[EXPLANATORY NOTE](index=3&type=section&id=EXPLANATORY%20NOTE) The company changed its name to "BIT Mining Limited" and its ticker symbol to "BTCM" in April 2021 - Company changed its English name to "BIT Mining Limited" effective April 8, 2021[6](index=6&type=chunk) - New ticker symbol "BTCM" is effective at the opening of trading on Tuesday, April 20, 2021[6](index=6&type=chunk) [CONVENTIONS THAT APPLY TO THIS ANNUAL REPORT ON FORM 20-F](index=5&type=section&id=CONVENTIONS%20THAT%20APPLY%20TO%20THIS%20ANNUAL%20REPORT%20ON%20FORM%2020-F) This section defines key terms and abbreviations used throughout the annual report PART I [ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS](index=6&type=section&id=ITEM%201.%20IDENTITY%20OF%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20ADVISERS) This item states that information regarding the identity of directors, senior management, and advisers is not applicable [ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE](index=6&type=section&id=ITEM%202.%20OFFER%20STATISTICS%20AND%20EXPECTED%20TIMETABLE) This item states that information regarding offer statistics and expected timetable is not applicable [ITEM 3. KEY INFORMATION](index=6&type=section&id=ITEM%203.%20KEY%20INFORMATION) This section provides key financial data and a comprehensive overview of risk factors related to the business [A. Selected Financial Data](index=6&type=section&id=A.%20Selected%20Financial%20Data) This section summarizes the company's consolidated financial performance and position from 2016 through 2020 Consolidated Statement of Comprehensive Loss Data (RMB in thousands) | Metric (RMB in thousands) | 2016 | 2017 | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----|:-----|:-----------| | Net revenues | 5,259 | 71,858 | 126,089 | 39,688 | 21,815 | 3,343 | | Total operating expenses | (374,296) | (383,691) | (485,775) | (374,227) | (216,264) | (33,145) | | Operating loss from continuing operations | (368,183) | (338,531) | (344,488) | (642,839) | (190,792) | (29,241) | | Net loss attributable to BIT Mining Limited | (202,965) | (317,099) | (451,673) | (651,268) | (223,226) | (34,211) | | Basic Net loss per share | (0.489) | (0.78) | (1.10) | (1.52) | (0.52) | (0.08) | Consolidated Balance Sheets Data (RMB in thousands) | Metric (RMB in thousands) | 2016 | 2017 | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----|:-----|:-----------| | Total current assets | 1,707,032 | 737,022 | 601,585 | 430,326 | 335,853 | 51,472 | | Total assets | 2,049,392 | 1,754,559 | 1,246,584 | 695,779 | 470,473 | 72,103 | | Total current liabilities | 181,975 | 175,937 | 99,694 | 77,162 | 73,620 | 11,284 | | Total liabilities | 241,349 | 223,197 | 111,634 | 111,861 | 79,953 | 12,255 | | Total BIT Mining Limited shareholders' equity | 1,709,531 | 1,409,774 | 1,116,605 | 584,456 | 403,777 | 61,880 | - Non-GAAP adjusted net loss attributable to BIT Mining Limited was **RMB (138,460) thousand** (US$ (21,220) thousand) in 2020, adjusted for share-based compensation, impairment of intangible assets, goodwill, long-term investments, and deferred tax benefit[13](index=13&type=chunk)[14](index=14&type=chunk) [B. Capitalization and Indebtedness](index=8&type=section&id=B.%20Capitalization%20and%20Indebtedness) This item states that information regarding capitalization and indebtedness is not applicable [C. Reasons for the Offer and Use of Proceeds](index=8&type=section&id=C.%20Reasons%20for%20the%20Offer%20and%20Use%20of%20Proceeds) This item states that information regarding reasons for the offer and use of proceeds is not applicable [D. Risk Factors](index=8&type=section&id=D.%20Risk%20Factors) The company faces significant risks from its evolving business model, regulatory uncertainties, and geopolitical tensions - The company's business model has changed multiple times, including suspending online lottery services and entering the cryptocurrency industry, making business evaluation difficult[16](index=16&type=chunk)[197](index=197&type=chunk) - **Online lottery sales services have been suspended since April 4, 2015**, with no clear indication of when they will resume, materially impacting financial results[16](index=16&type=chunk)[17](index=17&type=chunk)[20](index=20&type=chunk) - European online gaming operations are subject to evolving and potentially restrictive government regulations, which could severely impact business[24](index=24&type=chunk)[226](index=226&type=chunk) - The ongoing **COVID-19 pandemic** could materially and adversely affect business, results of operations, and financial condition[26](index=26&type=chunk) - The success of the cryptocurrency mining business depends heavily on the **volatile value of Bitcoin**[103](index=103&type=chunk) - Cryptocurrency mining operations are costly and susceptible to technological obsolescence, supply chain disruptions, and significant power requirements[100](index=100&type=chunk)[112](index=112&type=chunk) - **Chinese government policies** aimed at carbon neutralization and financial risk prevention may restrict or prohibit cryptocurrency mining operations in China[117](index=117&type=chunk)[119](index=119&type=chunk) - The company relies on **contractual arrangements with its consolidated affiliated entities** in China due to foreign ownership restrictions, which may not be as effective as direct ownership[125](index=125&type=chunk)[128](index=128&type=chunk) - Political tensions between the United States and China could adversely affect the company's business and the trading price of its ADSs[67](index=67&type=chunk) - The company's auditor is **not subject to inspection by the PCAOB** due to PRC regulations, which could lead to delisting under new U.S. standards[154](index=154&type=chunk)[156](index=156&type=chunk) [ITEM 4. INFORMATION ON THE COMPANY](index=61&type=section&id=ITEM%204.%20INFORMATION%20ON%20THE%20COMPANY) This section details the company's history, business evolution, current services, and organizational structure [A. History and Development of the Company](index=61&type=section&id=A.%20History%20and%20Development%20of%20the%20Company) The company has pivoted from online lottery services to online gaming and recently to cryptocurrency mining - Company began online lottery services in 2001, **suspended them in April 2015**, and has not generated revenue from them since[178](index=178&type=chunk) - Acquired **93% equity in The Multi Group (TMG)** in July 2017, and the remaining 7% in April 2020, to operate online gaming sites in Europe[182](index=182&type=chunk) - Announced entry into the **cryptocurrency industry in December 2020** through multiple acquisitions and agreements[182](index=182&type=chunk)[184](index=184&type=chunk)[186](index=186&type=chunk) - Completed acquisition of bitcoin mining machines with **~918.5 PH/S hash power** in March 2021 and began generating revenue from cryptocurrency mining in February 2021[184](index=184&type=chunk) - Acquired **54.2% ownership of Loto Interactive Limited** in March 2021, which operates big data centers for cryptocurrency mining[180](index=180&type=chunk) - Board resolved to change the company's English name to "BIT Mining Limited" and ticker symbol to "BTCM", effective April 2021, and relocate headquarters to Singapore[186](index=186&type=chunk) - Entered into a share exchange agreement in April 2021 to acquire Bee Computing (HK) Limited, a 7-nanometer mining machine manufacturer, for **US$100 million in Class A ordinary shares**[186](index=186&type=chunk) - Mr. Man San Vincent Law's aggregate voting power increased to approximately **60.28%** after the issuance of 65,000 Class A preference shares to his wholly-owned company[191](index=191&type=chunk) [B. Business Overview](index=69&type=section&id=B.