UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended ~~September~~June 30, ~~2020~~2021

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

For the transition period from ~~________~~____ to ~~________~~____

Commission file number: 001-34502

Future FinTech Group Inc.

(Exact name of registrant as specified in its charter)

Florida		98-0222013
(State or other jurisdiction of		(I.R.S. Employer
incorporation or organization)		~~(I.R.S. Employer~~ Identification ~~No.)~~Number)

~~Room 2302, South~~Americas Tower, ~~T1, Kaisa Plaza~~

~~No. 86 Jianguo~~1177 Avenue ~~Chaoyang District,~~of The Americas

~~Beijing, China 100025~~Suite 5100, New York, NY

(Address of principal executive offices including zip code)

~~86- 10-8353-0888~~888-622-1218

(Registrant’s telephone number, including area code)

N/A

(Former name, former address and former fiscal year, if changed since last report)

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

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, par value $0.001 per share		FTFT		Nasdaq Stock Market

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 and posted 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, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, 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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ NoNo.

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

~~Title of each class~~Class		~~Trading Symbol(s)~~		~~Name of each exchange on which registered~~Outstanding at August 13, 2021
~~Common Stock, par value $0.001 per share~~		~~FTFT~~		~~Nasdaq Stock Market~~

~~Class~~		~~Outstanding at November 13, 2020~~
Common Stock, $0.001 par value per share		~~42,286,579~~ 70,067,147

TABLE OF CONTENTS

PART I. FINANCIAL INFORMATION

~~Item 1.~~

~~Financial Statements~~

Item 1. Financial Statements

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

September 30, December 31,
2020 2019
CURRENT ASSETS
Cash and cash equivalents $ 957,676 $ 531,067
Accounts receivable 483 4,954
Other receivables, net 136,857 7,040
Inventories 3,336 3,594
Advances to suppliers and other current assets 46,688 1,670,947
Loan receivables 5,131,643 -
Assets related to discontinued operations 5,343,518 98,128,199
TOTAL CURRENT ASSETS $ 11,620,201 $ 100,345,801

Property, plant and equipment, net $ 19,692 $ 17,855
Right of use assets 306,965 -
Intangible assets, net 1,869,185 40,853
Amount due from related parties 3,170,470 3,326,061
Long term investments 12,250,000 12,250,000
TOTAL ASSETS $ 29,236,513 $ 115,980,570

LIABILITIES

CURRENT LIABILITIES
Accounts payable $ 257,431 $ 249,683
Accrued expenses and other payables 1,398,097 1,342,698
Advances from customers 270,765 534,089
Convertible loan payables 1,159,935 957,990
Loans payables 861,964 109,430
Lease liability-current 156,259 -
Liabilities related to discontinued operations 3,513,970 199,595,785
TOTAL CURRENT LIABILITIES $ 7,618,421 $ 202,789,675

NON-CURRENT LIABILITIES
Amount due to related parties $ 1,517,678 $ 1,268,101
Lease liability-non-current 148,613 -
TOTAL NON-CURRENT LIABILITIES 1,666,291 1,268,101
TOTAL LIABILITIES $ 9,284,712 $ 204,057,776

Commitments and contingencies (Note 17)

STOCKHOLDER’S EQUITY

Future Fintech Group Inc., Stockholders’ equity
Common stock, $0.001 par value; 60,000,000 shares authorized and 41,959,545 shares issued and outstanding as of September 30, 2020 and 33,810,416 shares issued and outstanding as of December 31, 2019, respectively $ 41,959 $ 33,810
Additional paid-in capital 117,562,942 107,852,827
Accumulated deficits (99,061,634 ) (213,314,612 )
Accumulated other comprehensive income 3,437,881 12,989,408
Total Future FinTech Group Inc. stockholders’ equity 21,981,148 (92,438,567 )
Non-controlling interests (2,029,347 ) 4,361,361
Total stockholders’ equity 19,951,801 (88,077,206 )

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 29,236,513 $ 115,980,570

	June 30, 2021			December 31, 2020
				(Audited)
ASSETS

CURRENT ASSETS
Cash and cash equivalents	$	72,016,338		$	9,787,989
Accounts receivable, net		2,197,937			-
Advances to suppliers and other current assets		286,787			257,933
Loan receivables		5,409,669			5,355,944
Other receivables, net		344,426			81,972
Assets related to discontinued operations		155			19,737
TOTAL CURRENT ASSETS	$	80,255,312		$	15,503,575

Property, plant and equipment, net	$	41,256		$	13,981
Right of Use Assets		204,359			291,379
Intangible assets		39,123			41,214
Amounts due from related parties		364,720			81,563
TOTAL NON-CURRENT ASSETS	$	649,458		$	428,137
TOTAL ASSETS	$	80,904,770		$	15,931,712

LIABILITIES

CURRENT LIABILITIES
Accounts payable	$	1,068,204		$	250,364
Accrued expenses and other payables		1,614,240			2,469,102
Advances from customers		29,171			28,962
Convertible note payables		-			1,163,146
Loan payables		445,936			394,848
Lease liability-current		188,164			180,803
Liabilities related to discontinued operations		-			165,216
TOTAL CURRENT LIABILITIES	$	3,345,715		$	4,652,441

NON-CURRENT LIABILITIES
Lease liability-non-current		16,195			110,575
Amounts due to related parties	$	1,209,961		$	2,437,555
TOTAL NON-CURRENT LIABILITIES		1,226,156			2,548,130
TOTAL LIABILITIES	$	4,571,871		$	7,200,571
Commitments and contingencies (Note 14)
STOCKHOLDER’S EQUITY

Future FinTech Group, Inc, Stockholders’ equity
Common stock, $0.001 par value; 300,000,000 shares authorized; 65,321,192 shares and 50,053,606 shares issued and outstanding as of June 30, 2021 and December 31, 2020 respectively	$	65,321		$	50,053
Additional paid-in capital		202,266,182			133,510,862
Accumulated deficits		(125,585,088	)		(124,384,301	)
Accumulated other comprehensive loss		(366,057	)		(398,014	)
Total Future FinTech Group, Inc. stockholders’ equity		76,380,358			8,778,600
Non-controlling interests		(47,459	)		(47,459	)
Total stockholders’ equity		76,332,899			8,731,141
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	80,904,770		$	15,931,712

The accompanying notes are an integral part of these condensed consolidated financial statements.

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Unaudited)

Three Months Ended
September 30, Nine Months Ended
September 30,
2020 2019* 2020 2019*
Revenue $ 43,657 $ 342,083 $ 357,295 $ 744,977
Cost of goods sold 13,516 77,165 23,388 322,942
Gross profit 30,141 264,918 333,907 422,035

Operating Expenses
General and administrative expenses 809,424 921,235 3,082,462 2,555,149
Selling expenses 26,167 243,411 46,641 780,259
Bad debt provision 31,549 48 247,097 7,491
Total operating expenses 867,140 1,164,694 3,376,200 3,342,899

Loss from operations (836,999 ) (899,776 ) (3,042,293 ) (2,920,864 )

Other income (expense)
Interest income 593 61 781 3,977
Interest expenses (289,419 ) (21,400 ) (343,206 ) (134,207 )
Loss on debt settlement (1,946,028 ) - (1,946,028 ) -
Other income (expenses), net 597,962 (1,741 ) 119,310 (4,521 )
Total other income (expenses) (1,636,892 ) (23,080 ) (2,169,143 ) (134,751 )

Loss from Continuing Operations before Income Tax (2,473,891 ) (922,856 ) (5,211,436 ) (3,055,615 )
Income tax provision - - - 76
Loss from Continuing Operations, net of tax (2,473,891) (922,856 ) (5,211,436 ) (3,055,691 )

Discontinued Operations (Note 12)
Loss from discontinued operations (80,983 ) (479,224 ) (140,794 ) (1,970,862 )
Gain on disposal of discontinued operations 115,947 - 119,582,658 -
NET INCOME (LOSS) (2,438,927 ) (1,402,080 ) 114,230,428 (5,026,553 )

Less: Loss attributable to the non-controlling interest (13,910 ) (324,647 ) (22,550 ) (1,030,611 )

Net income (loss) attributable to Future Fintech Group, Inc. Common Shareholders $ (2,425,017 ) $ (1,077,433 ) $ 114,252,978 $ (3,995,942 )
Comprehensive income (loss):
Net income (loss) $ (2,438,927 ) (1,402,080 ) 114,230,428 (5,026,553 )
Foreign currency translation (147,759 ) 2,135,361 (630,390) 7,327,449
Comprehensive income (loss) (2,586,686 ) 733,281 113,600,038 2,300,896
Less: Comprehensive income (loss) attributable to non-controlling interest 68,176 324,648 (2,079,581 ) 1,030,611
Comprehensive Income (loss) Attributable to Future Fintech Group, Inc. Common Shareholders $ (2, 654,862 ) $ 408,632 $ 115,679,619 $ 1,270,285

Basic Earnings (Loss) per Share:
Basic loss per share from continuing operations $ (0.07 ) $ (0.02 ) $ (0.14 ) $ (0.07 )
Basic earnings (loss) per share from discontinued operations - (0.01 ) 3.23 (0.06 )
Basic Earnings (Loss) per Share from Net Income (Loss) $ (0.07 ) (0.03 ) $ 3.09 $ (0.13 )

Diluted Earnings (Loss) per Share:
Diluted loss per share from continuing operations $ (0.07 ) $ (0.02 ) $ (0.14 ) $ (0.07 )
Diluted earnings (loss) per share from discontinued operations - (0.01 ) 3.18 (0.06 )
Diluted Earnings (Loss) per Share from Net Income (Loss) $ (0.07 ) (0.03 ) $ 3.04 $ (0.13 )

Weighted average number of shares outstanding
Basic 35,175,728 31,340,160 36,982,973 31,340,160
Diluted 35,845,251 32,009,683 37,652,496 32,009,683

	Three Months Ended June 30,						Six Months Ended June 30,
	2021			2020*			2021			2020*
Revenue	$	1,941,582		$	113,687		$	1,948,195		$	313,638
Cost of goods sold		1,870,227			9,359			1,876,250			9,872
Gross profit		71,355			104,328			71,945			303,766

Operating Expenses
General and administrative expenses		594,384			309,825			2,194,184			2,193,203
Selling expenses		10,090			7,693			23,035			20,474
(Recovery) Provision of doubtful debts		(36	)		230,255			(18,329	)		4,433,309
Total operating expenses		604,438			547,773			2,198,890			6,646,986

Loss from operations		(533,083	)		(443,445	)		(2,126,945	)		(6,343,220	)

Other (expenses) income
Interest income		153,411			51			290,877			166
Interest expenses		-			(26,650	)		(3,913	)		(53,787	)
Loss on debt settlement and conversion		-			(297,639	)		-			(616,476	)
Other (expenses) income, net		(2,229	)		16,748			482,701			(502,258	)
Total other income (expenses), net		151,182			(307,490	)		769,665			(1,172,355	)

Loss from Continuing Operations before Income Tax		(381,901	)		(750,935	)		(1,357,280	)		(7,515,575	)
Income tax provision		-			-			-			-
Loss from Continuing Operations		(381,901	)		(750,935	)		(1,357,280	)		(7,515,575	)

Discontinued Operations (Note 12)
Gain (loss) on disposal of discontinued operations		(21,577	)		-			156,493			123,688,874
Income (loss) from discontinued operations		-			(84,045	)		-			(120,420	)

NET INCOME (LOSS)		(403,478	)		(834,980	)		(1,200,787	)		116,052,879
Less: Net Loss attributable to non-controlling interests		-			-			-			(62	)
Net income(loss) from discontinued operations attributable to Future Fintech Group, Inc.	$	(403,478	)	$	(834,980	)	$	(1,200,787	)	$	116,052,941
Other comprehensive income (loss)
Income (loss) from continued operations		(381,901	)		(750,935	)		(1,357,280	)		(7,515,575	)
Foreign currency translation – continued operations		(36,150	)		(83,062	)		31,967			1,459,620
Comprehensive income (loss) - continued operation		(418,051	)		(833,997	)		(1,325,313	)		(6,055,955	)
Income (loss) from discontinued operations		(21,577	)		(84,045	)		156,493			123,568,454
Foreign currency translation – discontinued operations		(8,138	)		(93	)		(10	)		(10,781,302	)
Comprehensive income (loss) - discontinued operation		(29,715	)		(84,138	)		156,483			112,787,152
Comprehensive Income (Loss)		(447,766	)		(918,135	)		(1,168,830	)		106,731,197
Less: Net loss attributable to non-controlling interests		-			-			-			(62	)
COMPREHENSIVE LOSS ATTRIBUTABLE TO FUTURE FINTECH GROUP INC. STOCKHOLDERS		(447,766	)		(918,135	)		(1,168,830	)		106,731,259

Earnings per share:
Basic earnings per share from continued operation	$	(0.01	)	$	(0.02	)	$	(0.02	)	$	(0.21	)
Basic earnings per share from discontinued operation		-			-			-			3.45
	$	(0.01	)		(0.02	)	$	(0.02	)	$	3.24

Diluted Earnings per share:
Diluted earnings per share from continued operation	$	(0.01	)		(0.02	)	$	(0.02	)	$	(0.21	)
Diluted earnings per share from discontinued operation		-			-			-			3.38
	$	(0.01	)		(0.02	)	$	(0.02	)	$	3.17
Weighted average number of shares outstanding
Basic		53,798,156			33,334,888			54,324,447			35,867,188
Diluted		54,355,947			34,004,411			54,882,238			36,536,711

*	Reclassification- certain reclassifications have been made to the financial statements for the period ended ~~September~~June 30, ~~2019~~2020 to conform to the presentation for the period ended ~~September~~June 30, ~~2020,~~2021, with no effect on previously reported net income (loss).

The accompanying notes are an integral part of these condensed consolidated financial statements.

