UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 20-F

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to .

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report:

Commission file number: 001-39258

BTC Digital Ltd.

(Exact name of Registrant as Specified in its Charter)

Cayman Islands

(Jurisdiction of Incorporation or Organization)

61 Robinson Road Level 6 & 7

#738, Singapore 068893

(Address of Principal Executive Offices)

Siguang Peng

Telephone: +65 6022 2515

E-mail: ir@btct.us

61 Robinson Road Level 6 & 7

#738, Singapore 068893

(Name, Telephone, E-mail and/or Facsimile Number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of Each Class		Trading symbol		Name of Each Exchange On Which Registered
Ordinary Shares, par value US$0.06 per share		BTCT		The Nasdaq Stock Market LLC

Securities registered or to be registered pursuant to Section 12(g) of the Act:

None

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

(Title of Class)

The number of outstanding shares of each of the issuer’s classes of capital or common stock as of December 31, 2025 was: 9,516,975 ordinary shares, par value $0.06 per share.

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes ☐ No ☒

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐

Accelerated filer ☐

Non-accelerated filer ☒

Emerging growth company ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards † provided pursuant to Section 13(a) of the Exchange Act. ☐

†

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ☐

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

☒ U.S. GAAP

☐ International Financial Reporting Standards as issued by the International Accounting Standards Board

☐ Other

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow:

Item 17 ☐ Item 18 ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes ☐ No ☒

BTC DIGITAL LTD.

FORM 20-F ANNUAL REPORT

TABLE OF CONTENTS

		Page
	PART I	1
Item 1.	Identity of Directors, Senior Management and Advisers	1
Item 2.	Offer Statistics and Expected Timetable	1
Item 3.	Key Information	1
Item 4.	Information on the Company	28
Item 4A.	Unresolved Staff Comments	40
Item 5.	Operating and Financial Review and Prospects	40
Item 6.	Directors, Senior Management and Employees	49
Item 7.	Major Shareholders and Related Party Transactions	57
Item 8.	Financial Information	59
Item 9.	The Offer and Listing	60
Item 10.	Additional Information	60
Item 11.	Quantitative and Qualitative Disclosures about Market Risk	69
Item 12.	Description of Securities Other than Equity Securities	69
	PART II	70
Item 13.	Defaults, Dividend Arrearages and Delinquencies	70
Item 14.	Material Modifications to The Rights Of Security Holders and Use Of Proceeds	70
Item 15.	Controls And Procedures	70
Item 16.	[Reserved]	71
Item 16A.	Audit Committee Financial Expert	71
Item 16B.	Code of Ethics	71
Item 16C.	Principal Accountant Fees and Services	71
Item 16D.	Exemptions From the Listing Standards for Audit Committees	72
Item 16E.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	72
Item 16F.	Change in Registrant’s Certifying Accountant	72
Item 16G.	Corporate Governance	72
Item 16H.	Mine Safety Disclosure	73
Item 16I	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	73
Item 16J	Insider Trading Policies	73
Item 16K	Cybersecurity	73
	PART III	74
Item 17.	Financial Statements	74
Item 18.	Financial Statements	74
Item 19.	Exhibits	74

GENERAL INFORMATION

In this annual report on Form 20-F, or this annual report, except where the context otherwise requires and for purposes of this annual report only, references to:

●

“we,” “us,” “our Company,” “the Company” and “our” are to BTC Digital Ltd.;

●

“China” or the “PRC” are to the People’s Republic of China, including the special administrative regions of Hong Kong and Macau and excluding for the purposes of this annual report only, Taiwan;

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“Code” are to the U.S. Internal Revenue Code of 1986, as amended;

●

“former variable interest entities” or “former VIEs” are to Shenzhen Meten International Education Co., Ltd., or Shenzhen Meten, and Shenzhen Likeshuo Education Co., Ltd., or Shenzhen Likeshuo, and their respective direct and indirect subsidiaries, which are PRC companies in which Meten did not have equity interests but whose financial results had been consolidated by Meten in accordance with U.S. GAAP due to Meten being the primary beneficiary of these companies prior to the termination of the VIE agreements in November 2022;

