Motorsport Games (MSGM) 10-Q 7 Nov 23 2023 Q3 Quarterly report Financial data

Cover

Cover - shares	9 Months Ended
	Sep. 30, 2023	Nov. 07, 2023
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Transition Report	false
Document Period End Date	Sep. 30, 2023
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2023
Current Fiscal Year End Date	--12-31
Entity File Number	001-39868
Entity Registrant Name	Motorsport Games Inc.
Entity Central Index Key	0001821175
Entity Tax Identification Number	86-1791356
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	5972 NE 4th Avenue
Entity Address, City or Town	Miami
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33137
City Area Code	(305)
Local Phone Number	507-8799
Title of 12(b) Security	Class A common stock, $0.0001 par
Trading Symbol	MSGM
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Non-accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	true
Elected Not To Use the Extended Transition Period	false
Entity Shell Company	false
Common Class A [Member]
Entity Common Stock, Shares Outstanding		2,722,728
Common Class B [Member]
Entity Common Stock, Shares Outstanding		700,000

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets (Unaudited) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Current assets:
Cash and cash equivalents	$ 1,182,342	$ 979,306
Accounts receivable, net of allowances of $1,229,258 and $2,252,383 as of September 30, 2023 and December 31, 2022, respectively	704,549	1,809,110
Prepaid expenses and other current assets	963,051	1,048,392
Total Current Assets	2,849,942	4,043,340
Property and equipment, net	312,210	522,433
Operating lease right of use assets	247,804	971,789
Intangible assets, net	8,003,656	13,360,230
Total Assets	11,413,612	18,897,792
Current liabilities:
Accounts payable	1,320,860	2,372,219
Accrued expenses and other current liabilities	3,691,941	3,416,424
Purchase commitments	2,507,296	2,563,216
Operating lease liabilities (current)	197,201	380,538
Total Current Liabilities	7,963,733	13,321,608
Operating lease liabilities (non-current)	52,932	617,288
Other non-current liabilities	2,898,050	3,055,498
Total Liabilities	10,914,715	16,994,394
Commitments and contingencies (Note 9)
Stockholders’ Equity:
Preferred stock, $0.0001 par value per share; authorized 1,000,000 and 1,000,000 shares; and none issued and outstanding as of September 30, 2023 and December 31, 2022, respectively
Additional paid-in capital	91,842,069	76,446,061
Accumulated deficit	(90,741,141)	(73,979,131)
Accumulated other comprehensive loss	(688,706)	(933,406)
Total Stockholders’ Equity Attributable to Motorsport Games Inc.	412,561	1,533,711
Non-controlling interest	86,336	369,687
Total Stockholders’ Equity	498,897	1,903,398
Total Liabilities and Stockholders’ Equity	11,413,612	18,897,792
Common Class A [Member]
Stockholders’ Equity:
Common stock, value	269	117
Common Class B [Member]
Stockholders’ Equity:
Common stock, value	70	70
Related Party [Member]
Current assets:
Due from related parties		206,532
Current liabilities:
Due to related parties	$ 246,435	$ 4,589,211

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Allowances for doubtful accounts receivable	$ 1,229,258	$ 2,252,383
Preferred stock, par value	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common Class A [Member]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	2,720,328	1,183,808
Common stock, shares outstanding	2,720,328	1,183,808
Common Class B [Member]
Common stock, par value	$ 0.0001	$ 0.0001
Common stock, shares authorized	7,000,000	7,000,000
Common stock, shares issued	700,000	700,000
Common stock, shares outstanding	700,000	700,000

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations (Unaudited) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Revenues		$ 1,693,871	$ 1,223,142	$ 5,162,356	$ 6,553,918
Cost of revenues	[1]	831,479	602,856	2,946,382	3,472,819
Gross profit		862,392	620,286	2,215,974	3,081,099
Operating expenses:
Sales and marketing	[2]	358,120	1,440,659	1,411,318	4,669,328
Development	[3]	1,566,839	2,631,066	5,751,741	7,717,046
General and administrative	[4]	1,526,614	4,008,335	7,459,957	10,781,098
Impairment of goodwill					4,788,268
Impairment of intangible assets				4,004,627	4,640,102
Depreciation and amortization		75,614	92,703	277,822	326,499
Total operating expenses		3,527,187	8,172,763	18,905,465	32,922,341
Loss from operations		(2,664,795)	(7,552,477)	(16,689,491)	(29,841,242)
Interest expense		(230,190)	(244,953)	(674,060)	(638,211)
Other income (expense), net		(639,147)	(739,285)	369,345	(1,511,978)
Net loss		(3,534,132)	(8,536,715)	(16,994,206)	(31,991,431)
Less: Net loss attributable to non-controlling interest		(44,093)	(21,431)	(232,196)	(933,234)
Net loss attributable to Motorsport Games Inc.		$ (3,490,039)	$ (8,515,284)	$ (16,762,010)	$ (31,058,197)
Net loss attributable to Class A common stock per share:
Basic		$ (1.28)	$ (7.29)	$ (6.60)	$ (26.61)
Diluted		$ (1.28)	$ (7.29)	$ (6.60)	$ (26.61)
Weighted-average shares of Class A common stock outstanding:
Basic		2,720,328	1,167,359	2,538,863	1,167,178
Diluted		2,720,328	1,167,359	2,538,863	1,167,178
[1]Includes related party costs of $ 0 0 0 6,228 0 0 17,076 0 15,439 21,512 46,361 44,942 116,530 122,714 298,190 221,051

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Defined Benefit Plan Disclosure [Line Items]
Related party costs	[1]	$ 831,479	$ 602,856	$ 2,946,382	$ 3,472,819
Selling and Marketing Expense [Member]
Defined Benefit Plan Disclosure [Line Items]
Related party expenses		0	0	17,076	0
Research and Development Expense [Member]
Defined Benefit Plan Disclosure [Line Items]
Related party expenses		15,439	21,512	46,361	44,942
General and Administrative Expense [Member]
Defined Benefit Plan Disclosure [Line Items]
Related party expenses		116,530	122,714	298,190	221,051
Related Party [Member]
Defined Benefit Plan Disclosure [Line Items]
Related party costs		$ 0	$ 0	$ 0	$ 6,228
[1]Includes related party costs of $ 0 0 0 6,228

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Statement [Abstract]
Net loss	$ (3,534,132)	$ (8,536,715)	$ (16,994,206)	$ (31,991,431)
Other comprehensive income:
Foreign currency translation adjustments	520,239	224,230	244,700	235,961
Comprehensive loss	(3,013,893)	(8,312,485)	(16,749,506)	(31,755,470)
Comprehensive loss attributable to non-controlling interests	(56,779)	(2,280)	(283,351)	(1,031,225)
Comprehensive loss attributable to Motorsport Games Inc.	$ (2,957,114)	$ (8,310,205)	$ (16,466,155)	$ (30,724,245)

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($)	Common Stock [Member] Common Class A [Member]	Common Stock [Member] Common Class B [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Parent [Member]	Noncontrolling Interest [Member]	Total
Balance at Dec. 31, 2021	$ 116	$ 70	$ 75,652,853	$ (37,988,326)	$ (945,375)	$ 36,719,338	$ 1,262,665	$ 37,982,003
Balance, shares at Dec. 31, 2021	1,163,590	700,000
Stock-based compensation			353,030			353,030		353,030
Stock-based compensation, shares	3,769
Other comprehensive income					(125,245)	(125,245)	(59,293)	(184,538)
Net loss				(15,137,617)		(15,137,617)	(829,428)	(15,967,045)
Balance at Mar. 31, 2022	$ 116	$ 70	76,005,883	(53,125,943)	(1,070,620)	21,809,506	373,944	22,183,450
Balance, shares at Mar. 31, 2022	1,167,359	700,000
Balance at Dec. 31, 2021	$ 116	$ 70	75,652,853	(37,988,326)	(945,375)	36,719,338	1,262,665	37,982,003
Balance, shares at Dec. 31, 2021	1,163,590	700,000
Net loss								(31,991,431)
Balance at Sep. 30, 2022	$ 116	$ 70	76,473,168	(69,046,523)	(709,414)	6,717,417	231,440	6,948,857
Balance, shares at Sep. 30, 2022	1,167,359	700,000
Balance at Mar. 31, 2022	$ 116	$ 70	76,005,883	(53,125,943)	(1,070,620)	21,809,506	373,944	22,183,450
Balance, shares at Mar. 31, 2022	1,167,359	700,000
Stock-based compensation			238,573			238,573		238,573
Stock-based compensation, shares
Other comprehensive income					136,976	136,976	(57,849)	79,127
Net loss				(7,405,296)		(7,405,296)	(82,375)	(7,487,671)
Balance at Jun. 30, 2022	$ 116	$ 70	76,244,456	(60,531,239)	(933,644)	14,779,759	233,720	15,013,479
Balance, shares at Jun. 30, 2022	1,167,359	700,000
Stock-based compensation			228,712			228,712		228,712
Stock-based compensation, shares
Other comprehensive income					224,230	224,230	19,151	243,381
Net loss				(8,515,284)		(8,515,284)	(21,431)	(8,536,715)
Balance at Sep. 30, 2022	$ 116	$ 70	76,473,168	(69,046,523)	(709,414)	6,717,417	231,440	6,948,857
Balance, shares at Sep. 30, 2022	1,167,359	700,000
Balance at Dec. 31, 2022	$ 117	$ 70	76,446,061	(73,979,131)	(933,406)	1,533,711	369,687	1,903,398
Balance, shares at Dec. 31, 2022	1,183,808	700,000
Issuance of common stock	$ 74		10,571,460			10,571,534		10,571,534
Issuance of common stock, shares	734,741
Issuance of common stock for extinguishment of related party debt	$ 78		3,948,488			3,948,566		3,948,566
Issuance of common stock for extinguishment of related party loan, shares	780,385
Stock-based compensation			249,233			249,233		249,233
Stock-based compensation, shares
Other comprehensive income					(78,588)	(78,588)	(36,318)	(114,906)
Net loss				(5,100,947)		(5,100,947)	(158,245)	(5,259,192)
Balance at Mar. 31, 2023	$ 269	$ 70	91,215,242	(79,080,078)	(1,011,994)	11,123,509	175,124	11,298,633
Balance, shares at Mar. 31, 2023	2,698,934	700,000
Balance at Dec. 31, 2022	$ 117	$ 70	76,446,061	(73,979,131)	(933,406)	1,533,711	369,687	1,903,398
Balance, shares at Dec. 31, 2022	1,183,808	700,000
Net loss								(16,994,206)
Balance at Sep. 30, 2023	$ 269	$ 70	91,842,069	(90,741,141)	(688,706)	412,561	86,336	498,897
Balance, shares at Sep. 30, 2023	2,720,328	700,000
Balance at Mar. 31, 2023	$ 269	$ 70	91,215,242	(79,080,078)	(1,011,994)	11,123,509	175,124	11,298,633
Balance, shares at Mar. 31, 2023	2,698,934	700,000
Stock-based compensation			521,303			521,303		521,303
Stock-based compensation, shares	21,394
Other comprehensive income					(196,951)	(196,951)	(2,151)	(199,102)
Net loss				(8,171,024)		(8,171,024)	(29,858)	(8,200,882)
Balance at Jun. 30, 2023	$ 269	$ 70	91,736,545	(87,251,102)	(1,208,945)	3,276,837	143,115	3,419,952
Balance, shares at Jun. 30, 2023	2,720,328	700,000
Stock-based compensation			105,524			105,524		105,524
Stock-based compensation, shares
Other comprehensive income					520,239	520,239	(12,686)	507,553
Net loss				(3,490,039)		(3,490,039)	(44,093)	(3,534,132)
Balance at Sep. 30, 2023	$ 269	$ 70	$ 91,842,069	$ (90,741,141)	$ (688,706)	$ 412,561	$ 86,336	$ 498,897
Balance, shares at Sep. 30, 2023	2,720,328	700,000

