| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (FY) (Policies) | 6 Months Ended | 12 Months Ended |
| Jun. 30, 2023 | Dec. 31, 2022 |
| SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | | |
| Basis of preparation | 2.
BASIS OF PREPARATION The interim financial information for the six months ended
June 30, 2023 (“Interim Financial Information”) has been prepared in accordance with the same accounting policies adopted in the Group’s consolidated financial statements for the years ended December 31, 2020, 2021 and 2022 (“Annual Financial
Statements”). The Interim Financial Information comprises condensed consolidated
statements of financial position, condensed consolidated statements of operations and comprehensive loss, condensed consolidated statements of changes in equity, condensed consolidated statements of cash flows, and notes to the condensed
consolidated financial statements for the six months ended June 30, 2023. The Interim Financial Information has not been audited. The Interim Financial Information has been prepared in accordance
with International Accounting Standard (“IAS”) 34 ‘Interim Financial Reporting’ issued by the International Accounting Standards Board and should be read in conjunction with the Annual Financial Statements, which have been prepared in
accordance with International Financial Reporting Standards as issued by International Accounting Standards Board (“IFRS as issued by IASB”). The preparation of an interim financial information in conformity with IAS 34 requires management to
make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses on a year-to-date basis. Actual results may differ from these estimates. This Interim Financial Information contains selected explanatory
notes. The notes include an explanation of events and transactions that are significant to an understanding of the changes in financial position and performance of the Group for the six months ended on June 30, 2023. The Interim Financial
Information and notes thereon do not include all of the information required for a full set of financial statements prepared in accordance with IFRSs. | a.
Basis of preparation The accompanying consolidated financial statements have been prepared in accordance
with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). The consolidated historical financial statements comprise the following financial
information:
•
the combined results of operations of the Bitdeer Business during the year ended December 31, 2020, and the period from
January 1, 2021 to April 15, 2021 (the “Carve-out Period”), which have been prepared on a carve-out basis; and
•
the consolidated financial position of the Group as of December 31, 2021 and 2022 and the consolidated results of operations
of the Group for the period from April 16, 2021 to December 31, 2021 and for the year ended December 31, 2022, which have been prepared on a consolidated basis (together, the “consolidated financial statements”). Preparing combined financial statements of Bitdeer Business on a
carve-out basis Pursuant to the Reorganization discussed in Note 1, the Group prepared the combined
financial statements to capture the stand-alone Bitdeer Business, which has historically operated as part of Bitmain. The Group also excluded the assets, liabilities, operation results and cash flows of BTC.com Pool Business from its combined
financial statements as a result of the Reorganization. The combined financial statements have not historically been prepared for the Bitdeer business. In preparing the combined historical financial information, certain accounting
conventions commonly used for the preparation of combined historical financial information have been applied. The term “combined financial statements” is used when referring to financial information prepared by aggregating financial statements
of separate entities or components of groups that fail to meet the definition of a “group” under IFRS 10 Consolidated financial statements The combined financial statements of the Bitdeer Business are derived from the
historical accounting records of Bitmain on the following basis:
(i)
The combined statements of operations and comprehensive income / (loss) of the Bitdeer Business include all revenues and
costs directly attributable to the Bitdeer Business. These include certain common operating and administrative expenses incurred by the Bitdeer Business in conjunction with other business operations of Bitmain and BTC, including
financial, human resources, office administration and other support functions. These costs have been allocated on a basis considered reasonable by management using either specific identification or proportional allocations based on
usage, headcount, or other reasonable methods of allocation. Income tax expense was estimated based on the statutory tax rate, adjusted as appropriate for the effects of known non-taxable and non-deductible items reported in the
combined statements of operations and comprehensive income / (loss) as described above. However, the combined financial statements of the Bitdeer Business may not reflect the actual costs that would have been incurred and may not be
indicative of the Bitdeer Business’s combined results of operations, financial position, and cash flows had it been operating on a separate, stand-alone basis during the periods presented.
(ii)
The Bitdeer Business did not comprise a separate legal entity or group of entities during the Carve-out Period. Therefore, it
is not meaningful to present share capital or an analysis of reserves. The Group’s equity balance represented the excess or deficits of total assets over total liabilities and was presented as invested capital in the consolidated
statements of financial position. Transactions between the Bitdeer Business, Bitmain and BTC during the Carve-out Period were accounted for as related party transactions. Changes in net assets attributed to the Group are presented
separately in the consolidated statement of changes in invested capital and equity through the line item “deemed contribution from / (distribution to) related parties”. Equity transactions reflecting the internal financing between
Bitdeer Business, Bitmain and BTC are included in the financing activities, presented as deemed contribution from / (distribution to) related parties, in the consolidated statements of cash flows. Consolidation Subsequent to the Carve-out Period, the Group’s financial information is prepared on a consolidated
basis, for which the consolidation policies are described below. Subsidiaries are all entities over which the Group has control. The Group controls
an entity where the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the entity. Subsidiaries are fully
consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases. Inter-company transactions, balances and unrealized gains on transactions between
the Company and its subsidiaries are eliminated. Unrealized losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. The accounting policies of subsidiaries have been changed where necessary
to ensure consistency with the policies adopted by the Group. Restatement of prior years’ financial statements Presentation on the sale of mining machines During 2021, the Group identified an error in presenting the revenue from the sale
of the mining machine as the difference between the selling price and the remaining net book value of the associated mining machine under IAS 16 Property, plant and equipment Revenue from contracts with customers Cash flow presentation on the disposal of cryptocurrencies earned from revenue
arrangements The Group restated the presentation of disposal of cryptocurrencies earned from
revenue arrangements from operating activities to investing activities for the year ended December 31, 2021 as IAS 7 has indicated receipts from sales of intangible assets and debt investments are expected to be classified as investing
activities. See Note 2(h) for the accounting policy related to the disposal of cryptocurrencies. The previously reported combined statements of cash flows for the year ended December 31, 2020 have been presented consistently with the current
period’s presentation. The effects of the above adjustments on the consolidated statements of operations
and comprehensive income / (loss) for the year ended December 31, 2020 and the consolidated statements of cash flows for the years ended December 31, 2020 and 2021 are presented below. These adjustments did not have any impact on the net loss
or the consolidated statement of financial position for the periods presented. Restated consolidated statements of operations and comprehensive
income / (loss)
2020
2020
2020
In thousands of USD
As previously reported
Effect of adjustment – sale of mining machines
As restated
Revenue
168,850
17,537
186,387
Cost of revenue
(192,027)
(17,537)
(209,564) Restated consolidated statements of cash flows
2020
2020
2020
In thousands of USD
As previously reported
Effect of adjustment— sale of mining machines
As restated
Cash flows from operating activities
(124,395)
15,219
(109,176)
Cash flows from investing activities
77,961
(15,219)
62,742
2021
2021
2021
In thousands of USD
As previously reported
Effect of adjustment— disposal of cryptocurrencies
As restated
Cash flows from operating activities
454,656
(507,122)
(52,466)
Cash flows from investing activities
(112,553)
507,122
394,569 Reclassification Certain prior year amounts have been reclassified to conform to the current year
presentation. These reclassifications had no impact on net earnings and financial position. |
| Basis of accounting | | b.