%20Business%20Overview) This section details the company's transition to online gaming and cryptocurrency mining, outlining services and the regulatory environment [Our Services](index=69&type=section&id=Our%20Services) The company's services have evolved from suspended online lottery sales to online gaming, with a current focus on cryptocurrency mining - Current services include online gaming, sports information, and financial technology[199](index=199&type=chunk)[202](index=202&type=chunk)[204](index=204&type=chunk)[205](index=205&type=chunk) - As of the report date, **50,113 mining machines** are deployed, producing approximately three bitcoins daily, with a total of **398 bitcoins owned**[198](index=198&type=chunk) - TMG's online gaming services generated **RMB14.9 million (US$2.3 million)** in 2020, a decrease from RMB35.6 million in 2019[202](index=202&type=chunk)[297](index=297&type=chunk) - Sports information services generated **RMB6.9 million (US$1.1 million)** in 2020, an increase from RMB3.3 million in 2019[204](index=204&type=chunk)[297](index=297&type=chunk) [Our Revenue Model](index=73&type=section&id=Our%20Revenue%20Model) The company generates revenue from online gaming, sports information subscriptions, and financial technology trading commissions - Online gaming revenue is derived from the net difference between users' real money gaming wins/losses and 'bonus' gaming bets/wins[210](index=210&type=chunk) - Sports information revenue comes from monthly subscriptions and a percentage fee on pay-per-view content[210](index=210&type=chunk)[212](index=212&type=chunk) - Financial technology revenue is generated from trading commissions on online spot commodity trades[213](index=213&type=chunk) [User Support Operations](index=74&type=section&id=User%20Support%20Operations) User support operations are divided into customer service and online security teams handling inquiries and monitoring transactions - Customer service handles inquiries, assesses needs, builds relationships, and performs Know Your Customer (KYC) checks[215](index=215&type=chunk) - The Fraud and Payments team processes withdrawals, monitors for suspicious transactions, and reports anti-money laundering activities[217](index=217&type=chunk) [Sales, Marketing and Branding](index=75&type=section&id=Sales%2C%20Marketing%20and%20Branding) The company leverages online and offline marketing to maintain and enhance its brand reputation, particularly its '500wan' brand - The company utilizes both in-house and external online marketing, as well as traditional offline advertising, to target specific audiences[218](index=218&type=chunk) [Competition](index=75&type=section&id=Competition) The company operates in a intensely competitive environment, facing rivals in European lottery and online casino operations - Main competitors in European lottery include TheLotter, LottoLand, and 25Lotto[218](index=218&type=chunk) - Main competitors in online and live casino operations include Betsson, LeoVegas, Casumo, and Mr. Green[218](index=218&type=chunk) [Product Development](index=75&type=section&id=Product%20Development) The product development team focuses on enhancing existing services and developing new technologies - As of December 31, 2020, the product development team had **61 employees**, representing **44.2% of total employees**[219](index=219&type=chunk) - Focus areas include server capacity, user interface, mobile software, infrastructure optimization, and user data mining[219](index=219&type=chunk) [Legal and Administrative Proceedings](index=75&type=section&id=Legal%20and%20Administrative%20Proceedings) The company has been involved in several legal proceedings, including a settled class action and an ongoing securities lawsuit - Settled a stockholder class action lawsuit in 2016 for **US$1.5 million** (company paid) and **US$1.0 million** (insurance covered)[220](index=220&type=chunk) - Settled an arbitration dispute to purchase the remaining 7% equity interest in TMG for **EUR1.9 million** in April 2020[222](index=222&type=chunk) - An internal investigation into alleged illegal money transfers in Japan concluded in October 2020, finding **no sufficient basis for a U.S. FCPA violation**[222](index=222&type=chunk) - A securities class action lawsuit filed in February 2020, alleging misleading statements regarding anti-corruption compliance, is ongoing[222](index=222&type=chunk) [Regulation of Our Industry](index=77&type=section&id=Regulation%20of%20Our%20Industry) The company's operations are subject to complex and evolving regulatory frameworks in China and Europe [Regulations on Online Gaming in Europe](index=77&type=section&id=Regulations%20on%20Online%20Gaming%20in%20Europe) Online gaming operations in Europe are subject to licenses from various jurisdictions, with regulatory changes posing significant risks - TMG holds online gaming licenses from Curacao, Malta, the United Kingdom, Ireland, and Sweden, requiring periodic renewal[226](index=226&type=chunk) - TMG ceased operations in Ireland (July 2019) and the United Kingdom (September 2019) and temporarily suspended operations in Sweden (January-September 2020) due to license issues[226](index=226&type=chunk) - Uncertainty in European online gaming regulations could severely impact business, revenues, and financial condition[226](index=226&type=chunk) [Regulations on Lottery Services Industry and Online Lottery Sales](index=78&type=section&id=Regulations%20on%20Lottery%20Services%20Industry%20and%20Online%20Lottery%20Sales) The PRC lottery industry is highly regulated, with the company's online lottery sales services suspended since April 2015 - Online lottery sales in China require MOF approval and a Lottery Agency License[228](index=228&type=chunk)[229](index=229&type=chunk) - The company **voluntarily suspended all online lottery sales services on April 4, 2015**, in response to regulatory mandates[229](index=229&type=chunk)[231](index=231&type=chunk) - Despite receiving MOF approval in 2012, the suspension continues with no clear indication of when it will be lifted[229](index=229&type=chunk)[232](index=232&type=chunk) [Chinese Regulations and Policies Relating to Blockchain, Cryptocurrency and Cryptocurrency Mining](index=81&type=section&id=Chinese%20Regulations%20and%20Policies%20Relating%20to%20Blockchain%2C%20Cryptocurrency%20and%20Cryptocurrency%20Mining) China's regulatory stance on cryptocurrencies is complex, with prohibitions on related financial business and increasing scrutiny on mining - Bitcoin is considered a virtual commodity, not legal currency, and financial institutions are prohibited from engaging in bitcoin-related business in China[239](index=239&type=chunk) - Activities like **ICOs are forbidden in China**, deemed illegal public financing activities[239](index=239&type=chunk) - Cryptocurrency mining is subject to an unclear and evolving regulatory framework, with local governments guided to encourage an orderly exit[242](index=242&type=chunk) - **Inner Mongolia mandated the complete shutdown of cryptocurrency mining projects** by the end of April 2021, signaling potential broader restrictions[242](index=242&type=chunk) - Blockchain information service providers in China are required to register with the Cyberspace Administration of China[243](index=243&type=chunk) [Regulation of Telecommunication Services](index=83&type=section&id=Regulation%20of%20Telecommunication%20Services) The telecommunication industry in China is highly regulated, requiring operating licenses for basic and value-added services - Telecommunication services in China are categorized as basic or value-added, both requiring operating licenses[245](index=245&type=chunk) - Internet content provision (ICP) services are classified as value-added telecommunication services (VAS) and require a VAS license[245](index=245&type=chunk)[246](index=246&type=chunk) [Regulations on Value-Added Telecommunication and Internet Information Services](index=83&type=section&id=Regulations%20on%20Value-Added%20Telecommunication%20and%20Internet%20Information%20Services) Commercial ICP service operators in China must obtain a VAS license and monitor content for prohibited categories - Commercial ICP service operators must obtain a VAS license and display its number on their website[246](index=246&type=chunk) - E-Sun Sky Network holds a VAS license