Condensed Consolidated Statem_5

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($)	9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022
Cash flows from operating activities:
Net loss	$ (16,994,206)	$ (31,991,431)
Adjustments to reconcile net loss to net cash used in operating activities:
Loss on impairment of intangible assets	4,004,627	4,640,102
Loss on impairment of goodwill		4,788,268
Loss on impairment of property, plant and equipment	7,661
Depreciation and amortization	1,512,630	1,576,003
Non-cash lease expense		321,882
Purchase commitment and license liability interest accretion	621,780	620,541
Stock-based compensation	876,060	820,315
Changes in the fair value of stock warrants	(438,148)
Sales return and price protection reserves	280,000	1,098,397
Changes in assets and liabilities:
Accounts receivable	822,477	3,709,280
Due from related parties	(190,652)
Operating lease liabilities	(23,694)	(327,337)
Prepaid expenses and other assets	83,338	(1,141,174)
Accounts payable	(1,046,204)	(728,322)
Due to related parties	2,884
Accrued expenses and other liabilities	375,436	(310,622)
Net cash used in operating activities	(10,106,011)	(16,924,098)
Cash flows from investing activities:
Purchase of property and equipment	(26,798)	(266,948)
Net cash used in investing activities	(26,798)	(266,948)
Cash flows from financing activities:
Advances from related parties		3,012,885
Repayments on advances from related parties		(119,002)
Repayments of purchase commitment liabilities	(700,000)	(1,530,000)
Payment of license liabilities	(262,500)	(275,000)
Issuance of common stock from stock purchase commitment agreement	644,750
Issuance of common stock from registered direct offerings	10,404,784
Net cash provided by financing activities	10,087,034	1,088,883
Effect of exchange rate changes on cash and cash equivalents	248,811	1,499,865
Net increase (decrease) in cash and cash equivalents	203,036	(14,602,298)
Total cash and cash equivalents at beginning of the period	979,306	17,819,640
Total cash and cash equivalents at the end of the period	1,182,342	3,217,342
Cash paid during the year for:
Interest	405,690	17,670
Non-cash investing and financing activities:
Shares issued to Driven Lifestyle Group LLC for extinguishment of related party loan	3,948,566
Extinguishment of Driven Lifestyle Group LLC related party loan for Class A shares	(3,948,566)
Issuance of warrants in connection with registered direct offerings	$ 39,852

BUSINESS ORGANIZATION, NATURE O

BUSINESS ORGANIZATION, NATURE OF OPERATIONS, AND RISKS AND UNCERTAINTIES	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
BUSINESS ORGANIZATION, NATURE OF OPERATIONS, AND RISKS AND UNCERTAINTIES	NOTE 1 - BUSINESS ORGANIZATION, NATURE OF OPERATIONS, AND RISKS AND UNCERTAINTIES Organization and Operations Motorsport Gaming US LLC (“Motorsport Gaming”) was established as a limited liability company on August 2, 2018 under the laws of the State of Florida. On January 8, 2021, Motorsport Gaming converted into a Delaware corporation pursuant to a statutory conversion and changed its name to Motorsport Games Inc. (“Motorsport Games” or the “Company”). Upon effecting the corporate conversion on January 8, 2021, Motorsport Games now holds all the property and assets of Motorsport Gaming, and all of the debts and obligations of Motorsport Gaming were assumed by Motorsport Games by operation of law upon such corporate conversion. Risks and Uncertainties Liquidity and Going Concern The Company had a net loss of approximately $ 17.0 million and negative cash flows from operations of approximately $ 10.1 90.7 1.2 million, which increased to $ 3.2 Subsequent Events For the three months ended September 30, 2023, the Company experienced an average net cash burn from operations of approximately $ 0.4 The Company’s future liquidity and capital requirements include funds to support the planned costs to operate its business, including amounts required to fund working capital, support the development and introduction of new products, maintain existing titles, and certain capital expenditures. In order to address its liquidity shortfall, the Company continues to explore several options, including, but not limited to: i) additional funding in the form of potential equity and/or debt financing arrangements or similar transactions (collectively, “Capital Financing”); ii) other strategic alternatives for its business, including, but not limited to, the sale or licensing of the Company’s assets in addition to its recent sale of its NASCAR License; and iii) cost reduction and restructuring initiatives, including re-evaluating its product roadmap, each of which is described more fully below. The Company continues to explore additional funding in the form of potential Capital Financing and has entered into an Equity Distribution Agreement (the “ED Agreement”) with Canaccord Genuity LLC, as sales agent (the “Sales Agent”), pursuant to which the Company may issue and sell shares of its Class A common stock having an aggregate offering price of up to $ 10 2.9 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Due to the continuing uncertainty surrounding the Company’s ability to raise funding in the form of potential Capital Financing, and in light of its liquidity position and anticipated future funding requirements, the Company continues to explore other strategic alternatives and potential options for its business, including, but not limited to, the sale or licensing of certain of the Company’s assets in addition to its recent sale of its NASCAR License. If any such additional strategic alternative is executed, it is expected it would help to improve the Company’s working capital position and reduce overhead expenditures, thereby lowering the Company’s expected future cash-burn, and provide some short-term liquidity relief. Nonetheless, even if the Company is successful in implementing one or more additional strategic alternatives, the Company will continue to require additional funding and/or further cost reduction measures in order to continue operations, which includes further restructuring of its business and operations. There are no assurances that the Company will be successful in implementing any additional strategic plans for the sale or licensing of its assets, or any other strategic alternative, which may be subject to the satisfaction of conditions beyond the Company’s control. As part of its ongoing liquidity management efforts, the Company has evaluated its product roadmap and determined that changes to the expected timing and scope of certain new product releases is required. Specifically, the Company has determined that its upcoming Le Mans Ultimate game release date will be moved from December 2023 to an anticipated February 2024 release date. In addition, following the Company’s decision on October 29, 2023 to complete a restructuring of its operations that primarily resulted in the closure of its Australian development studio, as well as the reduction of headcount in the United Kingdom, the Company determined it was necessary to suspend the development of its previously planned INDYCAR title until such time it is able to secure additional funding and capable resources to be able to deliver a high-quality INDYCAR video game title. Refer to Note 12 – Subsequent Events As the Company continues to address its liquidity constraints, the Company may need to make further adjustments to its product roadmap in order to reduce operating cash burn. Additionally, the Company continues to seek to improve its liquidity If the Company is unable to satisfy its capital requirements, it could be required to adopt one or more of the following alternatives: ● delaying the implementation of or revising certain aspects of the Company’s business strategy; ● further reducing or delaying the development and launch of new products and events; ● further reducing or delaying capital spending, product development spending and marketing and promotional spending; ● selling additional assets or operations; ● seeking additional capital contributions and/or loans from Driven Lifestyle Group LLC (“Driven Lifestyle”), the Company’s other affiliates and/or third parties; ● further reducing other discretionary spending; ● entering into financing agreements on unattractive terms; and/or ● significantly curtailing or discontinuing operations. There can be no assurance that the Company would be able to take any of the actions referred to above because of a variety of commercial or market factors, including, without limitation, market conditions being unfavorable for an equity or debt issuance or similar transactions, additional capital contributions and/or loans not being available from Driven Lifestyle or affiliates and/or third parties, or that the transactions may not be permitted under the terms of the Company’s various debt instruments then in effect, such as due to restrictions on the incurrence of debt, incurrence of liens, asset dispositions and related party transactions. In addition, such actions, if taken, may not enable the Company to satisfy its capital requirements if the actions that the Company is able to consummate do not generate a sufficient amount of additional capital. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Even if the Company does secure additional Capital Financing, if the anticipated level of revenues are not achieved because of, for example, decreased sales of the Company’s products due to the disposition of key assets, such as the sale of its NASCAR License, further changes in the Company’s product roadmap and/or the Company’s inability to deliver new products for its various other licenses; less than anticipated consumer acceptance of the Company’s offering of products and events; less than effective marketing and promotion campaigns, decreased consumer spending in response to weak economic conditions or weakness in the overall electronic games category; adverse changes in foreign currency exchange rates; decreased sales of the Company’s products and events as a result of increased competitive activities by the Company’s competitors; changes in consumer purchasing habits, such as the impact of higher energy prices on consumer purchasing behavior; retailer inventory management or reductions in retailer display space; less than anticipated results from the Company’s existing or new products or from its advertising and/or marketing plans; or if the Company’s expenses, including, without limitation, for marketing, advertising and promotions, product returns or price protection expenditures, exceed the anticipated level of expenses, the Company’s liquidity position may continue to be insufficient to satisfy its future capital requirements. If the Company is ultimately unable to satisfy its capital requirements, it would likely need to dissolve and liquidate its assets under the bankruptcy laws or otherwise. In accordance with Accounting Standards Codification (“ASC”) 205-40, Going Concern The accompanying unaudited condensed consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty. Accordingly, the condensed consolidated financial statements have been prepared on a basis that assumes the Company will continue as a going concern and which contemplates the realization of assets and satisfaction of liabilities and commitments in the ordinary course of business.

BASIS OF PRESENTATION AND SUMMA

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 2 – BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In management’s opinion, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair statement of the Company’s unaudited condensed consolidated financial statements as of September 30, 2023 and for the three and nine months ended September 30, 2023. The Company’s results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the operating results for the full year ending December 31, 2023 or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related disclosures as of December 31, 2022 and 2021 and for the years then ended which are included in the 2022 Form 10-K. Effective on November 10, 2022, the Company amended its certificate of incorporation to effectuate a reverse split of the issued and outstanding shares of Class A common stock and Class B common stock at a ratio of 1-for-10. Fractional shares of common stock resulting from the reverse stock split were settled in cash. Shares underlying outstanding equity-based awards were proportionately decreased and the respective per share exercise prices, if applicable, were proportionately increased in accordance with the terms of the agreements governing such securities. All shares of common stock, equity-based awards, and per share information presented in the unaudited condensed consolidated financial statements have been adjusted to reflect the reverse stock split on a retroactive basis for all periods presented. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The Company’s significant estimates used in these consolidated financial statements include, but are not limited to, revenue recognition criteria, including allowances for returns and price protection, as well as current expected credit losses, valuation allowance of deferred income taxes, valuation of acquired companies and equity method investments, the recognition and disclosure of contingent liabilities, goodwill and intangible assets impairment testing, and stock-based compensation valuation. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and may cause actual results to differ from those estimates. Recently Issued Accounting Standards As an emerging growth company (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time as the Company is no longer considered to be an EGC. The adoption dates discussed below reflect this election. Adoption of Accounting Pronouncements On January 1, 2023, the Company adopted Accounting Standard Update (“ASU”) 2019-11, “ Codification Improvements to Topic 326, Financial Instruments – Credit Losses Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instrument” Revenue from Contracts with Customers Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements On January 1, 2023, the Company adopted ASU 2020-06, “ Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) – Accounting for Convertible instruments and Contracts in an Entity’s Own Equity Significant Accounting Policies There have been no material changes to the significant accounting policies disclosed in the audited consolidated financial statements for the year ended December 31, 2022, as included in the 2022 Form 10-K, except as disclosed in this note. Fair Value Measurements The Company accounts for its assets and liabilities using a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the fair-value hierarchy below. This hierarchy requires the Company to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value. ● Level 1 – Quoted prices for identical instruments in active markets; ● Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and ● Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements The Company’s liability-classified warrants are measured at fair value on a recurring basis, with subsequent changes in fair value recognized in earnings. Certain assets, including long-lived assets, right of use assets, goodwill, indefinite-lived intangible assets, and purchase commitments are measured at fair value on a nonrecurring basis; that is, the assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments using fair value measurements with unobservable inputs are classified as Level 3. Other financial instruments, including cash and cash equivalents, accounts receivable, prepaid and other assets, accounts payable, accrued expenses, and other current liabilities are carried at cost, which approximate their fair values due to their short-term nature. Stock Warrants 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 ASC 480 - Distinguishing Liabilities from Equity Derivatives and Hedging Allowances for Returns and Price Protection The Company may permit product returns from, or grant price protection to, its customers under certain conditions. Price protection represents the Company’s practice of providing channel partners with a credit allowance to lower their wholesale price on a particular game unit that they have not resold to customers. The amount of the price protection for permanent markdowns is the difference between the original wholesale price and the new reduced wholesale price. Credits are also given for short-term promotions that temporarily reduce the wholesale price. Allowances for returns and price protection are considered variable consideration under ASC 606. The Company reduces revenue for estimated future returns and price protections that may occur with distributors and retailers (“channel partners”). See Note 2 – Basis of Presentation and Summary of Significant Accounting Policies – Accounts Receivable When evaluating the adequacy of allowances for returns and price protection, the Company analyzes the following: historical credit allowances, current sell-through of channel partners’ inventory of the Company’s products, current trends in retail and the video game industry, changes in customer demand, acceptance of products, and other related factors. In addition, the Company monitors the volume of sales to its channel partners and their inventories, as substantial overstocking in the distribution channel could result in higher-than-expected returns or higher price protection in subsequent periods. The Company recognized an expense of approximately $ 0 0.3 0 1.1 Deferred Revenue The Company’s deferred revenue, or contract liability, is classified as current and is included within accrued expenses and other current liabilities on the unaudited condensed consolidated balance sheets (Also refer Note 4 – Accrued Expenses and Other Current Liabilities Revenue recognized in the period from amounts included in contract liability at the beginning of the period was approximately $ 0.4 0.6 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of common and dilutive common-equivalent shares outstanding during each period. Dilutive common-equivalent shares consist of shares of options and warrants, if not anti-dilutive. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE SHARES For the Three and Nine Months Ended September 30, 2023 2022 Stock options 25,486 57,405 Warrants 33,574 - Dilutive securities 59,060 57,405

