Note 18 - Concentration of Risk

Credit risk

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, restricted cash, digital assets, and accounts receivable.

As of June 30, 2026 and 2025, $478,042 and $1,677,879, respectively, were deposited with various financial institutions and financial services companies in the United States and PRC. Accounts at each institution in the United States are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000. The Company had approximately $0.05 million and $1.4 million, respectively, in excess of the FDIC insurance limit, as of June 30, 2026 and 2025.

As of June 30, 2026, the Company had approximately $3.25 million of restricted cash and $2.36 million of digital assets held with a single custodian, BitGo Trust Company. These assets are not insured by the FDIC or the Securities Investor Protection Corporation (“SIPC”) and are subject to the control of the Collateral Agent pursuant to the Company’s financing arrangements. Accordingly, the Company is exposed to concentration and custodial risk associated with these assets.

Accounts receivable are typically unsecured and derived from revenue earned from customers, thereby exposing the Company to credit risk. The risk is mitigated by the Company’s assessment of its customers’ creditworthiness and its ongoing monitoring of outstanding balances. The Company maintains an allowance for estimated credit losses based on its assessment of collectibility.

Customer and vendor concentration risk

For years ended June 30, 2026 and 2025, Amazon Vendor and Amazon Seller customers accounted for 38% and 82% of the Company’s total revenues, respectively. For the year ended June 30, 2026, GPM accounted for approximately 37% of the Company’s total revenues. As of June 30, 2026 and 2025, accounts receivable from Amazon Vendor and Amazon Seller accounted for 62% and 72% of the Company’s total accounts receivable. As of June 30, 2026, accounts receivable from GPM accounted for approximately 34% of the Company’s total accounts receivable.

For the year ended June 30, 2026, one supplier accounted for 60.8% of the Company’s total purchases. For the year ended June 30, 2025, two suppliers accounted for 14% and 11% of the Company’s total purchases, respectively. As of June 30, 2026, accounts payable to three suppliers accounted for 26.3%, 16.5%, and 12.5% of the Company’s total accounts payable. As of June 30, 2025, accounts payable to one supplier accounted for 10% of the Company’s total accounts payable.