for Internet information services, effective until September 5, 2022[247](index=247&type=chunk) [Regulations on Internet Content Services](index=84&type=section&id=Regulations%20on%20Internet%20Content%20Services) ICP service operators are required to monitor and censor content on their websites, with violations leading to severe penalties - ICP operators must monitor and remove content that compromises state security, spreads false information, or promotes illegal activities[248](index=248&type=chunk) - Violations of content restrictions can result in website shutdowns or VAS license revocation[248](index=248&type=chunk) [Regulations on Internet Data Center Services](index=84&type=section&id=Regulations%20on%20Internet%20Data%20Center%20Services) Internet Data Center (IDC) services require VAS licenses, which the company's controlled entities hold for its mining farms - IDC services, including server hosting and internet resource collaboration, require VAS licenses[249](index=249&type=chunk) - The company's mining farms are considered IDCs, and three Loto Interactive-controlled entities hold VAS licenses for IDC services[249](index=249&type=chunk) [Regulations on Foreign Investment in Lottery and Value-Added Telecommunications Services](index=84&type=section&id=Regulations%20on%20Foreign%20Investment%20in%20Lottery%20and%20Value-Added%20Telecommunications%20Services) PRC laws prohibit foreign investment in the lottery industry and restrict it in value-added telecommunication services - Foreign invested entities are not allowed to operate in the lottery industry in China[250](index=250&type=chunk) - Foreign ownership in value-added telecommunication services is **limited to 50%** in China[252](index=252&type=chunk) - The company uses contractual arrangements with consolidated affiliated entities to operate in China, circumventing foreign investment restrictions[252](index=252&type=chunk) [Regulations on Anti-money Laundering](index=85&type=section&id=Regulations%20on%20Anti-money%20Laundering) The PRC Anti-money Laundering Law requires institutions to adopt precautionary measures and report suspicious transactions - PRC Anti-money Laundering Law requires client identification, record retention, and suspicious transaction reporting[253](index=253&type=chunk) - The unclear legal nature of cryptocurrencies in China creates uncertainty regarding compliance with future anti-money laundering laws[253](index=253&type=chunk) [Regulations on Internet Information Security](index=85&type=section&id=Regulations%20on%20Internet%20Information%20Security) China's internet security laws mandate network operators to ensure secure operations and protect data integrity - Network operators must ensure secure and stable network operations, prevent cybercrimes, and protect data integrity, confidentiality, and availability[256](index=256&type=chunk) - Violators of internet security laws may face criminal punishment or revocation of operating licenses[254](index=254&type=chunk) [Regulations on Intellectual Property](index=86&type=section&id=Regulations%20on%20Intellectual%20Property) Intellectual property in China is protected by laws covering trademarks, software copyrights, and domain names - PRC Trademark Law protects registered trademarks for an initial term of ten years, renewable thereafter[257](index=257&type=chunk) - Computer software copyrights are registered with the National Copyright Administration of the PRC[258](index=258&type=chunk) - Domain names are regulated by CNNIC and MIIT, with dispute resolution mechanisms in place[258](index=258&type=chunk) [Regulations on Foreign Exchange](index=87&type=section&id=Regulations%20on%20Foreign%20Exchange) PRC foreign exchange regulations control the convertibility of Renminbi, particularly for capital account items - Renminbi is freely convertible only for current account items; capital account items require SAFE approval for foreign currency conversion[264](index=264&type=chunk) - PRC residents participating in overseas share incentive plans must register with SAFE[261](index=261&type=chunk)[262](index=262&type=chunk) - Failure to comply with SAFE Circular 37 by PRC resident beneficial owners could lead to fines and restrictions on profit distribution[260](index=260&type=chunk) [Regulations on Employee Stock Option Granted by Offshore Listed Companies](index=87&type=section&id=Regulations%20on%20Employee%20Stock%20Option%20Granted%20by%20Offshore%20Listed%20Companies) PRC residents participating in share incentive plans of overseas listed companies are required to register with SAFE - PRC residents with share options in overseas listed companies must register with SAFE and use a PRC agent for procedures[261](index=261&type=chunk)[262](index=262&type=chunk) - The company and its PRC citizen employees are currently applying for registration with the Shenzhen branch of SAFE[262](index=262&type=chunk) [M&A Regulations and Overseas Listings](index=88&type=section&id=M%26A%20Regulations%20and%20Overseas%20Listings) The 2006 M&A Rules establish complex procedures for foreign acquisitions of Chinese companies, posing risks to the company's VIE structure - The 2006 M&A Rules require MOFCOM approval for certain acquisitions of Chinese companies by offshore entities for overseas listing purposes[263](index=263&type=chunk) - Uncertainty exists regarding the application of these rules to the company's VIE structure, potentially leading to severe penalties[263](index=263&type=chunk) [Regulations on Foreign Currency Exchange](index=88&type=section&id=Regulations%20on%20Foreign%20Currency%20Exchange) PRC regulations restrict foreign currency conversion for capital account items and the use of converted RMB capital - Capital account items require prior approval from SAFE for Renminbi conversion into foreign currency[264](index=264&type=chunk) - SAFE Circular 19 restricts the use of RMB funds converted from foreign exchange capital by foreign-invested enterprises[266](index=266&type=chunk) [Regulations on Dividend Distribution](index=89&type=section&id=Regulations%20on%20Dividend%20Distribution) PRC Company Law requires companies to allocate a portion of after-tax profits to a non-distributable statutory common reserve - PRC companies must allocate **10% of after-tax profits** to a statutory common reserve until it reaches **50% of registered capital**[267](index=267&type=chunk) - Statutory reserve funds are non-distributable as cash dividends and are restricted to specific purposes[192](index=192&type=chunk) [Regulations Regarding the Enterprise Income Tax, Individual Income Tax and Withholding Tax](index=89&type=section&id=Regulations%20Regarding%20the%20Enterprise%20Income%20Tax%2C%20Individual%20Income%20Tax%20and%20Withholding%20Tax) The EIT Law imposes a 25% income tax on Chinese enterprises and a 10% withholding tax on dividends to non-resident enterprises - The EIT Law imposes a **25% enterprise income tax rate** on Chinese enterprises and a **10% withholding tax** on dividends to non-resident enterprises[268](index=268&type=chunk)[270](index=270&type=chunk) - If the company is deemed a PRC resident enterprise, its worldwide income and dividends/capital gains for foreign investors could be subject to PRC taxation[268](index=268&type=chunk)[269](index=269&type=chunk)[270](index=270&type=chunk) - Non-resident individual investors may face a **20% PRC tax** on dividends or capital gains if deemed PRC-sourced income[270](index=270&type=chunk) - SAT Circular 7 addresses indirect transfers of equity interests in PRC resident enterprises, potentially subjecting gains to PRC withholding tax[149](index=149&type=chunk)[271](index=271&type=chunk) [PRC Business Tax and Value-added Tax](index=91&type=section&id=PRC%20Business%20Tax%20and%20Value-added%20Tax) China's VAT reform program replaced the business tax with a 6% VAT for certain services provided by the company's entities - A **6% VAT** applies to certain services provided by E-Sun Sky Computer and E-Sun Sky Network since November 2012[274](index=274&type=chunk) - Other VIEs are subject to a **3% VAT** since June 2014[274](index=274&type=chunk) [C. Organizational Structure](index=91&type=section&id=C.