INTANGIBLE ASSETS

INTANGIBLE ASSETS	9 Months Ended
	Sep. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
INTANGIBLE ASSETS	NOTE 3 – INTANGIBLE ASSETS Licensing Agreements As of September 30, 2023, the Company had license agreements with various entities related to the development of video games and the organization and facilitation of esports events, including BARC (TOCA) Limited (“BARC”) with respect to the British Touring Car Championship (the “BTCC”), and INDYCAR LLC (“INDYCAR”) with respect to the INDYCAR SERIES. As of September 30, 2023, the Company had a remaining liability in connection with these licensing agreements of approximately $ 0.8 3.5 On October 26, 2023, BARC delivered notice to the Company terminating the BTCC License Agreement (as defined in Note 9). The termination of the BTCC License Agreement was effective as of November 3, 2023. Refer to Note 12 – Subsequent Events Impairment The Company identified triggering events as of June 30, 2023, that indicated certain finite-lived intangible assets were at risk of impairment and as such, performed a quantitative impairment assessment to determine the recoverability of those finite-lived intangible assets. The primary trigger for the impairment review was the Company’s decision to explore strategic alternatives, including, but not limited to, the sale or licensing of the Company’s assets (the “Strategic Initiatives”), and that failure to consummate any such transaction would likely result in the Company being unable to comply with certain requirements of certain of its video game licenses. No further indicators of impairment were identified as of September 30, 2023. As a result of the quantitative impairment assessment, the Company determined the fair value of certain licensing agreements, software and non-compete agreements were lower than their respective carrying values and recorded an impairment loss of approximately $ 4.0 The Company determined the fair value of the finite-lived intangible assets subject to assessment using either a discounted cash flow valuation model or a cost to recreate valuation model, depending on the nature of the asset. The identified impairment losses were primarily driven by a reduction in expected future cash flows, driven by the triggering event factors discussed above. The principal assumptions used in the discounted cash flow valuation model were forecasted cash flows and the expected proceeds from the sale of certain assets should the Company be successful in its Strategic Initiatives, while the principal assumptions used in the cost to recreate valuation model were production hours, cost per hour and technological obsolescence. The Company considers these assumptions to be judgmental and subject to risk and uncertainty, which could result in further changes in subsequent periods. The impairment loss is presented as impairment of intangible assets in the unaudited condensed consolidated statements of operations and comprehensive loss. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Intangible Assets The following is a summary of intangible assets as of September 30, 2023: SCHEDULE OF INTANGIBLE ASSETS Non- Licensing Licensing Software Distribution Trade Compete Agreements Agreements Licenses Contracts Names Agreements Accumulated (Finite) (Indefinite) (Finite) (Finite) (Indefinite) (Finite) Amortization Total Balance as of January 1, 2023 $ 7,198,363 $ 1,546,645 $ 8,656,842 $ 560,000 $ 212,185 $ 243,243 $ (5,057,048 ) $ 13,360,230 Amortization expense - - - - - - (1,221,970 ) (1,221,970 ) Impairment of intangible assets (3,457,202 ) - (483,173 ) - - (64,252 ) - (4,004,627 ) FX translation adjustments 27,506 (48,438 ) (105,137 ) - (5,762 ) (5,426 ) 7,280 (129,977 ) Balance as of September 30, 2023 $ 3,768,667 $ 1,498,207 $ 8,068,532 $ 560,000 $ 206,423 $ 173,565 $ (6,271,738 ) $ 8,003,656 Weighted average remaining amortization period as of September 30, 2023 10.8 - 3.6 - - 0.5 - - Accumulated amortization of intangible assets consists of the following: SCHEDULE OF ACCUMULATED AMORTIZATION OF INTANGIBLE ASSETS Licensing Software Distribution Non-Compete Agreements Licenses Contracts Agreements Accumulated (Finite) (Finite) (Finite) (Finite) Amortization Balance as of January 1, 2023 $ 1,146,010 $ 3,212,135 $ 560,000 $ 138,903 $ 5,057,048 Amortization expense 169,687 1,013,294 - 38,989 1,221,970 Foreign currency translation adjustment (9,688 ) 6,735 - (4,327 ) (7,280 ) Balance as of September 30, 2023 $ 1,306,009 $ 4,232,164 $ 560,000 $ 173,565 $ 6,271,738 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Estimated aggregate amortization expense of intangible assets for the next five years and thereafter is as follows: SCHEDULE OF ESTIMATED AGGREGATE AMORTIZATION EXPENSE OF INTANGIBLE ASSETS Total 2023 (remaining period) $ 379,619 2024 1,480,475 2025 1,343,999 2026 1,097,212 2027 346,277 2028 278,396 Thereafter 1,373,048 Estimated aggregate amortization expense $ 6,299,026 Amortization expense related to intangible assets was approximately $ 0.4 million and $ 0.4 million for the three months ended September 30, 2023 and 2022, and amortization expense related to intangible assets was approximately $ 1.2 million and $ 1.3 million for the nine months ended September 30, 2023 and 2022. Within intangible assets is approximately $ 1.5 million of licensing agreements that are not presently subject to amortization. These non-amortizing licensing agreements will begin amortizing upon release of the first title under the respective license agreement.

ACCRUED EXPENSES AND OTHER CURR

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	9 Months Ended
	Sep. 30, 2023
Payables and Accruals [Abstract]
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES	NOTE 4 – ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES Accrued expenses and other current liabilities consisted of the following: SCHEDULE OF ACCRUED EXPENSES September 30, December 31, 2023 2022 Accrued royalties $ 699,851 $ 274,085 Accrued professional and consulting fees 768,495 720,470 Accrued development costs 101,478 172,164 Accrued taxes 70,452 149,842 Accrued payroll 547,603 372,358 Deferred revenue 208,274 311,945 Loss contingency reserves 892,049 1,100,000 Accrued other 403,739 315,560 Total $ 3,691,941 $ 3,416,424

RELATED PARTY LOANS

RELATED PARTY LOANS	9 Months Ended
	Sep. 30, 2023
Related Party Loans
RELATED PARTY LOANS	NOTE 5 – RELATED PARTY LOANS On April 1, 2020, the Company entered into a promissory note (the “$ 12 10 10 12 12 10 12 12 12 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements On September 8, 2022, the Company entered into a support agreement with Driven Lifestyle (the “Support Agreement”) pursuant to which Driven Lifestyle issued approximately $ 3 12 12 12 12 3.9 780,385 As of September 30, 2023, the $ 12 12 As of September 30, 2023 and December 31, 2022, the balance due to Driven Lifestyle under the $ 12 0 3,670,000 0 96,667

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	9 Months Ended
	Sep. 30, 2023
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	NOTE 6 – RELATED PARTY TRANSACTIONS In addition to the $ 12 Related Party Loans 0.3 0.1 1.1 0.1 0.2 0 The Company has regular related party receivables and payables outstanding as of September 30, 2023 and December 31, 2022. Specifically, the Company owed approximately $ 0.2 4.6 0.2 Backoffice Services Agreement On March 23, 2023 (but effective as of January 1, 2023), the Company entered into a new Backoffice Services Agreement with Driven Lifestyle, (the “Backoffice Services Agreement”), following the expiration of the Company’s prior services agreement with Driven Lifestyle. Pursuant to the Backoffice Services Agreement, Driven Lifestyle will provide accounting, payroll and benefits, human resources and other back-office services on a full-time basis to support the Company’s business functions. The term of the Backoffice Services Agreement is 12 months from the effective date. The term will automatically renew for successive 12-month terms unless either party provides written notice of nonrenewal at least 30 days prior to the end of the then current term. The Backoffice Services Agreement may be terminated by either party at any time with 60 days prior notice. Pursuant to the Backoffice Services Agreement, the Company is required to pay a monthly fee to Driven Lifestyle of $ 17,500 157,500 52,500 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements

STOCKHOLDERS_ EQUITY

STOCKHOLDERS’ EQUITY	9 Months Ended
	Sep. 30, 2023
Equity [Abstract]
STOCKHOLDERS’ EQUITY	NOTE 7 – STOCKHOLDERS’ EQUITY Class A and B Common Stock As of September 30, 2023, the Company had 2,720,328 700,000 Effective on November 10, 2022, the Company amended its certificate of incorporation to effectuate a reverse split of the issued and outstanding shares of Class A common stock and Class B common stock at a ratio of 1-for-10. 704Games Warrants As of September 30, 2023 and December 31, 2022, 704Games LLC (“704Games”), a wholly-owned subsidiary of Motorsport Games Inc., has outstanding 10-year warrants to purchase 4,000 93.03 no 2 Registered Direct Offerings and the Wainwright Warrants On February 1, February 2 and February 3, 2023, the Company completed three separate registered direct offerings (the “Offerings”) priced at-market under NASDAQ rules with H.C. Wainwright & Co., LLC acting as the exclusive placement agent for each transaction (the “Agent”). In connection with the Offerings, the Company paid the Agent a transaction fee equal to 7.0 6.0 SCHEDULE OF REGISTERED DIRECT OFFERINGS AND WAINWRIGHT WARRANTS Offering Date Shares Issued Gross Proceeds Net Proceeds Warrants Issued Warrant Strike Price Warrant Term Registered direct offering 1 February 1, 2023 183,020 $ 3.9 $ 3.6 10,981 $ 26.75 5 Registered direct offering 2 February 2, 2023 144,366 $ 3.4 $ 3.1 8,662 $ 29.38 5 Registered direct offering 3 February 3, 2023 232,188 $ 4.0 $ 3.7 13,931 $ 21.74 5 As of September 30, 2023, the Wainwright Warrants were assessed to have a fair value of approximately $ 40,000 The Company utilized a Black-Scholes Option Pricing Model to determine the fair value of the Wainwright Warrants. The Black-Scholes model requires management to make a number of key assumptions, including expected volatility, expected term, and risk-free interest rate. The risk-free interest rate is estimated using the rate of return on U.S. treasury notes with a life that approximates the expected term. The expected term assumption used in the Black-Scholes model represents the period of time that the Wainwright Warrants are expected to be outstanding and is estimated using the contractual term of the Wainwright Warrants. As of September 30, 2023, the Wainwright Warrants had no intrinsic value. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Stock Purchase Commitment Agreement During the nine months ended September 30, 2023, the Company issued 175,167 657,850 2,000,000 1,302,676