Basis of accounting The consolidated financial statements, except for the consolidated statements of
cash flows, are prepared on the accrual basis. The measurement basis used is historical cost, except for certain accounts which are measured using the basis mentioned in the relevant notes herein. The consolidated statements of cash flows are prepared using the indirect method
and present the changes in cash from operating, investing, and financing activities. The consolidated financial statements provide comparative information in respect of
the previous period. |
| Foreign currency translation | | c.
Foreign currency translation Functional and presentation currency Items included in the consolidated financial statements of each of the Group’s
subsidiaries are measured using the currency of the primary economic environment in which the subsidiary operates (the “functional currency”). The Group presents its consolidated financial statements in United States Dollars (“USD”, “US$”, or
“$”). Transactions and balances Foreign currency transactions during the year are translated at the foreign
exchange rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the foreign exchange rates ruling at the end of the reporting period. Exchange gains and losses are recognized
in profit or loss. Non-monetary assets and liabilities that are measured in terms of historical cost
in a foreign currency are translated using the foreign exchange rates ruling at the transaction dates. The transaction date is the date on which the Group initially recognizes such non-monetary assets or liabilities. Foreign currency translation The results and financial position of foreign operations that have a functional
currency different from the presentation currency are translated into the presentation currency as follows:
•
assets and liabilities for each consolidated statement of financial position presented are translated at the closing rate at
the date of that balance sheet,
•
income and expenses for each consolidated statement of operations and comprehensive income / (loss) are translated at average
exchange rates, and
•
all resulting exchange differences are recognized in invested capital and reserves. |
| Use of estimates and judgments | | d.
Use of estimates and judgments The preparation of financial statements in conformity with IFRSs requires
management to make judgments, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and
various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.
Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis.
Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future
periods. Judgments made by management in the application of IFRSs that have significant
effects on the financial statements and major sources of estimation uncertainty are discussed in Note 3. |
| Related parties | | e.
Related parties A party is considered to be related to the Group if:
(a)
the party is a person or a close member of that person’s family and that person
i)
has control or joint control over the Group;
ii)
has significant influence over the Group; or
iii)
is a member of the key management personnel of the Group or a parent of the Group;
(b)
the party is an entity where any of the following conditions applies:
i)
the entity and the Group are members of the same Group;
ii)
one entity is an associate or joint venture of the other entity (or of a parent, subsidiary or fellow subsidiary of the other
entity);
iii)
the entity and the Group are joint ventures of the same third party;
iv)
one entity is a joint venture of a third entity and the other entity is an associate of the third entity;
v)
the entity is a post-employment benefit plan for the benefit of employees of either the Group or an entity related to the
Group;
vi)
the entity is controlled or jointly controlled by a person identified in (a);
vii)
a person identified in (a)(i) has significant influence over the entity or is a member of the key management personnel of the
entity (or of a parent of the entity); or
viii)
the entity, or any member of the Group of which it is a part, provides key management personnel services to the Group or the
parent of the Group. Close members of the family of a person are those family members who may be
expected to influence, or be influenced by, that person in their dealings with the entity. Transactions involving related parties cannot be presumed to be carried out on an
arm’s-length basis, as the requisite conditions of competitive, free-market dealings may not exist. Representations about transactions with related parties, if made, shall not imply that the related party transactions were consummated on terms
equivalent to those that prevail in arm’s-length transactions unless such representations can be substantiated. |
| Cash, cash equivalents and restricted cash | | f.
Cash, cash equivalents and restricted cash Cash and cash equivalents comprise cash in banks and on hand and short-term, highly
liquid investments that are readily convertible into known amounts of cash which are subject to an insignificant risk of changes in value and are within three months of maturity at acquisition. Cash and cash equivalents are assessed for
expected credit losses. See further discussion regarding expected credit loss in Note 2(u). The Group is required to hold a defined amount of cash as security under the terms
of standby letters of credits arrangement. See further discussion in Note 6. |
| Trade receivables | | g.
Trade receivables Trade receivables are recognized when the Group has an unconditional right to
receive consideration. A right to receive consideration is unconditional if only the passage of time is required before payment of that consideration is due. Trade receivables are stated at amortized cost, less a loss allowance based on
lifetime expected credit losses at each reporting date. See further discussion regarding expected credit loss in Note 2(u). |
| Cryptocurrencies | | h.
Cryptocurrencies Cryptocurrencies include USD Coin (“USDC”) and cryptocurrencies other than USDC
held in the Group’s cryptocurrency wallets. USDC USDC is accounted for as a financial instrument as one USDC can be redeemed for one
U.S.dollar on demand from the issuer. USDC, classified as a debt investment, is measured at fair value through profit or loss. Cryptocurrencies other than USDC Cryptocurrencies other than USDC are, by their nature, identifiable non-monetary
assets that lack physical substance. Future economic benefits attributable to these cryptocurrencies are expected to flow to the Group because these cryptocurrencies can be exchanged for fiat currencies. Furthermore, the cost of the Group’s
cryptocurrencies other than USDC can be measured using the quoted price of such cryptocurrencies at the time the fair value is being measured. The Group accounts for the cryptocurrencies other than USDC as intangible assets
with indefinite useful lives in its consolidated statements of financial position because, at the time of assessment, there is no foreseeable limit to the period over which such assets are expected to generate cash flows. The Group further adopts the cost model to account for cryptocurrencies other than
USDC and reviews their useful life and impairment at each reporting date in accordance with IAS 38 Intangible Assets Gains or losses arising from the disposal of cryptocurrencies other than USDC are
determined as the difference between the net disposal proceeds and the carrying amount of the assets. The Group recognizes realized gains or losses on the date of the disposal using the first-in-first-out method of accounting.
Cryptocurrency lending arrangements The Group enters into arrangements with counterparties to lend cryptocurrencies on
an unsecured basis. No collateral is held for the cryptocurrencies lent. Upon lending, the Group derecognizes the cryptocurrencies lent and concurrently recognizes cryptocurrency receivables which are measured at the fair value of the
cryptocurrencies lent based on their respective quoted prices initially and subsequently on the measurement date and adjusted for expected credit losses. Any differences between the carrying amount of the derecognized cryptocurrencies and the
initial measurement of the cryptocurrency receivables, if applicable, and the change in fair value of the cryptocurrencies lent, are recognized in other operating income / (expenses) on the consolidated statements of operations and
comprehensive income / (loss). See further discussion regarding credit losses from cryptocurrency receivables in Note 2(u). Also refer to Note 20 for more information. Cryptocurrency-denoted wealth management products The Group purchased two types of wealth management products during the year ended December 31, 2022. Wealth management product type A The Group enters into arrangements with the Matrixport Group, a related party, to
purchase cryptocurrency-denoted wealth management products which represent units of interest in the underlying cryptocurrency trading account and the value of the units is based on the performance of the trading account managed by the
Matrixport Group. The Group derecognizes the cryptocurrencies paid and concurrently recognizes a cryptocurrency receivable which gives rise to a variable return linked to the performance of the underlying trading account. The receivable
contains an embedded derivative which is accounted for separately as an asset or liability based on the change in the fair value of the trading account. The cryptocurrency receivable is measured at the fair value of the cryptocurrencies
invested based on their respective quoted prices on the measurement date and adjusted for expected credit losses. Any differences between the carrying amount of the derecognized cryptocurrencies and the initial measurement of the cryptocurrency
receivables, if applicable, and the change in fair value of the cryptocurrencies invested, are recognized in other operating income / (expenses) on the consolidated statements of operations and comprehensive income / (loss). Wealth management product type B The Group enters into arrangements with the Matrixport Group, a related party, to
purchase cryptocurrency-denoted wealth management products which represent variable-interest cryptocurrency deposit at Matrixport Group. The deposit is not protected by any deposit insurance scheme and non-secured, and the Group may lose some
or all of the amount deposited in extreme market conditions. Upon withdrawal, the Group receives the same type of cryptocurrency in the same quantity in principle plus additional interest returns. The deposit can be withdrawn on demand and is
generally delivered to the Group within 72 hours. The nature of the wealth management product type B is, in essence, a cryptocurrency lending arrangement. Refer to the discussion on the accounting of cryptocurrency lending arrangements above. See further discussion regarding credit losses from cryptocurrency receivables in
Note 2(u). Also refer to Note 20 for more information. The Group presents the revenue recognized on the acceptance of cryptocurrencies,
which is a non-cash item, as an adjustment to remove the non-cash item for the cash flows from operating activities and the disposals of cryptocurrencies received in revenue arrangements are presented as cash flows from investing activities in
the consolidated statements of cash flows. The purchases and disposals of cryptocurrencies associated with investment or lending transactions are presented as investing activities in the consolidated statements of cash flows. |
| Prepaid expenses and other assets | | i.