%20Organizational%20Structure) The company's structure involves a holding company, PRC subsidiaries, and VIEs to comply with foreign ownership restrictions [Contractual Arrangements with Our Consolidated Affiliated Entities](index=93&type=section&id=Contractual%20Arrangements%20with%20Our%20Consolidated%20Affiliated%20Entities) The company relies on contractual arrangements with its VIEs in China to operate its business and circumvent foreign ownership restrictions - Contractual arrangements with VIEs enable the company to exercise effective control and receive economic benefits, leading to consolidation under U.S. GAAP[278](index=278&type=chunk)[280](index=280&type=chunk) - Key agreements include Exclusive Business Cooperation, Exclusive Option, Equity Interests Pledge, and Shareholder's Voting Power Assignment Agreements[281](index=281&type=chunk)[282](index=282&type=chunk)[283](index=283&type=chunk)[284](index=284&type=chunk) - The company provides unconditional financial support to VIEs through nominee shareholders[284](index=284&type=chunk) - PRC legal counsel advises that the corporate structure and contractual arrangements comply with applicable PRC laws, but uncertainties exist[286](index=286&type=chunk) [D. Property, Plant and Equipment](index=97&type=section&id=D.%20Property%2C%20Plant%20and%20Equipment) The company's principal executive offices are located in Shenzhen, China, with additional offices in Hong Kong and Malta - Principal executive offices are in Shenzhen, China, covering **2,176 square meters**[288](index=288&type=chunk) - Leased office space was reduced from 9,659 to 2,176 square meters between August 2020 and January 2021[288](index=288&type=chunk) - Expected annual rental expense increase of **5%**[288](index=288&type=chunk) [ITEM 4A. UNRESOLVED STAFF COMMENTS](index=97&type=section&id=ITEM%204A.%20UNRESOLVED%20STAFF%20COMMENTS) This item states that there are no unresolved staff comments [ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS](index=97&type=section&id=ITEM%205.%20OPERATING%20AND%20FINANCIAL%20REVIEW%20AND%20PROSPECTS) This section analyzes the company's financial condition and results, highlighting a shift in revenue streams and changes in operating expenses [A. Operating Results](index=97&type=section&id=A.%20Operating%20Results) Operating results reflect a shift to online gaming and cryptocurrency mining, with decreased revenues and operating losses in 2020 [Overview](index=97&type=section&id=Overview) The company's revenue streams have diversified from online lottery to online gaming, with a recent strategic shift to cryptocurrency mining - No net revenues from sports lottery sales from 2016 to 2020 due to suspension[291](index=291&type=chunk) Net Revenues from Continuing Operations (RMB in thousands) | Service Type | 2018 (RMB) | 2019 (RMB) | 2020 (RMB) | 2020 (US$) | |:-------------|:-----------|:-----------|:-----------|:-----------| | Online gaming services | 105,511 | 35,596 | 14,929 | 2,288 | | Sports information services | 16,036 | 3,345 | 6,921 | 1,060 | | Financial technology services | 401 | 148 | 5 | 1 | | Total net revenues | 126,089 | 39,688 | 21,815 | 3,343 | - Net revenues from continuing operations **decreased by 68.5%** from 2018 to 2019 and by **45.1%** from 2019 to 2020[294](index=294&type=chunk) - Net loss from continuing operations attributable to BIT Mining Limited **decreased by 65.7%** from RMB651.3 million in 2019 to **RMB223.2 million** (US$34.2 million) in 2020[294](index=294&type=chunk) - The company officially began generating revenue from cryptocurrency mining operations as of February 26, 2021[293](index=293&type=chunk) [Description of Key Statement of Operations Items from Continuing Operation](index=99&type=section&id=Description%20of%20Key%20Statement%20of%20Operations%20Items%20from%20Continuing%20Operation) This section details the components of net revenues and operating expenses, showing declines in online gaming revenue and most expense categories Net Revenues by Service Type (RMB in thousands) | Service Type | 2018 (RMB) | 2019 (RMB) | 2020 (RMB) | 2020 (US$) | |:-------------|:-----------|:-----------|:-----------|:-----------| | Online gaming services in Europe and beyond | 105,511 | 35,596 | 14,929 | 2,288 | | Mobile gaming | 3,954 | 7 | — | — | | Sports information services | 16,036 | 3,345 | 6,921 | 1,060 | | Financial technology services | 401 | 148 | 5 | 1 | | Physical sales of sports lottery tickets | 187 | 592 | (40) | (6) | | Total revenues | 126,089 | 39,688 | 21,815 | 3,343 | - Online gaming services accounted for **83.7%** of net revenues in 2018, decreasing to **68.4%** in 2020[297](index=297&type=chunk) Operating Expenses from Continuing Operations (RMB in thousands) | Expense Category | 2018 (RMB) | 2019 (RMB) | 2020 (RMB) | 2020 (US$) | |:-----------------|:-----------|:-----------|:-----------|:-----------| | Cost of services | (80,017) | (59,410) | (16,774) | (2,571) | | Sales and marketing | (92,465) | (42,445) | (16,748) | (2,567) | | General and administrative | (251,384) | (223,758) | (152,541) | (23,378) | | Service development | (61,909) | (48,614) | (30,201) | (4,629) | | Total operating expenses | (485,775) | (374,227) | (216,264) | (33,145) | - **Cost of services decreased by 71.7%** in 2020, mainly due to reduced depreciation/amortization after full impairment of TMG intangible assets in 2019[300](index=300&type=chunk) - **Sales and marketing expenses decreased by 60.6%** in 2020, driven by reduced salary, promotional expenses, and share-based compensation[300](index=300&type=chunk) - **General and administrative expenses decreased by 31.9%** in 2020, primarily due to lower share-based compensation and salary expenses[300](index=300&type=chunk)[317](index=317&type=chunk)[318](index=318&type=chunk) - Impairment of intangible assets and goodwill in 2019 (**RMB181.8 million** and **RMB129.8 million**, respectively) was related to TMG's temporary suspension in Sweden[301](index=301&type=chunk) - Impairment of long-term investments increased by 47.3% to **RMB33.0 million** (US$5.1 million) in 2020, primarily related to the equity interest in Loto Interactive[303](index=303&type=chunk)[319](index=319&type=chunk) [Results of Operations](index=102&type=section&id=Results%20of%20Operations) Net revenues decreased significantly in 2020, while a substantial reduction in operating expenses led to a lower net loss Consolidated Statement of Comprehensive Loss Data (RMB in thousands) | Metric (RMB in thousands) | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----------| | Net Revenues | 126,089 | 39,688 | 21,815 | 3,343 | | Total operating expenses | (485,775) | (374,227) | (216,264) | (33,145) | | Operating loss from continuing operations | (344,488) | (642,839) | (190,792) | (29,241) | | Loss before income taxes from continuing operations | (491,339) | (661,928) | (224,750) | (34,445) | | Net loss from continuing operations | (471,737) | (654,286) | (221,096) | (33,885) | | Net loss attributable to BIT Mining Limited | (451,673) | (651,268) | (223,226) | (34,211) | - **Net revenues decreased by 45.1%** from RMB39.7 million in 2019 to RMB21.8 million in 2020, mainly due to TMG's temporary suspension in Sweden[316](index=316&type=chunk) - **Operating expenses decreased by 42.2%** from RMB374.2 million in 2019 to RMB216.3 million in 2020, driven by cost reduction measures[316](index=316&type=chunk) - Operating loss from continuing operations decreased by RMB452.0 million to **RMB190.8 million** in 2020, compared to RMB642.8 million in 2019[319](index=319&type=chunk) - Net loss from continuing operations decreased to **RMB221.1 million** in 2020, from RMB654.3 million in 2019[321](index=321&type=chunk) [B. Liquidity and Capital Resources](index=106&type=section&id=B.