Core Insights - Abits Group Inc. has reported significant growth in Bitcoin mining capacity, with hash rates increasing from approximately 285 PH/s to nearly 325 PH/s in Q1 2024, and projections to exceed 360 PH/s in Q2 2024 [1][2][3] Operational Achievements - The company completed key infrastructure projects in Q1, including the expansion of a 1 MW facility and the construction of a 100,000-gallon water reservoir to enhance production stability [2] - The workforce at the LaFollette site remains stable with four dedicated employees focused on enhancing their expertise [2] Future Plans - Abits Group is negotiating with its power provider to secure an additional 2 MW of power capacity, aiming for a dynamic 24/7 operation by July 1, 2024 [2] - The company has acquired a 55-acre property in Wisconsin for a new 20 MW site, with construction set to begin in Q2 and continue through Q4 [3]

Core Insights - Abits Group Inc. has reported significant growth in Bitcoin mining capacity, with hash rates increasing from approximately 285 PH/s to nearly 325 PH/s in Q1 2024, and projections to exceed 360 PH/s in Q2 2024 [1][2][3] Group 1: Operational Achievements - The company successfully launched new production lines, contributing to the increase in hash rates [1] - Key infrastructure projects completed in Q1 include the expansion of a 1 MW facility and the construction of a 100,000-gallon water reservoir, enhancing production stability and operational efficiency [2] - The workforce at the LaFollette site remains stable with four dedicated employees focused on enhancing expertise [2] Group 2: Future Initiatives - Abits Group is negotiating with its power provider to secure an additional 2 MW of power capacity, aiming for a dynamic 24/7 operation by July 1, 2024 [2] - The company has acquired a 55-acre property in Wisconsin for a new 20 MW site, with construction set to begin in Q2 and continue through Q4 [3] - CEO Forrest Deng expressed confidence in the company's stable performance and strategic investments, positioning Abits Group for continued success [3]