SHARE-BASED COMPENSATION

SHARE-BASED COMPENSATION	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
SHARE-BASED COMPENSATION	NOTE 8 – SHARE-BASED COMPENSATION On January 12, 2021, in connection with its initial public offering, Motorsport Games established the Motorsport Games Inc. 2021 Equity Incentive Plan (the “MSGM 2021 Stock Plan”). The MSGM 2021 Stock Plan provides for the grant of options, stock appreciation rights, restricted stock awards, performance share awards and restricted stock unit awards, and initially authorized 100,000 74,514 The majority of the options issued under the MSGM 2021 Stock Plan have time-based vesting schedules, typically vesting ratably over a three-year period. Certain stock option awards differed from this vesting schedule, notably awards made to the Company’s former Chief Executive Officer in conjunction with the Company’s initial public offering that vested immediately, as well as those made to the Company’s current and former directors that vest on the one-year anniversary of award issuance. All stock options issued under the MSGM 2021 Stock Plan expire 10 The following is a summary of stock-based compensation award activity for the nine months ended September 30, 2023: SCHEDULE OF STOCK-BASED COMPENSATION OPTIONS ACTIVITY Number of Options Awards outstanding under the MSGM 2021 Stock Plan as of January 1, 2023 (net of forfeitures) 74,285 Stock options awarded to Board of Directors under the MSGM 2021 Stock Plan 26,316 Stock options forfeited, cancelled or expired (75,115 ) Awards outstanding under the MSGM 2021 Stock Plan as of September 30, 2023 (net of forfeitures) 25,486 On April 4, 2023, the Company granted an aggregate of 26,316 0.1 21,394 30,000 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Stock-Based Compensation The following table summarizes stock-based compensation expense resulting from equity awards included in the Company’s condensed consolidated statements of operations: SCHEDULE OF STOCK BASED COMPENSATION EXPENSE 2023 2022 2023 2022 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2023 2022 2023 2022 General and Administrative $ 86,737 $ 223,953 $ 632,116 $ 682,276 Sales and Marketing 6,720 1,371 229,454 80,210 Development 12,067 3,388 14,490 57,829 Stock-based compensation expense $ 105,524 $ 228,712 $ 876,060 $ 820,315 As of September 30, 2023, there was approximately $ 0.2 1.5

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2023
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES	NOTE 9 – COMMITMENTS AND CONTINGENCIES Litigation The Company is involved in various routine legal proceedings incidental to the ordinary course of its business. The Company believes that the outcome of all pending legal proceedings in the aggregate is not reasonably likely to have a material adverse effect on the Company’s business, prospects, results of operations, financial condition and/or cash flows, except as otherwise disclosed below. In light of the uncertainties involved in legal proceedings generally, the ultimate outcome of a particular matter could be material to the Company’s operating results for a particular period depending on, among other things, the size of the loss or the nature of the liability imposed and the level of the Company’s income for that particular period. Litigation or other legal proceedings, with or without merit, is unpredictable and generally expensive and time consuming and, even if resolved in our favor, is likely to divert significant resources from our core business, including distracting our management personnel from their normal responsibilities. Certain conditions may exist as of the date the condensed consolidated financial statements are issued, which may result in a loss to the Company, but which will only be resolved when one or more future events occur or fail to occur. The Company assesses such contingent liabilities, and such assessment inherently involves an exercise of judgment. In assessing loss contingencies related to legal proceedings that are pending against the Company, or unasserted claims that may result in such proceedings, the Company evaluates the perceived merits of any legal proceedings or unasserted claims, as well as the perceived merits of the amount of relief sought or expected to be sought therein. If the assessment of a contingency indicates that it is probable that a material loss has been incurred and the amount of the liability can be estimated, then the estimated liability would be accrued in the Company’s condensed consolidated financial statements. If the assessment indicates that a potential material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability and an estimate of the range of possible losses, if determinable and material, would be disclosed. Loss contingencies considered remote are generally not disclosed, unless they involve guarantees, in which case the guarantees would be disclosed. There can be no assurance that such matters will not materially and adversely affect the Company’s business, financial position, and results of operations or cash flows. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements On February 11, 2021, HC2 Holdings 2 Inc. (now known as Innovate 2) (“Innovate”) and Continental General Insurance Company (“Continental”), former minority stockholders of 704Games, filed a complaint (the “HC2 and Continental Complaint”) in the U.S. District Court for the District of Delaware against the Company, the Company’s former Chief Executive Officer and Executive Chairman, the Company’s former Chief Financial Officer, and the manager of Driven Lifestyle. The complaint was later amended and added Leo Capital Holdings LLC (“Leo Capital”) as an additional plaintiff and the controller of Driven Lifestyle as an additional individual defendant. The complaint alleges, among other things, purported misrepresentations and omissions concerning 704Games’ financial condition made in connection with the Company’s purchase of these minority shareholders’ interest in 704Games in August and October 2021. The complaint asserts claims under Section 10(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and Rule 10b-5 thereunder; Section 20(a) of the Exchange Act; Section 20A of the Exchange Act; breach of the Company’s obligations under the Stockholders’ Agreement dated August 14, 2018; fraudulent inducement; breach of fiduciary duties; and unjust enrichment. The plaintiffs seek, among other things, damages from the defendants, jointly and severally, based on the alleged difference between the fair market value of the shares of common stock of 704Games on the date of plaintiffs’ sale and the purchase price that was paid, as well as punitive damages and other relief. In May 2021, the Company, along with the other defendants, filed a motion to dismiss the plaintiffs’ complaint. On March 28, 2022, the court entered an order denying the motion to dismiss. On January 11, 2023, in connection with the HC2 and Continental Complaint, the Company, along with other defendants, entered into a settlement agreement with one of the plaintiffs, Continental, to settle the claims made by Continental against the defendants and the claims made by the defendants against Continental. Under the terms of the settlement agreement, the Company was obligated to pay the sum of $ 1.1 0.1 40,000 1.1 The Company has continued to defend its position with the remaining plaintiffs, Leo Capital and Innovate. In respect of Leo Capital’s complaint, the Company believed it was probable a settlement would be reached and that such settlement was reasonably estimable at approximately $ 0.2 0.2 0.2 Subsequent Events In respect of Innovate, the Company continues to defend its position and believes the outcome of such defense remains uncertain at this time. A such, the Company does not believe it is probable a settlement will be reached, nor can any such settlement amount be reasonably estimable, and has not recognized a settlement liability in respect of the remaining plaintiff. As of September 30, 2023, the Company has recorded a settlement liability of $ 0.9 1.1 Accrued Expenses and Other Current Liabilities On July 28, 2023, Wesco Insurance Company (“Wesco”) filed a complaint in state court in Florida against the Company, as well as the other defendants involved in the litigation related to the HC2 and Continental Complaint (the “Underlying Action”). The Company had previously submitted the Underlying Action for coverage under a management liability policy issued by Hallmark Specialty Insurance Company and an excess policy with Wesco (the “Wesco Policy”). Wesco’s complaint seeks declaratory relief to determine Wesco’s obligations to the defendants under an excess policy of insurance issued to the Company by Wesco for the Underlying Action. Wesco claims that there is no coverage afforded to the defendants for the Underlying Action under the Wesco Policy. The Company disagrees with and disputes Wesco’s position regarding coverage for the Underlying Action under the Wesco Policy and plans to defend its position. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Commitments On January 25, 2021, the Company entered into an amendment (the “Le Mans Amendment”) to the Le Mans Esports Series Ltd joint venture agreement, which resulted in an increase of the Company’s ownership interest in the Le Mans Esports Series Ltd joint venture from 45 51 8,000,000 8,500,000 Epic License Agreement On August 11, 2020, the Company entered into a licensing agreement with Epic Games International (“Epic”) for worldwide licensing rights to Epic’s proprietary computer program known as the Unreal Engine 4. Pursuant to the agreement, upon payment of the initial license fee described below, the Company was granted a nonexclusive, non-transferable and terminable license to develop, market and sublicense (under limited circumstances and subject to conditions of the agreement) certain products using the Unreal Engine 4 for its next generation of games. The Company will pay Epic a license fee royalty payment equal to 5 Minimum Royalty Guarantees and Other Commitments The Company is required to make certain minimum royalty guarantee payments to third-party licensors, arising primarily from its INDYCAR and Le Mans Licenses, as well as its former NASCAR License and, as disclosed in more detail in Note 12 – Subsequent Events 17.4 million for the remaining duration of these arrangements as of September 30, 2023. In addition to the minimum royalty guarantee payments, the Company is obligated by the Video Game Licenses to spend a minimum amount on relevant marketing activities each year, aggregating to $ 2.4 million across all of the agreements. On October 3, 2023, the Company completed the sale of its NASCAR License, which relieved the Company of certain obligations – including the minimum royalty guarantee and marketing activity commitments pertaining to the NASCAR License. As a result of this transaction, the Company’s minimum royalty guarantee commitments was reduced from $ 17.4 11.0 2.4 0.4 Subsequent Events The Company has paid an aggregate of $ 0.5 1.3 Subsequent Events On May 29, 2020, the Company secured a licensing agreement with BARC, the exclusive promoter of the BTCC (the “BTCC License Agreement”). Pursuant to the BTCC License Agreement, the Company was granted an exclusive license (the “BTCC License”) to use certain licensed intellectual property for motorsports and/or racing video gaming products related to, themed as, or containing the BTCC, on consoles, PC and mobile applications, esports series and esports events (including the Company’s esports platform). In exchange for the BTCC License, the BTCC License Agreement required the Company to pay BARC an initial fee in two equal installments of $ 100,000 0.4 0.8 Subsequent Events Purchase Commitment Liabilities On April 20, 2021 the Company acquired 100% of the share capital of Studio 397 B.V. (“Studio397”) from Luminis International B.V. and Technology In Business B.V. (collectively, the “Sellers”). The purchase price originally consisted of (i) $ 12.8 3.2 on the first anniversary of closing pursuant to which, among other things, the Deferred Payment installment amount due to be paid by the Company on the first anniversary of closing was reduced from $3.2 million to $1 million with the remaining $2.2 million to be settled in installments of: $ 330,000 100,000 150,000 15 1.0 0.2 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements

CONCENTRATIONS

CONCENTRATIONS	9 Months Ended
	Sep. 30, 2023
Risks and Uncertainties [Abstract]
CONCENTRATIONS	NOTE 10 – CONCENTRATIONS Customer Concentrations The following table sets forth information as to each customer that accounted for 10% or more of the Company’s revenues for the following periods: SCHEDULE OF CONCENTRATIONS Three Months Ended Nine Months Ended September 30, September 30, Customer 2023 2022 2023 2022 Customer B 25.1 % 39.9 % 25.5 % 26.8 % Customer C 28.7 % - * 28.6 % 21.9 % Customer D 19.8 % 39.7 % 24.0 % 23.0 % Customer E 10.4 % - * - * - * Total 84.0 % 79.6 % 78.1 % 71.7 % * Less than 10%. The following table sets forth information as to each customer that accounted for 10% or more of the Company’s trade accounts receivable as of: September 30, December 31, Customer 2023 2022 Customer A - * 50.5 % Customer B 23.0 % 11.2 % Customer C 42.0 % 15.2 % Customer D 13.9 % 13.1 % Total 78.9 % 90.0 % * Less than 10%. A reduction in sales from or loss of these customers, in a significant amount, could have a material adverse effect on the Company’s results of operations and financial condition. Supplier Concentrations The following table sets forth information as to each supplier that accounted for 10% or more of the Company’s cost of revenues for the following periods: SCHEDULE OF CONCENTRATIONS Three Months Ended Nine Months Ended September 30, September 30, Supplier 2023 2022 2023 2022 Supplier A 62.3 % - * 22.2 % 16.1 % Supplier B - * - * 13.9 % 18.9 % Total 62.3 % 0.00 % 36.1 % 35.0 % * Less than 10%. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements

SEGMENT REPORTING

SEGMENT REPORTING	9 Months Ended
	Sep. 30, 2023
Segment Reporting [Abstract]
SEGMENT REPORTING	NOTE 11 – SEGMENT REPORTING The Company’s principal operating segments coincide with the types of products and services to be sold. The products and services from which revenues are derived are consistent with the reporting structure of the Company’s internal organization. The Company’s two Segment operating profit is determined based upon internal performance measures used by the CODM. The Company derives the segment results from its internal management reporting system. The accounting policies the Company uses to derive reportable segment results are the same as those used for external reporting purposes. Management measures the performance of each reportable segment based upon several metrics, including net revenues, gross profit and operating loss. Management uses these results to evaluate the performance of, and to assign resources to, each of the reportable segments. The Company manages certain operating expenses separately at the corporate level and does not allocate such expenses to the segments. Segment income from operations excludes interest income/expense and other income or expenses and income taxes according to how a particular reportable segment’s management is measured. Management does not consider impairment charges and unallocated costs in measuring the performance of the reportable segments. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements Segment information available with respect to these reportable business segments was as follows: SCHEDULE OF SEGMENT REPORTING INFORMATION Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Revenues: Gaming $ 1,693,871 $ 1,042,852 $ 4,872,184 $ 5,943,178 Esports - 180,290 290,172 610,740 Total Revenues $ 1,693,871 $ 1,223,142 $ 5,162,356 $ 6,553,918 Cost of Revenues: Gaming $ 831,479 $ 540,519 $ 2,571,627 $ 2,765,263 Esports - 62,337 374,755 707,556 Total Cost of Revenues $ 831,479 $ 602,856 $ 2,946,382 $ 3,472,819 Gross Profit (Loss): Gaming $ 862,392 $ 502,333 $ 2,300,557 $ 3,177,915 Esports - 117,953 (84,583 ) (96,816 ) Total Gross Profit $ 862,392 $ 620,286 $ 2,215,974 $ 3,081,099 Loss From Operations: Gaming $ (2,575,449 ) $ (6,515,203 ) $ (16,240,025 ) $ (27,952,962 ) Esports (89,346 ) (1,037,274 ) (449,466 ) (1,888,280 ) Total Loss From Operations $ (2,664,795 ) $ (7,552,477 ) $ (16,689,491 ) $ (29,841,242 ) Depreciation and Amortization: Gaming $ 63,332 $ 84,326 $ 240,947 $ 301,465 Esports 12,282 8,377 36,875 25,034 Total Depreciation and Amortization $ 75,614 $ 92,703 $ 277,822 $ 326,499 Interest Expense, net: Gaming $ (230,190 ) $ (244,953 ) $ (674,060 ) $ (638,211 ) Esports - - - - Total Interest Expense, net $ (230,190 ) $ (244,953 ) $ (674,060 ) $ (638,211 ) Other Income (Expense), net: Gaming $ (639,102 ) $ (729,158 ) $ 393,406 $ (1,496,763 ) Esports (45 ) (10,127 ) (24,061 ) (15,215 ) Total Other Income (Expense), net $ (639,147 ) $ (739,285 ) $ 369,345 $ (1,511,978 ) Net Loss: Gaming $ (3,444,132 ) $ (7,489,314 ) $ (16,520,070 ) $ (30,087,936 ) Esports (90,000 ) (1,047,401 ) (474,136 ) (1,903,495 ) Total Net Loss $ (3,534,132 ) $ (8,536,715 ) $ (16,994,206 ) $ (31,991,431 ) September 30, 2023 December 31, 2022 Total Assets: Gaming $ 9,184,841 $ 16,315,359 Esports 2,228,771 2,582,433 Total Assets $ 11,413,612 $ 18,897,792 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2023
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 12 - SUBSEQUENT EVENTS The Company evaluates subsequent events and transactions that occur after the balance sheet date up to the date that the unaudited consolidated financial statements were issued. On October 3, 2023, the Company, 704Games 704Games As consideration for the sale and assignment of the NASCAR License and all rights related thereto, , iRacing paid $ 5 704Games an 0.5 0.5 704Games 704Games 704Games 704Games On October 3, 2023, 704Games 704Games 656,115 598,000 704Games On October 3, 2023, 704Games 704Games 704Games The NASCAR New Limited License does not grant 704Games any right to create, make and/or sell any new product as the NASCAR New Limited License is solely intended to allow 704Games to continue supporting the Licensed Products created pursuant to the original NASCAR License through December 31, 2024. On October 14, 2023, the Company, along with other defendants (collectively the “Defendants”), entered into a settlement agreement with Leo Capital in connection with the HC2 and Continental Complaint disclosed in Note 9 – Commitments and Contingencies 0.2 0.2 On October 29, 2023, the Company determined to restructure its business and implement additional measures to continue lower operating expenses through the closure of its Australian development studio and the resulting reduction of the Company’s workforce primarily in Australia and the United Kingdom by approximately 40 employees. The workforce reduction is expected to impact approximately 40% of the Company’s employees worldwide. The Company expects to record a restructuring charge related to the workforce reduction, primarily consisting of severance and redundancy costs, in a preliminary estimated range of $ 0.4 0.5 On October 26, 2023, BARC delivered notice to the Company terminating the BTCC License Agreement. The termination of the BTCC License Agreement was effective as of November 3, 2023. As a result, the Company no longer has the right to develop and publish the video games for the BTCC racing series or to create and organize its esports leagues and events. Following the termination of the BTCC License Agreement, all outstanding royalties payable and other sums payable by the Company to BARC, became due and payable. As of the date of this Report, approximately $ 0.8

BASIS OF PRESENTATION AND SUM_2

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In management’s opinion, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair statement of the Company’s unaudited condensed consolidated financial statements as of September 30, 2023 and for the three and nine months ended September 30, 2023. The Company’s results of operations for the three and nine months ended September 30, 2023 are not necessarily indicative of the operating results for the full year ending December 31, 2023 or any other period. These unaudited condensed consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and related disclosures as of December 31, 2022 and 2021 and for the years then ended which are included in the 2022 Form 10-K. Effective on November 10, 2022, the Company amended its certificate of incorporation to effectuate a reverse split of the issued and outstanding shares of Class A common stock and Class B common stock at a ratio of 1-for-10. Fractional shares of common stock resulting from the reverse stock split were settled in cash. Shares underlying outstanding equity-based awards were proportionately decreased and the respective per share exercise prices, if applicable, were proportionately increased in accordance with the terms of the agreements governing such securities. All shares of common stock, equity-based awards, and per share information presented in the unaudited condensed consolidated financial statements have been adjusted to reflect the reverse stock split on a retroactive basis for all periods presented. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements
Use of Estimates	Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. The Company’s significant estimates used in these consolidated financial statements include, but are not limited to, revenue recognition criteria, including allowances for returns and price protection, as well as current expected credit losses, valuation allowance of deferred income taxes, valuation of acquired companies and equity method investments, the recognition and disclosure of contingent liabilities, goodwill and intangible assets impairment testing, and stock-based compensation valuation. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and may cause actual results to differ from those estimates.
Recently Issued Accounting Standards	Recently Issued Accounting Standards As an emerging growth company (“EGC”), the Jumpstart Our Business Startups Act (“JOBS Act”) allows the Company to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are applicable to private companies. The Company has elected to use this extended transition period under the JOBS Act until such time as the Company is no longer considered to be an EGC. The adoption dates discussed below reflect this election.
Adoption of Accounting Pronouncements	Adoption of Accounting Pronouncements On January 1, 2023, the Company adopted Accounting Standard Update (“ASU”) 2019-11, “ Codification Improvements to Topic 326, Financial Instruments – Credit Losses Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instrument” Revenue from Contracts with Customers Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements On January 1, 2023, the Company adopted ASU 2020-06, “ Debt – Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40) – Accounting for Convertible instruments and Contracts in an Entity’s Own Equity
Fair Value Measurements	Fair Value Measurements The Company accounts for its assets and liabilities using a hierarchy of valuation techniques based on whether the inputs to those valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect the Company’s market assumptions. These two types of inputs have created the fair-value hierarchy below. This hierarchy requires the Company to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value. ● Level 1 – Quoted prices for identical instruments in active markets; ● Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and ● Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements The Company’s liability-classified warrants are measured at fair value on a recurring basis, with subsequent changes in fair value recognized in earnings. Certain assets, including long-lived assets, right of use assets, goodwill, indefinite-lived intangible assets, and purchase commitments are measured at fair value on a nonrecurring basis; that is, the assets are not measured at fair value on an ongoing basis, but are subject to fair value adjustments using fair value measurements with unobservable inputs are classified as Level 3. Other financial instruments, including cash and cash equivalents, accounts receivable, prepaid and other assets, accounts payable, accrued expenses, and other current liabilities are carried at cost, which approximate their fair values due to their short-term nature.
Stock Warrants	Stock Warrants 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 ASC 480 - Distinguishing Liabilities from Equity Derivatives and Hedging
Allowances for Returns and Price Protection	Allowances for Returns and Price Protection The Company may permit product returns from, or grant price protection to, its customers under certain conditions. Price protection represents the Company’s practice of providing channel partners with a credit allowance to lower their wholesale price on a particular game unit that they have not resold to customers. The amount of the price protection for permanent markdowns is the difference between the original wholesale price and the new reduced wholesale price. Credits are also given for short-term promotions that temporarily reduce the wholesale price. Allowances for returns and price protection are considered variable consideration under ASC 606. The Company reduces revenue for estimated future returns and price protections that may occur with distributors and retailers (“channel partners”). See Note 2 – Basis of Presentation and Summary of Significant Accounting Policies – Accounts Receivable When evaluating the adequacy of allowances for returns and price protection, the Company analyzes the following: historical credit allowances, current sell-through of channel partners’ inventory of the Company’s products, current trends in retail and the video game industry, changes in customer demand, acceptance of products, and other related factors. In addition, the Company monitors the volume of sales to its channel partners and their inventories, as substantial overstocking in the distribution channel could result in higher-than-expected returns or higher price protection in subsequent periods. The Company recognized an expense of approximately $ 0 0.3 0 1.1
Deferred Revenue	Deferred Revenue The Company’s deferred revenue, or contract liability, is classified as current and is included within accrued expenses and other current liabilities on the unaudited condensed consolidated balance sheets (Also refer Note 4 – Accrued Expenses and Other Current Liabilities Revenue recognized in the period from amounts included in contract liability at the beginning of the period was approximately $ 0.4 0.6 Motorsport Games Inc. and Subsidiaries Notes to Unaudited Condensed Consolidated Financial Statements
Net Loss Per Common Share	Net Loss Per Common Share Basic net loss per common share is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of common and dilutive common-equivalent shares outstanding during each period. Dilutive common-equivalent shares consist of shares of options and warrants, if not anti-dilutive. The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE SHARES For the Three and Nine Months Ended September 30, 2023 2022 Stock options 25,486 57,405 Warrants 33,574 - Dilutive securities 59,060 57,405