%20Liquidity%20and%20Capital%20Resources) The company's liquidity is from operations and equity issuances, with sufficient cash expected to cover needs for the next 12 months Cash Flow Summary (RMB in thousands) | Metric (RMB in thousands) | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----------| | Net cash used in operating activities | (144,127) | (160,024) | (68,056) | (10,431) | | Net cash (used in) provided by investing activities | (15,604) | 66,817 | 21,714 | 3,330 | | Net cash provided by financing activities | 54,791 | 17,105 | 26 | 4 | | Cash, cash equivalents and restricted cash at end of the year | 436,387 | 365,796 | 312,505 | 47,894 | - As of December 31, 2020, cash and cash equivalents were **RMB308.7 million** (US$47.3 million)[323](index=323&type=chunk)[451](index=451&type=chunk) - Net cash used in operating activities decreased to **RMB68.1 million** in 2020, primarily due to lower net loss and various adjustments[325](index=325&type=chunk) - Capital expenditures were **RMB1.5 million** (US$0.2 million) in 2020, a significant decrease from RMB36.7 million in 2018[330](index=330&type=chunk) - PRC subsidiaries' ability to pay dividends is restricted by PRC laws and regulations[323](index=323&type=chunk) [C. Research and Development](index=114&type=section&id=C.%20Research%20and%20Development) The company does not anticipate significant future expenditures on research and development activities - No significant R&D expenditures expected in the future due to the suspension of online sports lottery sales services[351](index=351&type=chunk) [D. Trend Information](index=114&type=section&id=D.%20Trend%20Information) No material adverse trends are reported for 2020 other than those already disclosed in the annual report [E. Off-Balance Sheet Arrangements](index=114&type=section&id=E.%20Off-Balance%20Sheet%20Arrangements) The company does not engage in off-balance sheet arrangements [F. Tabular Disclosure of Contractual Obligations](index=115&type=section&id=F.%20Tabular%20Disclosure%20of%20Contractual%20Obligations) As of December 31, 2020, the company's primary contractual obligations consist of future minimum payments under operating leases Future Minimum Payments Under Non-Cancelable Operating Leases (RMB in thousands) | Year | RMB (in thousands) | US$ (in thousands) | |:-----|:-------------------|:-------------------| | 2021 | 3,830 | 587 | | 2022 | 3,835 | 588 | | 2023 | 2,684 | 411 | | Total | 10,349 | 1,586 | | Less: imputed interest | (832) | (127) | | Present value of lease liabilities | 9,517 | 1,459 | - No long-term debt obligations or purchase obligations as of December 31, 2020[355](index=355&type=chunk) [G. Safe Harbor](index=115&type=section&id=G.%20Safe%20Harbor) This section provides a safe harbor statement for forward-looking statements in the annual report - Forward-looking statements are based on current expectations and projections, subject to risks and uncertainties[355](index=355&type=chunk) - Key areas of forward-looking statements include business development, financial condition, market growth, and government policies[355](index=355&type=chunk) [ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES](index=116&type=section&id=ITEM%206.%20DIRECTORS%2C%20SENIOR%20MANAGEMENT%20AND%20EMPLOYEES) This section provides information on the company's directors, executive officers, compensation, and board practices [A. Directors and Senior Management](index=116&type=section&id=A.%20Directors%20and%20Senior%20Management) The company's leadership team includes a chairman, executive director, CEO, COO, CFO, and four independent directors Directors and Executive Officers | Name | Age | Position/Title | |:-----|:----|:---------------| | Shengwu Wu | 48 | Chairman | | Man San Vincent Law | 53 | Executive Director | | Xianfeng Yang | 52 | Chief Executive Officer | | Bo Yu | 53 | Director, Chief Operating Officer | | Qian Sun | 48 | Independent Director | | Honghui Deng | 52 | Independent Director | | Yu Wei | 52 | Independent Director | | Wong, Yan Ki Angel | 49 | Independent Director | | Qiang Yuan | 48 | Chief Financial Officer | - Mr. Man San Vincent Law, the founder, was appointed Executive Director in April 2021, and Mr. Xianfeng Yang was appointed CEO in December 2020[360](index=360&type=chunk) [B. Compensation](index=117&type=section&id=B.%20Compensation) In 2020, aggregate cash compensation for directors and executive officers was RMB4.7 million (US$0.7 million) [Share Incentive Plans](index=117&type=section&id=Share%20Incentive%20Plans) The company utilizes 2011 and 2021 Share Incentive Plans to grant options and restricted shares to employees and directors - Aggregate cash compensation for directors and executive officers was **RMB4.7 million** (US$0.7 million) in 2020[362](index=362&type=chunk) - The 2011 Share Incentive Plan expired in March 2021, and a new 2021 Share Incentive Plan was adopted, authorizing issuance of up to **12% of outstanding ordinary shares**[370](index=370&type=chunk) Share Options Outstanding (as of Dec 31, 2020) | Metric | Number of options | Weighted average exercise price (US$/Share) | Weighted average grant date fair value per share (US$) | Weighted average remaining contractual year (Years) | Aggregated intrinsic value (US$'000) | |:-------|:------------------|:--------------------------------------------|:-------------------------------------------------------|:----------------------------------------------------|:-------------------------------------| | Outstanding | 7,259,020 | 0.99 | 1.09 | 0.51 | 907 | | Vested and expected to vest | 7,259,020 | 0.99 | 1.08 | 0.52 | 907 | | Exercisable | 7,259,020 | 0.99 | 1.08 | 0.52 | 907 | Restricted Shares Outstanding (as of Dec 31, 2020) | Metric | Number of options | Weighted average grant date fair value per share (US$) | Weighted average remaining contractual year (Years) | Aggregated intrinsic value (US$'000) | |:-------|:------------------|:-------------------------------------------------------|:----------------------------------------------------|:-------------------------------------| | Outstanding | 30,884,300 | 0.62 | 8.98 | 27,796 | | Vested and expected to vest | 30,884,300 | 0.62 | 8.98 | 27,796 | | Exercisable | 30,884,300 | 0.62 | 8.98 | 27,796 | - Total share-based compensation expenses for employees and directors were **RMB55.424 million** (US$8.494 million) in 2020[638](index=638&type=chunk) [C. Board Practices](index=120&type=section&id=C.%20Board%20Practices) The board of directors comprises six members and operates through several committees [Committees of the Board of Directors](index=120&type=section&id=Committees%20of%20the%20Board%20of%20Directors) The board has an Audit Committee, a Compensation Committee, a Nominating and Corporate Governance Committee, and a Strategy Committee - The Audit Committee oversees accounting, financial reporting, and independent auditor selection[374](index=374&type=chunk)[376](index=376&type=chunk) - The Compensation Committee reviews and determines executive and director compensation[377](index=377&type=chunk) - The Nominating and Corporate Governance Committee identifies qualified director and executive officer candidates[380](index=380&type=chunk) - The Strategy Committee guides management and the board on strategic transactions and business planning[381](index=381&type=chunk) [Terms of Directors and Executive Officers](index=122&type=section&id=Terms%20of%20Directors%20and%20Executive%20Officers) Directors are appointed or removed by shareholder resolution, while executive officers serve at the discretion of the board - Directors hold office until removed by shareholder resolution or board resolution[382](index=382&type=chunk) - Executive officers are appointed and removed by a majority vote of the board of directors[382](index=382&type=chunk) [Employment Agreements](index=123&type=section&id=Employment%20Agreements) Employment agreements with executive officers allow for termination for cause without notice or remuneration - Executive officers' employment can be terminated for cause without notice or remuneration[384](index=384&type=chunk) - Termination without cause requires one-month prior written notice or one-month salary compensation[384](index=384&type=chunk) [D. Employees](index=123&type=section&id=D.