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Abits Group Inc

Abits Group IncABTS财报

Nasdaq · 信息技术 · 金融服务

Universal ABIT Co., Ltd was a computer components manufacturer, based in Taiwan, active since the 1980s. Its core product line were motherboards aimed at the overclocker market. ABIT experienced serious financial problems in 2005. The brand name "ABIT" and other intangible properties, including patents and trademarks, were acquired by Universal Scientific Industrial Co., Ltd. (USI) in May 2006.

What changed in Abits Group Inc's 20-F — 2022 vs 2023

Top changes in Abits Group Inc's 2023 20-F

83 paragraphs added · 82 removed · 53 edited across 5 sections

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account, and harm investors.
Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account, and harm investors.
Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account, and harm investors.
Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account, and harm investors.
Such events could have a material adverse effect on our ability to continue as a going concern or to pursue our business strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account.
Such events could have a material adverse effect on our ability to continue as a going concern or to pursue our business strategy at all, which could have a material adverse effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account.
Although we have completed the divestment in July 2022, the PRC government could find any one of our previous agreements non-compliant with relevant PRC laws, regulations, and rules, or if these laws, regulations, and rules or the interpretation thereof change in the future, and such changes may be retroactively applied to our historical contractual arrangements, we could be subject to severe penalties and require a potential restatement of our financial statements included elsewhere in this annual report.
Although we completed the divestment in July 2022, the PRC government could find any one of our previous agreements non-compliant with relevant PRC laws, regulations, and rules, or if these laws, regulations, and rules or the interpretation thereof change in the future, and such changes may be retroactively applied to our historical contractual arrangements, we could be subject to severe penalties and require a potential restatement of our financial statements included elsewhere in this annual report.
We have a history of operating losses, and we may not be able to achieve or sustain profitability; we have recently shifted our bitcoin mining business, and we may not be successful in this business. We are not profitable and have incurred losses since our inception.
We have a history of operating losses, and we may not be able to achieve or sustain profitability; we have recently begun to conduct our bitcoin mining operations, and we may not be successful in this business. We are not profitable and have incurred losses since our inception.
Whilst the Company acknowledges that such risks exist at any time, it also believes that repeating them in great depth serves no purpose and can preclude a proper reading of this Report. 1 The Holding Foreign Companies Accountable Act Our common shares may be prohibited from trading on a national exchange or “over-the-counter” markets under the HFCAA if the PCAOB determines it is unable to inspect or investigate completely our auditors for three consecutive years beginning in 2021.
Whilst the Company acknowledges that such risks exist at any time, it also believes that repeating them in great depth serves no purpose and can preclude a proper reading of this report. 1 The Holding Foreign Companies Accountable Act Our ordinary shares may be prohibited from trading on a national exchange or “over-the-counter” markets under the HFCAA if the PCAOB is unable to inspect our auditors for two consecutive years.
Although we divested ourselves of the PRC subsidiaries in July 2022 and we no longer have operations in China, we may be subject to potential future actions by the PRC government which may retroactively affect the enforceability and legality of our historical operations involving the former PRC subsidiaries.
Although we divested all of the equity in Moxian HK and its PRC subsidiaries in July 2022 and we no longer have substantial operations in China, we may be subject to potential future actions by the PRC government which may retroactively affect the enforceability and legality of our historical operations involving the former PRC subsidiaries.
ITEM 3. KEY INFORMATION Our Corporate Structure Moxian (BVI) Inc, or Moxian BVI, is not a PRC operating company but a British Virgin Islands holding company (“the Company”) resulting from a merger with a U.S. domiciled subsidiary in August 2021.
ITEM 3. KEY INFORMATION Our Corporate Structure Abits Group Inc, or Abits Group, is not a PRC operating company but a British Virgin Islands holding company (“the Company”) resulting from a merger with its U.S. domiciled parent holding company in August 2021.
As such, we are exempt from certain rules under the Exchange Act that are applicable to U.S. domestic issuers. Moreover, we are not required to provide as many Exchange Act reports, or as frequently or as promptly, as U.S. domestic issuers. We are also not required to provide the same level of disclosure on certain issues.
Moreover, we are not required to provide as many Exchange Act reports, or as frequently or as promptly, as U.S. domestic issuers. We are also not required to provide the same level of disclosure on certain issues.
In order to streamline our corporate structure and considering the changing regulatory environment, we have completed the divestment of our PRC subsidiaries to Jiantao Liu, a resident of China, for the disposal of all equity interests of Moxian (Hong Kong) Limited for a cash consideration of HKD 1,000. Accordingly, all contractual arrangements involving the PRC subsidiaries were effectively terminated.
In order to streamline our corporate structure and considering the changing regulatory environment, we had completed the divestment of Moxian HK and its PRC subsidiaries to Jiantao Liu, a resident of China for a cash consideration of HKD 1,000. Accordingly, all contractual arrangements involving the PRC subsidiaries were effectively terminated.
Failure to manage our liquidity and cash flows may materially and adversely affect our financial conditions and results of operations. As a result, we may need additional capital, and financing may not be available on terms acceptable to us, or at all. The Company is new to bitcoin mining and is operating in the United States for the first time.
As a result, we may need additional capital, and financing may not be available on terms acceptable to us, or at all. The Company is new to bitcoin mining and is operating in the United States for the first time.
For a more detailed discussion of the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to be a PFIC, see “Item 10.E.
