Chaince Digital (CD) Registration Filing summary

Company overview and business model

• Operates as a Cayman Islands holding company with subsidiaries in the U.S., Hong Kong, and China, focusing on business consultation, financial advisory, brokerage, and distributed computing/storage services, primarily Filecoin mining.

• Transitioned from blockchain technical services and Bitcoin mining to focus on Filecoin mining and business/financial consulting after regulatory and market challenges.

• Business consultation targets clients in Greater China, Southeast Asia, and North America, assisting with U.S. market entry and compliance.

• Financial advisory and brokerage services are expanding, pending FINRA approval for a U.S. broker-dealer acquisition.

• Discontinued digital payment and blockchain technical services due to regulatory and market shifts.

Financial performance and metrics

• 2023 revenue primarily from Filecoin mining ($285,928), with business consultation services contributing $140,000.

• Significant impairment losses on crypto assets: $303,276 in 2023, $3.1M in 2022, and $1.3M in 2021.

• Filecoin mining business operated at a loss in 2023 due to underutilized infrastructure and low Filecoin prices.

• Bitcoin and USD Coin assets were seized by Chinese authorities, leading to a $3.9M impairment in 2023.

• As of December 31, 2023, total cryptocurrency assets were less than 3% of consolidated total assets.

Use of proceeds and capital allocation

• No proceeds to the company from this offering; all shares are for resale by existing shareholders.

• Past PIPE financings raised over $19M, used for business expansion, infrastructure acquisition, and compliance initiatives.

• Investment in Web3 decentralized storage infrastructure ($5.98M in shares) to support Filecoin mining.

• Cancelled $3M Bitcoin mining equipment order; seeking refund.