~~FUTURE FINTECH GROUP INC.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(Unaudited)~~

For the Nine Months Ended
September 30,
2020 2019*
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 114,230,428 $ (5,026,553 )
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization 182,822 2,350,807
Bad debt expenses 247,097 -
Gain on sale of discontinued operations (119,582,658 ) -
Loss on debt settlement 1,946,028 -
Share based compensation 1,191,000 -
Interest converted to convertible note 170,939 -
Changes in operating assets and liabilities
Accounts receivable 4,471 31,029
Other receivable (129,817 ) 8,100,183
Advances to suppliers and other current assets (250,181 ) (135,714 )
Inventories 258 (128,688 )
Accounts payable 7,749 39,651
Accrued expenses 55,400 (16,180,323 )
Change in net assets related to discontinued operations 860,377 3,977,933
Advances from customers 295,970 (352,848 )
Net Cash Provided by (Used in) Operating Activities (770,117 ) (7,324,523 )

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and plant (2,944 ) -
Purchase of intangible assets (1,259 ) -
Payments for loan receivables (5,131,643 ) -
Net cash used in investing activities (5,135,846) -

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock 920,000 -
Proceeds from amount due from related parties, net 348,356 -
Proceeds from secured convertible promissory note 5,464,277 -
Proceeds from loans 571,760 1,003,809
Repayment of loans (206,006 ) -
Proceeds from sale of discontinued operations 85,714 -
Net cash provided by financing activities 7,184,101 1,003,809

Effect of change in exchange rate (851,530 ) 6,324,145

NET INCREASE IN CASH AND CASH EQUIVALENTS 426,609 3,431
Cash and cash equivalents, beginning of year 531,067 33,461
Cash and cash equivalents, end of period $ 957,676 $ 36,892

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest $ - $ -
Cash paid for income taxes $ - $ -

SUPPLEMENTARY DISCLOSURE OF SIGNIFICANT NON-CASH TRANSACTION
Debt settlement by issuance of Common Stock $ 4,901,600 -

*	Reclassification- certain reclassifications have been made to the statements of cash flow for the period ended September 30, 2019 to conform to the presentation for the period ended September 30, 2020.

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

~~FUTURE FINTECH GROUP, INC.~~Future Fintech Group, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

Three Months ended ~~September~~June 30, ~~2019~~2020

Common Stock Additional
paid-in Accumulated Accumulative
other
comprehensive Non-
controlling
Shares Amount capital deficits income interests Total
Balance at June 30, 2019 31,667,083 $ 31,667 $ 115,335,406 $ (191,004,189 ) $ (3,769,461 ) $ 3,895,157 $ (75,511,420 )
Issuance of common stocks 650,000 650 $ (650 ) - - - -
Net loss - - $ - $ (1,077,433 ) $ - $ (324,647 ) $ (1,402,080 )
Foreign currency translation adjustment - - $ - $ - $ 2,135,361 $ 2,135,361
Balance at September 30, 2019 32,317,083 $ 32,317 $ 115,334,756 $ (192,081,622 ) $ (1,634,100 ) $ 3,570,510 $ (74,778,139 )

	Common Stock				Additional paid-in		Retained			Accumulative other comprehensive			Non- controlling
	Shares		Amount		capital		earnings			income			interests			Total
Balance at March 31, 2020		38,140,415	$	38,140	$	109,793,334	$	(96,426,691	)	$	3,750,881		$	(2,088,945	)	$	15,066,719
Issuance of common stocks for conversion of debts		353,648		354		562,521		-			-			-			562,875
Net income from continued operations		-		-		-		(750,935	)		-			-			(750,935	)
Net income from discontinued operations		-		-		-		(84,045	)		-			-			(84,045	)
Foreign currency translation adjustment		-		-		-		-			(83,062	)		-			(83,062	)
Disposal of discontinued operation		-		-		-		-			(93	)		-			(93	)
Balance at June 30, 2020		38,494,063	$	38,494	$	110,355,855	$	(97,261,671	)	$	3,667,726		$	(2,088,945	)	$	14,711,459

Three Months ended ~~September~~June 30, ~~2020~~2021

Common Stock Additional
paid-in Accumulated Accumulative
other
comprehensive Non-
controlling
Shares Amount capital deficits income interests Total
Balance at June 30, 2020 38,494,063 $ 38,494 $ 109,739,379 $ (96,636,617 ) $ 3,667,726 $ (2,097,523 ) $ 14,711,459
Issuance of common stocks-conversion of debt 2,740,883 2,741 $ 4,958,259 - - - $ 4,961,000
Loss on debt settlement - - $ 1,946,028 $ 1,946,028
Issuance of common stocks-cash 724,599 724 $ 919,276 - - - $ 920,000
Net loss - - $ (2,425,017 ) - $ (13,910 ) $ (2,438,927 )
Foreign currency translation adjustment - - - $ - $ (229,845 ) $ 82,086 $ (147,759 )
Balance at September 30, 2020 41,959,545 $ 41,959 $ 117,562,942 $ (99,061,634 ) $ 3,437,881 $ (2,029,347 ) $ 19,951,801

~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

	Common Stock				Additional paid-in		Retained			Accumulative other comprehensive			Non- controlling
	Shares		Amount		capital		earnings			income			interests			Total
Balance at March 30, 2021		59,583,486	$	59,583	$	169,891,428	$	(125,181,610	)	$	(321,769	)	$	(47,459	)	$	44,400,173
Issuance of common stocks - cash		5,737,706		5,738		32,374,754		-			-			-			32,380,492
Net income from continued operations		-		-		-		(381,901	)		-			-			(381,901	)
Net income from discontinued operations		-		-		-		-			-			-			-
Foreign currency translation adjustment		-		-		-		-			(36,150	)		-			(36,150	)
Disposal of discontinued operation		-		-		-		(21,577	)		(8,138	)		-			(29,715	)
Balance at June 30, 2021		65,321,192	$	65,321	$	202,266,182	$	(125,585,088	)	$	(366,057	)	$	(47,459	)	$	76,332,899

~~Nine~~

Six Months ended ~~September~~June 30, ~~2019~~2020

Common Stock Additional
paid-in Accumulated Accumulative
other
comprehensive Non-
controlling
Shares Amount capital deficits income interests Total
Balance at December 31, 2018 31,017,083 $ 31,017 $ 105,737,256 $ (188,085,680 ) $ (8,961,549 ) $ 4,601,121 $ (86,677,835 )
Issuance of common stocks 1,300,000 1,300 9,597,500 - - - 9,598,800
Net loss - - - (3,995,942 ) - (1,030,611 ) (5,026,553 )
Foreign currency translation adjustment - - - - 7,327,449 - 7,327,449
Balance at September 30, 2019 32,317,083 $ 32,317 $ 115,334,756 $ (192,081,622 ) $ (1,634,100 ) $ 3,570,510 $ (74,778,139 )

	Common Stock				Additional paid-in		Retained			Accumulative other comprehensive			Non- controlling
	Shares		Amount		capital		earnings			income			interests			Total
Balance at December 31, 2019		33,810,416	$	33,810	$	107,852,827	$	(213,314,612	)	$	12,989,408		$	4,361,361		$	(88,077,206	)
Issuance of common stocks - cash		933,647		934		1,315,778		-			-			-			1,316,712
Net income from continued operations		-		-		-		(7,515,513	)		-			(62	)		(7,515,575	)
Net income from discontinued operations		-		-		-		(120,420	)		-			-			(120,420	)
Share-based payments-service		3,750,000		3,750		1,187,250		-			-			-			1,191,000
Foreign currency translation adjustment		-		-		-		-			1,459,620			-			1,459,620
Disposal of discontinued operation		-		-		-		123,688,874			(10,781,302	)		(6,450,244	)		106,457,328
Balance at June 30, 2020		38,494,063	$	38,494	$	110,355,855	$	(97,261,671	)	$	3,667,726		$	(2,088,945	)	$	14,711,459

~~Nine~~Six Months ended ~~September~~June 30, ~~2020~~2021

Common Stock Additional
paid-in Accumulated Accumulative
other
comprehensive Non-
controlling
Shares Amount capital deficits income interests Total
Balance at December 31, 2019 33,810,416 $ 33,810 $ 107,852,827 $ (213,314,612 ) $ 12,989,408 $ 4,361,361 $ (88,077,206 )
Issuance of common stocks-conversion of debt 3,674,530 3,675 5,460,602 - - - 5,464,277
Loss on debt settlement 1,946,028 1,946,028
Issuance of common stocks-cash 724,599 724 919,276 920,000
Net income (loss) - - 114,252,978 - (22,550 ) 114,230,428
Share-based payments 3,750,000 3,750 1,187,250 - - - 1,191,000
Foreign currency translation adjustment - - 196,959 - 1,229,682 2,057,031 (630,390 )
Disposal of discontinued operation - - - - (10,781,209 ) (4,311,127 ) (15,092,336 )
Balance at September 30, 2020 41,959,545 $ 41,959 $ 117,562,942 $ (99,061,634 ) $ 3,437,881 $ (2,029,347 ) $ 19,951, 801

	Common Stock				Additional paid-in		Retained			Accumulative other comprehensive			Non- controlling
	Shares		Amount		capital		earnings			income			interests			Total
Balance at December 31, 2020		50,053,606	$	50,053	$	133,510,862	$	(124,384,301	)	$	(398,014	)	$	(47,459	)	$	8,731,141
Issuance of common stocks - cash		15,267,586		15,268		67,862,070		-			-			-			67,877,338
Net income from continued operations		-		-		-		(1,357,280	)		-			-			(1,357,280	)
Net income from discontinued operations		-		-		-		-			-			-			-
Share-based payments-service		-		-		893,250		-			-			-			893,250
Foreign currency translation adjustment		-		-		-		-			31,967			-			31,967
Disposal of discontinued operation		-		-		-		156,493			(10	)		-			156,483
Balance at June 30, 2021		65,321,192	$	65,321	$	202,266,182	$	(125,585,088	)	$	(366,057	)	$	(47,459	)	$	76,332,899

The accompanying notes are an integral part of these condensed consolidated financial statements.

FUTURE FINTECH GROUP INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	For the Six Months Ended June 30,
	2021			2020

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	(1,200,787	)	$	116,052,879
Net income from discontinued operation		156,493			123,568,454
Net loss from continuing operations		(1,357,280	)		(7,515,575	)
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation		4,088			849
Amortization		2,500			32,945
(Recovery) Provision of doubtful debts		(18,329	)		4,433,309
Share-based payments		893,250			1,191,000
Interest expenses related to convertible note		(96,691	)		-
Changes in operating assets and liabilities
Accounts receivable		(2,197,937	)		4,490
Inventory		-			550
Other receivable		(247,002	)		(207,994	)
Advances to suppliers and other current assets		(25,779	)		1,523,010
Accounts payable		813,853			(2,564	)
Due to related parties		-			-
Accrued expenses		(758,172	)		(901,096	)
Advances from customers		209			(276,732	)
Net Cash Used in Operating Activities – Discontinued Operations		(2,987,290	)		(1,717,808	)
Net Cash Used in Operating Activities – Continued Operations		10,849			(35,693	)

CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment		(16,589	)		-
Payment for Loan receivable		-			(206,512	)
Additions to property, plant and equipment		-			(1,836,288	)
Net Cash Used in Investing Activities from Discontinued Operations		(16,589	)		(2,042,800	)
Net Cash Used in Investing Activities from Continuing Operations		-			-

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issuance of common stock, net of issuance costs		67,877,338			500,000
Proceeds from amounts due from related parties, net		178,392			397,937
Repayments of related party loan		(1,249,758	)		-
Proceeds from loan payable					211,876
Proceeds from secured convertible promissory note		-			1,203,527
Repayment of convertible payable		(1,163,146	)		-
Repayment of loans payable		(122,926	)		-
Net cash provided by financing activities		65,519,900			2,313,340

Effect of change in exchange rate		(298,521	)		1,528,368

NET INCREASE IN CASH AND CASH EQUIVALENTS		62,228,349			45,407
Cash and cash equivalents, beginning of period		9,787,989			530,896
Cash and cash equivalents, end of period		72,016,338			576,303
Less: Cash and cash equivalents from the discontinued operations, end of period		-			(29,765	)
Cash and cash equivalents, from the continuing operations end of period	$	72,016,338		$	546,538

SUPPLEMENTARY DISCLOSURE OF SIGNIFICANT NON-CASH TRANSACTION
Issuance of common stocks for conversion of debts	$	-		$	700,236

The accompanying notes are an integral part of these condensed consolidated financial statements.

FUTURE FINTECH GROUP INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. CORPORATE INFORMATION

~~1. BUSINESS DESCRIPTION~~

Future FinTech Group Inc. ~~(together with our direct or indirect subsidiaries, “we,” “us,” “our” or “the Company”~~(the “Company”) is a holding company incorporated under the laws of the State of Florida. The main business of the Company includes an online shopping platform, Chain Cloud Mall ~~(CCM)~~(CCM, website: http://gksharedmall.com/), which is based on blockchain technology; ~~a cross-border e-commerce platform (NONOGIRL) which started its trial operation in March 2020~~supply chain financing and ~~formally launched in July 2020;~~services; a blockchain-based application ~~incubator~~incubator; and technical service and support for ~~real name and~~ blockchain based assets and their operating ~~entities (DCON);~~entities; and the application and development of blockchain-based e-commerce technology and financial technology.

Prior to 2019, the Company engaged in the production and sales of fruit juice concentrates, fruit juice beverages and other fruit-related products in the People’s Republic of China (“PRC”, or “China”), and overseas markets. Due to the drastically increased production cost and tightened environmental law in China, the Company has transformed its business from fruit juice manufacturing and distribution to a real-name blockchain e-commerce platform that integrates blockchain and internet technology ~~from the end of 2018. On February 27, 2020 pursuant to a Share Transfer Agreement entered by the Company’s subsidiary, HeDeTang Holdings (HK) Ltd (“HeDeTang HK”),~~ and New Continent International Co., Ltd. on September 18, 2019, the Company sold HeDeTang HK and all its subsidiaries, which mainly engaged in fruit juice related business, to New Continent International Co., Ltd.financial technology services.

On April 23, 2020, Future FinTech (Hong Kong) Limited registered GuangChengJi (Shanghai) Industrial Co., Ltd. (“Guangchengji”) with a registered capital of $30 million in Shanghai, China, which needs to be paid before April 22, 2049 when the business license will expire. The business scope of Guangchengji includes wholesaling of electronic components and equipment, metal materials, petroleum products, import and export business, computer software development, information technology, technology consulting and services, business management consulting and supply chain management.

On July 22, 2020, the Company established Future Commercial Management (Beijing) Co., Ltd. Its ~~scope of~~ business includes management and consulting services.

On May 11, 2021, the Company established Future Supply (Chengdu) Co., Ltd. Its business is coal supply chain financing and trading.

On May 21, 2021, the Company established Future Big Data (Chengdu) Co., Ltd. in Chengdu, China. Its business includes big data technology and industrial internet data services.

On June 8, 2021, the Company established Tianjin Future Private Equity Fund Management Partnership (Ltd Partnership) in Tianjin, China. Its business is mainly external equity investment.

