Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2024 | May 06, 2024 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Entity Interactive Data Current | Yes | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2024 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Entity Information [Line Items] | ||
Entity Registrant Name | MEGA MATRIX CORP. | |
Entity Central Index Key | 0001036848 | |
Entity File Number | 001-13387 | |
Entity Tax Identification Number | 94-3263974 | |
Entity Incorporation, State or Country Code | DE | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Contact Personnel [Line Items] | ||
Entity Address, Address Line One | 3000 El Camino Real | |
Entity Address, Address Line Two | Bldg. 4 | |
Entity Address, Address Line Three | Suite 200 | |
Entity Address, City or Town | Palo Alto | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 94306 | |
Entity Phone Fax Numbers [Line Items] | ||
City Area Code | (650) | |
Local Phone Number | 340-1888 | |
Entity Listings [Line Items] | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | |
Trading Symbol | MPU | |
Security Exchange Name | NYSE | |
Entity Common Stock, Shares Outstanding | 35,978,581 |
Unaudited Condensed Consolidate
Unaudited Condensed Consolidated Balance Sheets - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Current Assets: | ||
Cash and cash equivalents | $ 2,851,100 | $ 3,129,800 |
Stable coins | 3,146,300 | 254,400 |
Digital assets | 7,851,100 | 7,696,700 |
Accounts receivable | 296,700 | |
Prepaid expenses and other assets | 3,192,500 | 489,700 |
Total current assets | 17,337,700 | 11,570,600 |
Non-current Assets: | ||
Long-term investments | 2,270,800 | 1,770,800 |
Goodwill | 2,889,200 | |
Content assets | 1,703,700 | |
Total non-current assets | 6,863,700 | 1,770,800 |
Total assets | 24,201,400 | 13,341,400 |
Current liabilities: | ||
Accounts payable | 44,700 | |
Contract liabilities | 1,561,400 | |
Income taxes payable | 1,500 | 1,100 |
Other current liabilities and accrued expenses | 6,258,600 | 185,400 |
Subscription advanced from the stockholders | 2,755,100 | |
Total liabilities | 7,866,200 | 2,941,600 |
Commitments and contingencies (Note 13) | ||
Equity: | ||
Preferred stock, $0.001 par value, 2,000,000 shares authorized, no shares issued and outstanding | ||
Common stock, $0.001 par value, 40,000,000 and 40,000,000 shares authorized, 35,940,631 and 31,724,631 shares outstanding at March 31, 2024 and December 31, 2023, respectively | 36,000 | 31,800 |
Paid-in capital | 34,179,100 | 27,822,200 |
Accumulated deficit | (18,321,000) | (17,454,200) |
Total Mega Matrix Corp. Stockholders’ Equity | 15,894,100 | 10,399,800 |
Non-controlling interests | 441,100 | |
Total equity | 16,335,200 | 10,399,800 |
Total liabilities and equity | $ 24,201,400 | $ 13,341,400 |
Unaudited Condensed Consolida_2
Unaudited Condensed Consolidated Balance Sheets (Parentheticals) - $ / shares | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Preferred stock par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 2,000,000 | 2,000,000 |
Preferred stock, shares issued | ||
Preferred stock, shares outstanding | ||
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 40,000,000 | 40,000,000 |
Common stock, shares outstanding | 35,940,631 | 31,724,631 |
Unaudited Condensed Consolida_3
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Revenues | $ 8,691,600 | |
Cost of revenues | (3,500,200) | |
Gross profit | 5,191,400 | |
Operating expenses: | ||
Selling expenses | (7,718,400) | (5,300) |
General and administrative expenses | (2,238,400) | (1,516,800) |
Total operating expenses | (9,956,800) | (1,522,100) |
Loss from operations | (4,765,400) | (1,522,100) |
Other income (expenses): | ||
Changes in fair value of digital assets | 2,540,700 | 215,400 |
Interest expenses, net | (2,500) | |
Other income, net | 14,900 | 8,500 |
Total other income, net | 2,553,100 | 223,900 |
Loss from operations before income tax | (2,212,300) | (1,298,200) |
Income tax benefits | 276,600 | 61,300 |
Net loss and comprehensive loss | (1,935,700) | (1,236,900) |
Less: Net loss and comprehensive loss attributable to non-controlling interests | 1,068,900 | 147,400 |
Net loss and comprehensive loss attributable to Mega Matrix Corp.’s stockholders | $ (866,800) | $ (1,089,500) |
Loss per share: | ||
Loss per share Basic (in Dollars per share) | $ (0.05) | $ (0.04) |
Weighted average shares used in loss per share computations: | ||
Weighted average shares Basic (in Shares) | 35,271,740 | 30,214,054 |
Unaudited Condensed Consolida_4
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Loss (Parentheticals) - $ / shares | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Loss per share Diluted | $ (0.05) | $ (0.04) |
Weighted average shares Diluted | 35,271,740 | 30,214,054 |
Unaudited Condensed Consolida_5
Unaudited Condensed Consolidated Statements of Changes in Equity - USD ($) | Common Stock | Paid-in Capital | Accumulated Deficits | Non-Controlling Interests | Total |
Balance at Dec. 31, 2022 | $ 26,500 | $ 21,372,100 | $ (13,420,400) | $ (1,016,300) | $ 6,961,900 |
Balance (in Shares) at Dec. 31, 2022 | 26,484,055 | ||||
Cumulative-effect adjustment of opening balance due to adoption of fair value measurement of digital assets | 30,600 | 30,600 | |||
Issuance of common stocks pursuant to private placement | $ 5,100 | 6,533,900 | 6,539,000 | ||
Issuance of common stocks pursuant to private placement (in Shares) | 5,079,999 | ||||
Net loss | (1,089,500) | (147,400) | (1,236,900) | ||
Balance at Mar. 31, 2023 | $ 31,600 | 27,906,000 | (14,479,300) | (1,163,700) | 12,294,600 |
Balance (in Shares) at Mar. 31, 2023 | 31,564,054 | ||||
Balance at Dec. 31, 2023 | $ 31,800 | 27,822,200 | (17,454,200) | 10,399,800 | |
Balance (in Shares) at Dec. 31, 2023 | 31,724,631 | ||||
Issuance of common stocks to certain investors in a private placement | $ 2,500 | 3,732,500 | 3,735,000 | ||
Issuance of common stocks to certain investors in a private placement (in Shares) | 2,490,000 | ||||
Issuance of common stocks to an underwriter | $ 100 | (100) | |||
Issuance of common stocks to an underwriter (in Shares) | 124,000 | ||||
Issuance of common stocks to acquire a subsidiary | $ 1,500 | 2,263,500 | 1,510,000 | 3,775,000 | |
Issuance of common stocks to acquire a subsidiary (in Shares) | 1,500,000 | ||||
Share-based compensation | $ 100 | 361,000 | 0 | 0 | 361,100 |
Share-based compensation (in Shares) | 102,000 | ||||
Net loss | (866,800) | (1,068,900) | (1,935,700) | ||
Balance at Mar. 31, 2024 | $ 36,000 | $ 34,179,100 | $ (18,321,000) | $ 441,100 | $ 16,335,200 |
Balance (in Shares) at Mar. 31, 2024 | 35,940,631 |
Unaudited Condensed Consolida_6
Unaudited Condensed Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Statement of Cash Flows [Abstract] | ||
Net cash (used in) provided by operating activities | $ (96,900) | $ 78,700 |
Investing activities: | ||
Purchases of digital assets | (610,000) | |
Investment in equity investees | (500,000) | |
Acquisition of cash of a subsidiary | 118,300 | |
Net cash used in investing activities | (991,700) | |
Financing activities: | ||
Subscription fee from investors | 809,900 | |
Subscription fee advanced from investors | 1,305,000 | |
Net cash provided by financing activities | 809,900 | 1,305,000 |
Net (decrease) increase in cash and cash equivalents | (278,700) | 1,383,700 |
Cash, cash equivalents, beginning of period | 3,129,800 | 7,263,600 |
Cash, cash equivalents, end of period | 2,851,100 | 8,647,300 |
Supplemental cash flow information | ||
Payment of interest expenses | ||
Payment of income tax expenses | 1,600 | |
Non-cash investing and financing activities | ||
Subscription fee advanced from investors in the form of USDC | 50,000 | |
Subscription fee from investors in the form of USDT | 75,000 | |
Issuance of common stocks to settle advance from subscription fee from investors | $ 2,755,100 | $ 6,539,000 |
Organization and Principal Acti
Organization and Principal Activities | 3 Months Ended |
Mar. 31, 2024 | |
Organization and Principal Activities [Abstract] | |
ORGANIZATION AND PRINCIPAL ACTIVITIES | 1. ORGANIZATION AND PRINCIPAL ACTIVITIES Mega Matrix Corp. (the “Company”, formerly “AeroCentury Corp.” and “ACY”) is a Delaware corporation incorporated in 1997. Through the Company’s emergence from bankruptcy on September 30, 2021, and new investors and management, the Company became a holding company located in Palo Alto, California . The Company is engaged in operation of FlexTV, a short drama streaming platform based in Singapore that produces English and Thai dramas through Yuder Pte. Ltd., an indirect majority-controlled subsidiary of the Company. The major subsidiaries of the Company as of March 31, 2024 are summarized as below: Later of date of incorporation or Place of % of Principal Name of Subsidiaries Acquisition Incorporation Ownership Activities Major subsidiaries: FunVerse Holding Limited January 7, 2024 BVI 60 % Investment holding Yuder Pte. Ltd. January 7, 2024 Singapore 60 % * Short drama streaming platform Saving Digital Pte. Ltd. August 31, 2022 Singapore 100 % Investment holding Marsprotocol Technologies Pte. Ltd. March 1, 2023 Singapore 100 % Investment holding * A wholly-owned subsidiary of FunVerse Holding Limited. Acquisition of FunVerse Holding Limited (“FunVerse”) and its subsidiary On January 7, 2024, the Company entered into and closed a definitive Share Exchange Agreement with FunVerse, a company incorporated under the laws of the British Virgin Islands and the sole parent company of Yuder Pte. Ltd. (“Yuder”), and the shareholders of FunVerse. Following the transaction, the Company owns sixty percent (60%) of equity interest of FunVerse. FunVerse, through Yuder, operates FlexTV, a short drama streaming platform based in Singapore that produces English and Thai dramas that are also translated into different languages for the users that are spread across various parts of the world. In addition to creating original dramas, Yuder also acquires third party content copyrights which it then translates and distributes on its FlexTV platform. Dissolution of JetFleet Management Corp. (“JMC”) On August 24, 2023, per the recommendation of JMC’s board of directors, the Company, as a holder of a majority of the voting stock of JMC, elected to approve the winding up and dissolution of JMC. In December 2023, JMC ceased providing aircraft advisory and management services upon winding up and the Company deconsolidated JMC and its subsidiaries. Upon the deconsolidation of JMC and its subsidiaries, the Company would focus on its short drama streaming platform business and ceased the cypto-related business in March 2024. The management believed the deconsolidation does not represent a strategic shift, in both operating and financing aspects, because it is not changing the way it is running its business. The Company has not shifted the nature of its operations or the major geographic market area. The management believed the deconsolidation of does not represent a strategic shift that has (or will have) a major effect on the Company’s operations and financial results. The deconsolidation is not accounted as discontinued operations in accordance with ASC 205-20. |
Summary of Principal Accounting
Summary of Principal Accounting Policies | 3 Months Ended |
Mar. 31, 2024 | |
Summary of Principal Accounting Policies [Abstract] | |