Prepaid expenses and other assets Prepaid expenses represent prepayments made for operational purposes, such as
prepaid utility fees and insurance expenses. Prepaid expenses are amortized over their future beneficial periods using the straight-line method or at a point in time upon the Group’s receipt of the underlying goods or service.
Other assets generally consisted of deposits paid to various service providers,
such as lessors and electricity vendors. |
| Intangible assets | | j.
Intangible assets Intangible assets acquired by the Group are stated at cost less accumulated
amortization (where the estimated useful life is finite) and impairment losses. Amortization of intangible assets with finite useful lives is charged to profit or
loss on a straight-line basis over the assets’ estimated useful life, which is the period over which an asset is expected to be available for use. The estimates and associated assumptions of useful life determined by the Group are based on
technical or commercial obsolescence, legal or contractual limits on the use of the asset, and other relevant factors. The following intangible assets with finite useful lives are amortized from the date they are available for use and their
estimated useful lives are as follows:
•
Software
3
years Both the period and method of amortization are reviewed annually. Intangible assets are not amortized while their useful lives are assessed to be
indefinite. Any conclusion that the useful life of an intangible asset is indefinite is reviewed annually to determine whether events and circumstances continue to support the indefinite useful life assessment for that asset. If they do not,
the change in the useful life assessment from indefinite to finite is accounted for prospectively from the date of change and in accordance with the policy for amortization of intangible assets with finite lives as set out above. |
| Property, plant and equipment | | k.
Property, plant and equipment Property, plant and equipment are measured at cost, less accumulated depreciation
and impairment losses, if any. Property, plant and equipment are recorded at purchase cost. Direct labor and other
directly attributable costs incurred to construct new assets and upgrade existing assets are capitalized. Repairs and maintenance expenditures are recognized in the consolidated statements of operations and comprehensive income / (loss) as
incurred. Significant renewals and betterments are capitalized. Property, plant and equipment are depreciated using the straight-line method based
on the estimated useful lives of the assets as follows:
•
Buildings
20
years
•
Land
Unlimited
•
Machinery
3
– 10 years
•
Electronic equipment
3
– 7 years
•
Leasehold improvements
3
years Land acquired by the Group has an unlimited useful life and therefore is not
depreciated. The depreciation method, useful life and residual value of an asset are reviewed at
least at each financial year-end and adjusted, if appropriate. When assets are retired or otherwise disposed of, their cost and the related
accumulated depreciation are derecognized from the consolidated statements of financial position and the resulting gains or losses on the disposal or sale of the assets are recognized in the consolidated statements of operations and
comprehensive income / (loss). An asset under construction is stated at cost until the construction is completed,
at which time it is reclassified to the property, plant and equipment account to which it relates. During the construction period until the asset is ready for its intended use or sale, borrowing costs, which include interest expense and
foreign currency exchange differences arising from foreign currency borrowings to
the extent that they are regarded as an adjustment to interest expense, are capitalized in proportion to the average amount of accumulated expenditures during the period. Capitalization of borrowing costs ceases when the construction is
completed, and the asset is ready for its intended use or sale. |
| Investment properties | | l.
Investment properties Investment properties are properties owned or leased to earn rental income or for
capital appreciation. Investment properties include right-of-use assets relating to properties that meet the definition of investment properties. Investment properties other than the ones acquired through leases are measured,
under the cost model, initially at cost, including transaction costs and subsequently at cost less accumulated depreciation and impairment loss. Investment properties acquired through leases are initially measured at cost, which
comprises the initial measurement of lease liabilities adjusted for lease payments made on or before the commencement date, plus initial direct costs incurred and an estimate of costs needed to restore the underlying assets, less any lease
incentives received. These investment properties are subsequently measured at cost less accumulated depreciation and accumulated impairment loss and adjusted for any remeasurement of the lease liabilities. Depreciation begins when the investment property is available for use and is
calculated using a straight-line method to allocate the depreciable amounts over the estimated useful lives as follows:
•
Buildings
15
years
•
Leasehold land
15
years
•
Machinery, fixtures as part of the buildings
3
– 8 years The residual values, useful lives and depreciation method of investment properties
are reviewed at least at each financial year-end and adjusted, if appropriate. An investment property is derecognized when either it has been disposed of or when
the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the disposal or retirement of an investment property are recognized in the consolidated statement of
operations and comprehensive income / (loss) in the year of disposal or retirement. A transfer to, or from, an investment property is made when, and only when, there is evidence of a change in use. |
| Mining machines | | m.
Mining machines Mining machines refer to the electronic equipment designed for the sole purpose of
completing complex mathematical functions to verify transactions on the blockchain. Mining machines are stated at cost less accumulated depreciation and impairment losses, if any. The Group estimated the useful lives of the mining machines to
be one to two years. This estimate is primarily based on the historical measures of (i) the period when each mining machine is able
to deliver expected performance and (ii) the frequency of technological advancement, which leads to a new generation of mining machines. The Group also estimates the residual value of the mining machines at the expected time of disposal, taking
into consideration factors such as make and model. Depreciation is recorded on a straight-line basis over the estimated useful lives. The depreciation method, useful life and residual value of the mining machines are reviewed at least at each
financial year-end and adjusted, if appropriate. The Group routinely sells used mining machines to customers. The net carrying
values of the associated mining machines were reclassified as inventories when the Group identified such mining machines for sale and were recognized as cost of revenue on the consolidated statements of operations and comprehensive income /
(loss) upon the sale. See Note 2(q). When mining machines are retired, their costs and the related accumulated
depreciation are derecognized from the consolidated statements of financial position and the resulting gains or losses on the disposal of the assets are recognized in the consolidated statements of operations and comprehensive income / (loss). |
| Leases | | n.