June 14, 2021, the Company established Future FinTech Labs Inc. in New York to serve as its global R&D and technical support center.

On June 24, 2021, the Company established FTFT Capital Investments L.L.C. in Dubai, United Arab Emirates. Its business is to serve institutional investors and high net worth individuals.

On August 2, 2021, the Company incorporated FTFT UK Limited in United Kingdom as serve as its operating base to develop fintech business in Europe.

The Company’s activities are principally conducted by its subsidiaries ~~operating~~and its blockchain based e-commerce platform is conducted through its Variable Interest Entity (“VIE”) in the PRC.

2. ~~BASIS~~SUMMARY OF ~~PRESENTATION~~SIGNIFICANT ACCOUNTING POLICIES

Basis of presentation

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information and the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the unaudited financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the financial position as of ~~September~~June 30, ~~2020~~2021 and the results of operations and cash flows for the periods ended ~~September~~June 30, ~~2020~~2021 and ~~2019.~~2020. The financial data and other information disclosed in these notes to the interim financial statements related to these periods are unaudited. The results for the three ~~and nine~~to six months ended ~~September~~June 30, ~~2020~~2021 are not necessarily indicative of the results to be expected for any subsequent periods or for the entire year ending December 31, ~~2020.~~2021. The balance sheet atof December 31, ~~2019~~2020 has been derived from the audited financial statements at that date.

Our contractual arrangements with our VIE and their respective shareholders allow us to (i) exercise effective control over our VIE, (ii) receive substantially all of the economic benefits of our VIE, and (iii) have an exclusive option to purchase all or part of the equity interests in our VIE when and to the extent permitted by PRC law.

As a result of our direct ownership in our wholly foreign-owned enterprise (“WFOE”) and the contractual arrangements with our VIE, we are regarded as the primary beneficiary of our VIE, and we treat it and its subsidiaries as our consolidated affiliated entities under U.S. GAAP. We have consolidated the financial results of our VIE in our condensed consolidated financial statements in accordance with U.S. ~~GAAP.~~GAAP

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States have been condensed or omitted pursuant to the Securities and Exchange Commission’s rules and regulations. These unaudited financial statements should be read in conjunction with our audited financial statements and notes thereto for the year ended December 31, ~~2019~~2020 as included in our Annual Report on Form 10-K.

~~Going Concern~~Discontinued Operations

~~The Company’s financial statements are prepared assuming that~~On February 27, 2020, SkyPeople BVI (the “Seller”) completed the ~~Company will continue as~~transfer of its ownership of HeDeTang HK to New Continent International Co., Ltd. (the “Buyer”), an unrelated third party and a ~~going concern.~~

~~The Company incurred operating losses~~company incorporated in the British Virgin Islands for a total price of RMB 0.6 million (approximately $85,714), pursuant to a Share Transfer Agreement entered into by the Seller and ~~had negative operating cash flows, which raised substantial doubts about its ability to continue as a going concern. The Company may continue to incur operating losses~~the Buyer on September 18, 2019 and ~~generate negative cash flows as~~approved at the ~~Company implements its future business plan. In order to meet its working capital needs through the next twelve months and to fund the growth~~special shareholders meeting of the Company on February 26, 2020. As the Company ~~may consider plans to raise additional funds through~~believed that no continued cash flow would be generated by the ~~issuance of equity or debt. Although~~sold component, in accordance with ASC 205-20, the Company ~~intends~~presented the operating results from Hedetang HK as discontinued operations within the accompanying consolidated financial statements.

In addition, Company’s Huludao Wonder operation, a subsidiary which produces concentrated apple juice, suffered continued operating losses from 2014 to ~~obtain additional financing to meet~~2016 and its cash ~~needs,~~flow was minimal for these three years. In December 2016, the Company ~~may be unable~~established a winding-down plan to ~~secure any additional financing~~close this operation. Based on ~~terms that are favorable or acceptable to it, if at all.~~the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from Huludao Wonder as a discontinued operation.

~~The ability~~On March 11, 2020, the Company’s Board of Directors passed a resolution to sell the operation of Future Supply Chain limited and Zhonglian Hengxin Assets Management Co., Ltd (“Zhonglian Hengxin”) and close the operation of Digital Online Marketing Limited, SkyPeople Foods Holding Ltd. and Chain Future Digital Tech (Beijing) Co., Ltd. On March 18, 2021, Chain Future Digital Tech (Beijing) Co., Ltd. was dissolved and deregistered with local government.

On May 7, 2020, Future Business Management Co., Ltd. completed the transfer of its ownership of Zhonglian Hengxin Assets Management Co., Ltd to individual third party. On July 24, 2020, the Company’s Board of Directors passed a resolution to sell the operation of Hedetang Farm Products Trading Markets (Mei County) Co., Ltd. and close the operation of Chain Cloud Mall Logistics Center (Shaanxi) Co., Ltd. As a result, Skypeople Foods Holdings Limited Company was deregistered on July 27, 2020; Digital Online Marketing Limited Company was deregistered on July 28, 2020; On October 31, 2020, Chain Cloud Mall Network and Technology (Tianjin) Co., Limited and Chain Cloud Mall Logistics Center (Shanxi) Co., Ltd. completed the transfer of its ownership of Hedetang Farm Products Trading Markets (Mei county) Co., Ltd to third parties.

On April 19, 2021, FT Commercial Management (Beijing) Co., Ltd was dissolved and deregistered with local government.

Based on the disposal plan and in accordance with ASC 205-20, the Company ~~to continue~~presented the operating results from these operations as a ~~going concern is dependent upon its ability to successfully execute its~~discontinued operation.

Segment Information Reclassification

Historically, the Company operated in 5 segments: concentrated apple juice and apple aroma, concentrated kiwifruit juice and kiwifruit puree, concentrated pear juice, fruit juice beverages, and others.

As the Company classified the juice related operation into discontinued operation in the beginning of year 2019, and in accordance with the Company’s new business strategy, ~~and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if~~ the Company ~~is unable to continue as a going concern.~~classified business segment into CCM Shopping Mall Membership, sales of goods, coal supply chain financing and trading and others.

~~3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES~~

For a detailed discussion about the Company significant accounting policies, refer to Note 2 — “Summary of Significant Accounting Policies,” in the Company’s consolidated financial statements included in Company’s 2019 Form 10-K. During the nine months ended September 30, 2020, there were no significant changes made to the Company’s significant accounting policies.

Uses of Estimates in the Preparation of Financial Statements

The Company’s condensed consolidated financial statements have been prepared in accordance with US GAAP and this requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and reported amounts of revenue and expenses during the reporting period. The significant areas requiring the use of management estimates include, but not limited to, the allowance for doubtful receivable, estimated useful life and residual value of property, plant and equipment, impairment of long-lived assets provision for staff benefit, recognition and measurement of deferred income taxes and valuation allowance for deferred tax assets. Although these estimates are based on management’s knowledge of current events and actions management may undertake in the future, actual results may ultimately differ from those estimates and such differences may be material to our condensed consolidated financial statements.

Going Concern

The Company’s financial statements are prepared assuming that the Company will continue as a going concern.

The Company incurred operating losses and had negative operating cash flows and may continue to incur operating losses and generate negative cash flows as the Company implements its future business plan. These factors raise substantial doubts about the Company’s ability to continue as a going concern. The Company has raised funds through issuance of convertible notes and common stock.

The ability of the Company to continue as a going concern is dependent upon its ability to successfully execute its new business strategy and eventually attain profitable operations. The accompanying financial statements do not include any adjustments that may be necessary if the Company is unable to continue as a going concern.

Impairment of Long-Lived Assets

In accordance with the ASC 360-10, Accounting for the Impairment or Disposal of Long-Lived Assets, long-lived assets, such as property, plant and equipment and purchased intangibles subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable, or it is reasonably possible that these assets could become impaired as a result of technological or other industrial changes. The determination of recoverability of assets to be held and used is made by comparing the carrying amount of an asset to future undiscounted cash flows to be generated by the assets.

If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less cost to sell.

Fair Value of Financial Instruments

The Company has adopted FASB ASC Topic on Fair Value Measurements and Disclosures (“ASC 820”), which defines fair value, establishes a framework for measuring fair value in GAAP, and expands disclosures about fair value measurements. ASC 820 establishes a three-level valuation hierarchy of valuation techniques based on observable and unobservable input, which may be used to measure fair value and include the following:

Level 1 - Quoted prices in active markets for identical assets or liabilities.

Level 2 - Input other than Level 1 that is observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other input that is observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

Level 3 - Unobservable input that is supported by little or no market activity and that is significant to the fair value of the assets or liabilities.

Our cash and cash equivalents and restricted cash are classified within level 1 of the fair value hierarchy because they are value using quoted market price.

Earnings (Loss) Per Share

Under ASC 260-10, Earnings Per Share, basic EPS excludes dilution for Common Stock equivalents and is calculated by dividing net income (loss) available to common stockholders by the weighted-average number of Common Stock outstanding for the period.

Diluted EPS is calculated by using the treasury stock method, assuming conversion of all potentially dilutive securities, such as stock options and warrants. Under this method, (i) exercise of options and warrants is assumed at the beginning of the period and shares of Common Stock are assumed to be issued, (ii) the proceeds from exercise are assumed to be used to purchase Common Stock at the average market price during the period, and (iii) the incremental shares (the difference between the number of shares assumed issued and the number of shares assumed purchased) are included in the denominator of the diluted EPS computation. The numerators and denominators used in the computations of basic and diluted EPS are presented in the following table.

Three Months ended June 30, 2021:

	Income			Share		Pre-share amount

Loss from continuing operations	$	(381,901	)		53,798,156	$	(0.01	)
Income from discontinuing operations	$	(21,577	)		53,798,156	$	-

Basic EPS:
Loss available to common stockholders from continuing operations	$	(381,901	)		53,798,156	$	(0.01	)
Income available to common stockholders from discontinuing operations	$	(21,577	)		53,798,156	$	-

Dilutive EPS:

Warrants		-			557,791		-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations	$	(381,901	)		54,355,947	$	(0.01	)
Diluted Earnings per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding.	$	(21,577	)		54,355,947	$	-

Three Months ended June 30, 2020:

	Income			Share		Pre-share amount

Loss from continuing operations	$	(750,935	)		33,334,888	$	(0.02	)
Income from discontinuing operations	$	(84,045	)		33,334,888	$	-

Basic EPS:
Loss available to common stockholders from continuing operations	$	(750,935	)		33,334,888	$	(0.02	)
Income available to common stockholders from discontinuing operations	$	(84,045	)		33,334,888	$	-

Dilutive EPS:

Warrants		-			669,523		-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations	$	(750,935	)		34,004,411	$	(0.02	)
Diluted Earnings per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding.	$	(84,045	)		34,004,411	$	-

For the six months ended June 30, 2021:

	Income			Share		Pre-share amount

Loss from continuing operations	$	(1,357,280	)		54,324,447	$	(0.02	)
Income from discontinuing operations	$	156,493			54,324,447	$	-

Basic EPS:
Loss available to common stockholders from continuing operations	$	(1,357,280	)		54,324,447	$	(0.02	)
Income available to common stockholders from discontinuing operations	$	156,493			54,324,447	$	-

Dilutive EPS:

Warrants		-			557,791		-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations	$	(1,357,280	)		54,882,238	$	(0.02	)
Diluted Earnings per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding.	$	156,493			54,882,238	$	-

For the six months ended June 30, 2020:

	Income			Share		Pre-share amount

Loss from continuing operations	$	(7,515,575	)		35,867,188	$	(0.21	)
Income from discontinuing operations	$	123,568,454			35,867,188	$	3.45

Basic EPS:
Loss available to common stockholders from continuing operations	$	(7,515,575	)		35,867,188	$	(0.21	)
Income available to common stockholders from discontinuing operations	$	123,568,454			35,867,188	$	3.45

Dilutive EPS:

Warrants		-			669,523		-
Diluted loss per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding. Diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares is anti-dilutive from continuing operations	$	(7,515,575	)		36,536,711	$	(0.21	)
Diluted Earnings per share is calculated by taking net loss, divided by the diluted weighted average common shares outstanding.	$	123,568,454			36,536,711	$	3.38

Cash and Cash Equivalents

Cash and cash equivalents included cash on hand and demand deposits placed with banks or other financial institutions, which are unrestricted as to withdrawal and use and with an original maturity of three months or less.

Deposits in banks in the PRC are only insured by the government up to RMB500,000, and are consequently exposed to risk of loss. The Company believes the probability of a bank failure, causing loss to the Company, is remote.

~~Recent~~Receivable and Allowances

Accounts receivable are recognized and carried at the original invoice amounts less an allowance for any uncollectible amount. We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable credit losses in our existing accounts receivable. We extend credit to our customers based on an evaluation of their financial condition and other factors. We generally do not require collateral or other security to support accounts receivable. We perform ongoing credit evaluations of our customers and maintain an allowance for potential bad debts if required.

Other receivables, and loan receivables are recognized and carried at the initial amount when occurred less an allowance for any uncollectible amount. We have a policy of reserving for uncollectible accounts based on our best estimate of the amount of probable impairment losses in our existing receivable.

We determine whether an allowance for doubtful accounts is required by evaluating specific accounts where information indicates the customers may have an inability to meet financial obligations. In these cases, we use assumptions and judgment, based on the best available facts and circumstances, to record a specific allowance for those customers against amounts due to reduce the receivable to the amount expected to be collected. These specific allowances are re-evaluated and adjusted as additional information is received. The amounts calculated are analyzed to determine the total amount of the allowance. We may also record a general allowance as necessary.

Direct write-offs are taken in the period when we have exhausted our efforts to collect overdue and unpaid receivable or otherwise evaluate other circumstances that indicate that we should abandon such efforts.

The Company has assessed its accounts receivable including credit term and corresponding all its accounts receivables in June 2021. Upon such credit terms, bad debt expense was $18,329 and $4.4 million during the six months ended June 30, 2021 and 2020, respectively. There is no accounts receivable balance overdue for over 90 days as of June 30, 2021 and December 31, 2020

Inventories

Inventories consist of raw materials, packaging materials (which include ingredients and supplies) and finished goods (which) include finished juice in the bottling, canning operations and other. Inventories also consist of merchant gift package to be delivered with the new membership signed up in our e-commerce platform. Inventories are valued at the lower of cost or net realizable value. We determine cost on the basis of the weighted average method. The Company periodically reviews inventories for obsolescence and any inventories identified as obsolete are written off.