Financial Performance - The company generated a total output of 43.93 bitcoins in the fiscal year 2023, resulting in revenue of approximately $1.68 million[185]. - Total revenue for the year ended December 31, 2023, was $1,681,533, a significant increase from $164,428 in 2022, representing a growth of approximately 923%[335]. - The company reported a comprehensive loss of $12,605,303 for the year ended December 31, 2023, compared to a loss of $21,520,114 in 2022, indicating an improvement of about 41%[335]. - The loss from operations for the year ended December 31, 2023, was $11,013,871, down from $19,260,227 in 2022, showing a reduction of about 43%[335]. - Net loss for the year ended December 31, 2023, was $12,585,250, a significant improvement from a net loss of $21,520,114 for the year ended December 31, 2022, representing a reduction of approximately 41%[341]. - The basic and diluted loss per ordinary share improved from $(0.629) in 2022 to $(0.355) in 2023, indicating a reduction in loss per share of about 43%[335]. - Net cash used in operating activities decreased to $1,755,913 in 2023 from $7,315,421 in 2022, indicating improved operational efficiency[341]. - The company reported a provision for dimunition in value for miners of $7,364,650 in 2023, down from $11,889,000 in 2022, showing a reduction of about 38%[341]. - The addition/utilization of digital assets resulted in a positive cash flow of $5,893,591 in 2023, compared to a negative cash flow of $2,000,000 in 2022[341]. - The total cash outflows for the year were $1,601,034, a significant improvement from $22,401 in the previous year[341]. Assets and Liabilities - Digital assets decreased from $7,087,747 as of December 31, 2022, to $1,194,157 as of December 31, 2023, reflecting a decline of approximately 83%[333]. - Total assets decreased from $24,531,417 in 2022 to $12,318,268 in 2023, a reduction of about 50%[333]. - Stockholders' equity fell from $23,917,962 in 2022 to $11,312,660 in 2023, a decrease of approximately 53%[333]. - Current liabilities increased from $613,455 in 2022 to $1,005,608 in 2023, an increase of approximately 64%[333]. - Cash and cash equivalents decreased to approximately $0.88 million, prompting the sale of 32.82 bitcoins to supplement operating cash[186]. - Cash and cash equivalents at the end of 2023 were $884,199, down from $2,505,286 at the end of 2022, reflecting a decrease of approximately 65%[341]. Operational Developments - The company completed the construction of a new mining center in September 2023 at a total cost of $6.5 million[184]. - The company purchased land for $1.2 million in April 2023 to support its bitcoin mining operations[184]. - The company has not entered into any material contracts other than in the ordinary course of business[233]. - The company did not issue new shares in 2023, contrasting with the issuance of 16 million new shares in 2022, which raised $40 million for bitcoin mining operations[344]. Management and Governance - The company’s name was changed from "Moxian (BVI) Inc" to "Abits Group Inc." effective November 17, 2023, with a new ticker symbol "ABTS" on the Nasdaq Capital Market[166]. - The company has a total of 11 full-time employees, with 4 in Finance and Administration and the rest in the bitcoin mining business[216]. - Mr. Conglin Deng, the Chief Executive Officer, has an annual base salary of $120,000 and is awarded 600,000 restricted stock units (RSUs) over three years[201]. - Mr. Wanhong Tan, the Chief Financial Officer, also has an annual base salary of $120,000 and is awarded 180,000 RSUs over three years[202]. - The Audit Committee is chaired by Lionel Khuat Leok Choong and includes Tao Xu and Chuan Zhan, focusing on financial reporting and compliance[204]. - The Compensation Committee, chaired by Tao Xu, is responsible for reviewing and approving executive compensation and incentive plans[207]. - The Corporate Governance and Nominating Committee, chaired by Chuan Zhan, oversees the selection of director candidates and corporate governance practices[208]. - The company adopted a Code of Business Conduct and Ethics on November 14, 2023, applicable to all directors, officers, and employees[214]. - The company has complied with NASDAQ requirements, maintaining at least 50% independent directors on the board[209]. - The total compensation for the Chief Executive Officer and Chief Financial Officer remained consistent at $120,000 for both 2022 and 2023[199]. Compliance and Internal Controls - As of December 31, 2023, the company's disclosure controls and procedures were deemed ineffective due to a lack of formal documented controls applicable to all officers and directors[292]. - Management identified material weaknesses in internal control over financial reporting, including a lack of understanding of NASDAQ requirements and inadequate mining record maintenance[297]. - The company's internal controls over financial reporting were not effective in detecting inappropriate application of US GAAP rules as of December 31, 2023[296]. - There were no changes in internal controls over financial reporting that materially affected the company's reporting during the period covered[299]. - The audit committee consists of independent directors, with Khuat Leok Choong meeting the criteria of an audit committee financial expert[300]. - Management has initiated remediation measures, including educating senior management on NASDAQ listing requirements and designing controls over financial reporting[298]. Tax and Regulatory Matters - The company is classified as a Passive Foreign Investment Company (PFIC), which affects U.S. Holders' tax obligations regarding capital gains and distributions[267]. - U.S. Holders who make a Qualified Electing Fund (QEF) election will not be subject to PFIC tax and interest charge rules for shares held during the PFIC status[267]. - A purging election allows U.S. Holders to recognize gain as if they sold shares at fair market value, impacting their adjusted tax basis and holding period[268]. - Non-U.S. Holders generally are not subject to U.S. federal income tax on dividends or gains unless connected to a U.S. trade or business[275]. - The company does not expect to be treated as a PFIC for the taxable years ending December 31, 2021, and 2022[257]. Risks and Challenges - The upcoming halving of bitcoin rewards in April 2024 poses challenges for miners, although previous halvings have historically led to price increases[187]. - Inflationary pressures may adversely affect operating results, but the company has not experienced significant impacts to date[287]. - The company has not entered into any hedging transactions to mitigate interest rate risk, as operations are not directly sensitive to interest rate fluctuations[285]. - The subsidiary in China incurs annual operating expenses of approximately RMB 1 million, exposing the company to minimal foreign exchange risk[286]. - The company did not identify any cybersecurity threats that materially affected its business strategy or financial condition in 2023[312]. - The company has implemented cybersecurity risk management processes, including limited access to critical systems and continuous monitoring[310].

Core Points - Abits Group Inc has received a notification from Nasdaq regarding non-compliance with the minimum bid price requirement due to its ordinary shares closing below $1.00 for 30 consecutive business days [1] - The company has a compliance period of 180 calendar days, until October 9, 2024, to regain compliance by having its share price at least $1.00 for a minimum of 10 consecutive business days [2] - If compliance is not achieved by the deadline, the company may be eligible for an additional 180-day grace period [2] Company Overview - Abits Group Inc is organized in the British Virgin Islands and operates in the United States, specifically in Tennessee, through its wholly owned subsidiary ABIT USA, Inc. The company also has operations in Beijing and Hong Kong, China [3]

Hong Kong, Jan. 30, 2024 (GLOBE NEWSWIRE) -- Abits Group Inc (NASDAQ:ABTS), a company engaged in the crypto mining business, has released its operations update for the quarter ended December 31, 2023. As previously reported, the Company completed the construction of its mining center at Duff, near the city of La Follette in the State of Tennessee in October 2023. The center is deployed with 1180 units of S19XP Hydro miners (20.8J) and 400 units of S19J Pro miners. As of December 31, 2023, the maximum mining ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Title of each class Symbol Name of each exchange on which registered Ordinary shares, par value $0.001 per share MOXC Nasdaq Capital Market FORM 20-F ☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR 12(G) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☐ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 OR ☒ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the ...