SUMMARY OF PRINCIPAL ACCOUNTING POLICIES | 2. SUMMARY OF PRINCIPAL ACCOUNTING POLICIES Basis of presentation The accompanying unaudited condensed consolidated financial statements are presented on a consolidated basis in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information, the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month period ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024 or for any other period. All intercompany balances and transactions have been eliminated on consolidation. Non-controlling interests As of March 31, 2024, non-controlling interests represent the 40% equity interests of FunVerse that are not attributable, either directly or indirectly, to the Company. As of March 31, 2024, the Company had non-controlling interests of $441,100. As of December 31, 2023, the Company had no non-controlling interests. Business combinations Business combinations are recorded using the acquisition method of accounting. The Company uses a screen to evaluate whether a transaction should be accounted for as an acquisition and/or disposal of a business versus assets. In order for a purchase to be considered an acquisition of a business, and receive business combination accounting treatment, the set of transferred assets and activities must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a business. The purchase price of business acquisition is allocated to the tangible assets, liabilities, identifiable intangible assets acquired and noncontrolling interest, if any, based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related expenses and restructuring costs are expensed as incurred. Where the consideration in an acquisition includes contingent consideration and the payment of which depends on the achievement of certain specified conditions post-acquisition, the contingent consideration is recognized and measured at its fair value at the acquisition date and if recorded as a liability, it is subsequently carried at fair value with changes in fair value reflected in earnings. Accounts receivable Accounts receivable are recorded at the gross billing amount less an allowance for any uncollectible accounts due from the customers. Accounts receivable do not bear interest. The Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) to measure expected credit losses of accounts receivable. The Company maintains an allowance for credit losses and records the allowance for credit losses as an offset to accounts receivable and the estimated credit losses charged to the allowance is classified as “General and administrative expenses” in the unaudited condensed consolidated statements of income and comprehensive income. The Company assesses collectability by reviewing accounts receivable on aging schedules because the accounts receivable were primarily consisted of online advertising service fees from certain customers. In determining the amount of the allowance for credit losses, the Company considers historical collectability based on past due status, the age of the balances, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. Delinquent account balances are written-off against the allowance for expected credit loss after management has determined that the likelihood of collection is not probable. As of March 31, 2024, the Company did not provide expected credit losses against accounts receivable. Content assets, net Content assets are stated at cost less accumulated amortization and impairment if any. Content assets are amortized in a method which reflect the pattern in which the economic benefits of the content assets are expected to be consumed or otherwise used up. When assets are retired or disposed of, the costs and accumulated amortization are removed from the accounts, and any resulting gains or losses are included in income/loss in the year of disposition. Estimated useful lives are as follows: Estimated Useful Life Software 12 months Produced contents 6 – 12 months Copyrights 12 – 36 months Goodwill Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. The Company assesses goodwill for impairment on annual basis as of December 31 or if indicator noted for goodwill impairment. In accordance with ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”) issued by the Financial Accounting Standards Board (“FASB”) guidance on testing of goodwill for impairment, the Company will first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative impairment test. If this is the case, the quantitative goodwill impairment test is required. If it is more likely-than-not that the fair value of a reporting unit is greater than its carrying amount, the quantitative goodwill impairment test is not required. Quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss, comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired. If the fair value of the reporting unit is less than its carrying amount, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. In January 2024, the Company recognized goodwill of $2,889,200 arising from business combination of FunVerse and its subsidiary (Note 4). As of March 31, 2024, no impairment was provided against the goodwill. Impairment of long-lived assets In accordance with ASC Topic 360, the Company reviews long-lived assets or asset group for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be fully recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Any impairment write-downs would be treated as permanent reductions in the carrying amounts of the assets and a charge to operations would be recognized. For the three months ended March 31, 2024 and 2023, the Company did not provide impairment against long-lived assets. Revenue Recognition Membership and top-up streaming services The Company offers membership streaming services to subscribing members from various countries and the features of the plan, which primarily include access to exclusive and ad-free streaming of short dramas, and accelerated downloads and others. It’s optional for users to subscribe for weekly, monthly or annual membership on the short drama streaming platform. Users can also top up their accounts to acquire in-app coins on our platform, which are then used to continue viewing the short dramas. Users can also earn in-app coins to watch short dramas by completing daily and new user tasks. Full membership and top-up charges are prepaid before provision of membership and top-up streaming services. The collection of membership and top-up charges are initially recorded as “contract liabilities” on the unaudited condensed consolidated balance sheets and revenue is recognized ratably over the membership period and consumption of in-app coins as services are rendered. Online advertising services The Company sells advertising services by delivering brand advertising primarily to third-party advertising agencies. The Company provides advertisement placements on its short drama streaming platform in different formats, including but not limited to video, banners, links, logos, brand placement and buttons. The transaction prices are varied according to the scale of impressions and types of the advisements in the contracts with customers. The contracts have one performance obligation. Revenues are recognized over time. The Company has a right to consideration from the customers in an amount that corresponds directly with the value the Company's performance completed to date. The Company adopted practical expedient under ASC 606-10-55-18, and recognizes revenues from provision of online advertising services based on amounts invoiced to the customers. Contract balances Contract liabilities are recognized if the Company receives consideration prior to satisfying the performance obligations, which include customer advances and deferred revenue under service arrangements. As of March 31, 2024, the Company had contract liabilities of $1,561,400, which were expected to be recognized as revenues in the twelve months ending March 31, 2025. Disaggregation of revenue For the three months ended March 31, 2024 and 2023, the Company disaggregate revenue into two revenue streams, consisting of membership and top-up streaming services and online advertising services, as follows: For the Three Months Ended 2024 2023 Membership and top-up streaming services $ 8,048,200 $ - Online advertising services 643,400 - $ 8,691,600 $ - Cost of revenues For the three months ended March 31, 2024, the cost of revenues was primarily comprised of platform service fees charged by third party payment processors, amortization of produced contents, software and copyrights which were applied to produce short dramas and other expenses which were directly attributable to producing short dramas. Cost of revenues are recorded in the unaudited condensed consolidated statements of operations and comprehensive loss as incurred. Taxes As part of the process of preparing the Company’s consolidated financial statements, management estimates income taxes in each of the jurisdictions in which the Company operates. This process involves estimating the Company’s current tax exposure under the most recent tax laws and assessing both permanent and temporary differences resulting from differing treatment of items for tax and US GAAP purposes. The temporary differences result in deferred tax assets and liabilities, which are included in the balance sheet. In assessing the valuation of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income or availability to carry back the losses to taxable income during periods in which those temporary differences become deductible. The Company considered several factors when analyzing the need for a valuation allowance including the Company’s three-year book cumulative loss through March 31, 2024, the financial forecast, the Company’s recent filing for protection under Chapter 11 of the bankruptcy code and the operation uncertainty of the Company’s new business. Based on this analysis, the Company has concluded that a valuation allowance is necessary for its U.S. and foreign deferred tax assets not supported by either future taxable income or availability of future reversals of existing taxable temporary differences and has recorded a full valuation allowance on its deferred tax assets. Warrant The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter with changes in fair value recognized in the statements of operations in the period of change. Reclassification Certain items in the financial statements of the comparative period have been reclassified to conform to the financial statements for the current period. The reclassification has no impact on the total assets and total liabilities as of December 31, 2023 or on the statements of operations for the three months ended March 31, 2023. Going concern For the three months ended March 31, 2024 and 2023, the Company reported net losses of approximately $1.9 million and $1.2 million, respectively. In addition, the Company had accumulated deficits of approximately $18.3 million and $17.5 million as of March 31, 2024 and December 31, 2023, respectively. These conditions raised substantial doubt about the Company’s ability to continue as a going concern. The Company’s liquidity is based on its ability to generate cash from operating activities and obtain financing from investors to fund its general operations and capital expansion needs. The Company’s ability to continue as a going concern is dependent on management’s ability to successfully execute its business plan, which includes increasing revenue while controlling operating cost and expenses to generate positive operating cash flows and obtain financing from outside sources. As of March 31, 2024, the Company had working capital of approximately $9.5 million, among which the Company held cash of approximately $2.9 million, stable coins of approximately $3.1 million and digital assets of approximately $7.9 million, which were easily convertible into cash over the market. Given the financial condition of the Company and its operating performance, the Company assesses current working capital is sufficient to meet its obligations for the next 12 months from the issuance date of this report. Accordingly, management continues to prepare the Company’s consolidated financial statements on going concern basis. Recent accounting pronouncements In December 2023, the FASB issued ASU 2023-09, which is an update to Topic 740, Income Taxes. The amendments in this update related to the rate reconciliation and income taxes paid disclosures improve the transparency of income tax disclosures by requiring (1) adding disclosures of pretax income (or loss) and income tax expense (or benefit) to be consistent with U.S. Securities and Exchange Commission (SEC) Regulation S-X 