Revenue Recognition

We apply the five steps defined under ASC 606: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) the entity satisfies a performance obligation. We assess its revenue arrangements against specific criteria in order to determine if it is acting as principal or agent. Revenue arrangements with multiple performance obligations are divided into separate distinct goods or services. We allocate the transaction price to each performance obligation based on the relative standalone selling price of the goods or services provided. Revenue is recognized upon the transfer of control of promised goods or services to a customer.

We do not make any significant judgment in evaluating when control is transferred. Revenue is recorded net of value-added tax.

Revenue recognitions are as follows:

Online sales and Membership fee:

The Company recognizes the sale of goods 15 days after the products are shipped (after the 15 days return policy). The revenue from the membership fee is amortized over the lifetime of the membership, which is one year. For the merchandise gift package, revenue is recognized when the receipt of the gift package is confirmed by the members. Other revenues include revenues earned on net basis from sales of certain products on our platform. During the second quarter of 2021, the Company has transformed its member based business model to sales agent based business model for its online shopping mall.

Sales of Coals

The Company recognize revenue when the receipt of merchandise is confirmed by the customers, which is the point that the title of the goods is transferred to the customer.

Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation and any impairment losses. Depreciation is computed using the straight-line method over the useful lives of the assets. Major renewals and betterments are capitalized and depreciated; maintenance and repairs that do not extend the life of the respective assets are expensed as incurred. Upon disposal of assets, the cost and related accumulated depreciation are removed from the accounts and any gain or loss is included in the consolidated statements of income and comprehensive income.

Depreciation related to property, plant and equipment used in production is reported in cost of sales, and includes amortized amounts related to capital leases. We estimated that the residual value of the Company’s property and equipment ranges from 3% to 5%. Property, plant and equipment are depreciated over their estimated useful lives as follows:

Machinery and equipment		5-10 years
Furniture and office equipment		3-5 years
Motor vehicles		5 years

Depreciation expense included in general and administration expenses for the six months ended June 30, 2021 and 2020 was $4,088 and $849, respectively. Depreciation expense included in cost of sales for the six months ended June 30, 2021 and 2020 was nil, respectively.

Intangible Assets

Acquired intangible assets are recognized based on their cost to the Company, which generally includes the transaction costs of the asset acquisition, and no gain or loss is recognized unless the fair value of noncash assets given as consideration differs from the assets’ carrying amounts on the Company’s book. These assets are amortized over their useful lives if the assets are deemed to have a finite life and they are reviewed for impairment by testing for recoverability whenever events or changes in circumstances indicate that its carrying amount may not be recoverable. The fair value of an intangible asset is the amount that would be determined if the entity used the assumptions that market participants would use if they were pricing the intangible asset. The useful life of the Company’s intangible assets is ten years, which is determined by using the time period that an intangible is estimated to contribute directly or indirectly to a Company’s future cash flows.

Foreign Currency and Other Comprehensive Income (Loss)

The financial statements of the Company’s foreign subsidiaries are measured using the local currency as the functional currency; however, the reporting currency of the Company is the USD. Assets and liabilities of the Company’s foreign subsidiaries have been translated into USD using the exchange rate at the balance sheet dates, while equity accounts are translated using historical exchange rate. The exchange rate we used to convert RMB to USD was 6.46 and 6.52 at the balance sheet dates of June 30, 2021 and December 31, 2020, respectively. The average exchange rate for the period has been used to translate revenues and expenses. The average exchange rates we used to convert RMB to USD were 6.47 and 7.03 for six months ended June 30, 2021 and 2020, respectively. Translation adjustments are reported separately and accumulated in a separate component of equity (cumulative translation adjustment).

Income Taxes

We use the asset and liability method of accounting for income taxes in accordance with ASC Topic 740, “Income Taxes.” Under this method, income tax expense is recognized for the amount of: (i) taxes payable or refundable for the current year and (ii) deferred tax consequences of temporary differences resulting from matters that have been recognized in an entity’s financial statements or tax returns. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the results of operations in the period that includes the enactment date. A valuation allowance is provided to reduce the deferred tax assets reported if based on the weight of the available positive and negative evidence, it is more likely than not some portion or all of the deferred tax assets will not be realized.

ASC Topic 740-10-30 clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC Topic 740-10-25 provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure, and transition. We have no material uncertain tax positions for any of the reporting periods presented.

Lease

After adoption of ASC 842 and related standards, which introduced a lessee model that requires entities to recognize assets and liabilities for most leases, but recognize expenses on their income statements in a manner similar to current accounting, thus operating lease right-of-use assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. For short-term leases with an initial lease term of 12 months or less and with purchase options we are reasonably certain will not be exercised. As a lessee, the Company leases equipment, land and office building. Lease expense is recognized on a straight-line basis over the lease term.

Convertible notes

The Company accounts for its convertible notes at issuance by allocating the proceeds received from a convertible note among freestanding instruments according to ASC 470, Debt, based upon their relative fair values. The fair value of debt and common stock is determined based on the closing price of the common stock on the date of the transaction. Convertible notes are subsequently carried at amortized cost. Each convertible note is analyzed for the existence of a beneficial conversion feature (“BCF”), defined as the fair value of the common stock at the commitment date for the convertible note, less the effective conversion price. No BCF was recognized for the convertible notes issued during June 30, 2021 and 2020.

Share-based compensation

The Company awards share options and other equity-based instruments to its employees, directors and consultants (collectively “share-based payments”). Compensation cost related to such awards is measured based on the fair value of the instrument on the grant date. The Company recognizes the compensation cost over the period the employee is required to provide service in exchange for the award, which generally is the vesting period. The amount of cost recognized is adjusted to reflect the expected forfeiture prior to vesting. When no future services are required to be performed by the employee in exchange for an award of equity instruments, and if such award does not contain a performance or market condition, the cost of the award is expensed on the grant date. The Company recognizes compensation cost for an award with only service conditions that has a graded vesting schedule on a straight-line basis over the requisite service period for the entire award, provided that the cumulative amount of compensation cost recognized at any date at least equals the portion of the grant-date value of such award that is vested at that date.

Variable interest entities

On July 31, 2019, Chain Cloud Mall Network and Technology (Tianjin) Co., Limited (“CCM Tianjin”), Chain Cloud Mall E-commerce (Tianjin) Co., Ltd. (“E-commerce Tianjin”), and Mr. Zeyao Xue and Mr. Kai Xu, citizens of China and shareholders of E-commerce Tianjin, entered into the following agreements, or collectively, the “Variable Interest Entity Agreements” or “VIE Agreements,” pursuant to which CCM Tianjin has contractual rights to control and operate the business of E-commerce Tianjin (the “VIE”). Therefore, pursuant to ASC 810, E-Commerce Tianjin is included in the Company’s consolidated financial statements since then.

Pursuant to Chinese law and regulations, a foreign owned enterprise cannot apply for and hold a license for operation of certain e-commerce businesses, the category of business which the Company is expanding in China. CCM Tianjin is an indirectly wholly foreign owned enterprise of the Company. In order to comply with Chinese law and regulations, CCM Tianjin agreed to provide E-commerce Tianjin an Exclusive Operation and Use Rights Authorization to operate and use the Chain Cloud Mall System owned by CCM Tianjin.

E-commerce Tianjin was incorporated by Mr. Zeyao Xue and Mr. Kai Xu solely for the purpose of holding the operation license of the Chain Cloud Mall System. Mr. Zeyao Xue is a major shareholder of the Company and the son of Mr. Yongke Xue, the President of the Company. Mr. Kai Xu was the Chief Operating Officer of the Company and currently is the Deputy General Manager of FT Commercial Group Ltd., a wholly owned subsidiary of the Company.

The VIE Agreements are as follows:

1)	Exclusive Technology Consulting and Service Agreement by and between CCM Tianjin and E-commerce Tianjin. Pursuant to the Exclusive Technology Consulting and Service Agreement, CCM Tianjin agreed to act as the exclusive consultant of E-commerce Tianjin and provide technology consulting and services to E-commerce Tianjin. In exchange, E-commerce Tianjin agreed to pay CCM Tianjin a technology consulting and service fee, the amount of which is to be equivalent to the amount of net profit before tax of E-commerce Tianjin, payable on a quarterly basis after making up losses of previous years (if necessary) and deducting necessary costs, expenses and taxes related to the business operations of E-commerce Tianjin. Without the prior written consent of CCM Tianjin, E-commerce Tianjin may not accept the same or similar technology consulting and services provided by any third party during the term of the agreement. All the benefits and interests generated from the agreement, including but not limited to intellectual property rights, know-how and trade secrets, will be CCM Tianjin’s sole and exclusive property. This agreement has a term of 10 years and may be extended unilaterally by CCM Tianjin with CCM Tianjin’s written confirmation prior to the expiration date. E-commerce Tianjin cannot terminate the agreement early unless CCM Tianjin commits fraud, gross negligence or illegal acts, or becomes bankrupt or winds up.

2)	Exclusive Purchase Option Agreement by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Exclusive Purchase Option Agreement, Mr. Zeyao Xue and Mr. Kai Xu granted to CCM Tianjin and any party designated by CCM Tianjin the exclusive right to purchase, at any time during the term of this agreement, all or part of the equity interests in E-commerce Tianjin, or the “Equity Interests,” at a purchase price equal to the registered capital paid by Mr. Zeyao Xue and Mr. Kai Xu for the Equity Interests, or, in the event that applicable law requires an appraisal of the Equity Interests, the lowest price permitted under applicable law. Pursuant to powers of attorney executed by Mr. Zeyao Xue and Mr. Kai Xu, they irrevocably authorized any person appointed by CCM Tianjin to exercise all shareholder rights, including but not limited to voting on their behalf on all matters requiring approval of E-commerce Tianjin’s shareholder, disposing of all or part of the shareholder’s equity interest in E-commerce Tianjin, and electing, appointing or removing directors and executive officers. The person designated by CCM Tianjin is entitled to dispose of dividends and profits on the equity interest without reliance on any oral or written instructions of Mr. Zeyao Xue and Mr. Kai Xu. The powers of attorney will remain in force for so long as Mr. Zeyao Xue and Mr. Kai Xu remain the shareholders of E-commerce Tianjin. Mr. Zeyao Xue and Mr. Kai Xu have waived all the rights which have been authorized to CCM Tianjin’s designated person under the powers of attorney.

3)	Equity Pledge Agreements by and among CCM Tianjin, E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu. Pursuant to the Equity Pledge Agreements, Mr. Zeyao Xue and Mr. Kai Xu pledged all of the Equity Interests to CCM Tianjin to secure the full and complete performance of the obligations and liabilities on the part of E-commerce Tianjin and them under this and the above contractual arrangements. If E-commerce Tianjin, Mr. Zeyao Xue, or Mr. Kai Xu breaches their contractual obligations under these agreements, then CCM Tianjin, as pledgee, will have the right to dispose of the pledged equity interests. Mr. Zeyao Xue and Mr. Kai Xu agree that, during the term of the Equity Pledge Agreements, they will not dispose of the pledged equity interests or create or allow any encumbrance on the pledged equity interests, and they also agree that CCM Tianjin’s rights relating to the equity pledge should not be interfered with or impaired by the legal actions of the shareholders of E-commerce Tianjin, their successors or designees. During the term of the equity pledge, CCM Tianjin has the right to receive all of the dividends and profits distributed on the pledged equity. The Equity Pledge Agreements will terminate on the second anniversary of the date when E-commerce Tianjin, Mr. Zeyao Xue and Mr. Kai Xu have completed all their obligations under the contractual agreements described above.

4)	Exclusive Operation and Use Rights Authorization letter which authorizes Chain Cloud Mall E-commerce (Tianjin) Co., Ltd, to exclusively operate and use the Chain Cloud Mall System and the authorization period is the same as the term of the Exclusive Technology Consulting and Service Agreement entered into by and between Chain Cloud Mall Network and Technology (Tianjin) Co., Ltd. and Cloud Chain Mall E-commerce (Tianjin) Co., Ltd. dated July 31, 2019.

GlobalKey Shared Mall Shopping Platform Software and System Transfer Agreement by and between Future Supply Chain Co., Ltd. and Chain Cloud Mall Network and Technology (Tianjian) Co., Ltd., pursuant to which the GlobalKey Shared Mall Shopping Platform Software and System was transferred from Future Supply China Co., Ltd. to CCM Tianjin and that both parties were wholly owned subsidiaries of the Company and transfer price is $0.

New Accounting Pronouncements

In June 2016, the FASB issued ~~Accounting Standards Update~~ASU No. 2016-13 ~~(ASU 2016-13)~~(“ASU 2016-13”) “Financial ~~Instruments-Credit Losses (Topic 326)~~Instruments - Credit Losses” (“ASC 326”): Measurement of Credit Losses on Financial Instruments” which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. In November 2019, the FASB issued ASU 2019-10 “Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842)” (“ASC 2019-10”), which defers the effective date of ASU 2016-13 to fiscal years beginning after December 15, 2022, including interim periods within those fiscal years, for public entities which meet the definition of a smaller reporting company. The Company will beadopt ASU 2016-13 effective on January 1, 2023. ~~We are~~Management is currently evaluating the effect of the adoption of ASU 2016-13 on the consolidated financial statements. The effect will largely depend on the composition and ~~believe it does not have any material impact on~~credit quality of our ~~results~~investment portfolio and the economic conditions at the time of ~~operations or financial.~~adoption.

In August 2020, the FASB issued Accounting Standards Update No. 2020-06 (ASU 2020-06) “Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity”, which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts on an entity’s own equity. For public business entities that are not smaller reporting companies, ASU 2020-6 effective fiscal years beginning after December 15, 2021, and interim periods within those fiscal years. ~~We are currently evaluating the effect of the adoption of ASU 2020-06 and believe it~~

Management does not ~~have~~believe that any ~~material impact on our results of operations or financial.~~

~~We have reviewed all the~~other recently issued, but not yet effective accounting pronouncements, ~~and we do not believe any of these pronouncements will~~if adopted, would have a material impact on the ~~Company.~~accompanying consolidated financial statements.

3. LOAN RECEIVABLES

~~4. LOAN RECEIVABLES~~

As of ~~September~~June 30, ~~2020,~~2021, the balance of loan receivables was $5.41 million, which was from Shenzhen Tiantian Haodian Technology Co., Ltd. (“Tiantian Haodian”). On June 28, 2020, ~~Guangchengji,~~GuangChengJi (Shanghai) Industrial Co., Ltd. (“Guangchengji”), a wholly owned subsidiary of ~~the Company,~~Future FinTech (Hong Kong) Limited, entered into a “Loan Agreement” with Tiantian Haodian. Pursuant to the Loan Agreement, ~~the Company agrees to lend cash~~Guangchengji loaned up to ~~but not greater than RMB35~~the amount of RMB 35 million (approximately ~~$5.14~~$5.41 million) with Tiantian Haodian at the annual interest rate of 10% from June 28, 2020 to ~~June~~December 27, 2021.