BASIS OF PRESENTATION AND SUM_3

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	9 Months Ended
	Sep. 30, 2023
Accounting Policies [Abstract]
SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE SHARES	The following shares were excluded from the calculation of weighted average dilutive common shares because their inclusion would have been anti-dilutive: SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE SHARES For the Three and Nine Months Ended September 30, 2023 2022 Stock options 25,486 57,405 Warrants 33,574 - Dilutive securities 59,060 57,405

INTANGIBLE ASSETS (Tables)

INTANGIBLE ASSETS (Tables)	9 Months Ended
	Sep. 30, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
SCHEDULE OF INTANGIBLE ASSETS	The following is a summary of intangible assets as of September 30, 2023: SCHEDULE OF INTANGIBLE ASSETS Non- Licensing Licensing Software Distribution Trade Compete Agreements Agreements Licenses Contracts Names Agreements Accumulated (Finite) (Indefinite) (Finite) (Finite) (Indefinite) (Finite) Amortization Total Balance as of January 1, 2023 $ 7,198,363 $ 1,546,645 $ 8,656,842 $ 560,000 $ 212,185 $ 243,243 $ (5,057,048 ) $ 13,360,230 Amortization expense - - - - - - (1,221,970 ) (1,221,970 ) Impairment of intangible assets (3,457,202 ) - (483,173 ) - - (64,252 ) - (4,004,627 ) FX translation adjustments 27,506 (48,438 ) (105,137 ) - (5,762 ) (5,426 ) 7,280 (129,977 ) Balance as of September 30, 2023 $ 3,768,667 $ 1,498,207 $ 8,068,532 $ 560,000 $ 206,423 $ 173,565 $ (6,271,738 ) $ 8,003,656 Weighted average remaining amortization period as of September 30, 2023 10.8 - 3.6 - - 0.5 - -
SCHEDULE OF ESTIMATED AGGREGATE AMORTIZATION EXPENSE OF INTANGIBLE ASSETS	Estimated aggregate amortization expense of intangible assets for the next five years and thereafter is as follows: SCHEDULE OF ESTIMATED AGGREGATE AMORTIZATION EXPENSE OF INTANGIBLE ASSETS Total 2023 (remaining period) $ 379,619 2024 1,480,475 2025 1,343,999 2026 1,097,212 2027 346,277 2028 278,396 Thereafter 1,373,048 Estimated aggregate amortization expense $ 6,299,026

ACCRUED EXPENSES AND OTHER CU_2

ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables)	9 Months Ended
	Sep. 30, 2023
Payables and Accruals [Abstract]
SCHEDULE OF ACCRUED EXPENSES	Accrued expenses and other current liabilities consisted of the following: SCHEDULE OF ACCRUED EXPENSES September 30, December 31, 2023 2022 Accrued royalties $ 699,851 $ 274,085 Accrued professional and consulting fees 768,495 720,470 Accrued development costs 101,478 172,164 Accrued taxes 70,452 149,842 Accrued payroll 547,603 372,358 Deferred revenue 208,274 311,945 Loss contingency reserves 892,049 1,100,000 Accrued other 403,739 315,560 Total $ 3,691,941 $ 3,416,424

STOCKHOLDERS_ EQUITY (Tables)

STOCKHOLDERS’ EQUITY (Tables)	9 Months Ended
	Sep. 30, 2023
Equity [Abstract]
SCHEDULE OF REGISTERED DIRECT OFFERINGS AND WAINWRIGHT WARRANTS	SCHEDULE OF REGISTERED DIRECT OFFERINGS AND WAINWRIGHT WARRANTS Offering Date Shares Issued Gross Proceeds Net Proceeds Warrants Issued Warrant Strike Price Warrant Term Registered direct offering 1 February 1, 2023 183,020 $ 3.9 $ 3.6 10,981 $ 26.75 5 Registered direct offering 2 February 2, 2023 144,366 $ 3.4 $ 3.1 8,662 $ 29.38 5 Registered direct offering 3 February 3, 2023 232,188 $ 4.0 $ 3.7 13,931 $ 21.74 5

SHARE-BASED COMPENSATION (Table

SHARE-BASED COMPENSATION (Tables)	9 Months Ended
	Sep. 30, 2023
Share-Based Payment Arrangement [Abstract]
SCHEDULE OF STOCK-BASED COMPENSATION OPTIONS ACTIVITY	The following is a summary of stock-based compensation award activity for the nine months ended September 30, 2023: SCHEDULE OF STOCK-BASED COMPENSATION OPTIONS ACTIVITY Number of Options Awards outstanding under the MSGM 2021 Stock Plan as of January 1, 2023 (net of forfeitures) 74,285 Stock options awarded to Board of Directors under the MSGM 2021 Stock Plan 26,316 Stock options forfeited, cancelled or expired (75,115 ) Awards outstanding under the MSGM 2021 Stock Plan as of September 30, 2023 (net of forfeitures) 25,486
SCHEDULE OF STOCK BASED COMPENSATION EXPENSE	The following table summarizes stock-based compensation expense resulting from equity awards included in the Company’s condensed consolidated statements of operations: SCHEDULE OF STOCK BASED COMPENSATION EXPENSE 2023 2022 2023 2022 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2023 2022 2023 2022 General and Administrative $ 86,737 $ 223,953 $ 632,116 $ 682,276 Sales and Marketing 6,720 1,371 229,454 80,210 Development 12,067 3,388 14,490 57,829 Stock-based compensation expense $ 105,524 $ 228,712 $ 876,060 $ 820,315

CONCENTRATIONS (Tables)

CONCENTRATIONS (Tables)	9 Months Ended
	Sep. 30, 2023
Customer Concentration Risk [Member]
Concentration Risk [Line Items]
SCHEDULE OF CONCENTRATIONS	The following table sets forth information as to each customer that accounted for 10% or more of the Company’s revenues for the following periods: SCHEDULE OF CONCENTRATIONS Three Months Ended Nine Months Ended September 30, September 30, Customer 2023 2022 2023 2022 Customer B 25.1 % 39.9 % 25.5 % 26.8 % Customer C 28.7 % - * 28.6 % 21.9 % Customer D 19.8 % 39.7 % 24.0 % 23.0 % Customer E 10.4 % - * - * - * Total 84.0 % 79.6 % 78.1 % 71.7 % * Less than 10%. The following table sets forth information as to each customer that accounted for 10% or more of the Company’s trade accounts receivable as of: September 30, December 31, Customer 2023 2022 Customer A - * 50.5 % Customer B 23.0 % 11.2 % Customer C 42.0 % 15.2 % Customer D 13.9 % 13.1 % Total 78.9 % 90.0 % * Less than 10%.
Supplier Concentration Risk [Member]
Concentration Risk [Line Items]
SCHEDULE OF CONCENTRATIONS	The following table sets forth information as to each supplier that accounted for 10% or more of the Company’s cost of revenues for the following periods: SCHEDULE OF CONCENTRATIONS Three Months Ended Nine Months Ended September 30, September 30, Supplier 2023 2022 2023 2022 Supplier A 62.3 % - * 22.2 % 16.1 % Supplier B - * - * 13.9 % 18.9 % Total 62.3 % 0.00 % 36.1 % 35.0 % * Less than 10%.

SEGMENT REPORTING (Tables)

SEGMENT REPORTING (Tables)	9 Months Ended
	Sep. 30, 2023
Segment Reporting [Abstract]
SCHEDULE OF SEGMENT REPORTING INFORMATION	Segment information available with respect to these reportable business segments was as follows: SCHEDULE OF SEGMENT REPORTING INFORMATION Three Months Ended September 30, Nine Months Ended September 30, 2023 2022 2023 2022 Revenues: Gaming $ 1,693,871 $ 1,042,852 $ 4,872,184 $ 5,943,178 Esports - 180,290 290,172 610,740 Total Revenues $ 1,693,871 $ 1,223,142 $ 5,162,356 $ 6,553,918 Cost of Revenues: Gaming $ 831,479 $ 540,519 $ 2,571,627 $ 2,765,263 Esports - 62,337 374,755 707,556 Total Cost of Revenues $ 831,479 $ 602,856 $ 2,946,382 $ 3,472,819 Gross Profit (Loss): Gaming $ 862,392 $ 502,333 $ 2,300,557 $ 3,177,915 Esports - 117,953 (84,583 ) (96,816 ) Total Gross Profit $ 862,392 $ 620,286 $ 2,215,974 $ 3,081,099 Loss From Operations: Gaming $ (2,575,449 ) $ (6,515,203 ) $ (16,240,025 ) $ (27,952,962 ) Esports (89,346 ) (1,037,274 ) (449,466 ) (1,888,280 ) Total Loss From Operations $ (2,664,795 ) $ (7,552,477 ) $ (16,689,491 ) $ (29,841,242 ) Depreciation and Amortization: Gaming $ 63,332 $ 84,326 $ 240,947 $ 301,465 Esports 12,282 8,377 36,875 25,034 Total Depreciation and Amortization $ 75,614 $ 92,703 $ 277,822 $ 326,499 Interest Expense, net: Gaming $ (230,190 ) $ (244,953 ) $ (674,060 ) $ (638,211 ) Esports - - - - Total Interest Expense, net $ (230,190 ) $ (244,953 ) $ (674,060 ) $ (638,211 ) Other Income (Expense), net: Gaming $ (639,102 ) $ (729,158 ) $ 393,406 $ (1,496,763 ) Esports (45 ) (10,127 ) (24,061 ) (15,215 ) Total Other Income (Expense), net $ (639,147 ) $ (739,285 ) $ 369,345 $ (1,511,978 ) Net Loss: Gaming $ (3,444,132 ) $ (7,489,314 ) $ (16,520,070 ) $ (30,087,936 ) Esports (90,000 ) (1,047,401 ) (474,136 ) (1,903,495 ) Total Net Loss $ (3,534,132 ) $ (8,536,715 ) $ (16,994,206 ) $ (31,991,431 ) September 30, 2023 December 31, 2022 Total Assets: Gaming $ 9,184,841 $ 16,315,359 Esports 2,228,771 2,582,433 Total Assets $ 11,413,612 $ 18,897,792

BUSINESS ORGANIZATION, NATURE_2

BUSINESS ORGANIZATION, NATURE OF OPERATIONS, AND RISKS AND UNCERTAINTIES (Details Narrative) - USD ($)	3 Months Ended						9 Months Ended
	Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022	Oct. 31, 2023	Dec. 31, 2022
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest	$ 3,534,132	$ 8,200,882	$ 5,259,192	$ 8,536,715	$ 7,487,671	$ 15,967,045	$ 16,994,206	$ 31,991,431
Net cash provided by used in operating activities							10,106,011	$ 16,924,098
Retained earnings accumulated deficit	90,741,141						90,741,141			$ 73,979,131
Cash and cash equivalents	1,182,342						1,182,342			$ 979,306
Average net cash decrease	$ 400,000
At The Market [Member]
Available for future sales							2,900,000
Equity Distribution Agreement [Member] | Canaccord Genuity LLC [Member] | Common Class A [Member]
Available for future sales							$ 10,000,000
Subsequent Event [Member]
Cash and cash equivalents									$ 3,200,000

SCHEDULE OF CALCULATION WEIGHTE

SCHEDULE OF CALCULATION WEIGHTED AVERAGE DILUTIVE SHARES (Details) - shares	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dilutive securities	59,060	57,405	59,060	57,405
Share-Based Payment Arrangement, Option [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dilutive securities	25,486	57,405	25,486	57,405
Warrant [Member]
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Dilutive securities	33,574		33,574

BASIS OF PRESENTATION AND SUM_4

BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Sales return and price protection reserves	$ 0	$ 0	$ 300,000	$ 1,100,000
Contract Liability [Member]
Revenue recognized			$ 400,000	$ 600,000