Leases As a lessee The Group accounts for leases under IFRS 16 Leases At inception or on a reassessment of a contract that contains a lease component,
the Group allocates the consideration in the contract to each lease and non-lease component on the basis of their relative stand-alone prices. At the lease commencement date, the Group recognizes a right-of-use asset and a
lease liability, except for short-term leases that have a lease term of 12 months or less and leases of low-value assets which, for the Group, are primarily vehicles. When the Group enters into a lease in respect of a low-value asset, the Group
decides whether to capitalize the lease on a lease-by-lease basis. The lease payments associated with those leases which are not capitalized are recognized as an expense on a systematic basis over the lease term. Where the lease is capitalized, the lease liability is initially recognized at the
present value of the lease payments payable over the lease term, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, using a relevant incremental borrowing rate. After initial recognition, the
lease liability is measured at amortized cost and interest expense is calculated using the effective interest method. Variable lease payments linked to the use of an underlying asset are excluded from the measurement of lease liabilities. The right-of-use asset recognized when a lease is capitalized is initially measured
at cost, which comprises the initial amount of the lease liability plus any lease payments made at or before the commencement date, and any initial direct costs incurred. The right-of-use asset is subsequently stated at cost less accumulated
depreciation and impairment losses, if any. Right-of-use assets are subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the
unexpired term of the lease. The estimated useful lives of right-of-use assets are determined on the same basis as those of property, plant and equipment. Provisions for the costs to restore leased assets to their original condition, as
required by the terms and conditions of the lease, are recognized when the obligation is incurred, either at the commencement date or as a consequence of having used the underlying asset during a particular period of the lease, at the Group’s
best estimate of the expenditure that would be required to restore the assets. Estimates are regularly reviewed and adjusted as appropriate for new circumstances. Whenever the Group incurs an obligation for costs to restore a leased asset to the
condition required by the terms and conditions of the lease, a provision is recognized and measured under IAS 37. To the extent that the costs relate to a right-of-use asset, the costs are included in the related right-of-use asset. The lease liability is remeasured when there is a change in future lease payments
arising from a change in an index or rate, or there is a change in the Group’s estimate of the amount expected to be payable under a residual value guarantee, or there is a change arising from the reassessment of whether the Group will be
reasonably certain to exercise a purchase, extension or termination option. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset or is recorded in profit or loss
if the carrying amount of the right- of-use asset has been reduced to zero. As a lessor At the commencement date of the lease, leases in which the Group does not transfer
substantially all the risks and rewards incidental to ownership of an asset are classified as operating leases. Rental income arising is accounted for on a straight-line basis over the lease terms and is included in revenue in the consolidated
statement of operations and comprehensive income / (loss). |
| Trade payables and other payables and accruals | | o.
Trade payables and other payables and accruals Trade payables are obligations to pay for goods and/or services that have been
acquired from suppliers in the ordinary course of business. Other payables and accruals primarily represent obligations to pay staff costs, surtaxes and value-added tax, and other operating service providers. Trade payables and other payables and accruals are recognized initially at fair
value and subsequently measured at amortized cost using the effective interest method. |
| Share-based payments | | p.
Share-based payments Employees (including senior executives and members of the board of directors) and
certain service providers of the Company receive remuneration in the form of share-based payment transactions, whereby they render services as consideration for equity instruments (“equity-settled transactions”). The cost of equity-settled transactions is measured by reference to the fair value
at the date on which they are granted. The cost of equity-settled transactions is recognized, together with a
corresponding increase in equity, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the beneficiary becomes fully entitled to the equity-settled transactions (the “vesting date”). The
cumulative expense recognized for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company’s best estimate of the number of equity-settled transactions
that will ultimately vest which includes assumptions on the number of equity-settled transactions to be forfeited due to the grantees’ failing to fulfill the service condition, and forfeitures following the non-completion of performance
conditions. |
| Revenue recognition | | q.
Revenue recognition The Group’s revenues are derived principally from the cloud hash rate arrangements,
the self-mining arrangements, the cloud hosting arrangements, the sales of mining machines, the general hosting arrangements and the membership hosting arrangements. Revenue is recognized when control over goods or services is transferred to the
customer, at the amount of promised consideration to which the Group is expected to be entitled. Revenue excludes value-added tax (“VAT”) or other sales taxes and is after deduction of trade discount, if any. Revenue is recognized applying the following five steps:
i)
Identify the contract with a customer;
ii)
Identify the performance obligations in the contract;
iii)
Determine the transaction price;
iv)
Allocate the transaction price to the performance obligations in the contract; and
v)
Recognize revenue when (or as) the Group satisfies a performance obligation. For arrangements priced at fiat currency, the Group recognizes revenue based on the
contract price. For arrangement priced at cryptocurrency, the Group recognizes revenue based on the spot price of the cryptocurrency to fiat currency on the date when it is earned. When another party is involved in providing services to a customer, the Group is
the principal if it controls the specified services before those services are transferred to the customer. The primary sources of Group’s revenues are recognized as follows: Cloud Hash Rate The Group enters into Cloud Hash Rate arrangements with its customers by offering
hash rate subscription plans to provide computing power in a specified quantity, measured by computing power per second, or hash rate, derived from the mining machines held by the Group, for a specified period of time. The customer also needs to pay for electricity subscriptions, which are billed
separately, to maintain the mining machines that produce the subscribed hash rate over the contract period. The Group connects such computing power to a customer-designated mining pool under the instructions of the customer to simplify the
customer’s mining experiences. As a result of directing the connection of such computing power to the mining pools, the customers are entitled to the mining rewards, which are directly transferred from mining pools to the customer-designated
cryptocurrency wallets. The Group offers a number of different hash rate subscription plans by plan
duration and type of cryptocurrency to be mined. The Group offers electricity subscriptions in short durations and a customer needs to purchase electricity subscriptions multiple times to cover the duration of the hash rate subscription plan.