4. LEASES

The ~~interest~~Company’s noncancelable operating leases consist of leases for office space. The Company is ~~paid quarterly. There is no collateral or guarantee provided by Tiantian Haodian. During~~ the ~~nine~~lessee under the terms of the operating leases. For the six months ended ~~September~~June 30, 2021, the operating lease cost was $0.20 million.

The Company’s operating leases have remaining lease terms that range from approximately one year to two years. As of June 30, 2021, the weighted average remaining lease term and weighted average discount rate were 1.08 years and 6%, respectively.

Maturities of lease liabilities were as follows:

	Operating
As of June 30,	Lease
From July 1, 2021 to June 30, 2022	$	195,307
From July 1, 2022 to June 31, 2022		16,276
Total	$	211,583
Less: amounts representing interest	$	7,224
Present Value of future minimum lease payments		204,359
Less: Current obligations		188,164
Long term obligations	$	16,195

5. LOAN PAYABLES

As of June 30, 2021, loan payables were $0.44 million, which consisted of the loan payable of $0.19 million to Shaanxi Entai Bio-Technology Co., Ltd., loan payable $0.01 million to Shenzhen Wangjv Trading Co., Ltd., and loan payable of $0.25 million to seven individuals.

The loan from Shaanxi Entai Bio-Technology Co., Ltd of $0.18 million was interest free and has no assets pledged for this loan.

On June 15, 2020, the Company ~~recorded an interest income of $99,027 from~~entered into a loan agreement with Shenzhen Wangjv Trading Co., Ltd. Pursuant to the loan ~~receivables, which was not paid by Tiantian Haodian as~~agreement, the Company borrowed $0.23 million from Shenzhen Wangjv Trading Co., Ltd. at the annual interest rate of 8% with the term of 1 year for the use of working capital. On July 6, 2020, the Company repaid $0.22 million to Shenzhen Wangjv Trading Co., Ltd.

During the third quarter of 2020, the Company entered into a series of interest free loan agreements with seven individuals, borrowing $0.37 million for working capital. The repayment term is one year. The Company repaid $0.12 million to two individual lenders, Yinyang Chen and Zhixing Pan.

6. ACCRUED EXPENSES AND OTHER PAYABLES

The amount of accrued expenses and other payables were consisted of the ~~date~~followings:

	June 30,		December 31,
	2021		2020
	(Unaudited)		(Audited)
Legal fee and other professionals	$	36,154	$	457,276
Wages and employee reimbursement		301,864		289,815
Suppliers		1,186,991		1,548,556
Accruals		89,231		173,455
Total	$	1,614,240	$	2,469,102

7. CONVERTIBLE NOTES PAYABLE

As of ~~this report. Management~~June 30, 2021 and December 31, 2020, convertible debt consisted of the ~~Company believes that the balance of the loan receivables is recoverable as of September 30, 2020.~~following:

	June 30,			December 31,
	2021			2020
	(Unaudited)			(Audited)
Beginning	$	1,163,146		$	957,990
Addition		-			905,392
Payment		(1,163,146	)		-
Conversion		-			(700,236	)
Balance	$	-		$	1,163,146

8. RELATED PARTY TRANSACTION

~~The amount~~As of June 30, 2021, the amounts due to the related parties were consisted of ~~September~~the followings:

Name	Amount (US$)		Relationship	Note
Yongke Xue	$	33,900	President of the Company	Loan payable
Wei Cheng Pan		193,495	Legal representative of Guangchengji and Chief Strategy Officer of the Company	Loan payable
Shaanxi Fu Chen Venture Capital Management Co. Ltd. (“Shaanxi Fu Chen”)		92,487	Two outside shareholders of the Company who are also the shareholders of Shaanxi Fu Chen	Other payables
Zhi Yan		243,742	General Manager of a subsidiary of the Company	Accrued expenses
Jing Chen		18,686	Vice president of the Company	Accrued expenses
Shenzhen TianShunDa Equity Investment Fund Management Co., Ltd. (“TianShunDa”)		340,552	Shaanxi Fu Chen holds 70% interest of TianShunDa	Other payables
Reits (Beijing) Technology Co., Ltd		16,602	Zhi Yan is the legal representative of this company	Acquisition of intangibles upon the full completion of the online platform pursuant to an agreement originally entered between parties before Zhi Yan was the general manager of our subsidiary.
Shaanxi Chunlv Ecological Agriculture Co. Ltd.		254,507	Shaanxi Fu Chen Venture holds 80% interest of the company	Other payables
Kai Xu		12,738	Deputy General Manager of a subsidiary of the Company	Accrued expenses
Shaanxi Fuju Mining Co., Ltd		3,252	Shaanxi Fu Chen holds 80% interest of the company	Other payables
Total	$	1,209,961

As of June 30, ~~2020, which~~2021, the amounts due from the related parties were consisted of the followings:

Name	Amount (US$)		Relationship	Note
Shanchun Huang		123,836	Chief Executive Officer of the Company	Prepaid expenses*
Bin Wu		200,000	a shareholder of a subsidiary of the Company	Advance to pay for the incorporation costs of the establishment of the subsidiary in Dubai*
Zeyao Xue		34,172	Son of the President of the Company, a shareholder of the VIE of the Company and a major shareholder of the Company	Prepaid expenses *
Ming Yi		5,945	Chief Financial Officer of the Company	Prepaid expenses *
Yang Liu		767	Chief Operator Officer of the Company	Prepaid expenses *
Total	$	364,720

*	~~Amount (US$)~~		~~Relationship~~	~~Note~~
~~Weicheng Pan~~		~~374,444~~	~~Legal representative of Guangchengji~~	~~Loan payable~~
~~Shanchun Huang~~		~~200,896~~	~~Chief Executive Officer of the Company~~	~~Loan payable~~
~~Kai Xu~~		~~16,689~~	~~Chief Operating Officer of the Company~~	~~Payable to employee~~
~~InUnion Chain Ltd. (“INU”)~~		~~300,116~~	The ~~Company is the 10% equity shareholder of INU~~	~~Accounts payables~~
~~Zhi Yan~~		~~65,302~~	~~Chief Technology Officer of the Company~~	~~Loan payable~~
~~Jing chen~~		~~6,984~~	~~Chief Financial Officer of the Company~~	~~Payable to employee~~
~~Yongke Xue~~		~~230,352~~	~~Chairman of the Company~~	~~Loan payable~~
~~Shenzen TianShunDa Equity Investment Fund Management Co., Ltd. (the “TSD”)~~		~~322,895~~	~~TSD holds 26.36% of the equity interest of SkyPoeple (China), a former subsidiary of the Company, which was sold to New Continent International Co., Ltd. on February 27, 2020.~~	~~Accounts payables~~
~~Total~~		~~1,517,678~~

~~The amount due from the related parties as of September 30, 2020, which consisted of the followings:~~

	~~Amount (US$)~~		~~Relationship~~	~~Note~~
~~Wealth Index (Beijing) Fund Management Co. Ltd.~~		~~14,683~~	~~The Company’s CEO is the legal representative of this company~~	Interest free loan*
~~Shaanxi Chunlv Ecological Agriculture Co., Ltd.~~		~~3,089,457~~	~~Holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited (CCM Logistics)~~	~~Including creditor’s rights of Shaanxi Youyi Co., Ltd of $3.24 million, which is partially offset by $0.24 million payable to the Company~~
~~Shaanxi Fullmart Commercial Holdings (Xi’an) Co., Ltd. (“Fullmart Commercial”)~~		~~23,935~~	~~Fullmart Commercial was 100% owned by Xiu Jun Wang, the ex-wife of Yongke Xue, the Chairman of the Company.~~	~~Service fee due~~
~~Shaanxi Quangou Convenient Island Co., Ltd.~~		~~24,663~~	~~Fullmart Commercial holds 33.33% its equity~~	Interest free loan*
~~Zeyao Xue~~		~~17,732~~	~~Son of the Chairman of the Company and a major shareholder of the Company of the Company~~	Interest free loan*
~~Total~~		~~3,170,470~~

*	~~The interest free loans and other~~ related party transactions have been approved by the Company’s Audit Committee.

~~6. INTANGIBLE ASSETS~~

~~On May 1, 2020,~~

9. INCOME TAX

The Company is incorporated in the United States of America and is subject to United States federal taxation. No provisions for income taxes have been made, as the Company ~~launched CCM v3.0, an on-line shopping mall platform, which creates a new value cycle system of online shopping malls with a real-name blockchain system. After~~had no U.S. taxable income for the ~~launch of CCM v3.0,~~six months ended June 30, 2021 and 2020. The effective income tax rate for the Company ~~reclassified this asset, which~~for both of the ~~Company prepaid~~six months ended June 30, 2021 and 2020 were 0% and 0% respectively. Some of our subsidiaries generated income and we accrued income tax according to the ~~software developer in fiscal year 2019, into intangible assets in the second quarter~~Chinese corporate income tax rate, but some had a loss and no tax provision was made.

The amount of ~~2020, which will be amortized over 10 years.~~

~~Also included in the intangible assets is accounting software. The accounting software will be amortized over 10 years. The amortization expense was $0.19 million and $0.59 million~~unrecognized deferred tax liabilities for ~~the nine months ended September 30, 2020.~~

~~The following table sets intangible assets of the Company as of September 30, 2020 and December 31, 2019, respectively.~~

CCM Accounting Software
September 30, December 31, September 30, December 31,
2020 2019 2020 2019
Cost $ 1,952,982 $ 43,004 $ 1,292 $ -
Less: Accumulated amortization (85,046 ) (2,114 ) (43 ) -
Balance as of September 30, 2020 $ 1,867,936 40,890 $ 1,249 $ -

~~The following table summarizes the expected amortization expense for the following years (in thousands):~~

Amortization
Year ending December 31, to be
recognized
2020 (excluding the nine months ended September 30, 2020) $ 79
2021 315
2022 315
2023 315
2024 315
2025 and thereafter 530
Total $ 1,869

~~7. LONG TERM INVESTMENT~~

On June 22, 2018, Digipay Fintech Limited (“Digipay”), a wholly-owned subsidiary of the Company acquired 10% ownership interest in InUnion Chain Ltd. (“InUnion”) for an aggregate purchase price of $15 million (“Purchase Price”), pursuant to a Shares Transfer and IUN Digital Assets Investment Agreement signed with Lake Chenliu, who are the sole owner of InUnion. The Company issued 5 million of its Common Stocktemporary differences related to the ~~InUnion on October 19, 2018 as the payment for Purchase Price.~~dividend from foreign subsidiaries is not determined because such determination is not practical.

Upon acquiring the InUnion Shares, Digipay has access to, and the use of, certain software, technology and related intellectual property of InUnion without further payment. Digipay also has the right to designate a director nominee to the board of directors of InUnion. The Company has ~~appointed a director~~not provided deferred taxes on undistributed earnings attributable to its PRC subsidiaries as they are to be permanently reinvested.

The Company had no material adjustments to its liabilities for unrecognized income tax benefits according to the ~~Board~~provisions of ~~Director~~ASC Topic 740, Income Taxes. Since the Company intends to reinvest its earnings to further expand its businesses in mainland China, its PRC subsidiaries do not intend to declare dividends to their immediate foreign holding companies in the foreseeable future. Accordingly, the Company has not recorded any deferred taxes in relation to US tax on the cumulative amount of ~~InUnion. Pursuant to~~undistributed retained earnings since January 1, 2008.

Effective on January 1, 2008, the ~~agreement, Digipay shall also purchase 20,000,000~~PRC Enterprise Income Tax Law, EIT Law, and Implementing Rules imposed a unified enterprise income tax rate of 25% on all domestic-invested enterprises and foreign-invested enterprises in the PRC, unless they qualify under certain limited exceptions. All of the ~~INU tokens issued by InUnion (the “INU Tokens”) for~~Companies’ Chinese subsidiaries were subject to an ~~aggregate purchase price~~enterprise income tax rate of $1,000,000, which such amount shall be paid in immediately available funds within 180 days of the date of the agreement. Digipay has reached an agreement with InUnion to waive the purchase of the INU Token. As a result, no INU Token was acquired by Digipay.25%.

~~As of December 31, 2019, management assessed the value of the above investment, and recorded an impairment loss of $2.75 million.~~

8.10. SHARE BASED COMPENSATION

Consulting Service Agreement

On January 25, 2020, the Company entered into a Consulting Service Agreement (the “Agreement”) with Dragon Investment Holding Limited (Malta) (the “Consultant”), a company incorporated in Malta, pursuant to which Consultant will: (i) help the Company to locate new merger projects globally, develop new merger strategy and provide the Company with at least five (5) merger and acquisition targets that have synergy with the Company’s business and development plans and could clearly contribute to the Company’s strategic goals each year; (ii) help the Company to map out new growth strategies in addition to its current business; (iii) work with the Company to explore new lines of business and associated growth strategies; and (iv) conduct market research and evaluating variable projects and providing feasibility studies per Company’s request from time to time. The term of the Agreement is three years. In consideration of the services to be provided by the Consultant to the Company, the Company agrees to pay the Consultant a three-year consulting fee totaling $3$3.0 million. The Company shall issue a total of 3,750,000 restricted shares of the Company Common Stock (the “Consultant Shares”) at a price of $0.794 per share, (the closing price of the Agreement date), as the payment for the above mentioned consultant fee to the Consultant. On February 23, 2020, ~~The~~the Company issued the Consultant Shares pursuant to the Agreement, of which 1,500,000 shares were released to the Consultant immediately, 1,125,000 and 1,125,000 shares, respectively, will be held by the Company and released to the Consultant on January 25, 2021 and January 25, 2022 if this Agreement has not been terminated and there has been no breach of the Agreement by the Consultant at such time. If the second and/or third release of the shares mentioned above does not occur, such shares shall be returned to the Company as treasury shares. The shares contemplated in the Agreement were issued pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. For the ~~nine months~~year ended ~~September 30,~~December 31, 2020, the Company recorded stock related compensation of $1.19 million, based on the stock closing price of $0.794 on the Agreement date, for the 1,500,000 shares which were released to the Consultant immediately upon issuance. On January 25, 2021, the Company recorded stock related compensation of $0.89 million, based on the stock closing price of $0.794 on the date of the Agreement, for the 1,125,000 shares which were released to the Consultant on January 25, 2021. The Company will recognize stock related compensation of ~~$1.79~~$0.89 million for the ~~2,250,000~~1,125,000 shares in the future if and when they are released to the Consultant pursuant to the Agreement.