Financial Performance - Revenues for the year ended December 31, 2021, were $219.33 million, compared to $946.47 million for the year ended September 30, 2020, indicating a significant decline[30]. - The net loss for the year ended December 31, 2021, was $2.74 million, compared to a profit of $72.72 million for the year ended September 30, 2020[30]. - Total assets as of December 31, 2021, were $7.74 billion, a substantial increase from $2.19 billion as of December 31, 2020[32]. - Cash and cash equivalents increased to $2.51 billion as of December 31, 2021, up from $19.40 million as of December 31, 2020[32]. - Total liabilities decreased to $1.17 billion as of December 31, 2021, from $2.10 billion as of December 31, 2020[32]. - Total shareholders' equity rose to $6.57 billion as of December 31, 2021, compared to $91.28 million as of December 31, 2020[32]. Business Operations and Strategy - The company has changed its primary business operations from digital advertising in China to bitcoin mining operations in the United States starting from Q1 2022[1]. - The company has shifted its focus to bitcoin mining, which is a new and evolving business model[45]. - The company is actively seeking acquisition opportunities to support growth, but there are no assurances that such transactions will be successful[48]. - The company may issue ordinary shares, preferred stock, or a combination of debt and equity for acquisitions, which could significantly dilute existing stockholders' ownership[50]. - Strategic investments or acquisitions in the bitcoin mining business could materially impact the company's financial condition and results of operations[51]. Regulatory and Compliance Risks - The company is subject to PRC rules and regulations regarding overseas listings, which may hinder its ability to offer securities[14]. - The PCAOB is unable to inspect or investigate the company's auditor located in Hong Kong, which may impact its ability to remain listed on U.S. exchanges[25]. - The company may face sanctions if it fails to obtain necessary approvals for future offshore offerings, which could adversely affect its operations and financial condition[21]. - The Data Security Law in China imposes fines of up to RMB 10 million for violations, which could materially affect the company's business[16]. - The company is not required to obtain permission from the CSRC for its current securities offerings, but future regulations may change this status[21]. Market and Economic Conditions - Future financial results may fluctuate significantly due to various factors, including bitcoin price volatility and operating expenses related to new business operations[46]. - The ongoing COVID-19 pandemic has adversely affected the company's operations and financial results, particularly due to disruptions in China[62]. - Labor costs in China are expected to continue increasing, which may adversely affect the company's financial condition and results of operations[67]. - The company faces risks in assimilating and integrating acquired operations, technologies, and personnel, which could disrupt business and adversely affect financial results[51]. Cryptocurrency Market Risks - The company has experienced significant fluctuations in Bitcoin prices, which directly affect its revenue from bitcoin mining[70]. - Mining operating costs are expected to outpace revenues, potentially increasing losses and harming the company's financial performance[72]. - The company is subject to regulatory changes that may restrict the use of cryptocurrencies, impacting its business operations and prospects[74]. - Geopolitical events can lead to rapid price fluctuations in cryptocurrencies, affecting their value and the company's inventory[84]. - The limited acceptance of bitcoin in retail and commercial markets contributes to its price volatility, which may adversely affect investments in the company's securities[86]. Intellectual Property and Legal Risks - The company does not currently own patents for its blockchain operations and relies on trade secrets and licensing agreements for intellectual property protection[146]. - The company faces significant challenges in protecting its intellectual property rights in China due to inconsistent enforcement and lack of clear guidance, which could adversely affect its business operations[153]. - The evolving nature of China's intellectual property laws creates uncertainties that could lead to liability for infringement or prohibit the use of certain intellectual property, materially affecting business operations[156]. Shareholder and Market Concerns - The company's ordinary shares may face trading prohibitions in the U.S. under the HFCAA if the PCAOB cannot inspect its auditor, which could materially impact the value of investments[168]. - The trading price of the company's common stock is influenced by factors unrelated to traditional financial metrics, such as anticipated adoption of cryptocurrencies[199]. - The company's common stock fell below the Nasdaq minimum bid price of $1.00 for 30 consecutive trading days, raising compliance concerns[204]. - If the company's stock is delisted from Nasdaq, trading may only occur in the over-the-counter market, complicating liquidity and price discovery[205]. - The company does not expect to pay cash dividends in the foreseeable future, as it intends to retain earnings for business operations and expansion[211].