For a more detailed discussion of the application of the PFIC rules to us and the consequences to U.S. taxpayers if we were determined to be a PFIC, see “Item 10.E. Taxation — United States Federal Income Taxation — Passive Foreign Investment Company.” 26
This process will reoccur until the total amount of bitcoin currency rewards issued reaches 21 million, which is expected around 2140. While bitcoin prices have had a history of price fluctuations around the halving of its bitcoin rewards, there is no guarantee that the price change will be favorable or would compensate for the reduction in mining reward.
While bitcoin prices have had a history of price fluctuations around the halving of its bitcoin rewards, there is no guarantee that the price change will be favorable or would compensate for the reduction in mining reward.
Because of this change, the following table presents the selected consolidated financial information of our Company as of December 31, 2022 and December 31, 2021, The selected consolidated statements of operations data and the selected consolidated balance sheets data have been derived from our audited consolidated financial statements, which are included in this annual report.
The selected consolidated statements of operations data and the selected consolidated balance sheets data have been derived from our audited consolidated financial statements, of which that for the year ended December 31, 2023 and December 31. 2022 are included in this annual report.
December 31, December 31, 2022 2021 Cash and cash equivalents 2,505,286 2,507,404 Digital assets 7,087,747 5,000,000 Property, equipment and vehicles 12,533,408 Other assets 2,384,976 229,708 Total assets 24,531,417 7,737,112 Total liabilities (613,455 ) (1,170,096 ) Total stockholders’ equity 23,917,962 6,567,016 2 3B. Capitalization and Indebtedness Not Applicable for annual reports on Form 20-F. 3C.
December 31 December 31 2023 2022 Cash and cash equivalents 884,199 2,505,286 Digital assets 1,194,157 7,087,747 Property, equipment and vehicles 9,465,567 12,553,408 Other assets 774,345 2,384,976 Total assets 12,318,268 24,531,417 Total liabilities (1,005,608 ) (613,455 ) Stockholders’ equity 11,312,660 23,917,962 2 3B. Capitalization and Indebtedness Not Applicable for annual reports on Form 20-F. 3C.
These exemptions and practices may afford less protection to our shareholders than they would enjoy if we were a U.S. domestic issuer. Selected Financial Data The Company has a December 31 fiscal year-end which is different from that of its predecessor company which fiscal year-end was September 30.
These exemptions and practices may afford less protection to our shareholders than they would enjoy if we were a U.S. domestic issuer. Selected Financial Data The following table presents the selected consolidated financial information of our Company as of December 31, 2023, December 31, 2022 and December 31, 2021.
Our results of operation may fluctuate significantly and may not fully reflect the underlying performance of our business.
Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods. Our results of operation may fluctuate significantly and may not fully reflect the underlying performance of our business.
Whilst we continue with the digital advertising business, it is proving to be increasingly difficult because of restrictions on online gaming. which is a key business of our clients. Starting in March 2022, we diversified into the bitcoin mining business.
Whilst we had continued with the digital advertising business, it later proved to be increasingly difficult because of restrictions on online gaming by the PRC government, which was a key business of our then clients.
Merger The Company is the surviving company following a merger in August 2021 with its predecessor company, Moxian, Inc., which was incorporated in Nevada, U.S. As an offshore holding company incorporated in the British Virgin Islands, we are qualified as a “foreign private issuer” within the meaning of the rules under the Exchange Act.
Foreign Private Issuer As an offshore holding company incorporated in the British Virgin Islands, we are qualified as a “foreign private issuer” within the meaning of the rules under the Exchange Act. As such, we are exempt from certain rules under the Exchange Act that are applicable to U.S. domestic issuers.
In July 2022, the Company divested its entire interest in Moxian (Hong Kong) Limited with the result that it no longer has any business operations in the PRC and now solely operates in the bitcoin mining industry, with an operation through its U.S. subsidiary, ABit USA Inc.
In July 2022, the Company divested its entire interest in Moxian (Hong Kong) Limited, or Moxian HK, with the result that it no longer has any substantial business operations in the PRC, other than certain administrative functions conducted by a wholly owned indirect subsidiary located in Beijing.
As of the date of this Report, the Company has yet to fully implement its plan to diversify into bitcoin mining as various mining sites have not been finalized. If we cannot execute the bitcoin mining, it would seriously affect our financial and business condition and deepen the losses of the Company.
If we cannot execute the bitcoin mining, it would seriously affect our financial and business condition and deepen the losses of the Company. Failure to manage our liquidity and cash flows may materially and adversely affect our financial conditions and results of operations.
Summary Consolidated Statements of Operations: Year ended December 31 2022 2021 Revenue 164,428 219,330 Direct costs of revenue (461,290 ) Other operating overheads (18,886,684 ) (3,485,470 ) Provision for impairment in value (76,681 ) Provision for doubtful debts Loss from operation (19,249,179 ) Administrative and general overheads (1,666,824 ) Loss associated from a divestment in a subsidiary (1,617,642 ) Other income (net) 126,290 Loss before tax (22,544,903 ) (2,739,850 ) Summary Consolidated Balance Sheet Data: The following table presents our summary consolidated balance sheet data as of December 31, 2022 and December 31, 2021.
Summary Consolidated Statements of Operations: Year ended December 31 2023 2022 2021 Revenue 1,681,533 161,428 219,330 Loss from operations (11,013,871 ) (19,260,227 ) 2,866,140 126,290 Loss before taxation 12,585,250 21,520,114 2,739,850 Summary Consolidated Balance Sheet Data: The following table presents our summary consolidated balance sheet data as of December 31, 2023 and December 31, 2022.