On May 13, 2019, the Company issued 500,000 of its Common Stock to two employees granted in December 2018 by the Compensation Committee of the Board pursuant to the Company’s 2017 Omnibus Equity Plan (the “Plan”). On June 5, 2019, the Company issued 150,000 shares of its Common Stock to three employees granted in December 2018 by the Compensation Committee of the Board pursuant to the Plan.

On February 26, 2020, the Company’s shareholders approved the 2019 Omnibus Equity Plan at a Special Meeting of shareholder, which permits the grant of incentive stock options (“ISOs”), nonqualified stock options (“NQSOs”), stock appreciation rights (“SARs”), restricted stock, unrestricted stock and restricted stock units (“RSUs”) to its employees, officers and directors of up to 3,000,000 shares of Common Stock. The Company has not issued any stock under the 2019 Omnibus Equity Plan.

On October 27, 2020, the Company’s board of directors approved the 2020 Omnibus Equity Plan, which permits the grant of incentive stock options (“ISOs”), nonqualified stock options (“NQSOs”), stock appreciation rights (“SARs”), restricted stock, unrestricted stock and restricted stock units (“RSUs”) to its employees, officers and directors of up to 5,000,000 shares of Common Stock. The 2020 Omnibus Equity Plan is subject to the shareholders’ approval on the annual shareholders’ meeting, which will be held on December 18, 2020. The Company has not issued any stock under the 2020 Omnibus Equity Plan.

~~The Company did not grant any stock options during the nine months ended September 30, 2020 and September 30, 2019.~~

~~9. OPERATING LEASE~~

In August 2020, the Company signed an operating lease agreement for its office in Beijing. The Company recognized operating lease liabilities and operating lease right-of-use assets on its balance sheets. Right of use assets represent the right to use an underlying asset for the lease term, and lease liabilities represent the obligation to make lease payments arising from the lease. Right of use assets and liabilities are recognized at the lease commencement date based on the estimated present value of lease payments over the lease term. The company has leases with fixed payments for office rental in Beijing, which are classified as operating leases. Options to extend or renew are recognized as part of the lease liabilities and recognized as right of use assets. There are no residual value guarantees and no restrictions or covenants imposed by the leases.

~~The weighted average remaining lease term is 2 years and the weighted average discount rate is 6%.~~

In the nine months ended September 30, 2020, the costs of the leases recognized in general administrative expenses are $13,000. Cash paid for the operating leases including in the operating cash flows was $15,038.

~~Future minimum lease payments for leases with initial or remaining noncancelable lease terms in excess of one year are as follows:~~

Year ending December 31, (In thousands of U.S. Dollars)
2020 $ 32
2021 164
2022 109
$ 305

11. COMMON STOCK

~~10. CONVERTIBLE LOAN PAYABLE~~

Securities Purchase Agreement

On December ~~19, 2019,~~24, 2020, the Company entered into a ~~Note Purchase Agreement~~securities purchase agreement with ~~Iliad Research and Trading, L.P., a Utah limited partnership (“Iliad”),~~certain purchasers, pursuant to which the Company sold to the purchasers in a registered direct offering, an aggregate of 4,210,530 units, each consisting of one share of our common stock and ~~issued~~a warrant to ~~Iliad~~purchase 1 share of our Common Stock, at a ~~Secured Promissory Note in the principal amount~~purchase price of ~~$1.06 million. Iliad purchased the Note with an original issue discount of $0.05 million, and~~$1.90 per unit, for aggregate gross proceeds to the Company ~~agreed~~of $8,000,007, before deducting fees to ~~pay~~the placement agent and other offering expenses payable by the Company. On December 29, 2020, the Company issued Units consisting of an aggregate of 4,210,530 shares of our Common Stock and warrants to ~~Iliad $0.01 million for fees~~purchase up to an aggregate of 4,210,530 shares of our Common Stock at an exercise price of $2.15 per share (the “Investors’ Warrants”). The Investors’ Warrants have a term of five years and ~~costs incurred~~are exercisable by ~~Iliad in~~the holder at any time after the date of issuance. In connection with the ~~consummation~~offering, the Company also issued placement agent a warrant to purchase 210,526 shares of the Purchase Agreement. The Note was sold to Iliad pursuant to an exemption from registration under Regulation D, promulgated under the Securities Act of 1933, as amended. The Note is one-year term with an interest rate of 8%. There was no fixed conversation price to the Company’sour Common Stock in(the “Placement Agent Warrant”) on substantially the ~~agreement. Iliad~~same terms as the Investors’ Warrants, except that the Placement Agent Warrant has ~~converted all the Note Purchased in fiscal year 2019 to the Company’s Common Stock based on the market date on the conversion date.~~ an exercise price of $2.375 per share and are not exercisable until June 24, 2021.

The ~~Company believes that this Note will also be converted into the Company’s Common Stock in future. The Company~~net proceeds offering were $7,338,500, after deducting underwriting discounts and commissions and other estimated offering expenses, and were received ~~proceeds of $0.53 from Iliad~~ on December ~~23, 2019, and the balance of $0.53 million on January 17,~~29, 2020.

On July 28, 2020, the Company, entered into a Standstill Agreement with the Iliad. Pursuant to the Standstill Agreement, Iliad agreed to refrain and forbear temporarily from making redemptions for the Note that was sold and issued by the Company on December 19, 2019 in the original principal amount of $1.06 million. Iliad agreed not to redeem any portion of the Note (the “Standstill”) for a period beginning on the date of the Agreement and ending on the date that is ninety (90) days from the date of the Agreement. As a material inducement and partial consideration for Iliad’s agreement to enter into the Agreement, the Company agreed that the outstanding balance of the Note shall be increased by nine percent (9%), or $0.10 million, on the date of the Agreement (the “Standstill Fee”). The Company recorded the Standstill Fee of $0.10 million as interest expenses during the third quarter of 2020.

~~As of September 30, 2020, the balance of the convertible note payable was $1.16 million.~~

~~Common stocks issued in connection with the convertible notes~~

On January 6, 2020, the Company entered into the Eighth Exchange Agreement (the “Eighth Exchange Agreement”) with Iliad. Pursuant to the Eighth Exchange Agreement, the Company and Iliad agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $145,000 (the “Eighth Partitioned Note”) from a Secured Convertible Promissory Note (the “Note”) issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Partitioned Note. The Company and Iliad further agreed to exchange the Eighth Partitioned Note for the delivery of 193,333 shares of the Company’s Common Stock, according to the terms and conditions of the Exchange Agreement.

On January 15, 2020, the Company entered into the Ninth Exchange Agreement (the “Ninth Exchange Agreement”) with the Iliad. Pursuant to the Exchange Agreement, the Company and Iliad agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $140,000 (the “Ninth Partitioned Note”) from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Ninth Partitioned Note. The Company and Iliad further agreed to exchange the Partitioned Note for the delivery of 186,666 shares of the Company’s Common Stock, according to the terms and conditions of the Exchange Agreement.

On March 11, 2020, the Company entered into the Tenth Exchange Agreement (the “Tenth Exchange Agreement”) with the Iliad. Pursuant to the Tenth Exchange Agreement, the Company and Iliad agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $150,000 (the “Tenth Partitioned Note”) from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Partitioned Note. The Company and Iliad further agreed to exchange the Partitioned Note for the delivery of 200,000 shares of the Company’s Common Stock, according to the terms and conditions of the Exchange Agreement.

On April 17, 2020, the Company entered into the Eleventh Exchange Agreement (the “Eleventh Exchange Agreement”) with Iliad. Pursuant to Eleventh Exchange Agreement, the Company and Iliad agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $153,750 (the “Eleventh Partitioned Note”) from a Secured Convertible Promissory Note (the “Note”) issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Eleventh Partitioned Note. The Company and Iliad further agreed to exchange the Eleventh Partitioned Note for the delivery of 205,000 shares of the Company’s Common Stock, according to the terms and conditions of the Eleventh Exchange Agreement.

On June 10, 2020, the Company entered into the Twelfth Exchange Agreement (the “Twelfth Exchange Agreement”) with the Iliad. Pursuant to the Twelfth Exchange Agreement, the Company and Iliad agreed to partition a new Secured Convertible Promissory Note in the original principal amount of $111,486 (the “Twelfth Partitioned Note”) from the Note issued by the Company on March 26, 2019. The outstanding balance of the Note shall be reduced by an amount equal to the outstanding balance of the Partitioned Note. The Company and Iliad further agreed to exchange the Twelfth Partitioned Note for the delivery of 148,648 shares of the Company’s Common Stock, according to the terms and conditions of the Twelfth Exchange Agreement.

~~11. COMMON STOCKS ISSUED~~

~~Debt Repayment Agreement~~

In July 2020, the Company entered a series of loan agreements with fourteen individuals for a total amount of $4.96 million. On August 4, 2020, the Company entered into a Debt Repayment Agreement with these individuals (the “Creditors”), pursuant to which the Company agreed to repay $4,961,000 debt owed to the Creditors in the form of shares of Common Stock of the Company for an aggregate of 2,740,883 shares at a price of $1.81 per share (the “Debt Repayment”). As the closing price of the Company stock was $2.52 on August 4, 2020, the Company recognized loss of $1.95 million in loss on debt settlement during the third quarter of 2020. The Debt Repayment will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. The Company issued ~~2,740,883~~4,210,530 shares of its Common Stock to the ~~Creditors~~purchaser on ~~August 12,~~December 29, 2020. During the three months ended March 31, 2021, the Investors Warrants to purchase an aggregate of 4,210,530 shares of common stock were fully exercised by the investors.

~~Securities Purchase Agreement~~On January 11, 2021, the Company entered into a securities purchase agreement with certain purchasers identified on the signature page thereto, pursuant to which the Company sold to the purchasers in a registered direct offering, an aggregate of 3,000,000 share of its common stock, par value $0.001 per share at a purchase price of $5.00 per share, for aggregate net proceeds to the Company of $13,797,732, after deducting fees to the placement agent and other offering expenses payable by the Company. On January 13, 2021, the Company issued 3,000,000 shares of common stock pursuant to this Agreement.

On ~~June 16, 2020,~~February 9, 2021, the Company entered into a securities purchase agreement with certain purchasers identified on the signature page thereto, pursuant to which the Company sold to the purchasers in a registered direct offering, an aggregate of 2,000,000 shares of its common stock, par value $0.001 per share at a purchase price of $5.95 per share, for aggregate net proceeds to the Company of $10,992,250, after deducting fees to the placement agent and other offering expenses payable by the Company. The Company issued 2,000,000 shares of common stock to the purchasers on February 11, 2021.

On April 1, 2021, the Company entered into a Securities Purchase Agreement with ~~Qun Xie,~~certain purchasers identified on the signature page thereto (the “Purchasers”), pursuant to which the Company ~~agreed to sell~~sold to the ~~Qun Xie~~Purchasers in a ~~private placement 500,000~~registered direct offering, an aggregate of 5,737,706 shares of ~~the Company’s Common Stock,~~its common stock, par value $0.001 per share at a purchase price of ~~$1.00~~$6.10 per share, for an aggregate ~~offering price of $500,000. The Private Placement will be completed pursuant~~net proceeds to the ~~exemption from registration provided~~Company of approximately $32,380,492, after deducting fees to the placement agent and other offering expenses payable by ~~Regulation S promulgated under~~ the ~~Securities Act of 1933, as amended. On June 30, 2020, Qun Xie paid $500,000, and on August 7, 2020, the~~Company. The Company issued ~~500,000 Shares pursuant~~5,737,706 shares of common stock to ~~this Agreement.~~the purchasers on April 5, 2021.

On ~~September 16, 2020,~~April 12, 2017, the Company entered into a Securities Purchase Agreement with ~~Houwu Huang,~~certain purchasers (the “Purchasers”), pursuant to which the Company ~~agreed~~offered and sold to ~~sell to Houwu Huang~~the Purchasers, in a registered direct offering, an aggregate of 862,097 shares of common stock, par value $0.001 per share. In a concurrent private placement, ~~224,599 shares~~the Company also issued to the each of the Purchasers a warrant to purchase one (1) share of the Company’s Common Stock for each share purchased under the Purchase Agreement, pursuant to that certain Common Stock Purchase Warrant, by and between the Company and each Purchaser (each, a “Warrant”, and collectively, the “Warrants”). The Warrants will be exercisable beginning on the six-months anniversary of the date of issuance at an initial exercise price of $5.20 per share and will expire on the five and a half year anniversary of the date of issuance.

During the six months ended June 30, 2021, the holders of the Warrants purchased an aggregate of 319,350 shares of common stock ~~at a purchase price~~ of ~~$1.87 per share~~the Company for ~~an aggregate offering price~~$1,654,224, of $420,000. The Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended. The Company issued 224,599which 1,230 shares of ~~its Common Stock to the Purchaser on September 24, 2020.~~common stock were issued based upon cashless exercises.

12. DISCONTINUED OPERATIONS

~~The following table listed the total assets and liabilities of the discontinued operation as of September 30, 2020 and December 31, 2019:~~

September 30, 2020 December 31, 2019
Total
Assets Total
Liabilities Assets Total
Liabilities
Hedetang Farm (1) $ 5,343,518 $ 3,367,129 $ 5,353,790 $ 3,237,113
Zhonglian Hengxin (1) - - 1,623 96,924
CCM Logistics (1) - 146,841 - -
Digital Online Marketing Limited (1) - - - -
SkyPeople Foods Holding Ltd. (1) - - - -
HeDeTang HK (2) - - 92,772,786 196,261,748
Total $ 5,343,518 $ 3,513,970 $ 98,128,199 $ 199,595,785

(1) On March 11, 2020, the Company’s Board of Directors passed a resolution to sell the operation of Zhonglian Hengxin Assets Management Co., Ltd (“Zhonglian Hengxin”) and close the operation of Digital Online Marketing Limited, and SkyPeople Foods Holding Ltd.

On July 24, 2020, the Company’s Board of Directors passed a resolution to close the operation of Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited (“CCM Logistics”), a subsidiary located in the national kiwifruit Industrial Park of Baoji City and Hedetang Farm Products Trading Markets (Mei County) Co., Ltd. (“Hedetang Farm”).