210.4-08(h), Rules of General Application—General Notes to Financial Statements: Income Tax Expense, and (2) removing disclosures that no longer are considered cost beneficial or relevant. For public business entities, the amendments in this Update are effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the amendments are effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this Update should be applied on a prospective basis. Retrospective application is permitted. In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements — codification amendments in response to SEC’s disclosure Update and Simplification initiative which amend the disclosure or presentation requirements of codification subtopic 230-10 Statement of Cash Flows—Overall, 250-10 Accounting Changes and Error Corrections— Overall, 260-10 Earnings Per Share— Overall, 270-10 Interim Reporting— Overall, 440-10 Commitments—Overall, 470-10 Debt—Overall, 505-10 Equity—Overall, 815-10 Derivatives and Hedging—Overall, 860-30 Transfers and Servicing—Secured Borrowing and Collateral, 932-235 Extractive Activities— Oil and Gas—Notes to Financial Statements, 946-20 Financial Services— Investment Companies— Investment Company Activities, and 974-10 Real Estate—Real Estate Investment Trusts—Overall. The amendments represent changes to clarify or improve disclosure and presentation requirements of above subtopics. Many of the amendments allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the SEC’s requirements. Also, the amendments align the requirements in the Codification with the SEC’s regulations. For entities subject to existing SEC disclosure requirements or those that must provide financial statements to the SEC for securities purposes without contractual transfer restrictions, the effective date aligns with the date when the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Early adoption is not allowed. For all other entities, the amendments will be effective two years later from the date of the SEC’s removal. In March 2023, the FASB issued new accounting guidance, ASU 2023-01, for leasehold improvements associated with common control leases, which is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been made available for issuance. The new guidance introduced two issues: terms and conditions to be considered with leases between related parties under common control and accounting for leasehold improvements. The goals for the new issues are to reduce the cost associated with implementing and applying Topic 842 and to promote diversity in practice by entities within the scope when applying lease accounting requirements. Recently issued ASUs by the FASB, except for the ones mentioned above, have no material impact on the Company’s unaudited condensed consolidated statements of operations and comprehensive loss or consolidated balance sheets. |
Revision of Previously Issued F
Revision of Previously Issued Financial Statements | 3 Months Ended |
Mar. 31, 2024 | |
Revision of Previously Issued Financial Statements [Abstract] | |
REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS | 3. REVISION OF PREVIOUSLY ISSUED FINANCIAL STATEMENTS The Company has noted the following matters in relation to its consolidated financial statements for the three months ended March 31, 2023 that had been filed on May 12, 2023. The matter related to the adoption of fair value to measure digital assets, reclassification digital assets and stable coins, and reclassification of other income. a. Adoption of fair value method to measure digital assets The Company measures the fair value of digital assets on a daily basis, and refers to the daily closing prices published by Matrixport Cactus Custody as the fair value. As of January 1, 2023, the Company recorded a cumulative-effect adjustment of $30,600 to accumulated deficits. The adoption of fair value measure caused a reversal of impairment of digital assets of $223,000, recognition of increase in fair value of digital assets of $215,400 and reversal of exchange gains of $14,000. b. Reclassification of digital assets and stablecoins As Tether reserves the right under its user agreement to redeem USDT by in-kind redemptions of other assets it holds in its reserves and as Tether has held precious metals and other non-financial assets in its reserves, it does not appear that USDT meets the definition of a financial instrument under ASC 825-10-20. The Company reclassified USDT, amounting $2,300 as of March 31, 2023, from stable coins to digital assets. The reclassification had no impact on net assets as of December 31, 2022, and revenues and net loss for the three months ended March 31, 2023. c. Reclassification of revenue and cost of revenues The Company ceased solo-staking business in March 2024, and accordingly the Company reclassified revenues from solo-staking business to other income, net, and cost of revenues to general and administrative expenses. For comparison purpose, the Company reclassified revenues to other income, net, and reclassified cost of revenues to general and administrative expenses for the three months ended March 31, 2023. The following tables present the effects of revisions on the Company’s financial statements as of March 31, 2023, and for the three months ended March 31, 2023: March 31, 2023 Consolidated balance sheet As previously Adjustments As Revised Stable coins 2,510,400 (2,300 ) 2,508,100 Digital assets 403,300 457,300 860,600 Accumulated deficits (14,934,300 ) 455,000 (14,479,300 ) For the Three Months Ended Consolidated statements of operations As Adjustments As Restated Revenues 8,500 (8,500 ) - Cost of revenues (229,800 ) 229,800 - Gross loss (221,300 ) 221,300 - General and administrative expenses 1,496,000 20,800 1,516,800 Total operating expenses 1,501,300 20,800 1,522,100 Other income, net - 223,900 223,900 Loss from operations before income tax expenses (1,722,600 ) 424,400 (1,298,200 ) Net loss (1,661,300 ) 424,400 (1,236,900 ) |
Acquisition of Funverse
Acquisition of Funverse | 3 Months Ended |
Mar. 31, 2024 | |
Acquisition of Funverse [Abstract] | |
ACQUISITION OF FUNVERSE | 4. ACQUISITION OF FUNVERSE On January 7, 2024, the Company acquired 60% of the equity interest of FunVerse at the cost of issuance of 1,500,000 ordinary shares. The fair value of the share consideration was $2,265,000 by reference to the closing price on January 7, 2024. The Company has allocated the purchase price of FunVerse based upon the fair value of the identifiable assets acquired and liabilities assumed on the acquisition date. The Company estimated the fair values of the assets acquired and liabilities assumed at the acquisition date in accordance with the business combination standard issued by FASB. The Company used carrying amount of assets and liabilities as fair value, which approximate the fair value, and used cost approach to estimate the fair value of content assets which was primarily comprised software and copyrights. Management of the Company is responsible for determining the fair value of assets acquired, liabilities assumed and content assets identified as of the acquisition date and considered a number of factors including valuations from an independent appraiser firm. Acquisition-related costs incurred for the acquisitions are not material and have been expensed as incurred in other operating expenses. The following table summarizes the estimated fair values of the identifiable assets acquired at the acquisition date, which represents the net purchase price allocation at the date of the acquisition of FunVerse based on a valuation performed by an independent valuation firm engaged by the Company. January 7, 2024 ASSETS Net tangible liabilities (1) $ (466,400 ) Copyrights (2) 581,000 Software (2) 1,048,200 Goodwill 2,889,200 Deferred tax liabilities (277,000 ) Non-controlling interest (1,510,000 ) Total purchase consideration $ 2,265,000 (1) The following is a reconciliation of the fair value of major classes of assets acquired and liabilities assumed which comprised of net tangible liabilities on January 7, 2024. January 7, 2024 ASSETS Cash and cash equivalents $ 118,300 Accounts receivable 323,500 Prepayments 25,200 Prepaid expenses and other assets 359,400 Content assets 165,300 Total assets $ 991,700 LIABILITIES Accounts payable $ 43,400 Contract liabilities 395,000 Other current liabilities and accrued expenses 1,019,700 Total liabilities $ 1,458,100 Net tangible liabilities $ (466,400 ) (2) The copyrights and software are both applied to produce short dramas. The useful lives of these content assets are 12 months. |
Stable Coins
Stable Coins | 3 Months Ended |
Mar. 31, 2024 | |
Stable Coins [Abstract] | |
STABLE COINS | 5. STABLE COINS Stable coins were comprised of the following: March 31, December 31, USDC $ 3,146,300 $ 254,400 As of March 31, 2024 and December 31, 2023, the Company held 3,146,300 and 254,400 USDC, respectively. The fair value of USDC were kept at $1.00 because one USDC is pegged to one U.S. dollar. The following table presents additional information about USDC for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 Opening balance $ 254,400 $ 2,972,000 Collection of USDC from subscription fee from investors - 50,000 Purchases of USDC 610,000 - Collection of USDC from exchange of ETH 2,391,700 - Exchange of USDC into ETH and USDT (100,000 ) (285,700 ) Payment of service fees and other expenses (9,800 ) (228,200 ) Ending balance $ 3,146,300 $ 2,508,100 |
Digital Assets
Digital Assets | 3 Months Ended |
Mar. 31, 2024 | |
Digital Assets [Abstract] | |
DIGITAL ASSETS | 6. DIGITAL ASSETS Digital asset holdings were comprised of the following: March 31, December 31, ETH $ 1,458,800 $ 7,123,300 USDT 6,392,300 573,400 $ 7,851,100 $ 7,696,700 As of March 31, 2024, the Company held 399.89 ETH, with fair value price of $3,648 per unit. As of December 31, 2023, the Company held 3,122.48 ETH, with fair value price of $2,281.32 per unit. For the three months ended March 31, 2024, the Company recognized an increase in fair value of ETH of $2,540,700 and an investment income of $6,300 from sales of ETH. For the three months ended March 31, 2023, the Company recognized an increase in fair value of ETH of $215,400. As of March 31, 2024 and December 31, 2023, the Company held 6,392,300 and 573,400 USDT, respectively. The fair value of USDT were kept at $1.00 because one USDT is pegged to one U.S. dollar. Additional information about digital assets The following table presents additional information about ETH for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 (revised) Opening balance $ 7,123,300 $ 369,200 Cumulative-effect adjustment of opening balance due to adoption of fair value measurement - 30,600 Addition of ETH staking reward and other services 14,300 6,000 Purchases of ETH from exchange of USDT 1,636,500 - Purchases of ETH from exchange of USDC - 285,700 Exchange of ETH into USDT (7,470,600 ) - Exchange of ETH into USDC (2,391,700 ) - Return of ETH to a third party - (48,500 ) Payment of ETH for other expenses - (100 ) Investment income from sales of ETH 6,300 - Changes in fair value of ETH 2,540,700 215,400 $ 1,458,800 $ 858,300 The following table presents additional information about USDT for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 Opening balance $ 573,400 $ 90,100 Purchases of USDT from exchange of digital assets 7,989,200 - Purchases of USDT from exchange of USDC 100,000 - Collection of USDT from subscription advance from investors 75,000 - Exchange of USDT into ETH (1,636,500 ) - Exchange of USDT into USD (701,000 ) - Payment of service fees (7,800 ) (87,800 ) $ 6,392,300 $ 2,300 |
Long-Term Investments
Long-Term Investments | 3 Months Ended |
Mar. 31, 2024 | |
Long-Term Investments [Abstract] | |
