| UNAUDITED INTERIM CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY |
17. UNAUDITED INTERIM CONDENSED FINANCIAL INFORMATION OF THE PARENT COMPANY The restricted net assets (as defined in Rule 1-02(dd) of Regulation S-X) of the Company’s consolidated subsidiaries did not exceed 25% of the Company’s consolidated net assets as of December 31, 2025. Accordingly, condensed financial information of the parent company is not required under Rule 5-04 of Regulation S-X. The following condensed financial information of the parent company is presented on a voluntary basis for supplemental information purposes only. The Company did not pay any dividend to the shareholders for the periods presented. For presenting parent only financial information, the Company records its investment in its subsidiary under the equity method of accounting. Such investment is presented on the separate condensed balance sheets of the Company as “Investment in subsidiary” and the income of the subsidiary is presented as “Income from subsidiary”. Certain information and footnote disclosures are generally included in financial statements prepared in accordance with U.S. GAAP have been condensed and omitted. UNAUDITED INTERIM CONDENSED BALANCE SHEETS (All amounts are in USD, except for share and per share data, unless otherwise noted) | | | December 31, | | | June 30, | | | | | 2025 | | | 2026 | | | | | | | | (Unaudited) | | | Assets | | | | | | | | Current assets | | | | | | | | Cash and cash equivalents | | $ | 1,179,880 | | | $ | 650,425 | | | Financial assets held for trading | | | 1,435,901 | | | | 1,435,901 | | | Advance to related party | | | 19,964 | | | | 19,964 | | | Other current assets | | | 530,000 | | | | 20,606,000 | | | Total Current Assets | | $ | 3,165,745 | | | $ | 22,712,290 | | | Non-current assets | | | | | | | | | | Investment in subsidiary | | | 2,483,593 | | | | 933,263 | | | Other non-current assets | | | 600,000 | | | | - | | | Total Non-current Assets | | | 3,083,593 | | | | 933,263 | | | Total Assets | | $ | 6,249,338 | | | $ | 23,645,553 | | | Liabilities and Equity | | | | | | | | | | Current Liabilities | | | | | | | | | | Accounts payable | | | 55,336 | | | | - | | | Due to subsidiary | | | 71,035 | | | | 71,035 | | | Total Current Liabilities | | $ | 126,371 | | | $ | 71,035 | | | Total Liabilities | | $ | 126,371 | | | $ | 71,035 | | | COMMITMENTS AND CONTINGENCIES | | | | | | | | | | Shareholders’ Equity | | | | | | | | | | *Class A ordinary shares, $0.0001 par value, 400,000,000 shares authorized, 9,382,000 and 109,382,000 shares issued and outstanding as of December 31, 2025 and June 30, 2026, respectively | | $ | 938 | | | $ | 10,938 | | | *Class B ordinary shares, $0.0001 par value, 100,000,000 shares authorized, 7,668,000 shares issued and outstanding as of December 31, 2025 and June 30, 2026, respectively | | | 767 | | | | 767 | | | Additional paid-in capital | | | 11,700,497 | | | | 34,991,640 | | | Statutory reserves | | | 89,685 | | | | 89,685 | | | Accumulated deficit | | | (5,620,752 | ) | | | (11,476,168 | ) | | Accumulated other comprehensive loss | | | (48,168 | ) | | | (42,344 | ) | | Total Shareholders’ Equity | | $ | 6,122,967 | | | $ | 23,574,518 | | | Total Liabilities and Shareholders’ Equity | | $ | 6,249,338 | | | $ | 23,645,553 | | | * | Giving retroactive effect to the re-denomination and nominal issuance of shares effected on March 23, 2023. | UNAUDITED INTERIM CONDENSED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (All amounts are in USD, except for share and per share data, unless otherwise noted) | | | Six Months | | | Six Months | | | | | Ended | | | Ended | | | | | June 30, | | | June 30, | | | | | 2025 | | | 2026 | | | | | (Unaudited) | | | (Unaudited) | | | General and administrative expenses | | | (1,825,351 | ) | | | (3,773,685 | ) | | Research and development | | $ | - | | | $ | (525,000 | ) | | Loss from operations | | | (1,825,351 | ) | | | (4,298,685 | ) | | Other loss | | | 27,204 | | | | (577 | ) | | Loss from subsidiaries | | $ | (239,349 | ) | | $ | (2,483,429 | ) | | Net loss | | $ | (2,037,496 | ) | | $ | (6,782,691 | ) | | Foreign currency translation adjustments | | | (1,346 | ) | | | 5,824 | | | Comprehensive Loss | | $ | (2,038,842 | ) | | $ | (6,776,867 | ) | UNAUDITED INTERIM CONDENSED STATEMENTS OF CASH FLOWS (All amounts are in USD, except for share and per share data, unless otherwise noted) | | | Six Months | | | Six Months | | | | | Ended | | | Ended | | | | | June 30, | | | June 30, | | | | | 2025 | | | 2026 | | | | | (Unaudited) | | | (Unaudited) | | | CASH FLOWS FROM OPERATING ACTIVITIES | | | | | | | | Net cash used in operating activities | | $ | (2,715,600 | ) | | $ | (529,455 | ) | | Net cash used in investing activities | | $ | (1,660,000 | ) | | $ | (20,000,000 | ) | | Net cash provided by financing activities | | $ | - | | | $ | 20,000,000 | | | CHANGES IN CASH AND CASH EQUIVALENTS | | | | | | | | | | Net decrease in cash and cash equivalents | | $ | (4,375,600 | ) | | $ | (529,455 | ) | | Cash and cash equivalents at beginning of the period | | | 6,052,260 | | | | 1,179,880 | | | Cash and cash equivalents at end of the period | | $ | 1,676,660 | | | $ | 650,425 | |
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