The Company has established a winding-down plan to close these operations. Based on the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from these operations. as a discontinued operation, as the Company believed that no continued cash flow would be generated by these operations. and that the Company would have no significant continuing involvement in the discontinued entity.

In the second quarter of 2020, the Company signed an Equity Transfer Agreement with Shaanxi Yinlian Huijin Asset Management Co. Ltd. to transfer 65% of the equity shares of Zhonglian Hengxin at zero consideration. The net liabilities of Zhonglian Hengxin are $0.15 million. The Company recorded a gain on sale of subsidiary of $0.15 million in the third quarter of 2020.

On November 12, 2020, CCM Tianjin, a wholly owned subsidiary of the Company entered into an Equity Transfer Agreement with Xi’an Yishengkang Information Technology, Ltd. (“Xi’an Yishengkang”), an unrelated third party, pursuant to which the Company agreed to sell 90% of total issued and outstanding capital stock of Hedetang Farm that it owns to Xi’an Yishengkang at RMB9,000 (approximately $1,324). On the same date, CCM Logistics entered into another Equity Transfer Agreement with an individual and unrelated third party, Liyuan Ying, pursuant to which the Company agreed to sell 10% of its shares of total issued and outstanding capital stock of Hedetang Farm that it owns to Liyuan Ying for RMB1,000 (approximately $147).

~~(2)~~ HeDeTang HK

On September 18, 2019, ~~HeDeTang HK~~SkyPeople Foods Holdings Limited (“SkyPeople Foods”) entered into a Share Transfer Agreement (the “Agreement”) with New Continent International Co., Ltd., (the “Buyer”) a company incorporated in the British Virgin Islands. Pursuant to the terms of the Agreement, the Buyer purchased 100% ownership of HeDeTang ~~HK,~~Holdings (HK) Ltd. (“HeDeTang HK”) from SkyPeople Foods, which value is primarily derived from HeDeTang HK’s wholly-owned subsidiary HeDeJiaChuan Holdings Co., Ltd. and 73.41% owned subsidiary SkyPeople Juice Group Co., Ltd., for a total price of RMB 600,000 (approximately $85,714) (the “Sale Transaction”). The Sale Transaction was closed on February 27, 2020. In accordance with ASC Topic 205, Presentation of Financial Statement Discontinued Operations (“ASC Topic 205”), the Company presented the operation results from HeDeTang HKHK’s and ~~its~~ subsidiaries as a discontinued operation, as the Company believed that no continued cash flow would be generated by the discontinued component and that the Company would have no significant continuing involvement in the operations of the discontinued component. The total assets of HeDeTang HK were $106.85 million as of February 27, 2020 and the total liabilities of HeDeTang HK were $231.21 million as of February 27, 2020, resulting in a gain on disposal of $123.69 million. There was no income or loss from HeDeTang HK from January 1, 2020 to the ~~sale.~~close of the Sale Transaction.

The discontinued operation presented in the financial statement includes Huludao Wonder operation, a subsidiary which produced concentrated apple juice. In December 2016, the Company established a winding-down plan to close this operation. Based on the restructuring plan and in accordance with ASC 205-20, the Company presented the operating results from Huludao Wonder as a discontinued operation, as the Company believed that no continued cash flow would be generated by the disposed component (Huludao Wonder) and that the Company would have no significant continuing involvement in the operation of the discontinued component. Management of the Company initiated a plan to sell the property located in Huludao in December 2016, and ceased the depreciation of the property in accordance with ASC 205-20. In accordance with the restructuring plan, the Company intended to transfer the concentrated fruit juice production equipment in Huludao Wonder to another subsidiary and to sell the land use right and facilities upon favorable circumstances. On February 27, 2020 pursuant to a Share Transfer Agreement entered into by SkyPeople Foods and New Continent International Co., Ltd. on September 18, 2019, the ownership of Huludao Wonder was transferred as a subsidiary of HeDeTang HK to New Continent International Co., Ltd.

~~13. VARIABLE INTEREST ENTITIES~~

On March 11, 2020, the Company’s Board of Directors passed a resolution to sell the operation of Future Supply Chain limited and Zhonglian Hengxin Assets Management Co., Ltd (“Zhonglian Hengxin”) and close the operation of Digital Online Marketing Limited, SkyPeople Foods Holding Ltd. and Chain Future Digital Tech (Beijing) Co., Ltd. On March 18, 2021, Chain Future Digital Tech (Beijing) Co., Ltd. was deregistered. Based on the disposal plan and in accordance with ASC 205-20, the Company presented the operating results from these operations as a discontinued operation. On October 31, 2020, the transfer of ownership of Future Supply Chain Limited and Zhonglian Hengxin was completed.

On July 24, 2020, the Company’s Board of Directors passed a resolution to sell the operation of Hedetang Farm Products Trading Markets (Mei County) Co., Ltd. and close the operation of Chain Cloud Mall Logistics Center (Shaanxi) Co., Ltd. On July 27,2020, Skypeople Foods Holdings Limited Company was dissolved; On July 28, 2020 Digital Online Marketing Limited was dissolved; On October 31, ~~2019,~~2020, Chain Cloud Mall Network and Technology (Tianjin) Co., Limited ~~(“CCM Tianjin”),~~and Chain Cloud Mall ~~E-commerce (Tianjin)~~Logistics Center (Shanxi) Co., Ltd. completed the transfer of their ownership of Hedetang Farm Products Trading Markets (Mei county) Co., (“E-commerce Tianjin”), and Mr. Zeyao Xue and Mr. Kai Xu, citizens of China and shareholders of E-commerce Tianjin, entered into the following agreements, or collectively, the “Variable Interest Entity Agreements” or “VIE Agreements,” pursuant to which CCM Tianjin has contractual rights to control and operate the business of E-commerce Tianjin (the “VIE”). Therefore, pursuant to ASC 810, E-Commerce Tianjin is included in the Company’s condensed consolidated financial statements since then.Ltd.

Pursuant to Chinese law and regulations, a foreign owned enterprise cannot apply for and hold a license for operation of certain e-commerce businesses, and the category of business which the Company plans to expand in China. CCM Tianjin is an indirectly wholly foreign owned enterprise of the Company. In order to comply with Chinese law and regulations, CCM Tianjin agreed to provide E-commerce Tianjin an Exclusive Operation and Use Rights Authorization to operate and use the Chain Cloud Mall System owned by CCM Tianjin.

E-commerce Tianjin was incorporated by Mr. Zeyao Xue and Mr. Kai Xu solely for the purpose of holding the operation license of the Chain Cloud Mall System. Mr. Zeyao Xue is a major shareholder of the Company and the son of Mr. Yongke Xue, the Chairman of the Board of Directors of the Company. Mr. Kai Xu is the Deputy General Manager of FutureOn April 19, 2021, FT Commercial Management (Beijing) Co., ~~Ltd.~~Ltd was deregistered, resulting in a loss on disposal of $21,577.

Loss from discontinued operations for June 30, 2021 and 2020 was as follows:

	June 30,			June 30,
	2021			2020
REVENUES	$	-		$	-
COST OF SALES		-			-
GROSS PROFIT		-			-

OPERATING EXPENSES:
General and administrative		-			139,614
Provision (Recovery) of doubtful debts		-			(19,745	)
Total		-			119,869

OTHER INCOME (EXPENSE)
Interest income		-			22
Interest expenses		-			(32	)
other income (expenses)		-			(541	)
Total		-			(551	)
Income (loss) from discontinued operations before income tax		-			(120,420	)
Income tax provision		-			-
Income (loss) from discontinued operation before noncontrolling interest	$	-			(120,420	)
Loss on disposal of discontinued operations		-	)		-
(INCOME) LOSS FROM DISCONTINUED OPERATION	$	-		$	(120,420	)

~~For~~

The major components of assets and liabilities related to discontinued operations are summarized below:

	June 30, 2021		December 31, 2020
Cash	$	-	$	3,037
Property, plant and equipment, net		-		2,747
Other current assets				897
Amount due from related parties		155		13,056
Total assets related to discontinued operations	$	155		19,737

Accrued expenses	$	-	$	10,341
Amount due to related parties		-		154,875
Total liabilities related to discontinued operations	$	-	$	165,216

13. SEGMENT REPORTING

In its operation of the ~~details about the VIE agreements, refer to Note 15 “Variable Interest Entities,”~~business, management, including our chief operating decision maker, who is our Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis consistent with GAAP. The Company operates in 4 segments starting in fiscal 2020: shared shopping mall membership fee, fruit related products, sales of goods and others. Our concentrated juice and juice beverages are primarily produced by the Company’s ~~consolidated financial statements included~~Jingyang factory. The operation of fruit related products is classified as discontinued operation as disclosed in ~~Company’s 2019 Form 10-K.~~

~~14. ACCRUED EXPENSES AND OTHER PAYABLES~~

~~The amount of accrued expenses and other payables as of September 30, 2020 and December 31, 2019 consisted of the followings:~~

September 30,
2020 December 31,
2019
Acquisition of Intangibles $ 320,267 $ 15,374
Legal fee and other professionals 364,924 361,279
Wages and employee reimbursement 321,350 452,389
Suppliers 254,702 350,992
Accrued interest 67,025 85,600
Accrued tax payable 58,073 77,064
Others 11,756 -
Total $ 1,398,097 $ 1,342,698

~~15. LOAN PAYABLE~~

As of September 30, 2020, loan payable were $0.86 million, which consisted of the loan payable of $0.17 million to Shaanxi Entai Bio-Technology Co., Ltd., loan payable $5,870 to Shenzhen Wangjv Trading Co., Ltd. and loan payable of $0.68 million to some individuals creditor.

~~The loan from Shaanxi Entai Bio-Technology Co., Ltd. of $0.17 million was an interest free loan and there is not assets pledged for this loan.~~

~~On June 15, 2020,~~Note 12. In 2021, the Company ~~entered into a loan agreement~~principally engages in coal supply chain financing and trading business.

In compliance with ~~Shenzhen Wangjv Trading Co., Ltd. Pursuant~~the Company’s business transformation strategy, membership fees from the shared shopping mall and sales of goods through the shared shopping mall platform started to generate the ~~loan agreement,~~main revenues for the Company borrowed $0.21 million from Shenzhen Wangjv Trading Co., Ltd. at the annual interest rate of 8% for the use of working capital for a year. On July 6, 2020, the Company returned $0.20 million to Shenzhen Wangjv Trading Co., Ltd.

During the third quarter of 2020, the Company entered into a series of interest free loan agreements with some individual creditors, borrowing $0.68 million for short-term working capital needs. The repayment term is one year from the borrowing date.

On October 27, 2020, the Company entered into a series of Debt Repayment Agreements with some of the individual creditors, pursuant to which the Company agreed to repay $0.32 million debt owed to these individual creditors in the form of shares of Common Stockand became more and more important business sections of the Company from fiscal year 2019, while its traditional business section of seasonal fruit related products continued to shrink in fiscal year 2019. However, due the COVID-19 pandemic and restriction on large gatherings in China, which have made the promotion strategy for its online e-commerce platforms difficult to implement and the Company has experienced difficulties to subscribe new members for its online e-commerce platforms. Due to lack of new members, difficulties in retaining old customers and significant decrease of revenue in e-commerce business, the Company began to provide supply chain financing and services for coal mines and power generation plants to buy and sell coals.

Some of our operation might not individually meet the quantitative thresholds for determining reportable segments and we determine the reportable segments based on the discrete financial information provided to the chief operating decision maker. The chief operating decision maker evaluates the results of each segment in assessing performance and allocating resources among the segments. Since there is an ~~aggregate~~overlap of ~~160,000 shares at a price of $2.00 per share (the “Debt Repayment”). As the closing price~~services and products between different subsidiaries of the Company, ~~stock was $2.23 on October 27,~~ the Company ~~recognized loss of $0.04 million in other~~does not allocate operating expenses ~~during the fourth quarter of 2020. The Debt Repayment will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended.~~

~~16. REVENUES~~

All of our revenues are generated in China. The following table summarizes the Company's revenues disaggregated by revenue source (in thousands). The revenues are recognized as separate performance obligations that are satisfied by transferring control ofand assets based on the product ~~or service to~~segments. Therefore, operating expenses and asset information by segment are not presented. Segment profit represents the ~~customer. There was no deferred revenue.~~gross profit of each reportable segment.

Three Months ended June 30, 2021

	CCM Shopping Mall Membership		Coals supply chain financing/trading		Others		Total
Reportable segment revenue	$	12	$	3,288,688	$	13	$	3,288,713
Inter-segment loss		-		1,347,131		-		1,347,131
Revenue from external customers	$	12		1,941,557		13		1,941,582
Segment gross profit	$	12	$	71,341	$	2	$	71,355

Three Months Ended Nine Months Ended *
September 30,
2020 September 30,
2019 September 30,
2020 September 30,
2019
Revenue
Service fees $ 38,109 $ 207,563 $ 348,896 $ 338,469
Sales of Goods 5,548 134,520 8,399 406,508
Total $ 43,657 $ 342,083 $ 357,295 $ 744,977

Certain reclassifications have been made to the financial statements for the period ended September 30, 2019 to conform to the presentation for the period ended September 30, 2020, with no effect on previously reported net income (loss).

Three Months ended June 30, 2020

~~17.~~

	CCM Shopping Mall Membership		Sales of Goods		Others		Total
Reportable segment revenue	$	104,762	$	1,853	$	7,139	$	113,754
Inter-segment loss		-		67		-		67
Revenue from external customers	$	104,762		1,786		7,139		113,687
Segment gross profit	$	100,803	$	1,067	$	2,458	$	104,328

As of June 30, 2021:

	CCM Shopping Mall Membership		Coal supply chain financing/trading		Others		Total
Reportable segment revenue	$	84	$	3,288,688	$	6,553	$	3,295,325
Inter-segment loss		-		1,347,131		-		1,347,131
Revenue from external customers	$	84		1,941,557		6,553		1,948,194
Segment gross profit	$	84	$	71,341	$	520	$	71,945

As of June 30, 2020:

	CCM Shopping Mall Membership		Sales of Goods		Others		Total
Reportable segment revenue	$	303,647	$	3,670	$	7,139	$	314,456
Inter-segment loss		-		818		-		818
Revenue from external customers	$	303,647		2,852		7,139		313,638
Segment gross profit	$	299,412	$	1,897	$	2,457	$	303,766

14. COMMITMENTS AND CONTINGENCIES

Legal case with FT Global Litigation

~~SEC Subpoena~~

~~On February 21, 2020, the Company received~~In January 2021, FT Global Capital, Inc. (“FT Global”), a subpoena from the SEC’s Division of Enforcement requiring us to produce documents and detailed information relating to, among other things, the Company’s accounting procedures, management oversight, and the sale of HeDeTang holdings (HK) Ltd. to New Continent International Co., Ltd. The subpoena required the Company to produce all responsive documents created during, or concerning, the period January 1, 2016 to the present, unless otherwise specified.