●

“Met Chain” are to Met Chain investment holding company Ltd, a company formed under the laws of the British Virgin Islands;

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“Met Path” are to Meta Path investing holding company, a company formed under the laws of the Cayman Islands;

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“Meten Blockchain” are to “METEN BLOCK CHAIN LLC,” a company formed in the State of California;

●

“ordinary shares” are to our ordinary shares, par value US$0.06 per share, carrying one vote per share;

●

“the operating entities” are to the Company and the Company’s subsidiaries with operations, namely Meta Path investing holding company, Met Chain investment holding company Ltd, and METEN BLOCK CHAIN LLC;

●

“dollars,” “US$” and “U.S. dollars” are to the legal currency of the United States;

●

“U.S. GAAP” are to generally accepted accounting principles in the United States; and

●

years are to the calendar year from January 1 to December 31 and references to our fiscal year or years are to the fiscal year or years ended December 31.

CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS

This Annual Report on Form 20-F (this “Report”) contains forward-looking statements that involve risks and uncertainties. You should not place undue reliance on these forward-looking statements. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including the reasons described in our “Business,” “Risk Factors,” and “Management Discussion and Analysis of Financial Condition and Result of Operations” sections, as well as those discussed elsewhere in this Report. In some cases, you can identify these forward-looking statements by terms such as “anticipate,” “believe,” “continue,” “could,” “depends,” “estimate,” “expects,” “intend,” “may,” “ongoing,” “plan,” “potential,” “predict,” “project,” “should,” “will,” “would” or the negative of those terms or other similar expressions, although not all forward-looking statements contain those words.

Our operations and business prospects are always subject to risks and uncertainties including, among others:

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Our ability to secure enterprise clients and deals in the face of growing competition;

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Assumptions relating to the size of the market for our products and services;

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Unanticipated regulations of cryptocurrencies that add barriers to adoption and have a negative effect on our business;

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Our ability to obtain and maintain intellectual property protection for our products; and

●

Our estimates of expenses, future revenue, capital requirements and our needs for, or ability to obtain, additional financing.

The forward-looking statements in this Report represent our views as of the date of this Report. We anticipate that subsequent events and developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the future, we have no current intention to do so except to the extent required by applicable law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this Report.

Unless the context requires otherwise, references in this Report to “we,” “us,” “our,” “our company,” “the Company” or similar terminology refer to BTC Digital Ltd., including its consolidated subsidiaries.

MARKET DATA AND FORECASTS

This annual report also contains data related to global cryptocurrency market that include projections based on a number of assumptions. The global cryptocurrency market may not grow at the rates projected by market data, or at all. The failure of the global cryptocurrency market to grow at the projected rates may have a material adverse effect on our business prospects, results of operations and the market price of our ordinary shares. In addition, the relatively new and rapidly changing nature of the global cryptocurrency market subjects any projections or estimates relating to the growth prospects or future condition of these markets to significant uncertainties. If any one or more of the assumptions underlying the market data turns out to be incorrect, actual results may differ from the projections based on these assumptions. You should not place undue reliance on these forward-looking statements.

iii

PART I

ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not Applicable.

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not Applicable.

ITEM 3. KEY INFORMATION

A.	[Reserved]

B.	Capitalization and Indebtedness

Not Applicable

C.	Reasons for the Offer and Use of Proceeds.

Not Applicable.

D.	Risk Factors

In addition to the other information contained in this Annual Report and in other documents we file with or furnish to the U.S. Securities and Exchange Commission (the “SEC”), the following risk factors should be considered in evaluating our business. The occurrence of any of the events or developments described below could materially harm our business, financial condition, results of operations and prospects. In such an event, the market price of our ordinary shares could decline. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may materially impair our business operations.

Summary of Risk Factors

Our business is subject to a number of risks of which you should be aware before making an investment decision. Among these important risks are the following, which are more fully described below:

Risks Related to Our Business and Industry

Risks and uncertainties related to our cryptocurrency business and industry include, but are not limited to, the following:

●

We have a limited operating history of blockchain and cryptocurrency business.