LONG-TERM INVESTMENTS | 7. LONG-TERM INVESTMENTS Long-term investments were comprised of the following: For the Three Months Ended 2024 2023 Investment in MarsLand Global Limited (“MarsLand”) (a) $ 224,800 $ 224,800 Investment in Quleduo Technology Co., (“Quleduo”) (b) 1,500,000 1,000,000 Investment in DaoMax Technology Co., Ltd, (“DaoMax”) (c) 546,000 546,000 Total $ 2,270,800 $ 1,770,800 (a) Investment in MarsLand MarsLand is a privately held company. In May 2023, the Company, through Saving Digital Pte. Ltd. (“Saving Digital”), its wholly owned subsidiary, invested consideration of $300,000 in USDC, which represents 30% of equity interest in MarsLand. The Company used equity method to measure the investment in MarsLand. For the three months ended March 31, 2024, the Company did not record a share equity of income or loss for its share of the results of Marsland because of minimal loss incurred by Marsland. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment in MarsLand. (b) Investment in Quleduo Quleduo is a privately held company which is engaged in software design and development. In May and September 2023 and January 2024, the Company made a total cash consideration of $1,500,000 in three instalments to acquire 25% of equity interest in Quleduo. The Company had no significant influence over Quleduo. Quleduo is a privately held company, over which the Company neither has control nor significant influence through investment in ordinary shares. The Company accounted for the investment in Quleduo using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer. Quleduo just commenced its operations in July 2023, and incurred minimal losses through March 31, 2024. For the three months ended March 31, 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment security. (c) Investment in DaoMax In June 2023, October 2023 and December 2023, the Company, through Saving Digital, invested an aggregated cash consideration of $546,000 in DaoMax in exchange for a total of 7.6% equity interest in the investee. DaoMax is a privately held company, over which the Company neither has control nor significant influence through investment in ordinary shares. The Company accounted for the investment in DaoMax using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer. DaoMax just commenced its operations in October 2023, and incurred minimal losses through March 31, 2024. For the three months ended March 31, 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment security. |
Intangible Assets
Intangible Assets | 3 Months Ended |
Mar. 31, 2024 | |
Intangible Assets [Abstract] | |
INTANGIBLE ASSETS | 8. CONTENT ASSETS Content assets were comprised of the following: For the Three Months Ended 2024 2023 Software $ 581,000 $ - Produced contents - in development and production 15,200 - - released 308,900 - Copyrights 1,349,200 - 2,254,300 - Less: accumulated amortization (550,600 ) - Total $ 1,703,700 $ - For the three months ended March 31, 2024 and 2023, the Company recorded amortization expenses of $550,600 and $ nil For the nine months ending December 31, 2024 $ 1,602,900 For the year ending December 31, 2025 93,500 For the year ending December 31, 2026 7,300 Total $ 1,703,700 |
Operating Leases
Operating Leases | 3 Months Ended |
Mar. 31, 2024 | |
Operating Leases [Abstract] | |
OPERATING LEASES | 9. OPERATING LEASES As of March 31, 2024 and December 31, 2023, the Company leases office spaces in the United States and Singapore under non-cancelable operating leases, with terms ranging within 12 months. The Company considers those renewal or termination options that are reasonably certain to be exercised in the determination of the lease term and initial measurement of right of use assets and lease liabilities. Lease expense for lease payment is recognized on a straight-line basis over the lease term. The Company determines whether a contract is or contain a lease at inception of the contract and whether that lease meets the classification criteria of a finance or operating lease. For operating leases that include rent holidays and rent escalation clauses, the Company recognizes lease expense on a straight-line basis over the lease term from the date it takes possession of the leased property. The Company records the straight-line lease expense and any contingent rent, if applicable, in the account of “professional fees, general and administrative and other expenses” on the condensed consolidated statements of operations and comprehensive losses. The lease agreements do not contain any material residual value guarantees or material restrictive covenants. The Company applied practical expedient to account for short-term leases with a lease term within 12 months. The Company records operating lease expense in its condensed consolidated statements of operations and comprehensive loss on a straight-line basis over the lease term and record variable lease payments as incurred. For the three months ended March 31, 2024 and 2023, the Company recorded rent expenses of $9,800 and $11,900, respectively. |
Equity
Equity | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
EQUITY | 10. EQUITY Common Stock As of December 31, 2023, the Company has been authorized to issue 40,000,000 shares of common stocks and had 31,724,631 shares issued and outstanding. On December 1, 2023, we entered into a Consulting Agreement with Honor Related LLC, a British Virgin Islands corporation (“Hornor”), pursuant to which the Company has agreed to issue 30,000 restricted shares of the Company’s common stock, $0.001 par value per share, on December 31, 2023, March 31, 2024, June 30, 2024, and September 30, 2024. As of March 31, 2024, the Company has issued 60,000 restricted shares to Honor. On January 12, 2024, the Company entered into a Unit Subscription Agreement (the “Agreement”) with certain investors, pursuant to which the investors agreed to purchase an aggregate of 2,490,000 units (the “Units”) for an aggregate purchase price of $3,735,000, or $1.50 per unit. Each Unit consists of one (1) share of common stock of the Company, $0.001 par value, and one (1) warrant (the “Warrant”), with each Warrant entitling the holder to purchase one share of common stock at an exercise price of $1.50 per share at any time for a period of up to five (5) years starting six (6) months from the issuance date at which time the Warrant will expire. The private placements closed on January 17, 2024. In connection with the private placement, the Company also entered into a Finder’s Agreement and issued to the finder 124,000 shares of common stock, a fee equal to 5% of the payment received by the Company for all Units purchased by investors introduced by the finder. The Company recorded the issuance of common stock at par value with the corresponding amount charged to additional paid-in capital. On January 7, 2024, the Company closed acquisition of FunVerse at share consideration of 1,500,000 ordinary shares. The fair value was referred to the closing price of $1.51 per share prevailing on January 7, 2024. As of the date of the report, 319,800 restricted stock units have been granted under the Amended and Restated 2021 Equity Incentive Plan, of which 79,950 have vested and 239,850 remain unvested. For the three months ended March 31, 2024, the Company recognized share-based compensation expenses of $228,155. As of March 31, 2024, the Company has been authorized to issue 40,000,000 shares of common stocks, and had 35,940,631 Warrants In connection with the private placement closed on January 17, 2024, the Company issued 2,490,000 warrants to certain investors. Each warrant entitling the holder to purchase one share of common stock at an exercise price of $1.50 per share at any time for a period of up to five (5) years starting six (6) months from the issuance date at which time the Warrant will expire. No fractional shares of warrants will be issued in connection with any exercise. The number of warrants and the price of warrant may be subject to adjustment in the event of (i) recapitalization, reorganization, reclassification, consolidation, merger or sale, or (ii) stock dividends, subdivisions and combinations, As the warrants meet the criteria for equity classification under ASC 480 and ASC 815, therefore, the warrants are classified as equity. On January 17, 2024, the relative fair value of the warrants was $1,867,400, calculated using the Black-Scholes pricing model with the following assumptions: As of Risk-free rate of return 4.02 % Estimated volatility rate 99.86 % Dividend yield 0 % Spot price of underling ordinary share $ 2.8 Exercise price $ 1.5 Relative fair value of warrant $ 1,867,400 |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2024 | |
Income Taxes [Abstract] | |
INCOME TAXES | 11. INCOME TAXES The Company recorded income tax benefits of $276,600 in the first quarter of 2024, or 12.5% of pre-tax loss, compared to $61,300 income tax benefits, or negative 3.56% of pre-tax loss in the first quarter of 2023. The difference in the effective federal income tax rate from the normal statutory rate in the first quarter of 2023 was primarily because In assessing the valuation of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income or availability to carryback the losses to taxable income during periods in which those temporary differences become deductible. The Company considered several factors when analyzing the need for a valuation allowance including the Company’s current three-year cumulative loss through March 31, 2023, the current year operation forecast, the Company’s recent filing for protection under Chapter 11 of the bankruptcy code, the operation uncertainty of the Company’s new business. Based on this analysis, the Company has concluded that a valuation allowance is necessary for its U.S. and foreign deferred tax assets not supported by either future taxable income or availability of future reversals of existing taxable temporary differences and has recorded a full valuation allowance on its deferred tax assets. |
Operating Segments
Operating Segments | 3 Months Ended |
Mar. 31, 2024 | |
Operating Segments [Abstract] | |
OPERATING SEGMENTS | 12. OPERATING SEGMENTS ASC 280, “Segment Reporting,” establishes standards for reporting information about operating segments on a basis consistent with the Company’s internal organizational structure as well as information about geographical areas, business segments and major customers in financial statements for details on the Company’s business segments. The Company uses the “management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. Management, including the chief operating decision maker, reviews operation results by the revenue of different services. Upon acquisition of FunVerse in January 2024, the Company commenced its short drama streaming platform business, and determined to cease its solo-staking activities in March 2024. During the three months ended March 31, 2024, the Company classified solo-staking activities as non-operating activities. short drama streaming platform business short drama streaming platform business for the three months ended March 31, 2024. F |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies [Abstract] | |
COMMITMENTS AND CONTINGENCIES | 13. COMMITMENTS AND CONTINGENCIES In the ordinary course of the Company’s business, the Company may be subject to lawsuits, arbitrations and administrative proceedings from time to time. The Company believes that the outcome of any existing or known threatened proceedings, even if determined adversely, should not have a material adverse effect on the Company’s business, financial condition, liquidity or results of operations. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 14. SUBSEQUENT EVENTS On April 17, 2024 and May 3, 2024, the Company issued 37,350 shares and 600 shares of common stock under the Amended and Restated 2021 Equity Incentive Plan, respectively. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ (866,800) | $ (1,089,500) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Accounting Policies, by Policy