%20Employees) The company had 138 employees as of December 31, 2020, a decrease from 282 in 2018 Number of Employees by Function (as of Dec 31, 2020) | Function | Number of employees | |:-------------------------------|:--------------------| | Management and Administration | 9 | | Sales, Marketing and Website Operation | 28 | | Service and User Support | 5 | | Technology and Product Development | 61 | | Administrative Support | 35 | | Total | 138 | - Total employees **decreased from 282 in 2018 to 138 in 2020**[384](index=384&type=chunk) - Employees participate in government-mandated social insurance and housing fund plans in China[384](index=384&type=chunk) [E. Share Ownership](index=123&type=section&id=E.%20Share%20Ownership) As of April 5, 2021, founder Mr. Man San Vincent Law held 61.7% of total voting power Beneficial Ownership of Ordinary Shares (as of April 5, 2021) | Shareholder | Shares Beneficially Owned (Number) | Percentage of Shares | Percentage of Votes Held | |:------------------------------------|:-----------------------------------|:---------------------|:-------------------------| | Man San Vincent Law | 96,791,039 | 17.3 % | 61.7 % | | Directors and Executive Officers as a Group | 106,969,979 | 19.0 % | 62.5 % | | Tsinghua Unigroup Co., Ltd. | 140,141,810 | 25.0 % | 11.6 % | | Sequoia Capital 2010 CGF Holdco, Ltd. | 35,042,735 | 6.3 % | 2.9 % | - Mr. Man San Vincent Law's voting power increased to approximately **60.28%** after the issuance of 65,000 Class A preference shares to his wholly-owned company[191](index=191&type=chunk)[386](index=386&type=chunk) - Tsinghua Unigroup Co., Ltd. is a major shareholder, holding **25.0% of shares** and **11.6% of votes**[387](index=387&type=chunk)[389](index=389&type=chunk) [ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS](index=125&type=section&id=ITEM%207.%20MAJOR%20SHAREHOLDERS%20AND%20RELATED%20PARTY%20TRANSACTIONS) This section outlines major shareholders and details related party transactions [A. Major Shareholders](index=125&type=section&id=A.%20Major%20Shareholders) Information on major shareholders is referenced from 'Item 6.E. Share Ownership' [B. Related Party Transactions](index=125&type=section&id=B.%20Related%20Party%20Transactions) The company had no outstanding non-interest-bearing borrowings from related parties as of December 31, 2020 - No outstanding non-interest-bearing borrowings from related parties as of December 31, 2020[390](index=390&type=chunk) - A **RMB10.0 million loan** to Loto Interactive Information Technology (Shenzhen) Limited was fully repaid in 2020[390](index=390&type=chunk) Related Party Transactions (RMB in thousands) | Transaction Type | 2018 (RMB) | 2019 (RMB) | 2020 (RMB) | 2020 (US$) | |:------------------------------------------|:-----------|:-----------|:-----------|:-----------| | Interest from loan to Loto Interactive Information Technology (Shenzhen) Limited | — | 218 | 137 | 21 | | Other operating income from management service provided to Loto Interactive Information Technology (Shenzhen) Limited | — | 320 | 217 | 33 | | Total | — | 538 | 354 | 54 | [C. Interests of Experts and Counsel](index=126&type=section&id=C.%20Interests%20of%20Experts%20and%20Counsel) This item states that information regarding interests of experts and counsel is not applicable [ITEM 8. FINANCIAL INFORMATION](index=126&type=section&id=ITEM%208.%20FINANCIAL%20INFORMATION) This section confirms the inclusion of consolidated financial statements and outlines the company's dividend policy [A. Consolidated Statements and Other Financial Information](index=126&type=section&id=A.%20Consolidated%20Statements%20and%20Other%20Financial%20Information) The company intends to reinvest all available funds and does not expect to pay cash dividends in the foreseeable future - Consolidated financial statements are included at the end of this annual report[393](index=393&type=chunk) - The company intends to **permanently reinvest all available funds** and future earnings, with no expectation of paying cash dividends[393](index=393&type=chunk) - Dividend payments from PRC subsidiaries are subject to PRC taxes and statutory reserve fund requirements[393](index=393&type=chunk) [B. Significant Changes](index=126&type=section&id=B.%20Significant%20Changes) The company has not experienced any significant changes since the date of its audited consolidated financial statements [ITEM 9. THE OFFER AND LISTING](index=127&type=section&id=ITEM%209.%20THE%20OFFER%20AND%20LISTING) This section provides details on the company's ADSs listing on the NYSE [A. Offering and Listing Details](index=127&type=section&id=A.%20Offering%20and%20Listing%20Details) The company's ADSs have been listed on the NYSE under the symbol "WBAI" since November 22, 2013 - ADSs listed on NYSE under symbol "WBAI" since November 22, 2013[395](index=395&type=chunk) - As of the report date, **55,993,405 ADSs** (representing 559,934,055 Class A ordinary shares) were outstanding[395](index=395&type=chunk) [B. Plan of Distribution](index=127&type=section&id=B.%20Plan%20of%20Distribution) This item states that information regarding the plan of distribution is not applicable [C. Markets](index=127&type=section&id=C.%20Markets) The company's ADSs are listed on the NYSE under the symbol "WBAI" - ADSs are listed on the NYSE under the symbol "WBAI"[127](index=127&type=chunk)[395](index=395&type=chunk) [D. Selling Shareholders](index=127&type=section&id=D.%20Selling%20Shareholders) This item states that information regarding selling shareholders is not applicable [E. Dilution](index=127&type=section&id=E.%20Dilution) This item states that information regarding dilution is not applicable [F. Expenses of the Issue](index=127&type=section&id=F.%20Expenses%20of%20the%20Issue) This item states that information regarding expenses of the issue is not applicable [ITEM 10. ADDITIONAL INFORMATION](index=127&type=section&id=ITEM%2010.%20ADDITIONAL%20INFORMATION) This section provides additional information on share capital, material contracts, exchange controls, and taxation [A. Share Capital](index=127&type=section&id=A.%20Share%20Capital) This item states that information regarding share capital is not applicable [B. Memorandum and Articles of Association](index=127&type=section&id=B.%20Memorandum%20and%20Articles%20of%20Association) The company's memorandum and articles of association were adopted upon its IPO and amended in December 2016 - Memorandum and articles of association were adopted upon IPO completion (November 2013) and amended in December 2016[396](index=396&type=chunk) [C. Material Contracts](index=128&type=section&id=C.%20Material%20Contracts) Material contracts include a settlement agreement for TMG's equity and a share subscription agreement settled partly in bitcoin - A shareholders' agreement with Helmet Limited for TMG's 7% equity interest was settled in April 2020 for **EUR1.9 million**[396](index=396&type=chunk) - A share subscription agreement in December 2020 for 85,572,963 Class A ordinary shares (US$23 million total) was settled **50% in U.S. dollars and 50% in bitcoin**[396](index=396&type=chunk) [D. Exchange Controls](index=128&type=section&id=D.%20Exchange%20Controls) This item refers to 'Item 4.B. Business Overview—Regulation of Our Industry' for details on exchange controls [E. Taxation](index=128&type=section&id=E.