Our current strategy is new and unproven, is in an industry that is relatively itself new and evolving and is subject to the risks discussed below. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods.
Starting in March 2022, we diversified into the bitcoin mining business and subsequently divested all of the equity in Moxian HK and the digital advertising business conducted by Moxian HK’s subsidiaries. Our current operations and business strategy are new, are in an industry that is relatively itself new and evolving and are subject to the risks discussed below.
Removed
Further, on June 22, 2021, the U.S. Senate passed the Accelerating Holding Foreign Companies Accountable Act (“AHFCAA”) and on February 4, 2022, the U.S. House of Representatives passed the America Creating Opportunities for Manufacturing Pre-Eminence in Technology and Economic Strength (COMPETES) Act of 2022, or the COMPETES Act.
Added
To reflect that change, the Company changed its name to Abits Group Inc as it now solely operates in the bitcoin mining industry, with principal operations in the United States through its wholly-owned subsidiary, Abit USA Inc.
Removed
If either the AHFCAA or COMPETES Act is enacted into law, it would amend the HFCAA and require the SEC to prohibit an issuer’s securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections or complete investigations for two consecutive years instead of three.
Added
Pursuant to the HFCAA enacted in December 2020 and related legislation, if the SEC determines that a company has filed an audit report issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for two consecutive years, the SEC is required to prohibit such company’s securities from being traded on a national securities exchange or in the over the counter trading market in the U.S.
Removed
At the Annual Meeting of its stockholders on August 12, 2022, the Company decided to appoint Audit Alliance LLP, a firm of accountants incorporated in the Republic of Singapore, as the Company’s auditors for the year ended December 31, 2022.
Added
Pursuant to the HFCAA, the PCAOB issued a Determination Report on December 16, 2021, which found that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland China and Hong Kong. In addition, the PCAOB’s report identified the specific registered public accounting firms which are subject to these determinations.
Removed
Moxian (BVI) Inc. is a British Virgin islands holding company with operations primarily conducted by its subsidiaries and, historically, through contractual arrangements with former subsidiaries based in China. In the past we primarily operated our businesses in China through the former subsidiaries.
Added
In June 2022, we were conclusively identified by the SEC as a Commission-Identified Issuer under the HFCAA following the filing of our annual report on Form 20-F for the fiscal year ended December 31, 2021, which contained the audit report issued by Centurion ZD CPA & Co.
Removed
Taxation — United States Federal Income Taxation — Passive Foreign Investment Company.” We expect that our capital expenditures in fiscal year 2022 will be incurred primarily in connection with the purchase of bitcoin mining machines, additional computer equipment and IT server to support our services. 26
Added
(“Centurion”), a registered public accounting firm headquartered in Hong Kong that the PCAOB had determined it was previously unable to inspect or investigate completely because of a position taken by an authority in such jurisdiction.
Added
Effective June 30, 2022, we appointed Audit Alliance LLP (“Audit Alliance”) as our independent registered public accounting firm for the fiscal year ending December 31, 2022 and accepted the resignation of Centurion, effective on the same date.
Added
On August 26, 2022, the PCAOB signed a Statement of Protocol (SOP) Agreement with the CSRC and the MOF of the PRC regarding cooperation in the oversight of PCAOB-registered public accounting firms in the PRC and Hong Kong to establish a method for the PCAOB to conduct inspections of PCAOB-registered public accounting firms in the PRC and Hong Kong, as contemplated by the Sarbanes-Oxley Act.
Added
On December 15, 2022, the PCAOB determined that the PCAOB was able to secure complete access to inspect and investigate registered public accounting firms headquartered in mainland China and Hong Kong and vacated its previous 2021 adverse determinations.
Added
However, should the PCAOB fails to have complete access in the future, the PCAOB will consider the need to issue a new determination. Our current auditor, Audit Alliance LLP, is based in the Republic of Singapore and has been inspected by the PCAOB on a regular basis.
Added
Our auditor is not among the PCAOB-registered public accounting firms headquartered in the PRC or Hong Kong that are subject to PCAOB’s determination.
Added
Notwithstanding the foregoing, in the future, if it is later determined that the PCAOB is unable to inspect or investigate our auditor completely, or if there is any regulatory change or step taken by PRC regulators that does not permit our auditor to provide audit documentations to the PCAOB for inspection or investigation, our investors may be deprived of the benefits of such inspection.
Added
Any audit reports not issued by auditors that are completely inspected or investigated by the PCAOB, or a lack of PCAOB inspections of audit work undertaken in China that prevents the PCAOB from regularly evaluating our auditors’ audits and their quality control procedures, could result in a lack of assurance that our financial statements and disclosures are adequate and accurate, which could result in limitation or restriction to our access to the U.S. capital markets and trading of our securities, including trading on the national exchange or “over-the-counter” markets, may be prohibited under the HFCAA.
Added
As of the date of this Report, the Company operates in one self-owned mining site in Duff, Tennessee. New mining sites are always being explored but none has yet to be developed. This dependence on one site has its risks on local factors such as a power failure or adverse weather conditions.
Added
This was further halved to 3.125 in April 2024. The process will reoccur until the total amount of bitcoin currency rewards issued reaches 21 million, which is expected around 2140.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention. 31 Property, Plant and Equipment Effective July 2022, the Company no longer has any business operations in China.