Accounting Policies, by Policy (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Summary of Principal Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited condensed consolidated financial statements are presented on a consolidated basis in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) for interim financial information, the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by US GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three-month period ended March 31, 2024 are not necessarily indicative of the results that may be expected for the year ending December 31, 2024 or for any other period. All intercompany balances and transactions have been eliminated on consolidation. |
Non-controlling interests | Non-controlling interests As of March 31, 2024, non-controlling interests represent the 40% equity interests of FunVerse that are not attributable, either directly or indirectly, to the Company. As of March 31, 2024, the Company had non-controlling interests of $441,100. As of December 31, 2023, the Company had no non-controlling interests. |
Business combinations | Business combinations Business combinations are recorded using the acquisition method of accounting. The Company uses a screen to evaluate whether a transaction should be accounted for as an acquisition and/or disposal of a business versus assets. In order for a purchase to be considered an acquisition of a business, and receive business combination accounting treatment, the set of transferred assets and activities must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs. If substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a business. The purchase price of business acquisition is allocated to the tangible assets, liabilities, identifiable intangible assets acquired and noncontrolling interest, if any, based on their estimated fair values as of the acquisition date. The excess of the purchase price over those fair values is recorded as goodwill. Acquisition-related expenses and restructuring costs are expensed as incurred. Where the consideration in an acquisition includes contingent consideration and the payment of which depends on the achievement of certain specified conditions post-acquisition, the contingent consideration is recognized and measured at its fair value at the acquisition date and if recorded as a liability, it is subsequently carried at fair value with changes in fair value reflected in earnings. |
Accounts receivable | Accounts receivable Accounts receivable are recorded at the gross billing amount less an allowance for any uncollectible accounts due from the customers. Accounts receivable do not bear interest. The Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”) to measure expected credit losses of accounts receivable. The Company maintains an allowance for credit losses and records the allowance for credit losses as an offset to accounts receivable and the estimated credit losses charged to the allowance is classified as “General and administrative expenses” in the unaudited condensed consolidated statements of income and comprehensive income. The Company assesses collectability by reviewing accounts receivable on aging schedules because the accounts receivable were primarily consisted of online advertising service fees from certain customers. In determining the amount of the allowance for credit losses, the Company considers historical collectability based on past due status, the age of the balances, current economic conditions, reasonable and supportable forecasts of future economic conditions, and other factors that may affect the Company’s ability to collect from customers. Delinquent account balances are written-off against the allowance for expected credit loss after management has determined that the likelihood of collection is not probable. As of March 31, 2024, the Company did not provide expected credit losses against accounts receivable. |
Content assets, net | Content assets, net Content assets are stated at cost less accumulated amortization and impairment if any. Content assets are amortized in a method which reflect the pattern in which the economic benefits of the content assets are expected to be consumed or otherwise used up. When assets are retired or disposed of, the costs and accumulated amortization are removed from the accounts, and any resulting gains or losses are included in income/loss in the year of disposition. Estimated useful lives are as follows: Estimated Useful Life Software 12 months Produced contents 6 – 12 months Copyrights 12 – 36 months |
Goodwill | Goodwill Goodwill represents the excess of the purchase price over the fair value of identifiable net assets acquired in business combinations. The Company assesses goodwill for impairment on annual basis as of December 31 or if indicator noted for goodwill impairment. In accordance with ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”) issued by the Financial Accounting Standards Board (“FASB”) guidance on testing of goodwill for impairment, the Company will first assess qualitative factors to determine whether it is “more likely than not” that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the quantitative impairment test. If this is the case, the quantitative goodwill impairment test is required. If it is more likely-than-not that the fair value of a reporting unit is greater than its carrying amount, the quantitative goodwill impairment test is not required. Quantitative goodwill impairment test is used to identify both the existence of impairment and the amount of impairment loss, comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit is greater than its carrying amount, goodwill is not considered impaired. If the fair value of the reporting unit is less than its carrying amount, an impairment loss shall be recognized in an amount equal to that excess, limited to the total amount of goodwill allocated to that reporting unit. In January 2024, the Company recognized goodwill of $2,889,200 arising from business combination of FunVerse and its subsidiary (Note 4). As of March 31, 2024, no impairment was provided against the goodwill. |
Impairment of Long-lived Assets | Impairment of long-lived assets In accordance with ASC Topic 360, the Company reviews long-lived assets or asset group for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets or asset group may not be fully recoverable. If circumstances require a long-lived asset or asset group be tested for possible impairment, the Company first compares undiscounted cash flows expected to be generated by that asset or asset group to its carrying amount. If the carrying amount of the long-lived asset or asset group is not recoverable on an undiscounted cash flow basis, an impairment is recognized to the extent that the carrying amount exceeds its fair value. Fair value is determined through various valuation techniques including discounted cash flow models, quoted market values and third-party independent appraisals, as considered necessary. Any impairment write-downs would be treated as permanent reductions in the carrying amounts of the assets and a charge to operations would be recognized. For the three months ended March 31, 2024 and 2023, the Company did not provide impairment against long-lived assets. |
Revenue Recognition | Revenue Recognition Membership and top-up streaming services The Company offers membership streaming services to subscribing members from various countries and the features of the plan, which primarily include access to exclusive and ad-free streaming of short dramas, and accelerated downloads and others. It’s optional for users to subscribe for weekly, monthly or annual membership on the short drama streaming platform. Users can also top up their accounts to acquire in-app coins on our platform, which are then used to continue viewing the short dramas. Users can also earn in-app coins to watch short dramas by completing daily and new user tasks. Full membership and top-up charges are prepaid before provision of membership and top-up streaming services. The collection of membership and top-up charges are initially recorded as “contract liabilities” on the unaudited condensed consolidated balance sheets and revenue is recognized ratably over the membership period and consumption of in-app coins as services are rendered. Online advertising services The Company sells advertising services by delivering brand advertising primarily to third-party advertising agencies. The Company provides advertisement placements on its short drama streaming platform in different formats, including but not limited to video, banners, links, logos, brand placement and buttons. The transaction prices are varied according to the scale of impressions and types of the advisements in the contracts with customers. The contracts have one performance obligation. Revenues are recognized over time. The Company has a right to consideration from the customers in an amount that corresponds directly with the value the Company's performance completed to date. The Company adopted practical expedient under ASC 606-10-55-18, and recognizes revenues from provision of online advertising services based on amounts invoiced to the customers. Contract balances Contract liabilities are recognized if the Company receives consideration prior to satisfying the performance obligations, which include customer advances and deferred revenue under service arrangements. As of March 31, 2024, the Company had contract liabilities of $1,561,400, which were expected to be recognized as revenues in the twelve months ending March 31, 2025. Disaggregation of revenue For the three months ended March 31, 2024 and 2023, the Company disaggregate revenue into two revenue streams, consisting of membership and top-up streaming services and online advertising services, as follows: For the Three Months Ended 2024 2023 Membership and top-up streaming services $ 8,048,200 $ - Online advertising services 643,400 - $ 8,691,600 $ - |
Cost of revenues | Cost of revenues For the three months ended March 31, 2024, the cost of revenues was primarily comprised of platform service fees charged by third party payment processors, amortization of produced contents, software and copyrights which were applied to produce short dramas and other expenses which were directly attributable to producing short dramas. Cost of revenues are recorded in the unaudited condensed consolidated statements of operations and comprehensive loss as incurred. |
Taxes | Taxes As part of the process of preparing the Company’s consolidated financial statements, management estimates income taxes in each of the jurisdictions in which the Company operates. This process involves estimating the Company’s current tax exposure under the most recent tax laws and assessing both permanent and temporary differences resulting from differing treatment of items for tax and US GAAP purposes. The temporary differences result in deferred tax assets and liabilities, which are included in the balance sheet. In assessing the valuation of deferred tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income or availability to carry back the losses to taxable income during periods in which those temporary differences become deductible. The Company considered several factors when analyzing the need for a valuation allowance including the Company’s three-year book cumulative loss through March 31, 2024, the financial forecast, the Company’s recent filing for protection under Chapter 11 of the bankruptcy code and the operation uncertainty of the Company’s new business. Based on this analysis, the Company has concluded that a valuation allowance is necessary for its U.S. and foreign deferred tax assets not supported by either future taxable income or availability of future reversals of existing taxable temporary differences and has recorded a full valuation allowance on its deferred tax assets. |
Warrant | Warrant The Company accounts for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 480, Distinguishing Liabilities from Equity (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to the Company’s own ordinary shares, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding. For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of additional paid-in capital at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded at their initial fair value on the date of issuance, and each balance sheet date thereafter with changes in fair value recognized in the statements of operations in the period of change. |