●

As the operating entities develop their blockchain and cryptocurrency business, our total revenue and cash flow will become materially dependent on the market value of digital assets and the volume of digital assets received from their mining efforts. If such market value or volume declines, our business, operating results and financial condition would be adversely affected.

●

The cost of acquiring new mining machines has historically been capital intensive, and is likely to continue to be very capital intensive, which may have a material and adverse effect on our business and results of operations.

●

The price of new mining machines may be linked to the market price of bitcoin and other cryptocurrencies, and our costs of obtaining new and replacement mining machines may increase along with the market price of bitcoin and other cryptocurrencies, which may have a material and adverse effect on our financial condition and results of operations.

●

Although we currently mine bitcoin as well as certain other cryptocurrencies, including Dogecoin and Litecoin, and also hold other digital assets, including Ethereum, our future success will depend in large part on the market value of bitcoin and other digital assets we mine or hold. Any sustained decline in the value of bitcoin or such other digital assets could adversely affect our business, results of operations, financial condition and liquidity.

●

To the extent that the profit margins of bitcoin mining operations are not high, operators of bitcoin mining operations are more likely to immediately sell bitcoin rewards earned by mining in the market, thereby constraining growth of the price of bitcoin, which could adversely impact us.

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We are subject to risks associated with our need for significant electrical power.

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The cryptocurrencies stored by the operating entities may be subject to accidental or unauthorized loss or theft or otherwise may be access restricted.

Risks Related to Bitcoin

Risks and uncertainties related to bitcoin include, but are not limited to, the following:

●

The trading price of bitcoin, which may be subject to pricing risks, including volatility related risks, has historically been subject to wide swings. A material decrease in the price of bitcoin could have a materially adverse effect on our business and results of operations.

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The markets for bitcoin may be underregulated. As a result, the market price of bitcoin may be extremely volatile. Rapid decreases in the price of bitcoin could have a materially adverse effect on our business and results of operations.

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Banks and financial institutions may not provide banking services, or may cut off services, to businesses that engage in cryptocurrency-related activities.

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We have an evolving business model subject to various uncertainties.

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It may be illegal now, or in the future, to acquire, own, hold, sell or use bitcoin, or other cryptocurrencies, participate in blockchains or utilize similar cryptocurrency assets in one or more countries, the ruling of which would adversely affect us.

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The development and acceptance of competing blockchain platforms or technologies may cause demand for bitcoin to decrease.

Risks Related to Governmental Regulation and Enforcement

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If bitcoins are determined to be investment securities, and we hold a significant portion of our assets in bitcoins, investment securities or non-controlling equity interests of other entities, we may inadvertently violate the Investment Company Act of 1940 (the “Investment Company Act”). We could incur large losses to modify our operations to avoid the need to register as an investment company or could incur significant expenses to register as an investment company or could terminate operations altogether.

●

We may be required to register as an investment company under the Investment Company Act. In such event, we may be deemed as operating as an unregistered investment company in violation of the Investment Company Act and required to register as an investment company or to adjust our strategies.

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We cannot be certain as to how future regulatory developments will impact our business and any such additional regulatory requirements, or changes in how existing requirements are interpreted and applied, may cause us to cease all or certain of our operations or change our business model.

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If U.S. and/or foreign regulators and other government entities assert jurisdictions over cryptocurrencies and cryptocurrency markets, we may be subject to additional regulations imposed by these regulators and government entities and may be required to alter our business operations to gain compliance with these regulations, as a result of which we may experience increased compliance costs and our business operations, financial position and results of operations may be materially and adversely affected.

●

If regulatory changes or interpretations of our activities require us to register under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act, or otherwise under state laws, we may incur significant compliance costs, which may have a material negative effect on our business and the results of its operations.

Risks Related to Our Ordinary Shares and the Trading Market

●

Our share price has been volatile and not entirely related to our performance and financial results. The price of our ordinary shares may be subject to further volatility in the future.

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We may issue additional ordinary shares or other equity securities without your approval, which would dilute your ownership interests and may depress the market price of our ordinary shares.

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We are not expected to pay dividends on our ordinary shares in the foreseeable future.

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You may face difficulties in protecting your interests, and your ability to protect your rights through U.S. courts may be limited, because we were formed under Cayman Islands law.

