WeTrade Group(WETG) - 2025 Q1 - Quarterly Report

Financial Performance - Net income from continuing operations for the three months ended March 31, 2025, was $193,440,425, a substantial increase from $19,546,495 in the same period of 2024, reflecting a growth of about 887%[17] - Other income for the three months ended March 31, 2025, was $245,311,156, significantly up from $24,019,399 in 2024, primarily due to gains from digital assets[125] - For the three months ended March 31, 2025, the Company reported a net income of $193,440,425, compared to a net loss of $19,546,495 for the same period in 2024[126] Asset Growth - Total assets increased significantly to $483,825,640 as of March 31, 2025, compared to $92,916,317 as of December 31, 2024, representing a growth of approximately 420%[15] - The total stockholders' equity rose to $421,026,654 as of March 31, 2025, up from $81,628,062 as of December 31, 2024, marking an increase of around 416%[15] - The Company’s digital assets holdings increased from $78,322,430 on December 31, 2024, to $481,717,253 on March 31, 2025, reflecting a significant fair value gain of $245,311,156 for the three months ended March 31, 2025[71] Bitcoin Holdings and Strategy - The company held 5,833 bitcoins as of March 31, 2025, with a total fair value of $481,717,253, compared to 833 bitcoins valued at $78,322,430 as of December 31, 2024, reflecting a significant increase in both quantity and value[15][32] - The company plans to continue its strategy of acquiring bitcoin with liquid assets exceeding working capital requirements, indicating a focus on long-term asset appreciation[27][30] - The company aims to generate cash for treasury management through periodic sales of bitcoin, highlighting a strategy for liquidity management[31] Shareholder Information - The weighted-average shares outstanding increased to 97,604,030 for the three months ended March 31, 2025, compared to 2,625,130 in the prior year, indicating a substantial increase in share issuance[17] - The Company has unlimited authorized shares of $0.00 par value common stock, with 436,265,135 shares issued and outstanding as of March 31, 2025[61] - The Company executed a 1-for-185 reverse stock split, reducing outstanding shares from 195,057,503 to 1,054,530 shares[96] Expenses and Financial Management - Operating expenses for the three months ended March 31, 2025, were $449,858, compared to $330,145 in the same period of 2024, representing an increase of approximately 36%[17] - General and administrative expenses increased to $449,858 for the three months ended March 31, 2025, from $330,145 in 2024, mainly due to higher litigation-related legal fees[124] - The company has not generated any revenue from its SAAS business for the three months ended March 31, 2025, and 2024[103] Tax and Compliance - The Company is subject to a U.S. Federal tax rate of 21% and has a subsidiary in Hong Kong subject to a 16.5% profits tax[104] - The company has adopted ASU 2023-09 for improved income tax disclosures, effective for fiscal years beginning after December 15, 2024[69] Legal Matters - A derivative lawsuit was filed against the company by purported shareholders seeking control, which was dismissed without prejudice on October 18, 2023[143] - The Chancery Court granted a temporary restraining order on November 7, 2023, restraining unauthorized individuals from claiming to act on behalf of the company[145] - A new lawsuit was initiated against the company in the WY District Court seeking inspection of certain corporate records[147] Internal Controls and Governance - As of March 31, 2025, the company concluded that its disclosure controls and procedures were not effective due to limited internal resources and lack of transaction review[136] - Management identified material weaknesses in internal audit functions and lack of segregation of duties within accounting functions[137] - The company plans to implement procedures to assure that the initiation of transactions, custody of assets, and recording of transactions will be performed by separate individuals[138]