Reclassification | Reclassification Certain items in the financial statements of the comparative period have been reclassified to conform to the financial statements for the current period. The reclassification has no impact on the total assets and total liabilities as of December 31, 2023 or on the statements of operations for the three months ended March 31, 2023. |
Going concern | Going concern For the three months ended March 31, 2024 and 2023, the Company reported net losses of approximately $1.9 million and $1.2 million, respectively. In addition, the Company had accumulated deficits of approximately $18.3 million and $17.5 million as of March 31, 2024 and December 31, 2023, respectively. These conditions raised substantial doubt about the Company’s ability to continue as a going concern. The Company’s liquidity is based on its ability to generate cash from operating activities and obtain financing from investors to fund its general operations and capital expansion needs. The Company’s ability to continue as a going concern is dependent on management’s ability to successfully execute its business plan, which includes increasing revenue while controlling operating cost and expenses to generate positive operating cash flows and obtain financing from outside sources. As of March 31, 2024, the Company had working capital of approximately $9.5 million, among which the Company held cash of approximately $2.9 million, stable coins of approximately $3.1 million and digital assets of approximately $7.9 million, which were easily convertible into cash over the market. Given the financial condition of the Company and its operating performance, the Company assesses current working capital is sufficient to meet its obligations for the next 12 months from the issuance date of this report. Accordingly, management continues to prepare the Company’s consolidated financial statements on going concern basis. |
Recent accounting pronouncements | Recent accounting pronouncements In December 2023, the FASB issued ASU 2023-09, which is an update to Topic 740, Income Taxes. The amendments in this update related to the rate reconciliation and income taxes paid disclosures improve the transparency of income tax disclosures by requiring (1) adding disclosures of pretax income (or loss) and income tax expense (or benefit) to be consistent with U.S. Securities and Exchange Commission (SEC) Regulation S-X 210.4-08(h), Rules of General Application—General Notes to Financial Statements: Income Tax Expense, and (2) removing disclosures that no longer are considered cost beneficial or relevant. For public business entities, the amendments in this Update are effective for annual periods beginning after December 15, 2024. For entities other than public business entities, the amendments are effective for annual periods beginning after December 15, 2025. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. The amendments in this Update should be applied on a prospective basis. Retrospective application is permitted. In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements — codification amendments in response to SEC’s disclosure Update and Simplification initiative which amend the disclosure or presentation requirements of codification subtopic 230-10 Statement of Cash Flows—Overall, 250-10 Accounting Changes and Error Corrections— Overall, 260-10 Earnings Per Share— Overall, 270-10 Interim Reporting— Overall, 440-10 Commitments—Overall, 470-10 Debt—Overall, 505-10 Equity—Overall, 815-10 Derivatives and Hedging—Overall, 860-30 Transfers and Servicing—Secured Borrowing and Collateral, 932-235 Extractive Activities— Oil and Gas—Notes to Financial Statements, 946-20 Financial Services— Investment Companies— Investment Company Activities, and 974-10 Real Estate—Real Estate Investment Trusts—Overall. The amendments represent changes to clarify or improve disclosure and presentation requirements of above subtopics. Many of the amendments allow users to more easily compare entities subject to the SEC’s existing disclosures with those entities that were not previously subject to the SEC’s requirements. Also, the amendments align the requirements in the Codification with the SEC’s regulations. For entities subject to existing SEC disclosure requirements or those that must provide financial statements to the SEC for securities purposes without contractual transfer restrictions, the effective date aligns with the date when the SEC removes the related disclosure from Regulation S-X or Regulation S-K. Early adoption is not allowed. For all other entities, the amendments will be effective two years later from the date of the SEC’s removal. In March 2023, the FASB issued new accounting guidance, ASU 2023-01, for leasehold improvements associated with common control leases, which is effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted for both interim and annual financial statements that have not yet been made available for issuance. The new guidance introduced two issues: terms and conditions to be considered with leases between related parties under common control and accounting for leasehold improvements. The goals for the new issues are to reduce the cost associated with implementing and applying Topic 842 and to promote diversity in practice by entities within the scope when applying lease accounting requirements. Recently issued ASUs by the FASB, except for the ones mentioned above, have no material impact on the Company’s unaudited condensed consolidated statements of operations and comprehensive loss or consolidated balance sheets. |
Organization and Principal Ac_2
Organization and Principal Activities (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Organization and Principal Activities [Abstract] | |
Schedule of Major Subsidiaries | The major subsidiaries of the Company as of March 31, 2024 are summarized as below: Later of date of incorporation or Place of % of Principal Name of Subsidiaries Acquisition Incorporation Ownership Activities Major subsidiaries: FunVerse Holding Limited January 7, 2024 BVI 60 % Investment holding Yuder Pte. Ltd. January 7, 2024 Singapore 60 % * Short drama streaming platform Saving Digital Pte. Ltd. August 31, 2022 Singapore 100 % Investment holding Marsprotocol Technologies Pte. Ltd. March 1, 2023 Singapore 100 % Investment holding * A wholly-owned subsidiary of FunVerse Holding Limited. |
Summary of Principal Accounti_2
Summary of Principal Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Summary of Principal Accounting Policies [Abstract] | |
Schedule of Intangible Assets, Net | When assets are retired or disposed of, the costs and accumulated amortization are removed from the accounts, and any resulting gains or losses are included in income/loss in the year of disposition. Estimated useful lives are as follows: Estimated Useful Life Software 12 months Produced contents 6 – 12 months Copyrights 12 – 36 months |
Schedule of Disaggregate Revenue | For the three months ended March 31, 2024 and 2023, the Company disaggregate revenue into two revenue streams, consisting of membership and top-up streaming services and online advertising services, as follows: For the Three Months Ended 2024 2023 Membership and top-up streaming services $ 8,048,200 $ - Online advertising services 643,400 - $ 8,691,600 $ - |
Revision of Previously Issued_2
Revision of Previously Issued Financial Statements (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Revision of Previously Issued Financial Statements [Abstract] | |
Schedule of Effects of Revisions on the Financial Statements | The following tables present the effects of revisions on the Company’s financial statements as of March 31, 2023, and for the three months ended March 31, 2023: March 31, 2023 Consolidated balance sheet As previously Adjustments As Revised Stable coins 2,510,400 (2,300 ) 2,508,100 Digital assets 403,300 457,300 860,600 Accumulated deficits (14,934,300 ) 455,000 (14,479,300 ) |
Schedule of Consolidated Statements of Operations | For the Three Months Ended Consolidated statements of operations As Adjustments As Restated Revenues 8,500 (8,500 ) - Cost of revenues (229,800 ) 229,800 - Gross loss (221,300 ) 221,300 - General and administrative expenses 1,496,000 20,800 1,516,800 Total operating expenses 1,501,300 20,800 1,522,100 Other income, net - 223,900 223,900 Loss from operations before income tax expenses (1,722,600 ) 424,400 (1,298,200 ) Net loss (1,661,300 ) 424,400 (1,236,900 ) |
Acquisition of Funverse (Tables
Acquisition of Funverse (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Acquisition of Funverse (Tables) [Line Items] | |
Schedule of Reconciliation of the Fair Value of Major Classes of Assets Acquired and Liabilities | The following is a reconciliation of the fair value of major classes of assets acquired and liabilities assumed which comprised of net tangible liabilities on January 7, 2024. January 7, 2024 ASSETS Cash and cash equivalents $ 118,300 Accounts receivable 323,500 Prepayments 25,200 Prepaid expenses and other assets 359,400 Content assets 165,300 Total assets $ 991,700 LIABILITIES Accounts payable $ 43,400 Contract liabilities 395,000 Other current liabilities and accrued expenses 1,019,700 Total liabilities $ 1,458,100 Net tangible liabilities $ (466,400 ) |
Asset Acquisition [Member] | |
Acquisition of Funverse (Tables) [Line Items] | |
Schedule of Reconciliation of the Fair Value of Major Classes of Assets Acquired and Liabilities | The following table summarizes the estimated fair values of the identifiable assets acquired at the acquisition date, which represents the net purchase price allocation at the date of the acquisition of FunVerse based on a valuation performed by an independent valuation firm engaged by the Company. January 7, 2024 ASSETS Net tangible liabilities (1) $ (466,400 ) Copyrights (2) 581,000 Software (2) 1,048,200 Goodwill 2,889,200 Deferred tax liabilities (277,000 ) Non-controlling interest (1,510,000 ) Total purchase consideration $ 2,265,000 (1) The following is a reconciliation of the fair value of major classes of assets acquired and liabilities assumed which comprised of net tangible liabilities on January 7, 2024. (2) The copyrights and software are both applied to produce short dramas. The useful lives of these content assets are 12 months. |
Stable Coins (Tables)
Stable Coins (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Stable Coins [Abstract] | |
Schedule of Stable Coins were Comprised | Stable coins were comprised of the following: March 31, December 31, USDC $ 3,146,300 $ 254,400 |
Schedule of Additional Information about USDC | The following table presents additional information about USDC for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 Opening balance $ 254,400 $ 2,972,000 Collection of USDC from subscription fee from investors - 50,000 Purchases of USDC 610,000 - Collection of USDC from exchange of ETH 2,391,700 - Exchange of USDC into ETH and USDT (100,000 ) (285,700 ) Payment of service fees and other expenses (9,800 ) (228,200 ) Ending balance $ 3,146,300 $ 2,508,100 |
Digital Assets (Tables)
Digital Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Digital Assets [Abstract] | |
Schedule of Digital Asset Holdings | Digital asset holdings were comprised of the following: March 31, December 31, ETH $ 1,458,800 $ 7,123,300 USDT 6,392,300 573,400 $ 7,851,100 $ 7,696,700 |
Schedule of Additional Information ETH | The following table presents additional information about ETH for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 (revised) Opening balance $ 7,123,300 $ 369,200 Cumulative-effect adjustment of opening balance due to adoption of fair value measurement - 30,600 Addition of ETH staking reward and other services 14,300 6,000 Purchases of ETH from exchange of USDT 1,636,500 - Purchases of ETH from exchange of USDC - 285,700 Exchange of ETH into USDT (7,470,600 ) - Exchange of ETH into USDC (2,391,700 ) - Return of ETH to a third party - (48,500 ) Payment of ETH for other expenses - (100 ) Investment income from sales of ETH 6,300 - Changes in fair value of ETH 2,540,700 215,400 $ 1,458,800 $ 858,300 |