Risk Factors

Risks Related to Our Business and Industry

We have launched our blockchain and cryptocurrency business in early 2022 and have a limited operating history.

Since early 2022, we have started to transition the business focus to blockchain and cryptocurrency business through the operating entities. Accordingly, we have a limited operating history, which makes an evaluation of our future prospects difficult. Our operating results will likely fluctuate moving forward as we focus on increasing our capacity and as the market price of bitcoin fluctuates. We may need to make business decisions that could adversely affect our operating results, such as modifications to our business structure, or operations. Additionally, as we have limited experience in the blockchain and cryptocurrency business, our efforts in developing such business may not succeed and we may not be able to generate sufficient revenue to cover our investment and become profitable. In the fiscal year ended December 31, 2024, we generated revenue in the amount of $11.7 million from our cryptocurrency business, and generated net loss of $2.0 million from our cryptocurrency business. In the fiscal year ended December 31, 2025, we generated revenue in the amount of $14.0 million from our cryptocurrency business, and generated net loss of $8.9 million from our cryptocurrency business. We may not continue to generate substantial revenue or net income from our blockchain and cryptocurrency business, if at all. If we do not effectively manage our growth, we may not be able to execute on our business plan, respond to competitive pressures or take advantage of market opportunities and our business, financial condition, and results of operations could be materially harmed.

As the operating entities develop their blockchain and cryptocurrency business, our total revenue and cash flow will become materially dependent on the market value of digital assets and the volume of digital assets received from our mining efforts. If such market value or volume declines, our business, operating results and financial condition would be adversely affected.

As we develop our blockchain and cryptocurrency business, the operating cash flow will be materially dependent on our ability to sell cryptocurrency for fiat currency as needed. As such, any declines in the number of cryptocurrencies that we successfully mine, the price of such cryptocurrencies or market liquidity for cryptocurrencies and digital assets generally would adversely affect our revenue and ability to fund the operations.

The price of cryptocurrencies and digital assets, and the associated demand for buying, selling and trading them, have historically been highly volatile. For example, Bitcoin’s market capitalization has fluctuated significantly in recent years, falling below and later rising above $1 trillion, and the market price of Bitcoin has experienced substantial swings. In 2025, the market price of one Bitcoin ranged from approximately $60,000 to over $126,000. The price and trading volume of any digital asset is subject to significant uncertainty and volatility, depending on a number of factors, including:

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market conditions across the broader blockchain ecosystem;

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trading activities on digital asset platforms worldwide, many of which may be unregulated, and may include manipulative activities;

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investment and trading activities of highly active retail and institutional users, speculators, mining machines and investors;

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the speed and rate at which digital assets are able to gain worldwide adoption as a medium of exchange, utility, store of value, consumptive asset, security instrument or other financial assets, if at all;

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changes in user and investor confidence in digital assets and digital asset platforms;

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publicity and events relating to the blockchain ecosystem, including public perception of the impact of the blockchain ecosystem on the environment;

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unpredictable social media coverage or “trending” of digital assets;

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the functionality and utility of digital assets and their associated ecosystems and networks, including digital assets designed for use in various applications;

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consumer preferences and perceived value of digital assets;

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increased competition from other payment services or other digital assets that exhibit better speed, security, scalability or other characteristics;

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the correlation between the prices of digital assets, including the potential that a crash in one digital asset or widespread defaults on one digital asset exchange or trading venue may cause a crash in the price of other digital assets, or a series of defaults by counterparties on digital asset exchanges or trading venues;

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regulatory or legislative changes and updates affecting the blockchain ecosystem;

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the characterization of digital assets under the laws of various jurisdictions around the world;

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the maintenance, troubleshooting and development of the blockchain networks underlying digital assets, including by mining machines, validators and developers worldwide;

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the ability for digital asset networks to attract and retain mining machines or validators to secure and confirm transactions accurately and efficiently;

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ongoing technological viability and security of digital assets and their associated protocols, smart contracts, applications and networks, including vulnerabilities against hacks and scalability;

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fees and speed associated with processing digital asset transactions, including on the underlying blockchain networks and on digital asset platforms;

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financial strength of market participants;

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interruptions in service from, or failures of, major digital asset trading platforms;

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availability of an active derivatives market for various digital assets;

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availability of banking and payment services to support digital asset-related projects;

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level of interest rates and inflation; and

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monetary policies of governments, trade restrictions and fiat currency devaluations.