SCHEDULE OF INTANGIBLE ASSETS (

SCHEDULE OF INTANGIBLE ASSETS (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 13,360,230
Intangible assets, amortization beginning			(5,057,048)
Amortization expense			(1,221,970)
Impairment of intangible assets			(4,004,627)	$ (4,640,102)
FX translation adjustments			(129,977)
Intangible assets, ending	8,003,656		8,003,656
Intangible assets, amortization ending	(6,271,738)		$ (6,271,738)
Weighted average remaining amortization
Licensing Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 7,198,363
Intangible assets, amortization beginning			(1,146,010)
Amortization expense
Impairment of intangible assets			(3,457,202)
FX translation adjustments			27,506
Intangible assets, ending	3,768,667		3,768,667
Intangible assets, amortization ending	(1,306,009)		$ (1,306,009)
Weighted average remaining amortization			10 years 9 months 18 days
Licensing Agreements (Indefinite) [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 1,546,645
Amortization expense
Impairment of intangible assets
FX translation adjustments			(48,438)
Intangible assets, ending	1,498,207		$ 1,498,207
Weighted average remaining amortization
Software Licenses (Finite) [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 8,656,842
Intangible assets, amortization beginning			(3,212,135)
Amortization expense
Impairment of intangible assets			(483,173)
FX translation adjustments			(105,137)
Intangible assets, ending	8,068,532		8,068,532
Intangible assets, amortization ending	(4,232,164)		$ (4,232,164)
Weighted average remaining amortization			3 years 7 months 6 days
Distribution Contracts (Finite) [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 560,000
Intangible assets, amortization beginning			(560,000)
Amortization expense
Impairment of intangible assets
FX translation adjustments
Intangible assets, ending	560,000		560,000
Intangible assets, amortization ending	(560,000)		$ (560,000)
Weighted average remaining amortization
Trade Names [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 212,185
Amortization expense
Impairment of intangible assets
FX translation adjustments			(5,762)
Intangible assets, ending	206,423		$ 206,423
Weighted average remaining amortization
Noncompete Agreements [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, Beginning			$ 243,243
Intangible assets, amortization beginning			(138,903)
Amortization expense
Impairment of intangible assets			(64,252)
FX translation adjustments			(5,426)
Intangible assets, ending	173,565		173,565
Intangible assets, amortization ending	(173,565)		$ (173,565)
Weighted average remaining amortization			6 months
Accumulated Amortization [Member]
Finite-Lived Intangible Assets [Line Items]
Intangible assets, amortization beginning			$ (5,057,048)
Amortization expense			(1,221,970)
Impairment of intangible assets
FX translation adjustments			7,280
Intangible assets, amortization ending	$ (6,271,738)		$ (6,271,738)
Weighted average remaining amortization

SCHEDULE OF ESTIMATED AGGREGATE

SCHEDULE OF ESTIMATED AGGREGATE AMORTIZATION EXPENSE OF INTANGIBLE ASSETS (Details)	Sep. 30, 2023 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2023 (remaining period)	$ 379,619
2024	1,480,475
2025	1,343,999
2026	1,097,212
2027	346,277
2028	278,396
Thereafter	1,373,048
Estimated aggregate amortization expense	$ 6,299,026

INTANGIBLE ASSETS (Details Narr

INTANGIBLE ASSETS (Details Narrative) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Indefinite-Lived Intangible Assets [Line Items]
Impairment loss for intangible assets			$ 4,004,627	$ 4,640,102
Accumulated amortization, beginning			5,057,048
Amortization expense	400,000	$ 400,000	1,221,970	$ 1,300,000
Amortization of intangible assets foreign currency translation adjusments			(7,280)
Accumulated amortization, ending	6,271,738		6,271,738
Intangible Assets, Net (Excluding Goodwill)	8,003,656		8,003,656		$ 13,360,230
Licensing Agreements [Member]
Indefinite-Lived Intangible Assets [Line Items]
Impairment loss for intangible assets			3,457,202
Accumulated amortization, beginning			1,146,010
Amortization expense			169,687
Amortization of intangible assets foreign currency translation adjusments			(9,688)
Accumulated amortization, ending	1,306,009		1,306,009
Software Licenses (Finite) [Member]
Indefinite-Lived Intangible Assets [Line Items]
Impairment loss for intangible assets			483,173
Accumulated amortization, beginning			3,212,135
Amortization expense			1,013,294
Amortization of intangible assets foreign currency translation adjusments			6,735
Accumulated amortization, ending	4,232,164		4,232,164
Distribution Contracts (Finite) [Member]
Indefinite-Lived Intangible Assets [Line Items]
Impairment loss for intangible assets
Accumulated amortization, beginning			560,000
Amortization expense
Amortization of intangible assets foreign currency translation adjusments
Accumulated amortization, ending	560,000		560,000
Noncompete Agreements [Member]
Indefinite-Lived Intangible Assets [Line Items]
Impairment loss for intangible assets			64,252
Accumulated amortization, beginning			138,903
Amortization expense			38,989
Amortization of intangible assets foreign currency translation adjusments			(4,327)
Accumulated amortization, ending	173,565		173,565
Non-amortizing Intangible Assets [Member]
Indefinite-Lived Intangible Assets [Line Items]
Intangible Assets, Net (Excluding Goodwill)	$ 1,500,000		1,500,000
Licensing Agreements [Member] | Purchase Commitments [Member]
Indefinite-Lived Intangible Assets [Line Items]
Indefinite-Lived intangible assets acquired			800,000
Licensing Agreements [Member] | Other Noncurrent Liabilities [Member]
Indefinite-Lived Intangible Assets [Line Items]
Indefinite-Lived intangible assets acquired			$ 3,500,000

SCHEDULE OF ACCRUED EXPENSES (D

SCHEDULE OF ACCRUED EXPENSES (Details) - USD ($)	Sep. 30, 2023	Dec. 31, 2022
Payables and Accruals [Abstract]
Accrued royalties	$ 699,851	$ 274,085
Accrued professional and consulting fees	768,495	720,470
Accrued development costs	101,478	172,164
Accrued taxes	70,452	149,842
Accrued payroll	547,603	372,358
Deferred revenue	208,274	311,945
Loss contingency reserves	892,049	1,100,000
Accrued other	403,739	315,560
Total	$ 3,691,941	$ 3,416,424

RELATED PARTY LOANS (Details Na

RELATED PARTY LOANS (Details Narrative) - USD ($)	Feb. 01, 2023	Jan. 30, 2023	Sep. 08, 2022	Sep. 30, 2023	Dec. 31, 2022	Sep. 30, 2022	Nov. 23, 2020	Apr. 01, 2020
Liine of credit			$ 12,000,000	$ 12,000,000
Principal and accrued interest payments	$ 3,900,000	$ 3,900,000
Line of credit current				0	$ 3,670,000
Accrued related party				$ 0	$ 96,667
Common Class A [Member]
Stock issued during period, shares, other	780,385	780,385
Support Agreement [Member]
Liine of credit			3,000,000			$ 12,000,000
Principal and accrued interest payments			$ 12,000,000
Promissory Note [Member]
Liine of credit							$ 12,000,000	$ 12,000,000
Interest rate								10%
Promissory Note [Member] | Maximum [Member]
Line of credit, maximum borrowing capacity							12,000,000	$ 10,000,000
Promissory Note [Member] | Minimum [Member]
Line of credit, maximum borrowing capacity							$ 10,000,000

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details Narrative)		3 Months Ended	9 Months Ended		12 Months Ended
	Mar. 23, 2023 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Sep. 30, 2023 EUR (€)	Sep. 08, 2022 USD ($)
Related Party Transaction [Line Items]
Line of credit		$ 12,000,000	$ 12,000,000				$ 12,000,000
Payment to related parties			1,100,000	$ 100,000	$ 4,600,000
Due from related parties		8,500,000	8,500,000			€ 8,000,000
New Services Agreement [Member]
Related Party Transaction [Line Items]
Monthly fee payment	$ 17,500	52,500	157,500
Related Party [Member]
Related Party Transaction [Line Items]
Incurred expenses			300,000	100,000
Cash advances		246,435	246,435	$ 0	4,589,211
Due from related parties		$ 200,000	$ 200,000		$ 200,000

SCHEDULE OF REGISTERED DIRECT O

SCHEDULE OF REGISTERED DIRECT OFFERINGS AND WAINWRIGHT WARRANTS (Details) $ / shares in Units, $ in Millions	9 Months Ended
	Sep. 30, 2023 USD ($) $ / shares shares
Registered Direct Offering One [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Offering Date	Feb. 01, 2023
Shares Issued | shares	183,020
Warrant Strike Price | $ / shares	$ 26.75
Gross proceeds | $	$ 3.9
Net Proceeds | $	$ 3.6
Warrants issued | shares	10,981
Warrants Term	5 years
Registered Direct Offering Two [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Offering Date	Feb. 02, 2023
Shares Issued | shares	144,366
Warrant Strike Price | $ / shares	$ 29.38
Gross proceeds | $	$ 3.4
Net Proceeds | $	$ 3.1
Warrants issued | shares	8,662
Warrants Term	5 years
Registered Direct Offering Three [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Offering Date	Feb. 03, 2023
Shares Issued | shares	232,188
Warrant Strike Price | $ / shares	$ 21.74
Gross proceeds | $	$ 4
Net Proceeds | $	$ 3.7
Warrants issued | shares	13,931
Warrants Term	5 years

STOCKHOLDERS_ EQUITY (Details N

STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($)			3 Months Ended	9 Months Ended
	Dec. 09, 2022	Nov. 10, 2022	Mar. 31, 2023	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Class of Stock [Line Items]
Reverse stock split ratio		the Company amended its certificate of incorporation to effectuate a reverse split of the issued and outstanding shares of Class A common stock and Class B common stock at a ratio of 1-for-10.
Transaction fee percentage				7%
Fair value of warrants				$ (438,148)
Stock issued during period value new issues			$ 10,571,534
Wainwright Warrants [Member]
Class of Stock [Line Items]
Fair value of warrants				$ 40,000
704 Games Company [Member]
Class of Stock [Line Items]
Shares of common stock				4,000
Stock option exercise price increase				$ 93.03
Warrants intrinsic value				$ 0
Remaining life of years, warrants				2 years
Common Class A [Member]
Class of Stock [Line Items]
Common stock shares outstanding				2,720,328		1,183,808
Percentage of aggregate number of shares of common stock placed in each offering				6%
Common Class A [Member] | Stock Purchase Commitment Agreement [Member] | Alumni Capital LP [Member]
Class of Stock [Line Items]
Stock issued during period shares new issues	2,000,000			175,167
Stock issued during period value new issues				$ 657,850
Purchase obligation				$ 1,302,676
Common Class B [Member]
Class of Stock [Line Items]
Common stock shares outstanding				700,000		700,000

SCHEDULE OF STOCK-BASED COMPENS

SCHEDULE OF STOCK-BASED COMPENSATION OPTIONS ACTIVITY (Details) - MSGM 2021 Stock Plan [Member]	9 Months Ended
	Sep. 30, 2023 shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options, outstanding, beginning	74,285
Number of options, granted	26,316
Number of options, forfeited, cancelled or expired	(75,115)
Number of options, outstanding, ending	25,486

SCHEDULE OF STOCK BASED COMPENS

SCHEDULE OF STOCK BASED COMPENSATION EXPENSE (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 105,524	$ 228,712	$ 876,060	$ 820,315
General and Administrative Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	86,737	223,953	632,116	682,276
Selling and Marketing Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	6,720	1,371	229,454	80,210
Research and Development Expense [Member]
Share-Based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]
Stock-based compensation expense	$ 12,067	$ 3,388	$ 14,490	$ 57,829