%20Taxation) This section details the tax implications across various jurisdictions where the company operates - The Cayman Islands levies no taxes on profits, income, gains, or appreciation[397](index=397&type=chunk) - PRC EIT Law imposes a **25% income tax** on Chinese enterprises and a **10% withholding tax** on dividends to non-PRC enterprise shareholders[399](index=399&type=chunk) - If deemed a PRC 'resident enterprise', the company could be subject to **25% EIT on its global income**, and dividends/capital gains for foreign investors could be subject to PRC taxation[399](index=399&type=chunk)[400](index=400&type=chunk) - Malta profits tax is 35%, but a 6/7 refund can effectively reduce it to **5%** for holding companies[304](index=304&type=chunk)[600](index=600&type=chunk) - Curacao profits tax is generally **2%** of taxable income[304](index=304&type=chunk)[600](index=600&type=chunk) - U.S. federal income tax consequences for ADSs/ordinary shares include dividends being taxable as ordinary income and capital gains/losses on disposition[403](index=403&type=chunk)[409](index=409&type=chunk) - The company does not believe it was a Passive Foreign Investment Company (PFIC) for 2020, but PFIC status is determined annually[165](index=165&type=chunk)[405](index=405&type=chunk) [F. Dividends and Paying Agents](index=134&type=section&id=F.%20Dividends%20and%20Paying%20Agents) This item states that information regarding dividends and paying agents is not applicable [G. Statement by Experts](index=134&type=section&id=G.%20Statement%20by%20Experts) This item states that information regarding statements by experts is not applicable [H. Documents on Display](index=134&type=section&id=H.%20Documents%20on%20Display) The company has filed this annual report and exhibits with the SEC, which are available for public inspection - The annual report and exhibits are filed with the SEC and accessible at its Public Reference Room and website (www.sec.gov)[410](index=410&type=chunk)[412](index=412&type=chunk) - As a foreign private issuer, the company is exempt from certain quarterly reporting and proxy statement rules under the Exchange Act[412](index=412&type=chunk) [I. Subsidiary Information](index=135&type=section&id=I.%20Subsidiary%20Information) This item states that information regarding subsidiary information is not applicable [ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=135&type=section&id=ITEM%2011.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to foreign exchange risk, minimal interest rate risk, and inflation risk - Exposed to foreign exchange risk from operations in multiple regions, with TMG's functional currency being EUR[413](index=413&type=chunk) - RMB/USD exchange rate fluctuations can materially affect reported results; **RMB appreciated 6.3% against USD in 2020**[415](index=415&type=chunk) Cash and Cash Equivalents by Currency (as of Dec 31, 2020) | Currency | Amount (RMB in thousands) | Amount (US$ in thousands) | |:---------|:--------------------------|:--------------------------| | Renminbi | 191,900 | 29,409 | | EUR | 900 | 138 | | U.S. dollar | 109,620 | 16,800 | | Total | 302,420 | 46,347 | - A **10% depreciation of RMB and EUR** against the U.S. dollar would reduce the total U.S. dollar cash balance from US$47.4 million to US$44.6 million[415](index=415&type=chunk) - Minimal exposure to interest rate risk, primarily from interest-bearing bank accounts[415](index=415&type=chunk) - China's inflation rate (CPI) was **2.5% in 2020**, not materially affecting the company in the past[415](index=415&type=chunk) [ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES](index=136&type=section&id=ITEM%2012.%20DESCRIPTION%20OF%20SECURITIES%20OTHER%20THAN%20EQUITY%20SECURITIES) This section details the fees and charges associated with American Depositary Shares (ADSs) for holders [A. Debt Securities](index=136&type=section&id=A.%20Debt%20Securities) This item states that information regarding debt securities is not applicable [B. Warrants and Rights](index=136&type=section&id=B.%20Warrants%20and%20Rights) This item states that information regarding warrants and rights is not applicable [C. Other Securities](index=136&type=section&id=C.%20Other%20Securities) This item states that information regarding other securities is not applicable [D. American Depositary Shares](index=137&type=section&id=D.%20American%20Depositary%20Shares) Holders of ADSs are subject to various fees charged by the depositary, including issuance, transfer, and administrative fees - The depositary may charge **US$5.00 per 100 ADSs** for issuance, delivery, reduction, cancellation, or surrender[417](index=417&type=chunk) - Additional charges include up to **US$1.50 per ADR** for transfers and **US$0.05 per ADS** for cash distributions and administrative services[417](index=417&type=chunk) - The company pays other charges and expenses of the depositary and its agents, and reimburses for ADR program-related expenses[418](index=418&type=chunk) PART II [ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES](index=138&type=section&id=ITEM%2013.%20DEFAULTS%2C%20DIVIDEND%20ARREARAGES%20AND%20DELINQUENCIES) This item states that there are no defaults, dividend arrearages, or delinquencies [ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS](index=138&type=section&id=ITEM%2014.%20MATERIAL%20MODIFICATIONS%20TO%20THE%20RIGHTS%20OF%20SECURITY%20HOLDERS%20AND%20USE%20OF%20PROCEEDS) There have been no material modifications to the rights of security holders, and proceeds from offerings have been used for capital expenditures - No material modifications to the rights of security holders[419](index=419&type=chunk) - Net proceeds from IPO (US$80.5 million) and a subsequent share purchase (US$123.8 million) were used for capital expenditures[420](index=420&type=chunk) - Approximately **RMB841.7 million (US$129.0 million)** of net proceeds were used for capital expenditures as of December 31, 2020[420](index=420&type=chunk) [ITEM 15. CONTROLS AND PROCEDURES](index=138&type=section&id=ITEM%2015.%20CONTROLS%20AND%20PROCEDURES) Management concluded that the company's disclosure controls and internal control over financial reporting were effective as of December 31, 2020 - Management concluded that disclosure controls and procedures were **effective** as of December 31, 2020[421](index=421&type=chunk) - Management concluded that internal control over financial reporting was **effective** as of December 31, 2020, based on the COSO framework[422](index=422&type=chunk) - The independent registered public accounting firm audited and attested to the **effectiveness of internal control** over financial reporting as of December 31, 2020[424](index=424&type=chunk)[444](index=444&type=chunk) - New internal control procedures were implemented for the adoption of ASC 842 (Leases) on January 1, 2019[424](index=424&type=chunk) [ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT](index=139&type=section&id=ITEM%2016A.%20AUDIT%20COMMITTEE%20FINANCIAL%20EXPERT) Wong, Yan Ki Angel has been determined to qualify as an "audit committee financial expert" - Wong, Yan Ki Angel is designated as an "audit committee financial expert"[425](index=425&type=chunk) [ITEM 16B. CODE OF ETHICS](index=139&type=section&id=ITEM%2016B.%20CODE%20OF%20ETHICS) The board of directors has adopted a code of ethics applicable to all directors, officers, employees, and agents - A code of ethics applies to directors, officers, employees, and agents, with specific provisions for senior financial officers[425](index=425&type=chunk) [ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES](index=139&type=section&id=ITEM%2016C.%20PRINCIPAL%20ACCOUNTANT%20FEES%20AND%20SERVICES) This section details the aggregate fees paid to the independent registered public accounting firms for audit and audit-related services Principal Accountant Fees and Services (RMB in thousands) | Fee Category | 2019 (RMB) | 2020 (RMB) | 2020 (US$) | |:-------------|:-----------|:-----------|:-----------| | Audit fees | 3,276 | 8,222 | 1,260 | | Audit related fees | 1,044 | 587 | 90 | | Total | 4,320 | 8,809 | 1,350 | - The audit committee's policy is to pre-approve all audit and non-audit services provided by the independent registered public accounting firm[426](index=426&type=chunk) [ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES](index=139&type=section&id=ITEM%2016D.%20EXEMPTIONS%20FROM%20THE%20LISTING%20STANDARDS%20FOR%20AUDIT%20COMMITTEES) This item states that there are no exemptions from the listing standards for audit committees [ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS](index=140&type=section&id=ITEM%2016E.