There is no assurance that any digital asset, including Bitcoin, will maintain its value or that there will be meaningful levels of trading activities to support markets in any digital asset. A decline in the market value of digital assets or in the demand for trading digital assets could lead to a corresponding decline in the value of our cryptocurrency assets, their returns on investments in mining machines, and could adversely affect their business, operating results and financial condition.

Digital assets may be subject to momentum pricing due to speculation regarding future appreciation or depreciation in value, leading to greater volatility. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for future changes in value. It is possible that momentum pricing of digital assets has resulted, and may continue to result, in speculation regarding future changes in the value of digital assets, making digital assets’ prices more volatile. As a result, digital assets may be more likely to fluctuate in value due to changing investor confidence, which could impact future appreciation or depreciation in digital asset prices. As a result, our business, operating results and financial condition could be adversely affected.

The cost of acquiring new mining machines has historically been capital intensive and is likely to continue to be very capital intensive, which may have a material and adverse effect on our business and results of operations.

The success and profitability of our mining operations depend largely on the costs associated with our mining activities, including the costs of mining machines and electricity. We can be profitable only if such costs are lower than the prices of the cryptocurrencies we mine when we sell them. Our mining machines are subject to ordinary wear and tear from operation and may also experience more significant malfunctions caused by factors beyond our control. Over time, we will need to repair, replace or upgrade mining machines that are no longer functional or economically efficient with mining machines sourced from third-party suppliers. As mining technology continues to evolve, we may also need to invest in upgrading our mining fleet and related infrastructure in order to improve efficiency and remain competitive.

All of the mining machines deployed by us will degrade due to ordinary wear and tear from usage. Additionally, all of these machines will eventually become obsolete, and may also be lost or damaged due to factors outside of our control. Once such event happens, these mining machines will need to be repaired or replaced along with other equipment from time to time for us to stay competitive. This upgrading process requires substantial capital investment, and we may face challenges in doing so on a timely and cost-effective basis based on our ability to develop new mining machines with greater processing power and our access to adequate capital resources. If we are unable to obtain adequate numbers of new and replacement mining machines at scale, we may be unable to remain competitive in our highly competitive and evolving industry. If this happens, we may not be able to mine cryptocurrencies through our subsidiaries as efficiently or in similar amounts as our competitors and, as a result, our business and financial results could suffer. This could, in turn, materially and adversely affect the trading price of our securities and our investors could lose part or all of their investment.

Our financial condition and results of operations are dependent on our ability to sell the bitcoin the operating entities mine at a price greater than our costs to produce that bitcoin. We incur significant up-front capital costs each time we acquire new mining machines, and, if future prices of bitcoin are not sufficiently high, we may not realize the benefit of these capital expenditures. As the price for new mining machines we buy increases, our cost to mine a single bitcoin also increases, therefore requiring a corresponding increase in the price of bitcoin for us to maintain our results of operations, to the extent we sell the bitcoin shortly after mining it.

We have observed significant fluctuations in market prices for bitcoin, to the extent that we are unable to reasonably predict future prices for the bitcoin the operating entities mine. The market price of bitcoin could decrease during this time to the point at which it no longer becomes profitable for the operating entities to use such equipment to mine bitcoin and, as a result, our business and financial results could suffer. This could, in turn, materially and adversely affect the trading price of our securities and our investors could lose part or all of their investment.

Reports have been released that the prices of new mining machines are adjusted according to the price of bitcoin. As a result, the cost of new machines can be unpredictable, and could also be significantly higher than our historical cost for new mining machines. As a result, at times, the operating entities may obtain mining machines and other hardware from third parties at higher prices, to the extent they are available. While we cannot know definitively if these two phenomena are linked, we have seen a measurable increase in the prices for new mining machines offered by third party manufacturers during periods of increased market prices for bitcoin, and such prices may continue to track the volatility in the market price of bitcoin.