Litigation or any other legal or administrative proceeding, regardless of the outcome, is likely to result in substantial cost and diversion of our resources, including our management’s time and attention. 30 Property, Plant and Equipment Effective July 2022, the Company no longer has any substantial business operations in China.
This group of mining hardware is on the cutting edge of available mining equipment, however, advances and improvements to the technology are ongoing and may be available in quantities to the market in the near future which may affect our perceived position. 29 Halving Further affecting the industry, and particularly for the bitcoin blockchain, the cryptocurrency reward for solving a block is subject to periodic incremental halving.
However, advances and improvements to the technology are ongoing and may be available in quantities in the market in the near future which may affect our perceived position. 29 Halving Further affecting the industry, and particularly for the bitcoin blockchain, the cryptocurrency reward for solving a block is subject to periodic incremental halving.
Our facility and mining platform will operate with the primary intent of accumulating bitcoin which we may sell for fiat currency from time to time depending on market conditions and management’s determination of our cash flow needs.
Management believes that bitcoin mining is profitable and its business plan is viable. Our facility and mining platform will operate with the primary intent of accumulating bitcoin which we may sell for fiat currency from time to time depending on market conditions and management’s determination of our cash flow needs.
Peoples’ Republic of China December 20, 2019 In-house Support Services ABit USA, Inc Delaware, United States of America April 6, 2022 Bitcoin Mining 27 Organization Chart The following diagram illustrates our corporate structure, as of the date of this Report: Moxian (BVI) Inc 28 Business Overview Bitcoin Mining Operations of bitcoin mining In view of the widespread adoption of blockchain technology and bitcoin worldwide, the Company determined to enter the bitcoin mining industry, which is the production of bitcoin.
Delaware April 27, 2022 Bitcoin Mining 27 Organization Chart The following diagram illustrates our corporate structure, as of the date of this report: Abits Group Inc 28 Business Overview Bitcoin Mining Operations of bitcoin mining In view of the widespread adoption of blockchain technology and bitcoin worldwide, the Company determined to enter the bitcoin mining industry, which is the production of bitcoin.
As of December 31, 2022, the subsidiaries of the Company are as follows: Name of Company Country of Incorporation Date of Incorporation Principal Activity ABit Hong Kong Limited Hong Kong SAR May 8, 2019 Investment Holding Beijing Bitmatrix Technology Co. Ltd.
As of December 31, 2023, the subsidiaries of the Company are as follows: Name of Company Jurisdiction of Incorporation Date of Incorporation Principal Activity Abit Hong Kong Limited Hong Kong SAR May 8, 2019 Investment Holding Beijing Bitmatrix Technology Co. Ltd Peoples’ Republic of China December 20, 2019 In-house Support Services Abit USA, Inc.
At present, the information concerning the activities of these enterprises is not readily available as the vast majority of the participants in this sector do not publish information publicly or the information may be unreliable.
At present, the information concerning the activities of these enterprises is not readily available as the vast majority of the participants in this sector do not publish information publicly or the information may be unreliable. Published sources of information include “bitcoin.org” and “blockchain.info”; however, the reliability of that information and its continued availability cannot be assured.
General purpose chipsets like CPUs and GPUs have since been replaced in the mining industry by Application Specific Integrated Circuits (ASIC) chips like those found in the MicroBT M21S miner currently utilized by the Company at its mining facility. These ASIC chips are designed specifically to maximize the rate of hashing operations.
General purpose chipsets like CPUs and GPUs have since been replaced in the mining industry by Application Specific Integrated Circuits (ASIC) chips. These ASIC chips are specifically to maximize the rate of hashing operations. The Company measures our mining performance and competitive position based on overall hash rate being produced in our mining sites.
The mobile app business failed to achieve a meaningful share of the market and incurred huge losses, primarily because users found the Moxian app unwieldy and not user-friendly. By September 30, 2018, the Company had to halt this business as it ran out of working capital whilst the digital advertising continued.
The mobile app business failed to achieve a meaningful share of the market and incurred huge losses, primarily because users found the Moxian app unwieldy and not user-friendly.
There were discussions with various parties for strategic partnerships between June 2018 to the end of 2020 but none of these business opportunities materialized. In August, 2021, Moxian, Inc decided to redomicile to the British Virgin Islands through a merger with its wholly-owned subsidiary, Moxian BVI. Moxian BVI became the surviving company when the merger was completed in August 2021.
In August, 2021, Moxian, Inc decided to redomicile to the British Virgin Islands through a merger with its wholly-owned subsidiary, Moxian BVI. Moxian BVI became the surviving company when the merger was completed in August 2021.
On February 11, 2022, the Company completed this private placement and issued 16,000,000 new shares, raising $40 million, which it will use in bitcoin mining in order to diversify its business operations. Of the proceeds raised, $29.8 million was used to purchase relevant equipment and the balance will be used as working capital.
On February 11, 2022, the Company completed this private placement and issued 16,000,000 new shares, raising $40 million, which it will use in bitcoin mining in order to diversify its business operations. Our predecessor company, Moxian, Inc (“Moxian”) was incorporated in the State of Nevada, United States of America, on October 12, 2010.
This process will reoccur until the total amount of bitcoin currency rewards issued reaches 21 million, which is expected to occur around 2140. Network Hash Rate and Difficulty In cryptocurrency mining, “hash rate” is a measure of the processing speed by a mining computer for a specific coin.