%20PURCHASES%20OF%20EQUITY%20SECURITIES%20BY%20THE%20ISSUER%20AND%20AFFILIATED%20PURCHASERS) The company had a share repurchase program but made no repurchases in 2020 - A share repurchase program was approved in February 2015 for up to **US$30 million**[427](index=427&type=chunk) - Repurchased ADSs in 2015 (US$1.43 million), 2016 (US$17.24 million), and 2017 (US$3.0 million)[427](index=427&type=chunk) - **No ADSs were repurchased in 2020**[427](index=427&type=chunk) [ITEM 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT](index=140&type=section&id=ITEM%2016F.%20CHANGE%20IN%20REGISTRANT'S%20CERTIFYING%20ACCOUNTANT) Friedman LLP resigned as the company's auditor in September 2020 and was replaced by MaloneBailey, LLP - Friedman LLP resigned as auditor on September 23, 2020, due to a disagreement over internal control effectiveness[428](index=428&type=chunk) - Friedman LLP advised that its audit reports for 2017 and 2018 should no longer be relied upon[428](index=428&type=chunk) - MaloneBailey, LLP was appointed as the new auditor on September 27, 2020[428](index=428&type=chunk) - The Special Investigation Committee found **no sufficient basis to establish a violation of the U.S. FCPA**[428](index=428&type=chunk) [ITEM 16G. CORPORATE GOVERNANCE](index=141&type=section&id=ITEM%2016G.%20CORPORATE%20GOVERNANCE) The company adheres to NYSE Corporate Governance Rules - The company follows NYSE Corporate Governance Rules with no significant differences from domestic companies' practices[430](index=430&type=chunk) [ITEM 16H. MINE SAFETY DISCLOSURE](index=141&type=section&id=ITEM%2016H.%20MINE%20SAFETY%20DISCLOSURE) This item states that mine safety disclosure is not applicable PART III [ITEM 17. FINANCIAL STATEMENTS](index=142&type=section&id=ITEM%2017.%20FINANCIAL%20STATEMENTS) The company has elected to provide its financial statements pursuant to Item 18 of this annual report [ITEM 18. FINANCIAL STATEMENTS](index=142&type=section&id=ITEM%2018.%20FINANCIAL%20STATEMENTS) The company's consolidated financial statements are included at the end of this annual report - Consolidated financial statements are included at the end of this annual report[432](index=432&type=chunk) [ITEM 19. EXHIBITS](index=143&type=section&id=ITEM%2019.%20EXHIBITS) This section lists all exhibits filed with the annual report, including corporate governance documents and material agreements - Exhibits include Amended and Restated Memorandum and Articles of Association, Share Incentive Plans, Employment Agreements, and various contractual arrangements[434](index=434&type=chunk)[435](index=435&type=chunk)[437](index=437&type=chunk) - Key exhibits also include the Share Purchase Agreement with Good Luck Information Technology Co., Limited and the Registrant's 2021 Share Incentive Plan[437](index=437&type=chunk) - Certifications by the CEO and CFO pursuant to the Sarbanes-Oxley Act of 2002 are included[437](index=437&type=chunk) REPORT OF CONSOLIDATED FINANCIAL STATEMENTS [REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM](index=151&type=section&id=REPORT%20OF%20INDEPENDENT%20REGISTERED%20PUBLIC%20ACCOUNTING%20FIRM) MaloneBailey, LLP issued an unqualified opinion on the company's consolidated financial statements and internal controls - MaloneBailey, LLP issued an **unqualified opinion** on the consolidated financial statements for the three-year period ended December 31, 2020[444](index=444&type=chunk) - MaloneBailey, LLP also issued an **unqualified opinion** on the effectiveness of the company's internal control over financial reporting as of December 31, 2020[444](index=444&type=chunk) - **No critical audit matters** were identified[446](index=446&type=chunk) [AUDITED CONSOLIDATED FINANCIAL STATEMENTS](index=153&type=section&id=AUDITED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section presents the audited consolidated financial statements for the periods ended December 31, 2018, 2019, and 2020 [CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2019 AND 2020](index=153&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS%20AS%20OF%20DECEMBER%2031%2C%202019%20AND%202020) The consolidated balance sheets show a decrease in total assets and total liabilities in 2020 compared to 2019 Consolidated Balance Sheets (RMB in thousands) | Metric (RMB in thousands) | As of Dec 31, 2019 | As of Dec 31, 2020 | As of Dec 31, 2020 (US$) | |:------------------------------------------|:-------------------|:-------------------|:-------------------------| | Total current assets | 430,326 | 335,853 | 51,472 | | Total assets | 695,779 | 470,473 | 72,103 | | Total current liabilities | 77,162 | 73,620 | 11,284 | | Total liabilities | 111,861 | 79,953 | 12,255 | | Total BIT Mining Limited shareholders' equity | 584,456 | 403,777 | 61,880 | | Total shareholders' equity | 569,069 | 390,520 | 59,848 | [CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS FOR THE YEARS ENDED DECEMBER 31, 2018, 2019 AND 2020](index=155&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20COMPREHENSIVE%20LOSS%20FOR%20THE%20YEARS%20ENDED%20DECEMBER%2031%2C%202018%2C%202019%20AND%202020) The statements show a decrease in net revenues and a reduction in net loss in 2020 compared to 2019 Consolidated Statements of Comprehensive Loss (RMB in thousands) | Metric (RMB in thousands) | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----------| | Net Revenues | 126,089 | 39,688 | 21,815 | 3,343 | | Operating loss from continuing operations | (344,488) | (642,839) | (190,792) | (29,241) | | Loss before income taxes from continuing operations | (491,339) | (661,928) | (224,750) | (34,445) | | Net loss from continuing operations | (471,737) | (654,286) | (221,096) | (33,885) | | Net loss attributable to BIT Mining Limited | (451,673) | (651,268) | (223,226) | (34,211) | | Basic Net loss per share | (1.10) | (1.52) | (0.52) | (0.08) | [CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2018, 2019 AND 2020](index=156&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS%20FOR%20THE%20YEARS%20ENDED%20DECEMBER%2031%2C%202018%2C%202019%20AND%202020) Net cash used in operating activities decreased in 2020, while investing activities provided cash Consolidated Statements of Cash Flows (RMB in thousands) | Metric (RMB in thousands) | 2018 | 2019 | 2020 | 2020 (US$) | |:------------------------------------------|:-----|:-----|:-----|:-----------| | Net cash used in operating activities | (144,127) | (160,024) | (68,056) | (10,431) | | Net cash (used in) provided by investing activities | (15,604) | 66,817 | 21,714 | 3,330 | | Net cash provided by financing activities | 54,791 | 17,105 | 26 | 4 | | Cash, cash equivalents and restricted cash at end of the year | 436,387 | 365,796 | 312,505 | 47,894 | - **Net cash used in operating activities decreased by 57.47%** from 2019 to 2020[457](index=457&type=chunk) - Net cash provided by investing activities in 2020 was **RMB21.7 million**, primarily from return of time deposits and repayment of loans[329](index=329&type=chunk)[457](index=457&type=chunk) [CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY FOR THE YEARS ENDED DECEMBER 31, 2018, 2019 AND 2020](index=158&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CHANGES%20IN%20SHAREHOLDERS'%20EQUITY%20FOR%20THE%20YEARS%20ENDED%20DECEMBER%2031%2C%202018%2C%202019%20AND%202020) Total shareholders' equity decreased from 2018 to 2020,

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) ¨ Registration statement pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934 or x Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2019 or ¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from __________ to __________ or ¨ Shell company report pursuant t ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 20-F (Mark One) ¨ Registration statement pursuant to Section 12(b) or 12(g) of the Securities Exchange Act of 1934 or x Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2018 or ¨ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from __________ to __________ or ¨ Shell company report pursuant t ...