The price of the electricity subscription is fixed at the commencement of each electricity subscription period but subject to adjustment from period to period. Both cryptocurrency and fiat currency are accepted as payments under the Cloud Hash
Rate arrangements. Furthermore, the hash rate subscription plans are offered under two modes. Under the classic mode, the customer receives all of the mining rewards from the mining pool. Under the accelerator mode, the customer pays a
relatively lower computing power subscription fee. In exchange, the Group is entitled to additional consideration once the customer’s cost is recovered. The Group offers two promises under the Cloud Hash Rate arrangement. One is to
provide a specified quantity of computing power during a period of time and the other is to provide maintenance services for computing power generation for a period of time. The two promises are highly interrelated and are not separately
identifiable because the customers expect to receive the computing power as a combined output from the hash rate subscription plan and the electricity subscription plan. The two promises provide a series of distinct services, which are
substantially the same and have the same pattern of transfer to the customer, over a period of time. As a result, the promises are treated as a single performance obligation satisfied over time. The transaction price of the performance obligation includes the subscription
prices for the hash rate subscription plans and the electricity subscription plans. As the price for the electricity subscription plans may change each electricity subscription period, the Group allocates the variable consideration to each
electricity subscription period. The control of the computing power has been transferred to the customers
simultaneously as the customers consume the benefits from the computing power. The revenue is recognized over time where the consideration related to the hash rate subscription is recognized evenly over the contract term and the electricity
subscription is allocated to and recognized evenly over each electricity subscription period. For plans under the accelerator mode, besides the aforementioned subscription
prices, the transaction price also includes the additional consideration once the customer’s cost is recovered. The additional consideration, which is variable, is determined as a percentage of a customer’s mining profit derived from the
subscribed computing power and constrained until the mining pool operator finishes the calculation of the mining reward related to the mining activity in a given day. The Group includes such additional consideration in the transaction price and
recognizes the revenue when the Group can reasonably calculate the amount and determine it is probable a significant reversal will not occur. Self-mining The Group enters into contracts with mining pool operators to provide computing
power generated from the Group’s own mining machines to the mining pools. The contracts with mining pool operators are terminable at any time by either party. In exchange for providing computing power to the mining pool, the Group is entitled
to cryptocurrency rewards from the mining pool operators, which is a variable consideration calculated based on a predetermined formula agreed by the Group and the mining pool operator as a part of the arrangement. The variable consideration is
constrained until the Group can reasonably estimate the amount of mining rewards by the end of a given day based on the actual amount of computing power provided to the mining pool operators. By then, the Group considers it is highly probable
that a significant reversal in the amount of revenues will not occur and includes such variable consideration in the transaction price. Providing computing power is an output of the Group’s ordinary activities and the only performance obligation in the Group’s contracts with mining
pool operators. The Group recognizes the revenue when the variable consideration is no longer constrained and the performance obligation of providing computing power has been satisfied. Although the cryptocurrency rewards the mining pool
operators receive from the blockchain networks include both the block rewards and the transaction verification fees, the transaction price the Group receives is an aggregate amount and primarily includes the block rewards. As a result, the
Group does not present disaggregated revenue information on block rewards and transaction verification fees. Cloud Hosting The Group provides its customers, through subscription of Cloud Hosting orders,
one-stop mining machines hosting solution which integrates the provision of computing power generated from specified second-hand mining machines and the provision of maintenance service, primarily including electricity supply and daily
maintenance and repair care. The Group charges the customer an upfront fixed amount at the commencement of the Cloud Hosting arrangement for the customer to secure the procurement of the computing power from the specified mining machines, as
well as the variable fees for the provision of maintenance service based on the consumption of resources such as electricity throughout the duration of the service. The Group historically only accepts cryptocurrency as payments for services
under the Cloud Hosting arrangement. The Cloud Hosting arrangements are offered under two modes. Under the classic mode,
the customer receives all of the mining rewards from the mining pool. Under the accelerator mode, the customer is charged with a lower upfront amount and enjoys a quicker recovery of the costs. In exchange, the Group is entitled to additional
consideration once a customer’s cost is recovered. Two promises are offered under the Cloud Hosting arrangements. One is to provide
the computing power generated from the specified mining machines and the other is to perform maintenance services over the life of the mining machines. The two promises are not separately identifiable because the customer expects to receive a
steady operation of the mining machines specified in the Cloud Hosting order, which is a combined output of the provision of computing power from the specified mining machines and the provision of maintenance service of the specified mining
machines. The two promises provide a series of distinct services, which are substantially the same and have the same pattern of transfer to the customer, over a period of time. As a result, the promises are treated as a single performance
obligation satisfied over time. The transaction price of the performance obligation includes an upfront fee paid
upon placement of the Cloud Hosting order and periodical maintenance fees. The periodical maintenance fee is variable in each maintenance period based on the electricity consumption. The Group allocates the variable consideration to each
distinct maintenance service period. The revenue is recognized over time where the fixed upfront fee is recognized
evenly over the contract term and the periodical maintenance fee is recognized over each respective service period. The contract term approximates to the life of the specified mining machines and is estimated to be two years. The estimated life of these mining machines is reviewed at least at each financial year-end and adjusted if the expectation of the
realization of economic benefits from the specified mining machines is different from the previous estimate. For plans under the accelerator mode, besides the aforementioned fees, the
transaction price also includes the additional consideration once the customer’s cost is recovered. The additional consideration, which is variable, is determined as a percentage of a customer’s mining profit derived from the computing power of
the specified mining machines and constrained until the mining pool operator finishes the calculation of the mining reward related to the mining activity in a given day. The Group includes such additional consideration in the transaction price
and recognizes revenues when the Group can reasonably calculate the amount and determine it is probable a significant reversal will not occur. For all the periods presented, no revenue was generated from the additional consideration from Cloud
Hosting arrangements offered under the accelerator mode. Sale of Mining Machines The Group recognizes revenue from sales of mining machines to customers at the
point in time when control of the mining machines is transferred to the customer, which generally occurs upon shipment of the mining machines as defined in the revenue contract. Sale of mining machine is the sole performance obligation in this
type of arrangement. The Group accepts both cryptocurrency and fiat currency as payments for sales of mining machines. General Hosting The Group provides general hosting services, which is a combined service package
including custody and hosting of the customers’ mining machines, electricity and network maintenance and other services, that enable customers to run blockchain computing operations. The customer is only able to benefit from the hosting service
as a package and the Group has a single performance obligation. The hosting service fee is charged to the customer monthly as a single fee based on the customer’s consumption of resources, such as the amount of electricity used in a period.
Revenue from the general hosting service is recognized across each service cycle. The Group accepts both cryptocurrency and fiat currency as payments for the hosting services. Membership Hosting The Group offers its large-scale miner customers membership hosting services by
entering into a series of contracts, which includes a membership program agreement and a management services agreement. These contracts are signed with the same customer at or near the same time, and they are combined and accounted for as a
single contract. Pursuant to the membership program agreement, a customer subscribing the program is
entitled to the program benefit of receiving mining machine management services, as described below, within a predetermined capacity measured by energy consumption (i.e., Kilowatts, or KW) (the “designated capacity”). The Group provides such
designated capacity in a leased mining datacenter and the program subscription period starts from the time when the designated capacity is made available to the customer and ends when the Group no longer operates the mining datacenter. In
addition, the Group also agrees to provide other program benefits, if available, to the customer, including, among other things, (i) early, priority and exclusive access to the newly available mining datacenter capacity that is sufficient for
large-scale miners, upon a new mining datacenter becomes available and (ii) more favorable pricing terms for the Group’s services, such as mining machine management services, than the prevailing price in the local market. The Group charges an
upfront fee for the program benefits subscribed. Pursuant to the management services agreement, the Group provides management
services for the customer’s mining machines up to the capacity subscribed in the membership program agreement. In exchange for the management services fee, the Group promises to deliver a package of services to provide an infrastructure for the
mining machines, such as a premise for the custody of mining machines, and network and utility to support the operation of the mining machines. Unlike the general hosting service where the Group includes in its service package to host or
operate the customer’s mining machines under the customer’s instructions so that the mining machines keep running and remain connected to the customer designated mining pools (the “mining machine operation service”), under the management
services agreement, a customer has the discretion to subscribe to the mining machine operation service or choose to operate the mining machines using the customer’s own resource. The Group charges additional fee, at its stand-alone selling
price, for the subscription of the Group’s mining machine operation service. The management services fee and the mining machine operation fee, as applicable, are charged to the customer monthly based on the customer’s consumption of resources,
such as the amount of electricity used in a period. The Group’s promise associated with the membership program agreement is to stand
ready to provide services, and the Group’s promise associated with the management services agreement is to provide an infrastructure for the mining machines through the set of services provided under the management services agreement. The two promises are not separately identifiable because the customer
expects to receive mining machines management services for the mining machines up to the designated capacity, which is a combined output of the program benefit and management services provided by the Group as a package. The two promises provide
a series of distinct services that have the same pattern of transfer to the customer over a period of time. As a result, the promises are treated as a single performance obligation satisfied over time. Revenue associated with the upfront fee
for the program benefits is recognized over the program subscription period and revenue associated with the management services is recognized over each distinct service period. The promise to provide the mining machine operation service, if
subscribed to by a customer, is accounted for as a separate performance obligation and the associated revenue is recognized over each distinct service period at their respective stand-alone selling price. The Group accepts both cryptocurrency
and fiat currency as payments for the membership hosting arrangements. The contract term approximates the lease term of the mining datacenter and is estimated to be 13 years. The estimated lease term is adjusted when there is an indication that the Group is reasonably certain to renew or terminate the lease. Details of revenues for each category are as follows:
Years ended December 31,
2020
2021
2022
In thousands of USD
(Restated)
Self-mining
88,493
191,693
62,359
Cloud hash rate
Hash rate subscription
31,389
53,952
77,862
Electricity subscription
45,242
35,113
39,525
Additional consideration from Cloud Hash Rate arrangements
under acceleration mode
1,657
35,140
3,954
Sales of mining machines
15,844
45,693
705
Cloud hosting arrangements (2)
2,929
7,568
12,723
General hosting
—
18,312
99,251
Membership hosting
—
—
26,056
Others (1)
833
7,190
10,907
Total revenues
186,387
394,661
333,342
(1)
Others
include revenue generated primarily from providing technical and human resources service, repairment services of hosted mining machines, lease of investment properties, and the sale of mining machine peripherals.