Network Hash Rate and Difficulty In cryptocurrency mining, “hash rate” is a measure of the processing speed by a mining computer for a specific coin. An individual miner, has a hash rate total of its miners seeking to mine a specific coin.
Published sources of information include “bitcoin.org” and “blockchain.info”; however, the reliability of that information and its continued availability cannot be assured. 30 The bitcoin industry is a highly competitive and evolving industry and new competitors and/or emerging technologies could enter the market and affect our competitiveness in the future.
The bitcoin industry is a highly competitive and evolving industry and new competitors and/or emerging technologies could enter the market and affect our competitiveness in the future. Legal Proceedings We are currently not a party to any material legal or administrative proceedings.
It maintains a small office of about 200 square meters for the administrative and accounting staff, which is part of a larger office for a third party which bears the rental. The Company does not bear its share of the rental for the space it occupies.
However, it still maintains a small office of about 200 square meters for a staff of 3, who are engaged in accounting and administrative functions. There is no rental payable as this office is within a larger office occupied by a third party who pays the entire monthly rent of about $9,200 on a two year lease.
Removed
Our predecessor company, Moxian, Inc (“Moxian”) was incorporated in the State of Nevada, United States of America, on October 12, 2010.
Added
By September 30, 2018, the Company had to halt this business as it ran out of working capital whilst the digital advertising continued until July 2022 when the Company divested its entire business operation in China. There were discussions with various parties for strategic partnerships between June 2018 to the end of 2020 but none of these business opportunities materialized.
Removed
Management believes that bitcoin mining is profitable and its business plan is viable. As of the date of this Report, the Company has identified a suitable site in Eastern Tennessee and will continue to identify other suitable sites for the sole purpose of mining bitcoin.
Added
On October 25, 2023, the Company’s Board of Directors approved to change the name of the Company from “Moxian (BVI) Inc” to “Abits Group Inc.” On November 14, 2023, the British Virgin Islands Registrar of Corporate Affairs issued the certificate of name change to the Company.
Removed
The Company measures our mining performance and competitive position based on overall hash rate being produced in our mining sites.
Added
In connection with the corporate name change, the Board of Directors approved to change the ticker symbol for the Company’s ordinary shares traded on the Nasdaq Capital Market from “MOXC” to “ABTS” effective November 17, 2023.
Removed
The latest equipment the MicroBT M21S miner, performs in the range of approximately 50 – 58 terahash per second (TH/s) per unit, M20S performs in the range of 64 – 68 TH/s per unit, M10 performs in the range of 31 – 35 TH/s per unit; Bitmain T17+ performs with a maximum hashrate of 64 TH/s per unit; Innosilicon T3 performs in the range of 41 – 45 TH/s per unit.
Added
The latest equipment in our fleet of miners, the Bitmain S19 XP performs with a maximum hashrate of 100 TH/s per unit and is on the cutting edge of available mining equipment.
Removed
An individual miner, such as Riot has a hash rate total of its miners seeking to mine a specific coin, and system wide there is a total has rate of all miners seeking to mine each specific type of coin.
Added
On April 19, 2024 it was halved again to 3.125. With each halving, the mining rewards to the miners are halved and the industry becomes a lot more competitive.. This process of halving will reoccur until the total amount of bitcoins in circulation reaches 21 million, which is expected to occur around 2140.
Removed
For more information regarding those risk factors known to us, see the section entitled “Risk Factors” herein.
Added
The Company anticipates this arrangement to be only temporary as it will eventually move the back-office operations to the United States. The Company also maintains a registered office at Level 24, Lee Garden One, 33 Hysan Avenue in Causeway Bay, Hong Kong SAR.
Removed
Employees As required by PRC regulations, we participate in various government statutory employee benefit plans, including social insurance funds, namely a pension contribution plan, a medical insurance plan, an unemployment insurance plan, a work-related injury insurance plan and a maternity insurance plan, and a housing provident fund.
Added
As the Company is in the bitcoin mining business, its investment in plant and equipment is substantial and is centered at its self-owned property at 4458 White Oak Road, Duff, TN 37729, where its principal subsidiary, Abit USA, operates.
Removed
We are required under PRC law to make contributions to employee benefit plans at specified percentages of the salaries, bonuses and certain allowances of our employees, up to a maximum amount specified by the local government from time to time. As of the date of this report, we have made adequate employee benefit payments.
Removed
However, if we were found by the relevant authorities that we failed to make adequate payment, we may be required to make up the contributions for these plans as well as to pay late fees and fines. See “Item 3.D.
Removed
Risk Factors — Risks Related to Doing Business in China — Failure to make adequate contributions to various employee benefit plans as required by PRC regulations may subject us to penalties.” We enter into standard labor and confidentiality agreements with our employees.
Removed
We believe that we maintain a good working relationship with our employees, and we have not experienced any major labor disputes. Insurance We provide social security insurance including pension insurance, unemployment insurance, work-related injury insurance and medical insurance for our employees.
Removed
We do not maintain business interruption insurance or general third-party liability insurance, nor do we maintain product liability insurance or key-man insurance. We consider our insurance coverage to be sufficient for our business operations in China. Legal Proceedings We are currently not a party to any material legal or administrative proceedings.
Removed
The third party pays a rental of about $9,200 on a two-year lease, expiring in February 2024. The office address is Room 1202, Block B, Jiahui Center, 6 Jiqing Li, Chaoyangmenwai Street, Chaoyang District, Beijing.
