NFTG(US:NFTG)2023-03-31 20:01Revenue Generation - The company did not generate any revenues from operations during the year ended December 31, 2022, and for the period from October 27, 2021, to December 31, 2021[251]. - The company anticipates that it will not generate revenue for the foreseeable future until a critical mass of users is achieved[251]. - The company plans to generate revenue from the sale of in-game NFTs, advertising fees, royalty revenues, commission from third-party sales, and transaction fees[244][247]. Research and Development - Research and development fees increased to $824,523 in 2022 from $6,810 in 2021, an increase of approximately $817,713 due to labor and outside development costs[254]. - The company expects research and development fees to increase in the future as the development of games accelerates[254]. - The company plans to capitalize development and production service payments to third-party developers as internal-use software development costs and licenses[253]. - The company plans to pursue research and development of its products, requiring significant capital beyond current resources[267]. Financial Condition - The company has no cash equivalents as of December 31, 2022, and 2021, and held approximately $1,578,000 in cash exceeding FDIC limits as of December 31, 2021[234][236]. - As of December 31, 2022, the company had approximately $679,781 in cash and an accumulated deficit of approximately $1.4 million[262]. - The company has not experienced any losses on its invested cash to date, but any loss or lack of access to funds could significantly impact its financial condition[235]. Expenses - General and administrative expenses for the year ended December 31, 2022, totaled $599,573, a significant increase from $5,445 in 2021[255]. - Compensation and related benefits increased to $369,914 in 2022 from $0 in 2021, due to the hiring of executive officers and employees[256]. - Professional fees rose to $164,495 in 2022, primarily due to accounting, legal, and recruiting fees associated with the IPO[257]. Losses - The company reported a loss from operations of $1,424,096 for the year ended December 31, 2022, compared to a loss of $12,255 in 2021, reflecting an increase of $1,411,841[259]. - Net loss for the year ended December 31, 2022, was $1,421,172, or $0.14 per common share, compared to a net loss of $12,255, or $0.00 per common share, in 2021[261]. - Net cash used in operations for the year ended December 31, 2022, was $1,260,425, primarily due to the net loss adjusted for changes in operating assets and liabilities[263]. IPO and Investments - The company closed its IPO on February 17, 2023, issuing 1,686,747 shares for gross proceeds of approximately $7 million, with net proceeds of $5.9 million[266]. - The company incurred net cash used in investing activities of $62,836 in 2022, related to a software and patent license agreement[264]. Digital Assets - The company accounts for digital currencies and other digital assets as indefinite-lived intangible assets at historical cost[237]. - The company plans to launch its gaming platform "Gaxos," which will allow users to mint unique in-game NFTs[224][225].