The supply chain for mining machines and related components may from time to time be adversely affected by concentrated manufacturing, trade restrictions, tariffs, customs delays, geopolitical tensions, logistics disruptions, and shortages of certain semiconductor and electronic components. A significant portion of available mining machines may be acquired by companies with substantial financial resources, which could reduce supply available to us or increase our procurement costs. Prices for mining machines, particularly newer and more efficient models, may be volatile and may increase significantly depending on market demand, bitcoin prices, network hashrate, component availability, and regulatory developments. In addition, because a substantial portion of mining hardware and related components is sourced from China or from suppliers with operations concentrated in a limited number of jurisdictions, any disruption affecting such suppliers could impair our ability to obtain replacement parts or additional mining machines on a timely basis, or at commercially reasonable prices, if at all. Such events could materially and adversely affect our ability to execute our strategy, business, financial condition, results of operations, and the value of our securities.

Because the mining machines owned by the operating entities are designed specifically to mine bitcoin, our future success will depend in large part upon the value of bitcoin, and any sustained decline in its value could adversely affect our business and results of operations.

Our operating results will depend upon the value of bitcoin because it is the only cryptocurrency the operating entities currently mine. Specifically, our revenues from our bitcoin mining operations are based upon two factors: (1) the number of bitcoin rewards the operating entities successfully mine and (2) the value of bitcoin. In addition, our operating results are directly impacted by changes in the value of bitcoin because under the value measurement model, both realized and unrealized changes will be reflected in our statement of operations. This means that our operating results will be subject to changes based upon increases or decreases in the value of bitcoin. The introduction of alternative cryptocurrencies, such as those backed by central banks known as Central Bank Digital Currencies, could significantly reduce the demand for bitcoin. This would reduce both our ability to earn mining rewards and transaction fees and would also impair our ability to monetize the bitcoin we earn.

Our reliance primarily on a limited assortment of miner models from a single manufacturer may subject our operations to increased risk of failure.

The performance and reliability of the operating entities’ mining machines and our technology is critical to our reputation and operations. Because the operating entities currently use a limited assortment of mining machines in their fleet, if there are issues with those machines, such as a design flaw in the ASIC chips they employ, our entire system could be affected. The operating entities currently use a few different models of mining machines, but if there are issues with such machines, we may have to rely on a single model of mining machine. Any system error or failure may significantly delay response times or even cause our system to fail. Any disruption in our ability to continue mining could result in lower yields and harm our reputation and business. Any exploitable weakness, flaw, or error common to the type of mining machines we use affects all such mining machines; therefore, if a defect or other flaw exists and is exploited, all or a substantial portion of our mining operations could go offline simultaneously. Any interruption, delay or system failure could result in financial losses, a decrease in the trading price of shares of our ordinary shares and damage to our reputation.

Although we currently mine bitcoin as well as certain other cryptocurrencies, including Dogecoin and Litecoin, our future success will continue to depend in large part on the market value of bitcoin and other digital assets we mine or hold. Any sustained decline in the value of bitcoin or such other digital assets could adversely affect our business, results of operations, financial condition and liquidity.

A substantial portion of our mining revenue is derived from bitcoin mining, and our operating results continue to be materially affected by the market value of bitcoin. Our mining revenues are affected by, among other things, (i) the quantity of bitcoin rewards we successfully mine and (ii) the market value of bitcoin. In addition, we hold digital assets other than bitcoin, including Ethereum, and changes in the market value of the digital assets we mine or hold may directly affect our financial condition, results of operations and liquidity. As a result, our operating results may fluctuate significantly based on increases or decreases in the market value of bitcoin and other digital assets.

The introduction or increased adoption of alternative cryptocurrencies, including central bank digital currencies and other digital assets, could reduce demand for bitcoin or otherwise affect its market value. Any such development could reduce our ability to earn mining rewards and transaction fees, impair our ability to monetize the digital assets we mine or hold, and adversely affect our business, financial condition and results of operations.

To the extent that profit margins of bitcoin mining operations are compressed, operators may be more likely to sell a greater portion of the bitcoin earned from mining, which may create downward pressure on the market price of bitcoin and could adversely affect us.