Removed
The main subsidiary of the Company, ABit USA, Inc is constructing a mining center in its acquired land in Duff, near the city of LaFollette in the State of Tennessee in the United States which was purchased in April 2023 for $1.2 million.
Removed
Construction is expected to be completed in August 2023 and will include the office of its USA subsidiary.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Removed
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS The Company is now on a much stronger footing than any time in the past. Stockholders’ equity as of December 31, 2022 is now in excess of $23 million, nearly a 4-fold increase from the previous year.
Added
ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS Operating review Bitcoin prices began to recover in early January 2023, vindicating the Company’s decision to place a large order for advanced state-of-the-art machines, the Bitmain Antminer S19XP in the third quarter of the previous year.
Removed
The year began with a strong promise as new stockholders pumped $40 million as new working capital as the Company sought to ship mining equipment from China. Unfortunately, as the year unfolded, bitcoin prices fell from the $40,000 level at the beginning of the year to a low of about $15,000 towards the end of the year.
Added
The search for a suitable site intensified and in April, the Company bought a piece of land for $1.2 million in Duff, near the city of La Follette in Tennessee. Construction of the new mining center began in May 2023 and was completed by September 2023 at a total cost of $6.5 million.
Removed
Interest rate hikes by the Federal Reserve and geo-political tensions, not excluding the Ukraine war, hastened the collapse of bitcoin prices as the outlook remained grim throughout the year. Our mining operation which began in earnest in Buffalo in late February, followed by another operation in Columbus, Georgia became increasing unprofitable with sharp fluctuations in electricity prices.
Added
The fiscal year 2023, therefore, only saw three months of operation, beginning in the first days of October with production output increasing month-by-month. However, bearing in mind the relative short period of operations, any direct comparison between the two financial years must be tempered with caution.
Removed
Mining operations discontinued in both locations by the end of May. The Company felt it necessary to cease operations and reviewed its mining equipment, resulting in an impairment adjustment to the tune of $11.9 million as a one-time charge. Efforts began to intensify for a more favorable site and eventually, we acquired a piece of property in Eastern Tennessee.
Added
There was a total output of 43.93 bitcoins for the 2023 fiscal year, registering a revenue of approximately $1.68 million for the year. Direct cost of revenue comprising depreciation and electricity costs totaled $0.89 million while other operating overheads, primarily the remuneration of key site executives amounted to $0.17 million resulting in a profit of approximately $0.62 million.
Removed
The directors of the Company remained optimistic about the longer-term future of the bitcoin business and sought to capitalize on the dim outlook of the industry towards December to acquire 1,140 units of the latest supercomputing servers at most competitive prices.
Added
However, this profit was offset by the write-off of the remaining equipment imported from China of $7.37 million, as the performance of these machines was unexpectedly poor given its power consumption.
Removed
With these additions and other equipment, including switchgear and transformers, the Company began construction of a new mining center in April of 2023 with a completion by August by which time, the first new units of equipment will have arrived and the Company can look forward to a renewed start.
Added
Other administrative and general overheads topped approximately $1.47 million which was comparable with $1.67 million of the 2022 fiscal year, bringing the loss before taxation of $12.59 million, an improvement of about 42%.
Removed
The optimism seemed to be well=founded as bitcoin prices have somewhat recovered from the lows of 2022. In July 2022, the Company divested its entire interest in Moxian (Hong Kong) Limited, the holding company of a group of companies in the People’s Republic of China and Malaysia. which have ceased active operations since June 2018.
Added
Financial review Cash and cash equivalents dwindled to approximately $0.88 million and the Company had to resort to a sale of 32.82 bitcoins to supplement its operating cash. Digital assets fell to $1.2 million as a result of this sale, with a mix of digital assets as some suppliers accepted payment in USDC and USDT.
Removed
It meant that the Company no longer has a business footprint in China and is now in a position to consider other commercial opportunities in the United States and the rest of the world. With the continued support of a new group of investors, there is every hope that 2023 fiscal year will mark a significant milestone for the Company.
Added
Prospects The halving of rewards in April meant that the immediate prospects of all miners look dim. Much will depend on bitcoin prices as previous halvings saw a substantial rise in bitcoin prices in the period after the significant halving event.
Removed
Because of the relative inactivity, there is little meaning in comparing with the financials of the previous year. The Company operated on sundry jobs in its Beijing subsidiary, maintained a central pool of staff and did not segregate costs between that of direct jobs or back-office supporting staff.
Added
In January 2024, the Securities and Exchange Commission approved the listing and trading of spot bitcoin exchange-traded product shares on U.S. stock exchanges and this has brought in a influx of funds from institutional investors, a favorable factor. Nonetheless, the prospects of continued profitability for bitcoin miners appear uncertain.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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The RSUs will vest in equal installments over thirty-six (36) months of the Employement Agreement. Employment Agreement with Mr. Wanhong Tan Mr. Tan has an Employment Agreement with the Company as the Chief Financial Officer for a term of three years, commencing from January 1, 2022.
The RSUs will vest in equal installments over thirty-six (36) months of the Employment Agreement. Employment Agreement with Mr. Wanhong Tan Mr. Tan has an Employment Agreement with the Company as the Chief Financial Officer for a term of three years, commencing from January 1, 2022.
In addition, our Board of Directors has determined that Lionel Choong qualifies as an “audit committee financial expert” as such term is currently defined in Item 407(d)(5) of Regulation S-K and meets the financial sophistication requirements of the NASDAQ rules. 35 Compensation Committee Tao Xu, Chuan Zhan and Khuat Leok Choong, Lionel currently serve on the Compensation Committee, which is chaired by Tao Xu.