SHARE-BASED COMPENSATION (Detai

SHARE-BASED COMPENSATION (Details Narrative) - USD ($)			9 Months Ended
	Jun. 09, 2023	Apr. 04, 2023	Sep. 30, 2023	Jan. 12, 2021
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Unrecognized stock based compensation expense			$ 200,000
Compensation expense period			1 year 6 months
MSGM 2021 Stock Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Share based compensation expiring period			10 years
MSGM 2021 Stock Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options, granted			26,316
MSGM 2021 Stock Plan [Member] | Board of Directors [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of options, granted		26,316
Grant date fair value		$ 100,000
Common Class A [Member] | MSGM 2021 Stock Plan [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Shares available for issuance			74,514	100,000
Common Class A [Member] | MSGM 2021 Stock Plan [Member] | Consultant [Member] | Restricted Stock [Member]
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Grant date fair value	$ 30,000
Number of options, granted	21,394

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details Narrative)

3 Months Ended

9 Months Ended

12 Months Ended

Oct. 29, 2023 USD ($)

Oct. 14, 2023 USD ($)

Feb. 01, 2023 USD ($)

Jan. 30, 2023 USD ($)

Jan. 17, 2023 USD ($)

Jan. 11, 2023 USD ($)

Jul. 31, 2022 USD ($)

Jul. 21, 2022 USD ($)

Apr. 30, 2022 USD ($)

Apr. 20, 2021

May 29, 2020 USD ($)

Sep. 30, 2023 USD ($)

Sep. 30, 2023 USD ($)

Sep. 30, 2022 USD ($)

Dec. 31, 2022 USD ($)

Oct. 03, 2023 USD ($)

Oct. 02, 2023 USD ($)

Sep. 30, 2023 EUR (€)

Jul. 19, 2022

Jan. 25, 2021

Aug. 11, 2020

Loss Contingencies [Line Items]

Gain (loss) related to litigation settlement

$ 200,000

Settlement liability

$ 200,000

Fund for research

8,500,000

8,500,000

€ 8,000,000

Purchase Commitment, Remaining Minimum Amount Committed

17,400,000

17,400,000

Repayments on advances from related parties

$ 119,002

Debt Instrument, periodic payment

$ 3,900,000

$ 3,900,000

Studio Three Nine Seven [Member]

Loss Contingencies [Line Items]

Purchase commitment liabilites

1,000,000

Accrued interest

200,000

At Closing [Member] | Studio Three Nine Seven [Member]

Loss Contingencies [Line Items]

Deferred payment

$ 12,800,000

First Anniversary Of Closing [Member] | Studio Three Nine Seven [Member]

Loss Contingencies [Line Items]

Deferred payment

$ 3,200,000

NASCAR License [Member]

Loss Contingencies [Line Items]

Minimum royalty guarantee commitments, paid

500,000

500,000

Licensing Agreement [Member]

Loss Contingencies [Line Items]

License fee royalty percentage

5%

Video Games Licenses Agreement [Member]

Loss Contingencies [Line Items]

Minimum royalty guarantee commitments, paid

2,400,000

2,400,000

BTCC License Agreement [Member]

Loss Contingencies [Line Items]

Payments to Acquire Intangible Assets

$ 100,000

BTCC License Agreement [Member] | Other Current Liabilities [Member]

Loss Contingencies [Line Items]

Finite-Lived License Agreements, Gross

400,000

400,000

BTCC License Agreement [Member] | Other Current Liabilities [Member] | Unpaid Installments [Member]

Loss Contingencies [Line Items]

Finite-Lived License Agreements, Gross

$ 800,000

800,000

First Share Purchase Agreement [Member]

Loss Contingencies [Line Items]

Debt instrument, description

pursuant to which, among other things, the Deferred Payment installment amount due to be paid by the Company on the first anniversary of closing was reduced from $3.2 million to $1 million with the remaining $2.2 million to be settled in installments of: $330,000 to be paid on July 31, 2022; for the period August 15, 2022, through December 15, 2022 monthly installments of $100,000; and for the period beginning on January 15, 2023, monthly installments of $150,000 until the remaining Deferred Payment amount is satisfied.

Repayments on advances from related parties

$ 330,000

Second Share Purchase Agreement [Member] | August Fifteen Two Thousand Twenty Two Through December Fifteen Two Thousand Twenty Two [Member]

Loss Contingencies [Line Items]

Debt Instrument, periodic payment

$ 100,000

Letter Amendment [Member] | August Fifteen Two Thousand Twenty Two Through December Fifteen Two Thousand Twenty Two [Member]

Loss Contingencies [Line Items]

Debt Instrument, periodic payment

$ 150,000

Letter Agreement [Member]

Loss Contingencies [Line Items]

Interest rate

15%

LeMans Esports Series Ltd [Member] | Minimum [Member]

Loss Contingencies [Line Items]

Ownership percent

45%

LeMans Esports Series Ltd [Member] | Maximum [Member]

Loss Contingencies [Line Items]

Ownership percent

51%

Subsequent Event [Member]

Loss Contingencies [Line Items]

Gain (loss) related to litigation settlement

$ 200,000

Subsequent Event [Member] | Forecast [Member]

Loss Contingencies [Line Items]

Minimum royalty guarantee commitments, paid

$ 1,300,000

Subsequent Event [Member] | NASCAR License [Member]

Loss Contingencies [Line Items]

Minimum royalty guarantee commitments, paid

11,000,000

$ 17,400,000

Annual marketing commitment amount

$ 400,000

$ 2,400,000

Subsequent Event [Member] | Minimum [Member]

Loss Contingencies [Line Items]

Litigation settlement amount

$ 400,000

Subsequent Event [Member] | Maximum [Member]

Loss Contingencies [Line Items]

Litigation settlement amount

$ 500,000

Continental [Member]

Loss Contingencies [Line Items]

Litigation settlement amount

$ 1,100,000

Litigation settlement

$ 100,000

$ 900,000

$ 1,100,000

Payments of litigation settlement

$ 40,000

SCHEDULE OF CONCENTRATIONS (Det

SCHEDULE OF CONCENTRATIONS (Details)	3 Months Ended				9 Months Ended				12 Months Ended
	Sep. 30, 2023		Sep. 30, 2022		Sep. 30, 2023		Sep. 30, 2022		Dec. 31, 2022
Revenue Benchmark [Member] | Supplier Concentration Risk [Member] | Supplier A [Member]
Concentration Risk [Line Items]
Concentration risk percentage	62.30%			[1]	22.20%		16.10%
Revenue Benchmark [Member] | Supplier Concentration Risk [Member] | Supplier B [Member]
Concentration Risk [Line Items]
Concentration risk percentage		[1]		[1]	13.90%		18.90%
Revenue Benchmark [Member] | Supplier Concentration Risk [Member] | Supplier [Member]
Concentration Risk [Line Items]
Concentration risk percentage	62.30%		0%		36.10%		35%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer A [Member]
Concentration Risk [Line Items]
Concentration risk percentage						[2]			50.50%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer B [Member]
Concentration Risk [Line Items]
Concentration risk percentage					23%				11.20%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer C [Member]
Concentration Risk [Line Items]
Concentration risk percentage					42%				15.20%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer D [Member]
Concentration Risk [Line Items]
Concentration risk percentage					13.90%				13.10%
Trade Accounts Receivable [Member] | Customer Concentration Risk [Member] | Customer [Member]
Concentration Risk [Line Items]
Concentration risk percentage					78.90%				90%
Customer B [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percentage	25.10%		39.90%		25.50%		26.80%
Customer C [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percentage	28.70%			[2],[3]	28.60%		21.90%
Customer D [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percentage	19.80%		39.70%		24%		23%
Customer E [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percentage	10.40%			[2],[3]		[2],[3]		[2],[3]
Customer [Member] | Revenue Benchmark [Member] | Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Concentration risk percentage	84%		79.60%		78.10%		71.70%
[1]Less than 10%.[2]Less than 10%.[3]Less than 10%.

SCHEDULE OF SEGMENT REPORTING I

SCHEDULE OF SEGMENT REPORTING INFORMATION (Details) - USD ($)		3 Months Ended						9 Months Ended
		Sep. 30, 2023	Jun. 30, 2023	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Revenue from External Customer [Line Items]
Total Revenues		$ 1,693,871			$ 1,223,142			$ 5,162,356	$ 6,553,918
Total Cost of Revenues	[1]	831,479			602,856			2,946,382	3,472,819
Total Gross Profit		862,392			620,286			2,215,974	3,081,099
Total Loss From Operations		(2,664,795)			(7,552,477)			(16,689,491)	(29,841,242)
Total Depreciation and Amortization		75,614			92,703			277,822	326,499
Total Interest Expense, net		(230,190)			(244,953)			(674,060)	(638,211)
Total Other (Expense) Income, net		(639,147)			(739,285)			369,345	(1,511,978)
Total Net Loss		(3,534,132)	$ (8,200,882)	$ (5,259,192)	(8,536,715)	$ (7,487,671)	$ (15,967,045)	(16,994,206)	(31,991,431)
Total assets		11,413,612						11,413,612		$ 18,897,792
Gaming [Member]
Revenue from External Customer [Line Items]
Total Revenues		1,693,871			1,042,852			4,872,184	5,943,178
Total Cost of Revenues		831,479			540,519			2,571,627	2,765,263
Total Gross Profit		862,392			502,333			2,300,557	3,177,915
Total Loss From Operations		(2,575,449)			(6,515,203)			(16,240,025)	(27,952,962)
Total Depreciation and Amortization		63,332			84,326			240,947	301,465
Total Interest Expense, net		(230,190)			(244,953)			(674,060)	(638,211)
Total Other (Expense) Income, net		(639,102)			(729,158)			393,406	(1,496,763)
Total Net Loss		(3,444,132)			(7,489,314)			(16,520,070)	(30,087,936)
Total assets		9,184,841						9,184,841		16,315,359
Esports [Member]
Revenue from External Customer [Line Items]
Total Revenues					180,290			290,172	610,740
Total Cost of Revenues					62,337			374,755	707,556
Total Gross Profit					117,953			(84,583)	(96,816)
Total Loss From Operations		(89,346)			(1,037,274)			(449,466)	(1,888,280)
Total Depreciation and Amortization		12,282			8,377			36,875	25,034
Total Interest Expense, net
Total Other (Expense) Income, net		(45)			(10,127)			(24,061)	(15,215)
Total Net Loss		(90,000)			$ (1,047,401)			(474,136)	$ (1,903,495)
Total assets		$ 2,228,771						$ 2,228,771		$ 2,582,433
[1]Includes related party costs of $ 0 0 0 6,228

SEGMENT REPORTING (Details Narr

SEGMENT REPORTING (Details Narrative)	9 Months Ended
	Sep. 30, 2023 Segment
Segment Reporting [Abstract]
Number of reportable segments	2

SUBSEQUENT EVENTS (Details Narr

SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Apr. 04, 2024	Oct. 29, 2023	Oct. 16, 2023	Oct. 12, 2023	Oct. 03, 2023	Oct. 02, 2023	May 29, 2020	Oct. 26, 2023
Subsequent Event [Member] | Minimum [Member]
Subsequent Event [Line Items]
Litigation settlement amount		$ 400,000
Subsequent Event [Member] | Maximum [Member]
Subsequent Event [Line Items]
Litigation settlement amount		$ 500,000
Assignment and Assumption Agreement [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Payments for assignment sale	$ 500,000				$ 5,000,000	$ 500,000
Assignment and Assumption Agreement [Member] | Subsequent Event [Member] | 704 Games [Member]
Subsequent Event [Line Items]
Annual guarantee					656,115
Prepaid annual guarantee					$ 598,000
Assignment and Assumption Agreement [Member] | Subsequent Event [Member] | Leo Capital [Member]
Subsequent Event [Line Items]
Litigation settlement amount			$ 200,000	$ 200,000
BTCC License Agreement [Member]
Subsequent Event [Line Items]
Payments for assignment sale							$ 100,000
BTCC License Agreement [Member] | Subsequent Event [Member]
Subsequent Event [Line Items]
Due, amount								$ 800,000