmain was approximately US$441.1 million, nil and nil, and other payables to Bitmain was approximately US$638.2 million, nil and nil, respectively.
Removed
Bitdeer received an interest of approximately US$0.8 million associated with the loan. 103 Table of Contents In July 2022, Bitdeer signed an agreement with Matrixport Group to subscribe a limited partner interest in a limited partnership set up by the Matrixport Group and the capital commitment is amounting to US$20 million. We do not have control over the limited partnership.

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