In addition, our Board of Directors has determined that Lionel Choong qualifies as an “audit committee financial expert” as such term is currently defined in Item 407(d)(5) of Regulation S-K and meets the financial sophistication requirements of the NASDAQ rules. 34 Compensation Committee Tao Xu, Chuan Zhan and Khuat Leok Choong, Lionel currently serve on the Compensation Committee, which is chaired by Tao Xu.
Tan joined Hong Leong Asia, Singapore on a specific assignment in China which he completed in 2009. He then took the post of Head of Investor Relations with 361 Degrees International, a Mainland sportswear group listed on the Stock Exchange of Hong Kong. where he stayed for a further six years. 32 Mr.
Tan joined Hong Leong Asia, Singapore on a specific assignment in China which he completed in 2009. He then took the post of Head of Investor Relations with 361 Degrees International, a Mainland sportswear group listed on the Stock Exchange of Hong Kong. where he stayed for a further six years. 31 Mr.
We have complied with these requirements in all aspects. 36 Director Independence The Board of Directors has reviewed the independence of our directors, applying the NASDAQ independence standards. Based on this review, the Board of Directors determined that each of Khuat Leok Choong, Lionel, Tao Xu and Chuan Zhan are independent within the meaning of the NASDAQ rules.
We have complied with these requirements in all aspects. 35 Director Independence The Board of Directors has reviewed the independence of our directors, applying the NASDAQ independence standards. Based on this review, the Board of Directors determined that each of Khuat Leok Choong, Lionel, Tao Xu and Chuan Zhan are independent within the meaning of the NASDAQ rules.
From August 2013 to December 2018, she had served as a Department Manager with the People’s Daily Online, the largest newspaper group in China. Ms. Wang obtained a Bachelor’s degree in Media Economy from the Communication University of China in 2013 and a Master’s degree in Public Administration from Beijing Normal University in 2018. 33 6B.
From August 2013 to December 2018, she had served as a Department Manager with the People’s Daily Online, the largest newspaper group in China. Ms. Wang obtained a Bachelor’s degree in Media Economy from the Communication University of China in 2013 and a Master’s degree in Public Administration from Beijing Normal University in 2018. 32 6B.
The RSUs will vest in equal installments over thirty-six (36) months of the Employment Agreement. 34 6C. BOARD COMMITTEES Our Board of Directors has established standing committees in connection with the discharge of its responsibilities. These committees include an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee.
The RSUs will vest in equal installments over thirty-six (36) months of the Employment Agreement. 33 6C. BOARD COMMITTEES Our Board of Directors has established standing committees in connection with the discharge of its responsibilities. These committees include an Audit Committee, a Compensation Committee and a Nominating and Corporate Governance Committee.
COMPENSATION The following table presents summary information regarding the total compensation awarded to, earned by, or paid to each of the named executive officers for services rendered to us for the years ended December 31, 2022 and December 31, 2021.
COMPENSATION The following table presents summary information regarding the total compensation awarded to, earned by, or paid to each of the named executive officers for services rendered to us for the years ended December 31, 2023 and December 31, 2022.
He graduated from Changchun Institute of Technology with a Bachelor’s degree in Water Supply and Drainage, followed by a Research Fellowship and a Master’s Degree in Economics from the Hohaii University in Nanjing, China in 1998. Mr.
He graduated from Changchun Institute of Technology with a Bachelor’s degree in Water Supply and Drainage, followed by a Research Fellowship and a Master’s Degree in Economics from the Hohai University in Nanjing, China in 1998. Mr.
Name and Principal Position Fiscal Year Salary ($) Fees ($) Total ($) Conglin Deng 2022 120,000 - 120,000 Chief Executive Officer (1) 2021 33,333 33,333 Qinghu Hao (2) 2022 - 12,500 12,500 Former Chief Executive Officer 2021 - 60,000 60,000 Wanhong Tan 2022 120,000 - 120,000 Chief Financial Officer 2021 75,000 - 75,000 Khuat Leok Choong, Lionel 2022 18,000 18,000 Audit Chair, Independent Director 2021 36,000 36,000 Tao Xu 2022 5,000 5,000 Chuan Zhan 2022 5,000 5,000 Panpan Wang 2022 5,000 5,000 (1) Conglin Deng was appointed as our Chief Executive Officer, effective on September 21, 2021.
Name and Principal Position Fiscal Year Salary ($) Fees ($) Total ($) Conglin Deng 2023 120,000 - 120,000 Chief Executive Officer (1) 2022 120,000 120,000 Qinghu Hao (2) 2022 - 12,500 12,500 Former Chief Executive Officer Wanhong Tan 2023 120,000 - 120,000 Chief Financial Officer 2022 120,000 - 120,000 Khuat Leok Choong, Lionel 2023 9,000 9,000 Independent Director and Audit Committee Chair 2022 18,000 18,000 Tao Xu 2023 5,000 5,000 Independent Director 2022 5,000 5,000 Chuan Zhan 2023 5.000 5,000 Independent Director 2022 5,000 5,000 Panpan Wang 2023 5,000 5,000 Director 2022 5,000 5,000 (1) Conglin Deng was appointed as our Chief Executive Officer, effective on September 21, 2021.