Schedule of Additional Information USDT | The following table presents additional information about USDT for the three months ended March 31, 2024 and 2023: For the Three Months Ended 2024 2023 Opening balance $ 573,400 $ 90,100 Purchases of USDT from exchange of digital assets 7,989,200 - Purchases of USDT from exchange of USDC 100,000 - Collection of USDT from subscription advance from investors 75,000 - Exchange of USDT into ETH (1,636,500 ) - Exchange of USDT into USD (701,000 ) - Payment of service fees (7,800 ) (87,800 ) $ 6,392,300 $ 2,300 |
Long-Term Investments (Tables)
Long-Term Investments (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Long-Term Investments [Abstract] | |
Schedule of Long-Term Investments | Long-term investments were comprised of the following: For the Three Months Ended 2024 2023 Investment in MarsLand Global Limited (“MarsLand”) (a) $ 224,800 $ 224,800 Investment in Quleduo Technology Co., (“Quleduo”) (b) 1,500,000 1,000,000 Investment in DaoMax Technology Co., Ltd, (“DaoMax”) (c) 546,000 546,000 Total $ 2,270,800 $ 1,770,800 MarsLand is a privately held company. In May 2023, the Company, through Saving Digital Pte. Ltd. (“Saving Digital”), its wholly owned subsidiary, invested consideration of $300,000 in USDC, which represents 30% of equity interest in MarsLand. The Company used equity method to measure the investment in MarsLand. For the three months ended March 31, 2024, the Company did not record a share equity of income or loss for its share of the results of Marsland because of minimal loss incurred by Marsland. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment in MarsLand. Quleduo is a privately held company which is engaged in software design and development. In May and September 2023 and January 2024, the Company made a total cash consideration of $1,500,000 in three instalments to acquire 25% of equity interest in Quleduo. The Company had no significant influence over Quleduo. Quleduo is a privately held company, over which the Company neither has control nor significant influence through investment in ordinary shares. The Company accounted for the investment in Quleduo using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer. Quleduo just commenced its operations in July 2023, and incurred minimal losses through March 31, 2024. For the three months ended March 31, 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment security. In June 2023, October 2023 and December 2023, the Company, through Saving Digital, invested an aggregated cash consideration of $546,000 in DaoMax in exchange for a total of 7.6% equity interest in the investee. DaoMax is a privately held company, over which the Company neither has control nor significant influence through investment in ordinary shares. The Company accounted for the investment in DaoMax using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer. DaoMax just commenced its operations in October 2023, and incurred minimal losses through March 31, 2024. For the three months ended March 31, 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company’s impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment security. |
Intangible Assets (Tables)
Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Intangible Assets [Abstract] | |
Schedule of Intangible Assets | Content assets were comprised of the following: For the Three Months Ended 2024 2023 Software $ 581,000 $ - Produced contents - in development and production 15,200 - - released 308,900 - Copyrights 1,349,200 - 2,254,300 - Less: accumulated amortization (550,600 ) - Total $ 1,703,700 $ - |
Schedule of Amortization Amount of Intangible Asset | For the three months ended March 31, 2024 and 2023, the Company recorded amortization expenses of $550,600 and $ nil For the nine months ending December 31, 2024 $ 1,602,900 For the year ending December 31, 2025 93,500 For the year ending December 31, 2026 7,300 Total $ 1,703,700 |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
Schedule of Fair Value of the Warrants | On January 17, 2024, the relative fair value of the warrants was $1,867,400, calculated using the Black-Scholes pricing model with the following assumptions: As of Risk-free rate of return 4.02 % Estimated volatility rate 99.86 % Dividend yield 0 % Spot price of underling ordinary share $ 2.8 Exercise price $ 1.5 Relative fair value of warrant $ 1,867,400 |
Organization and Principal Ac_3
Organization and Principal Activities (Details) | Jan. 07, 2024 |
FunVerse [Member] | |
Organization and Principal Activities [Line Items] | |
Percentage of shareholders agreement | 60% |
Organization and Principal Ac_4
Organization and Principal Activities (Details) - Schedule of Major Subsidiaries | 3 Months Ended | |
Mar. 31, 2024 | ||
FunVerse Holding Limited [Member] | ||
Major subsidiaries: | ||
Later of date of incorporation or Acquisition | Jan. 07, 2024 | |
Place of Incorporation | BVI | |
Percentage of Ownership | 60% | |
Principal Activities | Investment holding | |
Yuder Pte. Ltd. [Member] | ||
Major subsidiaries: | ||
Later of date of incorporation or Acquisition | Jan. 07, 2024 | |
Place of Incorporation | Singapore | |
Percentage of Ownership | 60% | [1] |
Principal Activities | Short drama streaming platform | |
Saving Digital Pte. Ltd. [Member] | ||
Major subsidiaries: | ||
Later of date of incorporation or Acquisition | Aug. 31, 2022 | |
Place of Incorporation | Singapore | |
Percentage of Ownership | 100% | |
Principal Activities | Investment holding | |
Marsprotocol Technologies Pte. Ltd. [Member] | ||
Major subsidiaries: | ||
Later of date of incorporation or Acquisition | Mar. 01, 2023 | |
Place of Incorporation | Singapore | |
Percentage of Ownership | 100% | |
Principal Activities | Investment holding | |
[1]A wholly-owned subsidiary of FunVerse Holding Limited. |
Summary of Principal Accounti_3
Summary of Principal Accounting Policies (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Jan. 31, 2024 | Dec. 31, 2023 | |
Summary of Principal Accounting Policies [Abstract] | ||||
Non-controlling interests | $ 441,100 | |||
Recognized goodwill | 2,889,200 | $ 2,889,200 | ||
Contract liabilities | 1,561,400 | |||
Net losses | (1,935,700) | $ (1,236,900) | ||
Accumulated deficit | 18,300,000 | 17,500,000 | ||
Working capital | 9,500,000 | |||
Cash | 2,851,100 | 3,129,800 | ||
Digital assets | $ 7,851,100 | $ 7,696,700 | ||
Fun Verse [Member] | ||||
Summary of Principal Accounting Policies [Abstract] | ||||
Equity interests | 40% | |||
JMC [Member] | ||||
Summary of Principal Accounting Policies [Abstract] | ||||
Net losses | $ 1,900,000 | $ 1,200,000 | ||
Cash | 3,100,000 | |||
Working Capital [Member] | ||||
Summary of Principal Accounting Policies [Abstract] | ||||
Stable coins | $ 2,900,000 |
Summary of Principal Accounti_4
Summary of Principal Accounting Policies (Details) - Schedule of Intangible Assets, Net | Mar. 31, 2024 |
Software [Member] | |
Schedule of Intangible Assets, Net [Line Items] | |
Estimated useful lives | 12 months |
Minimum [Member] | Produced contents [Member] | |
Schedule of Intangible Assets, Net [Line Items] | |
Estimated useful lives | 6 months |
Minimum [Member] | Copyrights [Member] | |
Schedule of Intangible Assets, Net [Line Items] | |
Estimated useful lives | 12 months |
Maximum [Member] | Produced contents [Member] | |
Schedule of Intangible Assets, Net [Line Items] | |
Estimated useful lives | 12 months |
Maximum [Member] | Copyrights [Member] | |
Schedule of Intangible Assets, Net [Line Items] | |
Estimated useful lives | 36 months |
Summary of Principal Accounti_5
Summary of Principal Accounting Policies (Details) - Schedule of Disaggregate Revenue - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Schedule of Disaggregate Revenue [Line Items] | ||
Disaggregate revenue | $ 8,691,600 | |
Membership and top-up streaming services [Member] | ||
Schedule of Disaggregate Revenue [Line Items] | ||
Disaggregate revenue | 8,048,200 | |
Online advertising services [Member] | ||
Schedule of Disaggregate Revenue [Line Items] | ||
Disaggregate revenue | $ 643,400 |
Revision of Previously Issued_3
Revision of Previously Issued Financial Statements (Details) - USD ($) | 3 Months Ended | |
Jan. 01, 2023 | Mar. 31, 2023 | |
Revision of Previously Issued Financial Statements [Abstract] | ||
Cumulative-effect adjustment of accumulated deficits | $ 30,600 | $ 30,600 |
Cumulative-effect adjustment | 223,000 | |
Fair value of digital assets | 215,400 | |
Reversal of exchange gains | $ 14,000 | |
USDC [Member] | ||
Revision of Previously Issued Financial Statements [Abstract] | ||
Stable coins | $ 2,300 |
Revision of Previously Issued_4
Revision of Previously Issued Financial Statements (Details) - Schedule of Effects of Revisions on the Financial Statements | Mar. 31, 2024 USD ($) |
As previously reported [Member] | |
Schedule of Effects of Revisions on the Financial Statements [Line Items] | |
Stable coins | $ 2,510,400 |
Digital assets | 403,300 |
Accumulated deficits | (14,934,300) |
Adjustments [Member] | |
Schedule of Effects of Revisions on the Financial Statements [Line Items] | |
Stable coins | (2,300) |
Digital assets | 457,300 |
Accumulated deficits | 455,000 |
As Revised [Member] | |
Schedule of Effects of Revisions on the Financial Statements [Line Items] | |
Stable coins | 2,508,100 |
Digital assets | 860,600 |
Accumulated deficits | $ (14,479,300) |
Revision of Previously Issued_5
Revision of Previously Issued Financial Statements (Details) - Schedule of Consolidated Statements of Operations | 3 Months Ended |
Mar. 31, 2024 USD ($) | |
As previously reported [Member] | |
Schedule of Consolidated Statements of Operations [Line Items] | |
Revenues | $ 8,500 |
Cost of revenues | (229,800) |
Gross loss | (221,300) |
General and administrative expenses | 1,496,000 |
Total operating expenses | 1,501,300 |
Other income, net | |
Loss from operations before income tax expenses | (1,722,600) |
Net loss | (1,661,300) |
Adjustments [Member] | |
Schedule of Consolidated Statements of Operations [Line Items] | |
Revenues | (8,500) |
Cost of revenues | 229,800 |
Gross loss | 221,300 |
General and administrative expenses | 20,800 |
Total operating expenses | 20,800 |
Other income, net | 223,900 |
Loss from operations before income tax expenses | 424,400 |
Net loss | 424,400 |
As Restated [Member] | |
Schedule of Consolidated Statements of Operations [Line Items] | |
Revenues | |
Cost of revenues | |
Gross loss | |
General and administrative expenses | 1,516,800 |
Total operating expenses | 1,522,100 |
Other income, net | 223,900 |
Loss from operations before income tax expenses | (1,298,200) |
Net loss | $ (1,236,900) |
Acquisition of Funverse (Detail
Acquisition of Funverse (Details) | Jan. 07, 2024 USD ($) shares |
Fun Verse [Member] | |
Acquisition of Funverse [Line Items] | |
Acquisition equity interest percentage | 60% |
Business Acquisition [Member] | |
Acquisition of Funverse [Line Items] | |
Fair value of share consideration | $ | $ 2,265,000 |
Asset Acquisition [Member] | |
Acquisition of Funverse [Line Items] | |
Issuance of ordinary shares | shares | 1,500,000 |
Acquisition of Funverse (Deta_2
Acquisition of Funverse (Details) - Schedule of Estimated Fair Values of the Identifiable Assets Acquired - Business Acquisition [Member] | Jan. 07, 2024 USD ($) | |
Schedule of Estimated Fair Values of the Identifiable Assets Acquired [Abstract] | ||
Net tangible liabilities | $ (466,400) | [1] |
Goodwill | 2,889,200 | |
Deferred tax liabilities | (277,000) | |
Non-controlling interest | (1,510,000) | |
Total purchase consideration | 2,265,000 | |
Copyrights [Member] | ||
Schedule of Estimated Fair Values of the Identifiable Assets Acquired [Abstract] | ||
Net tangible liabilities | 581,000 | [2] |
Software [Member] | ||