(2)
The Group
did not generate any revenue from the additional consideration from Cloud Hosting arrangements offered under accelerator mode for the years ended December 31, 2020, 2021 and 2022. For the years ended December 31, 2020, 2021 and 2022, the revenue generated from
Bitmain under the brand of AntPool representing 24.44%, 0.72% and 0.24% of total revenue respectively; the revenue
generated from BTC representing 22.81%, 44.68% and 14.94% of total revenue respectively; and the revenue generated from one customer
representing nil Contract assets and liabilities A contract asset is recognized when the Group recognizes revenue before being
unconditionally entitled to the consideration under the payment terms set out in the contract. Contract assets are assessed for expected credit losses and are reclassified to receivables when the right to the consideration has become
unconditional. As of December 31, 2021 and 2022, the Group did not have any contract assets. A contract liability is recognized when the customer pays consideration for goods
or services before the Group recognizes the related revenue. A contract liability would also be recognized if the Group has an unconditional right to receive non-refundable consideration before the Group
recognizes the related revenue. In such cases, a corresponding receivable would also be recognized. As of December 31, 2021 and 2022, the Group had contract liabilities, presented as deferred revenue on the consolidated statements of financial
position, of approximately US$213.4 million and US$182.3 million. Approximately US$10.3 million, US$11.1 million and US$102.3 million, included in the
deferred revenue balance at January 1, 2020, 2021 and 2022, respectively, was recognized as revenue during the years ended December 31, 2020, 2021 and 2022. |
| Cost of revenue | | r.
Cost of revenue Cost of revenue consists primarily of electricity expenses incurred for operating
the Group’s mining machines in its revenue-generating activities, depreciation expense from the mining machines and datacenters hosting those mining machines, costs of mining machines sold to customers, and compensation expenses incurred by
mining datacenter personnel. |
| Taxes | | s.
Taxes Income tax Current and deferred income taxes are recognized as income or expense and included
in the consolidated statements of operations and comprehensive income / (loss), except to the extent that the income tax relates to items recognized in comprehensive income / (loss) or directly in equity, in which case the relevant amounts of
tax are recognized in comprehensive income / (loss) or directly in equity, respectively. Current income tax assets and liabilities are measured at the amounts expected to
be recovered or paid by using the tax rates and tax laws that have been enacted or substantively enacted at each reporting date. Management periodically evaluates positions taken in the tax reporting process with respect to situations in which
applicable tax regulation is subject to interpretation. Where appropriate, management establishes provisions based on the amounts expected to be paid to the tax authorities. Deferred tax Deferred tax assets and liabilities arise from deductible and taxable temporary
differences respectively, being the differences between the carrying amounts of assets and liabilities for financial reporting purposes and their tax bases. Deferred tax assets also arise from unused tax losses and unused tax credits. Apart from the temporary differences arising from goodwill not deductible for tax
purposes, all deferred tax liabilities, and all deferred tax assets to the extent that it is probable that future taxable profits will be available against which the asset can be utilized, are recognized. Deferred tax assets and liabilities are
measured using enacted or substantively enacted tax rates and tax laws at each reporting date which are expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The carrying amount of deferred tax assets is reviewed at each reporting date and
reduced if it is no longer probable that sufficient taxable profit will be available to compensate part or all of the benefits of deferred tax assets. Unrecognized deferred tax assets are re-assessed at each reporting date and recognized if it
is probable that future taxable profits will be available for recovery. Tax deductions arising from the reversal of deferred tax assets are excluded from estimates of future taxable income. Deferred taxes on transactions which are recognized outside profit or loss are
recognized outside profit or loss. Therefore, deferred taxes on these transactions are recognized either in comprehensive income / (loss) or recognized directly in equity. Deferred tax assets and liabilities are offset in the consolidated statements of
financial position, if and only if it has a legally enforceable right to set off current tax assets and liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same Tax Authority on either the same taxable
entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realize the assets and settle the liabilities simultaneously, in each future period in which significant amounts of
deferred tax assets or liabilities are expected to be recovered or settled. Uncertainty over income tax treatments The Group determines the recognition and measurement of tax assets and liabilities
that contain uncertainty over income tax by considering the assumptions used in the examination of tax treatments by the tax authorities, the probability that the tax authorities will accept uncertain tax treatment and re-consideration or
estimation if there is a change in facts and circumstances. If the acceptance of tax treatment is probable, the measurement is in line with
income tax fillings. If the acceptance of tax treatment is not probable, the Group uses tax amounts using the method that provides a better prediction of resolution (i.e., most likely amount or expected value). Due to the complexity of some of
these uncertainties, their ultimate resolution may result in payments that are materially different from current estimates. Any such differences will be reflected as adjustments to income tax expenses in the periods in which they are
determined. |
| Financial instruments | | t.
Financial instruments Financial assets The Group classifies its financial assets in the following measurement categories:
•
those to be measured subsequently at fair value (either through other comprehensive income, or through profit or loss), and
•
those to be measured at amortized cost. The classification depends on the Group’s business model for managing the financial
assets and the contractual cash flow characteristics. Purchases and sales of financial assets are recognized on trade-date, the date on
which the Group commits to purchase or sell the assets. Financial assets are derecognized when the rights to receive cash flows from the assets have expired or the Group has transferred substantially all the risks and rewards of ownership of
the assets. At initial recognition, the Group measures a financial asset at its fair value,
plus in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value through
profit or loss are expensed in profit or loss. Debt instruments Initial recognition and subsequent measurement of debt instruments depend on the
Group’s business model for managing the asset and the contractual cash flow characteristics of the asset, and the Group reclassifies debt investments only when its business model for managing those assets changes. There are three categories
into which the Group classifies its debt instruments:
•
Amortized cost: Financial assets that are held for collection of contractual cash flows where those cash flows represent
solely payments of principal and interest are classified as and measured at amortized cost. A gain or loss on a debt investment measured at amortized cost which is not part of a hedging relationship is recognized in profit or loss when
the asset is derecognized or impaired. Interest income from these financial assets is recognized using the effective interest rate method.
•
Fair value through other comprehensive income: Financial assets that are held for collection of contractual cash flows and
for selling the financial assets, where the assets’ cash flows represent solely payments of principal and interest, are classified as and measured at fair value through other comprehensive income. Movements in the carrying amount of
these financial assets are taken through other comprehensive income, except for the recognition of impairment losses or reversals, interest income and foreign exchange gains and losses which are recognized in profit or loss. When the
financial asset is derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss. Interest income from these financial assets is recognized using the
effective interest rate method.