Over the past several years, bitcoin mining has evolved from activity conducted by individual users with consumer-grade processors and earlier-generation ASIC equipment to large-scale, professionalized mining operations. These professionalized mining operations generally require substantial upfront capital investment in specialized mining hardware and incur significant ongoing operating costs, including facility costs, electricity costs and personnel expenses. As a result, such operators may be more sensitive to short-term changes in bitcoin prices, network difficulty, hashprice and operating costs, and may be more likely than smaller or less capital-intensive miners to sell newly mined bitcoin in order to maintain liquidity, satisfy debt service obligations or preserve operating margins.

The profitability of a bitcoin mining operation generally reflects the value of bitcoin mined less the allocable capital and operating costs required to mine bitcoin. When profit margins are low or negative, some mining operators may sell a higher percentage of newly mined bitcoin, reduce mining activity, delay hardware upgrades or temporarily cease operations. Although the market price of bitcoin is influenced by many factors beyond miner selling activity, increased selling by mining operators during periods of margin compression could contribute to market volatility or downward pressure on the price of bitcoin. Any such decline in the market price of bitcoin could adversely affect our business, financial condition and results of operations.

The operating entities’ mining operations, including the sites in which their mining machines are operated or that are currently under construction, may experience damages, including damages that are not covered by insurance.

The operating entities’ current mining operations and any future mining operations they establish will be subject to a variety of risks relating to their physical condition and operation, including, but not limited to:

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the presence of construction or repair defects or other structural or building damage;

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any noncompliance with or liabilities under applicable environmental, health or safety regulations or requirements or building permit requirements;

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any damage resulting from natural disasters, such as hurricanes, earthquakes, fires, floods and windstorms; and

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claims by employees and others for injuries sustained at our properties, including as a result of exposure to high voltage operations, extreme temperature conditions in the operating entities’ mining farms, exposure to on-site contaminants and pollutants and dangers posed by the liquid-cooling reservoirs located at their sites.

For example, the operating entities’ mining farms could be rendered temporarily or permanently inoperable as a result of fire or other natural disasters, or as a result of terrorist attacks or other hostile acts. The security and other protective measures the operating entities take against these risks may not be sufficient. In addition, the operating entities’ mining farms could be materially adversely affected by power outages, loss of access to the electrical grid, or the loss of cost-effective sources of electrical power generation. Although the operating entities maintain insurance coverage for their mining sites, such insurance may not cover all losses, damages, liabilities or business interruptions, and certain assets, including mining machines, may not be fully insured or insured at all. In the event of a significant loss at any mining site, the operating entities may not be able to remediate the loss in a timely manner or at all, and may lose some or all of the revenues anticipated to be derived from such mining operations.

The operating entities do not maintain any insurance coverage for the cryptocurrency mining machines, and any potential material losses could materially and adversely affect their business and results of operations.

The operating entities maintain insurance coverage for their cryptocurrency mining sites; however, the mining machines are not insured. As a result, any damage or loss of mining machines may require the operating entities to expend additional capital resources for replacement, which could materially and adversely affect their business and results of operations.

Since the mining machines remain uninsured, the operating entities are still exposed to liabilities arising from the operation of their business. Given the high cost of new mining machines, any unexpected losses could impact their financial condition and operational stability.

Furthermore, the bitcoin held by the operating entities is not insured by any government-sponsored investor protection program or otherwise. Therefore, any loss of bitcoin held by the operating entities, either through an information security failure, a mistaken transaction or otherwise, would not be reimbursed. This could adversely affect our operations and, consequently, an investment in our securities.

The operating entities are subject to risks associated with their need for significant electrical power.

The operating entities’ mining operations have historically required significant amounts of electrical power. As the operating entities continue to expand their mining operations, we anticipate the operating entities’ demand for electrical power will continue to grow. If the operating entities are unable to continue to obtain sufficient electrical power to operate their mining machines on a cost-effective basis, we may not realize the anticipated benefits of our significant capital investments in new mining machines.

Additionally, the operating entities’ mini

SEC Form 20-F filed by BTC Digital Ltd.