Schedule of Estimated Fair Values of the Identifiable Assets Acquired [Abstract] | ||
Net tangible liabilities | $ 1,048,200 | [2] |
[1]The following is a reconciliation of the fair value of major classes of assets acquired and liabilities assumed which comprised of net tangible liabilities on January 7, 2024.[2] The copyrights and software are both applied to produce short dramas. The useful lives of these content assets are 12 months. |
Acquisition of Funverse (Deta_3
Acquisition of Funverse (Details) - Schedule of Reconciliation of the Fair Value of Major Classes of Assets Acquired and Liabilities - Business Acquisition [Member] | Jan. 07, 2024 USD ($) |
ASSETS | |
Cash and cash equivalents | $ 118,300 |
Accounts receivable | 323,500 |
Prepayments | 25,200 |
Prepaid expenses and other assets | 359,400 |
Content assets | 165,300 |
Total assets | 991,700 |
LIABILITIES | |
Accounts payable | 43,400 |
Contract liabilities | 395,000 |
Other current liabilities and accrued expenses | 1,019,700 |
Total liabilities | 1,458,100 |
Net tangible liabilities | $ (466,400) |
Stable Coins (Details)
Stable Coins (Details) - USDC [Member] - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Stable Coins (Details) [Line Items] | ||
USDC stable coins | $ 3,146,300 | $ 254,400 |
Fair value of USDC | $ 1 |
Stable Coins (Details) - Schedu
Stable Coins (Details) - Schedule of Stable Coins were Comprised - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
USDC [Member] | ||
Stable Coins (Details) - Schedule of Stable Coins were Comprised [Line Items] | ||
USDC | $ 3,146,300 | $ 254,400 |
Stable Coins (Details) - Sche_2
Stable Coins (Details) - Schedule of Additional Information about USDC - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Schedule of Additional Information USDC [Abstract] | ||
Opening balance | $ 254,400 | $ 2,972,000 |
Collection of USDC from subscription fee from investors | 50,000 | |
Purchases of USDC | 610,000 | |
Collection of USDC from exchange of ETH | 2,391,700 | |
Exchange of USDC into ETH and USDT | (100,000) | (285,700) |
Payment of service fees and other expenses | (9,800) | (228,200) |
Ending balance | $ 3,146,300 | $ 2,508,100 |
Digital Assets (Details)
Digital Assets (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Digital Assets [Line Items] | ||||
ETH units (in Shares) | 3,122.48 | |||
Price per unit (in Dollars per share) | $ 2,281.32 | |||
Increase in fair value of ETH | $ 215,400 | |||
Investment income | $ 6,300 | |||
Digital asset | 1,703,700 | |||
USDT [Member] | ||||
Digital Assets [Line Items] | ||||
Digital asset | 6,392,300 | $ 573,400 | ||
Fair value of USDT | $ 1 | |||
ETH [Member] | ||||
Digital Assets [Line Items] | ||||
ETH units (in Shares) | 399.89 | |||
Price per unit (in Dollars per share) | $ 3,648 | |||
Increase in fair value of ETH | $ 2,540,700 | |||
Digital asset | $ 1,458,800 | $ 858,300 | $ 7,123,300 | $ 369,200 |
Digital Assets (Details) - Sche
Digital Assets (Details) - Schedule of Digital Asset Holdings - USD ($) | Mar. 31, 2024 | Dec. 31, 2023 |
Digital Assets (Details) - Schedule of Digital Asset Holdings [Line Items] | ||
Digital asset | $ 7,851,100 | $ 7,696,700 |
ETH [Member] | ||
Digital Assets (Details) - Schedule of Digital Asset Holdings [Line Items] | ||
Digital asset | 1,458,800 | 7,123,300 |
USDT [Member] | ||
Digital Assets (Details) - Schedule of Digital Asset Holdings [Line Items] | ||
Digital asset | $ 6,392,300 | $ 573,400 |
Digital Assets (Details) - Sc_2
Digital Assets (Details) - Schedule of Additional Information ETH - ETH [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Digital Assets (Details) - Schedule of Additional Information ETH [Line Items] | ||
Opening balance | $ 7,123,300 | $ 369,200 |
Cumulative-effect adjustment of opening balance due to adoption of fair value measurement | 30,600 | |
Addition of ETH staking reward and other services | 14,300 | 6,000 |
Purchases of ETH from exchange of USDT | 1,636,500 | |
Purchases of ETH from exchange of USDC | 285,700 | |
Exchange of ETH into USDT | (7,470,600) | |
Exchange of ETH into USDC | (2,391,700) | |
Return of ETH to a third party | (48,500) | |
Payment of ETH for other expenses | (100) | |
Investment income from sales of ETH | 6,300 | |
Changes in fair value of ETH | 2,540,700 | 215,400 |
Ending balance | $ 1,458,800 | $ 858,300 |
Digital Assets (Details) - Sc_3
Digital Assets (Details) - Schedule of Additional Information USDT - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Schedule of Additional Information USDT [Abstract] | ||
Opening balance | $ 573,400 | $ 90,100 |
Purchases of USDT from exchange of digital assets | 7,989,200 | |
Purchases of USDT from exchange of USDC | 100,000 | |
Collection of USDT from subscription advance from investors | 75,000 | |
Exchange of USDT into ETH | (1,636,500) | |
Exchange of USDT into USD | (701,000) | |
Payment of service fees | (7,800) | (87,800) |
Ending balance | $ 6,392,300 | $ 2,300 |
Long-Term Investments (Details)
Long-Term Investments (Details) - USD ($) | Mar. 31, 2024 | Jan. 31, 2024 | Dec. 31, 2023 | Oct. 31, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | May 31, 2023 | Mar. 31, 2023 |
Long-Term Investments [Line Items] | ||||||||
Investments | $ 2,270,800 | $ 1,500,000 | $ 1,770,800 | $ 1,770,800 | ||||
Investment in Marsland [Member] | ||||||||
Long-Term Investments [Line Items] | ||||||||
Investments | $ 300,000 | |||||||
Ownership percentage | 30% | |||||||
Investment in Quleduo [Member] | ||||||||
Long-Term Investments [Line Items] | ||||||||
Investments | $ 1,500,000 | $ 1,500,000 | ||||||
Ownership percentage | 25% | 25% | 25% | |||||
Investment in DaoMax [Member] | ||||||||
Long-Term Investments [Line Items] | ||||||||
Investments | $ 546,000 | $ 546,000 | $ 546,000 | |||||
Ownership percentage | 7.60% | 7.60% | 7.60% |
Long-Term Investments (Detail_2
Long-Term Investments (Details) - Schedule of Long-Term Investments - USD ($) | Mar. 31, 2024 | Jan. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | |
Schedule of Long-Term Investments [Line Items] | |||||
Total | $ 2,270,800 | $ 1,500,000 | $ 1,770,800 | $ 1,770,800 | |
Investment in Marsland Global Limited (“Marsland”) [Member] | |||||
Schedule of Long-Term Investments [Line Items] | |||||
Total | [1] | 224,800 | 224,800 | ||
Investment in Quleduo Technology Co., (“Quleduo”) [Member] | |||||
Schedule of Long-Term Investments [Line Items] | |||||
Total | [2] | 1,500,000 | 1,000,000 | ||
Investment in DaoMax Technology Co., Ltd, (“DaoMax”) [Member] | |||||
Schedule of Long-Term Investments [Line Items] | |||||
Total | [3] | $ 546,000 | $ 546,000 | ||
[1] MarsLand is a privately held company. In May 2023, the Company, through Saving Digital Pte. Ltd. (“Saving Digital”), its wholly owned subsidiary, invested consideration of $300,000 in USDC, which represents 30% of equity interest in MarsLand. The Company used equity method to measure the investment in MarsLand. For the three months ended March 31, 2024, the Company did not record a share equity of income or loss for its share of the results of Marsland because of minimal loss incurred by Marsland. As of March 31, 2024 and December 31, 2023, the Company did not recognize impairment against the investment in MarsLand. |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) | Mar. 31, 2024 | Mar. 31, 2023 |
Intangible Assets [Abstract] | ||
Amortization expenses | $ 550,600 |
Intangible Assets (Details) - S
Intangible Assets (Details) - Schedule of Intangible Assets - USD ($) | Mar. 31, 2024 | Mar. 31, 2023 |
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | $ 2,254,300 | |
Less: accumulated amortization | (550,600) | |
Total, Net | 1,703,700 | |
Software [Member] | ||
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | 581,000 | |
Produced contents [Member] | ||
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | ||
in development and production [Member] | ||
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | 15,200 | |
released [Member] | ||
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | 308,900 | |
Copyrights [Member] | ||
Schedule of Intangible Assets [Line Items] | ||
Total, Gross | $ 1,349,200 |
Intangible Assets (Details) -_2
Intangible Assets (Details) - Schedule of Amortization Amount of Intangible Asset - USD ($) | Mar. 31, 2024 | Mar. 31, 2023 |
Schedule of Amortization Amount of Intangible Asset [Line Items] | ||
For the nine months ending December 31, 2024 | $ 1,602,900 | |
For the year ending December 31, 2025 | 93,500 | |
For the year ending December 31, 2026 | 7,300 | |
Total | $ 1,703,700 |
Operating Leases (Details)
Operating Leases (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating Leases [Abstract] | ||
Renewal term | 12 months | |
Rent expenses | $ 9,800 | $ 11,900 |
Equity (Details)
Equity (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||||||
Jan. 17, 2024 | Jan. 12, 2024 | Jan. 12, 2024 | Jan. 07, 2024 | Dec. 01, 2023 | Jan. 17, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | |
Common Stock [Line Items] | ||||||||
Common stock, shares authorized | 40,000,000 | 40,000,000 | ||||||
Common stock, shares issued | 31,724,631 | |||||||
Common stock, shares outstanding | 35,940,631 | 31,724,631 | ||||||
Initial sale of shares | 1,500,000 | 60,000 | ||||||
Common stock, par value (in Dollars per share) | $ 0.001 | $ 0.001 | ||||||
Purchase of aggregate value (in Dollars) | $ 3,735,000 | |||||||
Price per share (in Dollars per share) | $ 1.5 | $ 1.5 | $ 1.51 | |||||
Exercise price (in Dollars per share) | $ 1.5 | $ 1.5 | ||||||
Common stock payment received percentage | 5% | |||||||
Restricted stock | 319,800 | |||||||
Shares vested | 79,950 | |||||||
Stock nonvested | 239,850 | |||||||
Share-based expenses (in Dollars) | $ 228,155 | |||||||
Issued warrants | 2,490,000 | 2,490,000 | ||||||
Fair value of the warrants (in Dollars) | $ 1,867,400 | |||||||
Subscription Agreement [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Each one unit shares issued | 1 | 1 | ||||||
Finder s Agreement [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Issuance of common stock | 124,000 | |||||||
Subscription Agreement [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Purchase of aggregate shares | 2,490,000 | |||||||
Purchase of aggregate value (in Dollars) | $ 3,735,000 | |||||||
Warrant [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Each one unit shares issued | 1 | 1 | ||||||
Exercise price (in Dollars per share) | $ 1.5 | $ 1.5 | ||||||
Fair value of the warrants (in Dollars) | $ 1,867,400 | |||||||
Warrant [Member] | Subscription Agreement [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Each one unit shares issued | 1 | 1 | ||||||
Private Placement [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Initial sale of shares | 30,000 | |||||||
Price per share (in Dollars per share) | $ 0.001 | $ 0.001 | ||||||
Each one unit shares issued | 1 | 1 | ||||||
IPO [Member] | ||||||||
Common Stock [Line Items] | ||||||||
Common stock, shares issued | 35,940,631 | |||||||
Common stock, par value (in Dollars per share) | $ 0.001 |
Equity (Details) - Schedule of
Equity (Details) - Schedule of Fair Value of the Warrants - Warrant [Member] | Jan. 17, 2024 USD ($) $ / shares |
Equity (Details) - Schedule of Fair Value of the Warrants [Line Items] | |
Risk-free rate of return | 4.02% |
Estimated volatility rate | 99.86% |
Dividend yield | 0% |
Spot price of underling ordinary share (in Dollars per share) | $ 2.8 |
Exercise price (in Dollars per share) | $ 1.5 |
Relative fair value of warrant (in Dollars) | $ | $ 1,867,400 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Taxes [Abstract] | ||
Income tax benefits | $ 276,600 | $ 61,300 |
Percentage of income tax benefits | 12.50% | 3.56% |
Operating Segments (Details)
Operating Segments (Details) | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating Segments [Abstract] | ||
Business segment | 1 | 2 |
Subsequent Events (Details)
Subsequent Events (Details) - shares | May 03, 2024 | Apr. 17, 2024 |
Subsequent Event [Member] | ||
Subsequent Event [Line Items] | ||
Common stock, shares issued | 600 | 37,350 |