•
Fair value through profit or loss: Financial assets that do not meet the criteria for amortized cost or fair value through
other comprehensive income are classified as and measured at fair value through profit or loss. A gain or loss on a debt investment measured at fair value through profit or loss which is not part of a hedging relationship is recognized
in profit or loss for the period in which it arises. Equity instruments The Group subsequently measures all equity investments at fair value through profit
or loss or other comprehensive income. For investments in equity instruments that are not held for trading, this will depend on whether the Group has made an irrevocable election at the time of initial recognition to account for the equity
investment at fair value through other comprehensive income. Dividends from such investments continue to be recognized in profit or loss when the Group’s right to receive payments is established.
•
Changes in the fair value of financial assets at fair value through profit or loss are recognized in profit or loss as
applicable. Financial liabilities The Group’s financial liabilities are classified and measured at amortized cost
using the effective interest method. Financial liabilities are derecognized when, and only when, the Group’s obligations
are discharged, cancelled or expired. The difference between the carrying amount of the financial liability derecognized and the consideration paid and payable is recognized in profit or loss. Financial assets and financial liabilities are offset, and the net amount is
reported in the statement of financial position if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, or to realize the assets and settle the liabilities
simultaneously. Convertible debt As disclosed in Note 14, in 2021, the Group issued a convertible debt that can be
converted into ordinary shares of the Group at the option of the holder. The number of shares to be issued is fixed and does not vary with changes in fair value. The Group accounts for the components of this compound financial instrument
separately as a financial liability and an equity instrument. The liability component of the convertible debt is initially recognized at the fair value of a similar liability that does not have an equity conversion option. The equity component
is initially recognized at the difference between the fair value of the convertible debt as a whole and the fair value of the liability component. Any directly attributable transaction costs are allocated to the liability and equity components
in proportion to their initial carrying amounts. Subsequent to initial recognition, the liability component of the convertible debt is measured at amortized cost using the effective interest method. The equity component is not remeasured. Interest related to financial liabilities is recognized in profit or loss. Upon
conversion, the financial liability is reclassified to equity and no gain or loss will be recognized. |
| Credit losses and impairment of assets | | u.
Credit losses and impairment of assets
(i)
Credit losses from financial instruments at amortized cost The Group recognizes a loss allowance for expected credit losses (“ECL”) on
financial assets, such as cash and cash equivalents, restricted cash and trade receivable, which are measured at amortized cost; Measurement of ECLs ECLs are a probability-weighted estimate of credit losses. Credit losses are
measured as the present value of all expected cash shortfalls (i.e., the difference between the cash flows due to the Group in accordance with the contract and the cash flows that the Group expects to receive). The expected cash shortfalls are
discounted using the following discount rates where the effect of discounting is material:
•
fixed-rate financial assets, trade and other receivables: effective interest rate determined at initial recognition or an
approximation thereof;
•
variable-rate financial assets: current effective interest rate. The maximum period considered when estimating ECLs is the maximum contractual
period over which the Group is exposed to credit risk. In measuring ECLs, the Group takes into account reasonable and supportable
information that is available without undue cost or effort. This includes information about past events, current conditions and forecasts of future economic conditions. ECLs are measured on either of the following bases:
•
12-month ECLs: these are losses that are expected to result from possible default events within the 12 months after the
reporting date; and
•
lifetime ECLs: these are losses that are expected to result from all possible default events over the expected lives of the
items to which the ECL model applies. Loss allowances for trade receivables are always measured at an amount equal to
lifetime ECLs. ECL on this type of financial asset is estimated using a provision matrix based on the Group’s historical credit loss experience, adjusted for factors that are specific to the debtors and an assessment of both the current and
forecast general economic conditions at the reporting date. For all other financial instruments, the Group recognizes a loss allowance equal to
12-month ECLs unless there has been a significant increase in the credit risk of the financial instrument since initial recognition, in which case the loss allowance is measured at an amount equal to lifetime ECLs. Significant increases in credit risk In assessing whether the credit risk of a financial instrument has increased
significantly since initial recognition, the Group compares the risk of a default occurring on the financial instrument assessed at the reporting date with that assessed at the date of initial recognition. In making this reassessment, the Group
considers that a default event occurs when the borrower is unlikely to pay its credit obligations to the Group in full and without recourse. The Group considers both quantitative and qualitative information that is reasonable and supportable,
including historical experience and forward-looking information that is available without undue cost or effort. In particular, the following information is taken into account when assessing
whether credit risk has increased significantly since initial recognition:
•
failure to make payments of principal or interest on their contractually due dates;
•
an actual or expected significant deterioration in a financial instrument’s external or internal credit rating (if
available);
•
an actual or expected significant deterioration in the operating results of the debtor; and
•
existing or forecast changes in the technological, market, economic or legal environment that have a significant adverse
effect on the debtor‘s ability to meet its obligation to the Group. Depending on the nature of the financial instruments, the assessment of a
significant increase in credit risk is performed on either an individual basis or a collective basis. When the assessment is performed on a collective basis, the financial instruments are grouped based on shared credit risk characteristics,
such as past-due status and credit risk ratings. ECLs are remeasured at each reporting date to reflect changes in the financial
instrument’s credit risk since initial recognition. Any change in the ECL amount is recognized as an impairment gain or loss in profit or loss. The Group recognizes an impairment gain or loss for all financial instruments with
a corresponding adjustment to their carrying amount through a loss allowance account. Impairment and write-off policy At each reporting date, the Group assesses whether a financial asset is
credit-impaired. A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable
events:
•
significant financial difficulties of the debtor;
•
a breach of contract, such as a default or delinquency in interest or principal payments;
•
is becoming probable that the borrower will enter into bankruptcy or other financial reorganization;
•
significant changes in the technological, market, economic or legal environment that have an adverse effect on the debtor; or
•
the disappearance of an active market for a security because of financial difficulties of the issuer. The gross carrying amount of a financial asset is written off (either partially or
in full) to the extent that there is no realistic prospect of recovery. This is generally the case when the Group determines that the debtor does not have assets or sources of income that could generate sufficient cash flows to repay the
amounts subject to the write-off. Subsequent recoveries of an asset that was previously written off are recognized as
a reversal of impairment in profit or loss in the period in which the recovery occurs.
(ii)
Credit losses from cryptocurrency receivables The Group recognizes an allowance for cryptocurrency receivables using the general
expected credit losses model in manner a similar to the model and consideration used for assessing credit losses from financial instruments discussed above. Under this model, the Group calculates the allowance for credit losses by considering
on a discounted basis, all expected shortfalls which are the difference between the quantity of cryptocurrency due to the Group in accordance with the contract and the quantity of cryptocurrency that the Group expects to receive, in various
default scenarios for prescribed future periods and multiplying the shortfalls by the probability of each scenario occurring. The allowance on the financial asset is the sum of these probability-weighted outcomes. The Group considers both internal and external, and quantitative and qualitative
factors when estimating ECL for cryptocurrency receivables such as the creditworthiness of the counterparty, the result of the historical transactions with the counterparty, the business practice of the counterparty, regulatory development
relating to the industry, liquidity of the underlying cryptocurrency, and the trend of the general economy. The Group recognizes an impairment gain or loss for expected credit losses from
cryptocurrency receivables with a corresponding adjustment to their carrying amount through a loss allowance account. Subsequent recoveries of cryptocurrency receivables previously written off are recognized as a reversal of impairment in
profit or loss in the period in which the recovery occurs. As of December 31, 2021 and 2022, the balance of cryptocurrency receivables was nil
(iii)
Impairment of other assets Internal and external sources of information are reviewed at the end of each
reporting period to identify indications that the following assets may be impaired or, an impairment loss previously recognized no longer exists or may have decreased:
•
property, plant and equipment;
•
lease right-of-use assets;
•
investment properties;
•
intangible assets; and
•
cryptocurrencies other than USDC. If any such indication exists, the asset’s recoverable amount is estimated. In
addition, for cryptocurrencies other than USDC, the recoverable amount is estimated at each reporting date whether or not there is any indication of impairment.