DIRECTORS AND SENIOR MANAGEMENT Our directors and executive officers are as follows; Name Age Position Conglin Deng 39 Chief Executive Officer and Director Wanhong Tan 69 Chief Financial Officer Khuat Leok Choong, Lionel 59 Independent Director and Audit Chair(1)(2)(3) Tao Xu 35 Independent Director (1)(2)(3) Chuan Zhan 53 Independent Director (1)(2)(3) Panpan Wang 35 Non-Independent Director (1) Member of Audit Committee (2) Member of Compensation Committee (3) Member of the Corporate Governance and Nominating Committee Below is a summary of the experience of each of our directors and executive officers.
DIRECTORS AND SENIOR MANAGEMENT Our directors and executive officers are as follows; Name Age Position Conglin Deng 40 Chief Executive Officer and Director Wanhong Tan 70 Chief Financial Officer Khuat Leok Choong, Lionel 60 Independent Director and Audit Chair(1)(2)(3) Tao Xu 36 Independent Director (1)(2)(3) Chuan Zhan 54 Independent Director (1)(2)(3) Panpan Wang 36 Non-Independent Director (1) Member of Audit Committee (2) Member of Compensation Committee (3) Member of the Corporate Governance and Nominating Committee Below is a summary of the experience of each of our directors and executive officers.
We intend to disclose on our website any amendments to the Code of Business Conduct and Ethics and any waivers of the Code of Business Conduct and Ethics that apply to our principal executive officer, principal financial officer, principal accounting officer and executive officers.
We intend to disclose on our website any amendments to the Code of Business Conduct and Ethics and any waivers of the Code of Business Conduct and Ethics that apply to any of our executive officers. 36 6D.
Insider Trading Policy Our Company has adopted an Insider Trading Policy which applies to all directors and employees. 37 6D. EMPLOYEES As of the date of this Report, the Company has a total of 12 full time employees, of which 3 are involved in Finance and Administration and the rest in the bit coin mining business.
EMPLOYEES As of the date of this Report, the Company has a total of 11 full time employees, of which 4 are involved in Finance and Administration and the rest in the bit coin mining business.
Code of Business Conduct and Ethics On September 7, 2016, our Board of Directors adopted a code of business conduct and ethics that applies to our directors, officers and employees.
Code of Business Conduct and Ethics On November 14, 2023, in connection with the Company’s name change, our Board of Directors adopted a Code of Business Conduct and Ethics of Abits Group Inc that applies to our directors, officers and employees.

Item 7. Management's Discussion & Analysis

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

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Percentage of Number of Shares Ordinary Shares Beneficially Beneficially Percentage of Name of Beneficial Owner Owned Owned (1) Voting Power Directors and Executive Officers: Conglin Deng, CEO and Director (2) - - 45.7 % Wanhong Tan, CFO - - - Khuat Leok Choong, Lionel, Director - - - Tai Xu, Director - - - Chuan Zhan, Director - - - Panpan Wang, Director * * All directors and executive officers as a group (six individuals) * 45.7 % 5% Beneficial Owners: Danqing Sun (3) 1,852,000 5.2 % 2.8 % (1) The percentage of shares beneficially owned is based on 35,554,677 ordinary shares outstanding as of March 31, 2023.
Percentage of Number of Shares Ordinary Shares Beneficially Beneficially Percentage of Name of Beneficial Owner Owned Owned (1) Voting Power Directors and Executive Officers: Conglin Deng, CEO and Director (2) - - 45.7 % Wanhong Tan, CFO - - - Khuat Leok Choong, Lionel, Director - - - Tai Xu, Director - - - Chuan Zhan, Director - - - Panpan Wang, Director * * All directors and executive officers as a group (six individuals) * 45.7 % 5% Beneficial Owners: Danqing Sun (3) 1,852,000 5.2 % 2.8 % (1) The percentage of shares beneficially owned is based on 35,554,677 ordinary shares outstanding as of March 31, 2024.
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS The following table sets forth information with respect to beneficial ownership of our ordinary shares as of March 31, 2023 by: ● Each person who is known by us to beneficially own more than 5% of our outstanding ordinary shares; ● Each of our director, director nominees and named executive officers; and ● All directors and named executive officers as a group.
MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS The following table sets forth information with respect to beneficial ownership of our ordinary shares as of March 31, 2024 by: ● Each person who is known by us to beneficially own more than 5% of our outstanding ordinary shares; ● Each of our director, director nominees and named executive officers; and ● All directors and named executive officers as a group.
For purposes of the table below, we deem shares subject to options, warrants or other exercisable or convertible securities that are exercisable or convertible currently or within 60 days of March 31, 2023, to be outstanding and to be beneficially owned by the person holding the options, warrants or other currently exercisable or convertible securities for the purposes of computing the percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
For purposes of the table below, we deem shares subject to options, warrants or other exercisable or convertible securities that are exercisable or convertible currently or within 60 days of March 31, 2024, to be outstanding and to be beneficially owned by the person holding the options, warrants or other currently exercisable or convertible securities for the purposes of computing the percentage ownership of that person but we do not treat them as outstanding for the purpose of computing the percentage ownership of any other person.
(3) Address is 16 Xinjian Road, Xinhe Village, Wenling City, Zhejiang Province, China. 38 Related Party Transactions Interests of Experts and Counsel Not applicable for annual reports on Form 20-F.
(3) Address is 16 Xinjian Road, Xinhe Village, Wenling City, Zhejiang Province, China. 37 Related Party Transactions Interests of Experts and Counsel Not applicable for annual reports on Form 20-F.

Other ABTS 10-K year-over-year comparisons