•
Calculation of recoverable amount The recoverable amount of an asset is the greater of its fair value less costs of
disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific
to the asset. Where an asset does not generate cash inflows largely independent of those from other assets, the recoverable amount is determined for the smallest group of assets that generates cash inflows independently (i.e., a cash-generating
unit). The recoverable amount of cryptocurrencies other than USDC is based on the fair
value less costs of disposal. The fair value of these cryptocurrencies is measured using the quoted price of these cryptocurrencies at the time the fair value is being measured.
•
Recognition of impairment losses An impairment loss is recognized in profit or loss if the carrying amount of an
asset, or the cash-generating unit to which it belongs, exceeds its recoverable amount. Impairment losses recognized in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill (if any) allocated to the
cash-generating unit (or group of units) and then, to reduce the carrying amount of the other assets in the unit (or group of units) on a pro-rata basis, except that the carrying value of an asset will not be reduced below its individual fair
value less costs of disposal (if measurable) or value in use (if determinable).
•
Reversals of impairment losses An impairment loss is reversed if there has been a favorable change in the
estimates used to determine the recoverable amount. A reversal of an impairment loss is limited to the asset’s carrying amount that
would have been determined had no impairment loss been recognized in prior years. Reversals of impairment losses are credited to profit or loss in the year in which the reversals are recognized. |
| Provisions | | v.
Provisions Provisions are recognized when the Group has a present obligation (legal or
constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. The timing or
amount of the outflow may still be uncertain. Provisions are measured using the
best estimate of the expenditure required to settle the present obligation at the end of the reporting period, taking into account risks and uncertainties associated with the obligation. Provisions are discounted where the time value of money
is considered material. |
| Segment information | | w.
Segment information Operating segments are identified on the basis of internal reports about components
of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segments and to assess their performances. An operating segment is a component of an entity:
•
that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses
relating to the transactions with other components of the same entity);
•
whose operating results are reviewed regularly by the entity’s chief operating decision maker to make decisions about
resources to be allocated to the segments and assess its performance; and
•
for which discrete financial information is available. The chief operating decision maker makes resource allocation decisions based on
internal management functions and assesses the Group’s business performance as one integrated business instead of by separate business lines or geographical regions. Accordingly, the Group has only one operating segment and therefore, no
segment information is presented. Disaggregated revenue data by geographical region in terms of the customer’s
location within the operating segment is as follows:
Years ended December 31,
2020
2021
2022
In thousands of USD
(Restated)
Singapore
90,808
79,537
27,591
Asia, excluding Singapore
57,146
211,805
136,901
North America
24,063
75,559
141,174
Europe
7,755
15,487
19,075
Others
6,615
12,273
8,601
Total
186,387
394,661
333,342 Selected assets of mining machines, property, plant and equipment, investment
properties, right-of-use assets and intangible assets by geographical region within the operating segment is as follows:
At December 31,
2021
2022
Singapore
7,481
46,306
North America
181,864
170,439
Europe
18,797
45,540
Total
208,142
262,285 |
| Earnings per share | | x.
Earnings per share Basic earnings per share is computed by dividing the income attributable to equity
shareholders of the Group by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per share is computed by dividing the income attributable to
equity shareholders of the Group by the weighted average number of ordinary shares outstanding during the period, after adjusting for the effects of the dilutive potential ordinary shares. When calculating basic loss per share for the years ended December 31, 2020, the
denominator for the period prior to the Reorganization included the number of shares issued in the Reorganization, as if the Reorganization occurred prior to or as of January 1, 2020. |
| Asset acquisition | | y.
Asset acquisition Asset acquisitions are acquisitions that do not qualify as business combinations
under IFRS 3. IFRS 3 allows the use of an optional concentration test to determine if an acquisition is a business combination or an asset acquisition. Under the optional concentration test, if substantially all of the fair value of the gross
assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets, the test is met, and the integrated asset of assets and activities acquired is not a business. Assets acquired in an asset acquisition are initially recognized, at the date of
acquisition, at cost. Costs directly attributable to the acquisition of such assets are included in the initial carrying amount. |
| Initial application of new or amended standards during the reporting periods | | z.
Initial application of new or amended standards during the reporting periods As from January 1, 2022, the Group adopted the following recently issued or amended
standards. These new standards are not expected to have any significant impact on the Group’s financial statements:
Standard/Interpretation
Application Date of Standard
Application Date for the Group
Amendments to IFRS 1, Subsidiary as a First-time Adopter
January 1, 2022
January 1, 2022
Amendments to IFRS 9, Derecognition of Financial
Liabilities
January 1, 2022
January 1, 2022
Amendments to IFRS 3, Reference to the Conceptual
Framework
January 1, 2022
January 1, 2022
Amendments to IAS 16, Property, Plant and Equipment:
Proceeds before Intended Use
January 1, 2022
January 1, 2022
Amendments to IAS 37, Onerous Contracts – Cost of
Fulfilling a Contract
January 1, 2022
January 1, 2022 |
| New standards and interpretations not yet adopted | | aa.
New standards and interpretations not yet adopted Up to the date of issue of these financial statements, the IASB has issued a number
of amendments and a new standard, IFRS 17, Insurance contracts, which are not yet effective for the year ended December 31, 2022 and which have not been adopted in these financial statements.
Standard/Interpretation
Application Date for the Group
IFRS 17, Insurance Contracts and Amendments to Address
Concerns and Implementation Challenges
January 1, 2023
Amendments to IFRS 4, Expiry Date of the Deferral Approach
January 1, 2023
Amendments to IAS 1, Making Materiality Judgement
January 1, 2023
Amendments to IAS 1 and IFRS Practice Statement 2,
Disclosure of Accounting Policies
January 1, 2023
Amendments to IAS 8, Definition of Accounting Estimates
January 1, 2023
Amendments to IAS 12, Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
January 1, 2023
Initial Application of IFRS 17 and IFRS 9—Comparative Information
January 1, 2023
Amendments to IAS 1, Classification of Liabilities as
Current or Non-current and Disclosure of Accounting Policies
January 1, 2024
Amendments to IAS 1, Classification of Debt with Covenants
January 1, 2024
Amendments to IFRS 16, Subsequent Measurement of Sale and
Leaseback Transactions by a Seller-lessee
January 1, 2024 The Group is in the process of making an assessment of what the
impact of these new and amended standards and interpretations would be in the period of initial application. So far, the Group has concluded that the adoption of these standards and interpretations is unlikely to have a significant impact on
the Group’s financial position. |