The Company is cooperating with the SEC’s investigation and has provided responsive documents and information requested in the subpoena. In the event the Company locates additional responsive documents, we expect to produce them promptly to the SEC. We will also make officers or other employees available to be interviewed by the SEC with regard to the subject matters identified in the subpoena.

The Company is unable to predict, what action, if any, might be taken in the future by the SEC or any other governmental authority as a result of the subpoenas. There can be no assurance that the SEC will not commence an enforcement action against us or members of our management, or as to the ultimate resolution of any enforcement action that the SEC may decide to bring. Under applicable law, the SEC has the ability to impose significant sanctions on companies and individuals who are found to have violated the provisions of applicable federal securities laws, including cease and desist orders, civil money penalties, and barring individuals from serving as directors or officers of public companies. We have expended significant financial and managerial resources responding to the SEC subpoena. Defending any enforcement action brought by the SEC against us would involve further significant expenditures and the resolution of any such enforcement action could have a material adverse effect on our business, financial condition, results of operations and cash flows.

~~Entry into a material Definitive Agreement~~

~~On July 13, 2020, the Company and Future FinTech (Hong Kong) Limited, a wholly owned subsidiary~~former placement agent of the Company ~~entered into~~filed a Share Exchange Agreement with Nice Talent Asset Management Limited, a limited company organized under the laws of Hong Kong (“Nice”), which is licensed under the Security and Futures Commission of Hong Kong for assets management, and Joy Rich Enterprises Limited, a limited company organized under the laws of Hong Kong and 90% shareholder of Nice (“Joy Rich”), pursuant to whichlawsuit against the Company ~~agreed~~in the Superior Court of Fulton County, Georgia. FT Global served the complaint upon the Company in January 2021. In the complaint, FT Global alleges claims, most of which attempt to ~~acquire 90%~~hold the Company liable under legal theories that relate back to an alleged breach of an exclusive placement agent agreement between FT Global and the ~~issued~~Company in July 2020 which had a term of three months. FT Global claims that the Company failed to compensate FT Global for securities purchase transactions between December 2020 and ~~outstanding ordinary shares of Nice (the “Nice Shares”) from Joy Rich in exchange for the Company’s Common Stock.~~

~~Pursuant~~April 2021, pursuant to the terms of the ~~Share Exchange Agreement,~~expired exclusive placement agent agreement. Allegedly, the ~~parties agreed: (i)~~exclusive placement agent agreement required the ~~aggregate purchase price~~Company to pay FT Global for ~~Nice Shares shall be HK$54 million (approximately $6.97 million,~~capital received during the ~~“Purchase Price”) and it shall be paid in the Company’s Common Stock; (ii) 40%~~term of the ~~Purchase Price HK$21.6 million (approximately $2.79 million) shall be paid in~~agreement and for the ~~shares of common stock~~12-month period following the termination of the agreement involving any investors that FT Global introduced and/or wall-crossed to the Company. However, the Company ~~based on~~believes the ~~average closing price~~securities purchase transactions at issue did not involve the one investor which FT Global introduced or wall-crossed to the Company during the term of the ~~Company’s Common Stock listed on Nasdaq Stock Exchange for the ten (10) trading days prior to the date of the Agreement~~agreement. FT Global claims approximately $7,000,000 in damages and the foreign exchange rate between HK$ and US$ shall be the rate published by Bloomberg on the date of the Agreement; (iii) 30% of Purchase Price shall be paid in the Company Common Stock (the “2020 Earn-Out Shares”) if Nice meets certain earnings goal for 2020 (the “2020 Earnings Goal”); (iv) the 2020 Earn-Out Shares shall be issued based upon the average closing price of the Company’s Common Stock listed on Nasdaq Stock Exchange for the ten (10) trading days prior to December 31, 2020 and the exchange rate between HK$ and US$ shall be the rate published by Bloomberg on December 31, 2020; (v) additional 30% of Purchase Price shall be paid in the shares of common stock the Company (the “2021 Earn-Out Shares”) if Nice meets certain earnings goal for 2021 (the “2021 Earnings Goal”); (vi) the 2021 Earn-Out Shares shall be issued based upon the average closing price of the Company’s Common Stock listed on Nasdaq Stock Exchange for the ten (10) trading days prior to December 31, 2021 and the exchange rate between HK$ and US$ shall be the rate published by Bloomberg on December 31, 2021; (vii) if Nice does not achieve its earnings goal for a given year, the parties agree to have forbearance clause that the amount of such year’s earn-out shares shall not be reduced for that year if Nice achieves at least sixty percent (60%) of its given year earnings goal and if Nice achieves lower than 60% earnings goal for a given year, the amount of such year’s earn-out shares shall be reduced to zero. attorneys’ fees.

The Company ~~Shares will be issued pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended.~~

~~This transaction is subject to the approval of the Security and Futures Commission of Hong Kong. As of the date of this report, the transaction is still pending.~~

~~Litigation~~

~~Legal case with Zhongcai~~

Hedetang Market, a subsidiary of CCM Tianjin, entered into a loan agreement with Shaanxi Zhongcai Pawn Co., Ltd. ("Zhongcai") in February 2015. Pursuant to the loan agreement, Hedetang Market borrowed $1.84 million from Zhongcai at the monthly interest rate of 0.4%. Hedetang Market provided its land use right as a pledge for the loan. Hedetang Market did not return the principal and interest on time pursuant to the loan agreement. Zhongcai filed an enforcement request with Xi’an Intermediate People’s Court in July 2015. In August 2017, Xi’an Intermediate People’s Court issued a verdict to seize the pledged land use rights of Hedetang Market for auction. As of the date of this report, the auction sale was not successful. The Company recorded the unpaid amount of $1.84 million as loan payable.

~~Legal case with Shaanxi Zhongkun Construction Co., Ltd.~~

In May 2015, Hedetang Market and Shaanxi Zhongkun Construction Co., Ltd. (“Zhongkun”) entered into a construction and decoration agreement. On September 5, 2018, Zhongkun filed the lawsuit with Mei County People’s Court (the “Court”) for repayment of construction and decoration fees. The Court issued a civil judgement in November 2018, ordering Hedetang Market to pay project funds of RMB 1.65 million (approximately $0.24 million) to Zhongkun, plus interest. On April 19, 2020, the Court issued a verdict to terminate the enforcement because assets of Hedetang Market had already been seized by Xi’an Yanta District People’s Court and Baoji Intermediate People’s Court, and there were no other assets for enforcement. Currently the Company is still liable for the unpaid amount and the interest.

~~Legal case with Cinda Capital Financing Co., Ltd.~~

In August 2017, Cinda Capital Financing Co., Ltd. (“Cinda”) filed a lawsuit with Beijing 2nd Intermediate People’s Court (the “Beijing Intermediate Court”) against the Company’s indirectly wholly-owned subsidiaries Shaanxi Guoweimei Kiwi Deep Processing Company, Ltd. (“Guoweimei”) and Hedetang Market (Hedetang Market and together with Guoweimei, “Lessees”) requested that Lessees repay RMB 50 million (approximately $7.27 million) in capital lease fees, plus interest. Cinda purchased or paid for refrigerant warehouse and trading hall to the suppliers and vendors and agreed to lease them to the Lessees for a leasing fee of RMB 50 million in December 2016. The capital leasing fee became due on its maturity date of June 2017, with certain land use rights of Lessees in Mei County and equity of Guoweimei as a pledge. The Company disputed that the land use rights for the refrigerant warehouse and trading hall were never sold to or transferred to Cinda, and argues that therefore it is a loan agreement and not a capital lease agreement among the parties. Lessees have taken the position that Cinda is not a bank and does not have government permits required to make loans in China, and the agreements including pledge agreement were invalid, void and without legal effect from the beginning. Therefore, the Company only has the obligations to repay principal but not the interest. In November 2017, Beijing Intermediate Court ruled in favor of Cinda and the Lessees appealedtimely removed the case to the ~~Beijing Supreme~~United States District Court for the Northern District of Georgia (the (“Court”) on February 9, 2021 based on diversity of jurisdiction. On March 9, 2021, the Company filed a motion to dismiss based on FT Global’s failure to state a claim which is pending before the Court. ~~The Beijing Supreme~~On March 23, 2021, FT Global filed its response to the Company’s motion to dismiss. FT Global argues that the Court ~~held a hearing at~~should deny the ~~end of July 2018. On December 4, 2018,~~Company’s motion to dismiss. However, if the ~~Beijing Supreme~~ Court ~~upheld~~is inclined to grant the ~~lower court’s decision.~~Company’s motion to dismiss, FT Global requested that the Court permit it to file an amended complaint. On April 8, ~~2019, Beijing Intermediate~~2021, the parties filed a Joint Preliminary Report and Discovery Plan. On April 12, 2021, the Court approved the Joint Preliminary Report and Discovery Plan and issued ~~the verdict for enforcement of the judgment and the plaintiff has the priority rights for the repayment for the pledged land use rights of Lessees in Mei County and equity of Guoweimei. The~~a Scheduling Order placing this case is under enforcement procedure and Cinda is in the process of sale the land use rights. Before the land use right is sold, the subsidiaries of SkyPeople China still owns the seized properties and the liabilities to Cinda. As of Septemberon a six-month discovery tract. On April 30, 2020, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. The creditors have no recourse to the current Company.

In August 2017, Cinda Capital Financing Co., Ltd. (“Cinda”) filed another lawsuit with Beijing Intermediate Court against the Company’s indirectly wholly-owned subsidiaries Guoweimei and SkyPeople China for repayment of a leasing fee of RMB 84.97 million (approximately $12.35 million) plus interest. In January 2014, Guoweimei and SkyPeople China (the “Equipment Lessees”) signed an Equipment Financial Lease Purchase Agreement with Cinda and an equipment supplier pursuant to which Cinda would provide funds to purchase equipment and the Equipment Lessees would lease the equipment from Cinda. Guoweimei pledged certain land use rights in Mei County to Cinda and Xi’an Hedetang and Hedetang Holding pledged their equities in Guoweimei to Cinda to secure the repayment. Mr. Hongke Xue also provided a personal guarantee for the payment of the leasing fee. Beijing Intermediate Court had two hearings of the case and on March 21, 2018, and it ruled in favor of Cinda to the effect that SkyPeople China and Guoweimei shall pay leasing fees due in the amount of RMB 21.00 million (approximately $3.05 million), as well as leasing fees not yet due in the amount of RMB 63.98 million (approximately $9.30 million), plus attorney’s fees and expenses. Beijing Intermediate Court also ruled that Mr. Hongke Xue is jointly liable for the debt as the guarantor, and that Cinda has priority rights to the pledged land use rights in Mei County and the pledged equities of Guoweimei as well as the ownership of the leasing properties until the leasing fees are paid. SkyPeople China has appealed the decision to the Beijing Supreme Court. The Beijing Supreme Court rejected the appeal and upheld the original verdict on September 7, 2018. The case is under enforcement procedure and Cinda is in the process of sale the seized properties. Before they are sold, the subsidiaries of SkyPeople China still owns the seized properties and the liabilities to Cinda. As of September 30, 2020, SkyPeople China has not repaid the amount. SkyPeople China was one of the subsidiaries transferred along with HeDengTang HK to New Continent International Co., Ltd. on February 27, 2020. The creditors have no recourse to the current Company.

~~Certain pending legal cases that we previously disclosed are related to the subsidiaries of HeDengTang HK, which was sold to New Continent International Co., Ltd. on February 27, 2020. Accordingly,~~2021, the Company ~~is no longer a party~~served FT Global with its Initial Disclosures. On May 6, 2021, FT Global served the Company with its Initial Disclosures. On May 17, 2021, FT Global served the Company with its First Amended Initial Disclosures. The Company will continue to ~~these legal cases.~~vigorously defend the action against FT Global.

~~18.~~

15. RISKS AND UNCERTAINTIES

Impact of COVID 19

In December 2019, a novel strain of coronavirus was reported ~~to have surfaced in Wuhan, China, the pandemic quickly~~and has spread ~~to many provinces, autonomous regions, and cities all over the~~throughout China and other parts of the world. ~~Substantially all of our revenues are generated in China. The Company’s results of operations have been materially negatively affected by~~On March 11, 2020, the World Health Organization characterized the outbreak ~~of COVID-19 in China, especially during the first half of 2020.~~as a “pandemic”. In early 2020, Chinese government took emergency measures to combat the spread of the virus, including quarantines, travel restrictions, and the temporary closure of office buildings and facilities in China. Substantially all of our revenues are generated in China. In response to the evolving dynamics related to the COVID-19 outbreak, the Company is following the guidelines of local authorities as it prioritizes the health and safety of its employees, contractors, suppliers and business partners. Our offices in China ~~which has materially adversely affected~~were closed and all of the Company’s ~~business~~employees worked from home at the end of January until late March 2020. The quarantines, travel restrictions, and ~~services and results~~the temporary closure of ~~operations.~~office buildings have negatively impacted our business. Our suppliers ~~have~~were negatively ~~been~~ affected, and could continue to be negatively affected in their ability to supply and ship products to our customers byin case of any ~~further outbreak or~~ resurgence of ~~COVID-19 in China.~~COVID-19. Our customers that ~~are~~have been negatively impacted by the outbreak of COVID-19 may reduce their budgets to purchase products and services from us, which may materially adversely impact our revenue. The business operations of the third parties’ stores on our e-commerce platform have been and could continue to be negatively impacted by ~~any further~~the outbreak, ~~or resurgence of COVID-19, which may negatively impact their operations and business,~~ which may in turn adversely affect the business of our platform as a whole as well as our financial condition and operating results. The outbreak has had and might continue to have disruption to our supply chain, logistics providers, customers or our marketing activities in case of any resurgence of COVID-19, which could materially adversely impact our business and results of operations. Some of our customers, contractors, suppliers and other business partners are small and medium-sized enterprises (SMEs), which may not have strong cash flows or be well capitalized, and may be vulnerable to an epidemic outbreak and slowing macroeconomic conditions. ~~Further, as we do not have access to a revolving credit facility, there can be no assurance~~If the SMEs that we ~~would~~work with cannot weather the COVID-19 and the resulting economic impact, or cannot resume business as usual after a prolonged outbreak, our revenues and business operations may be ~~able to secure commercial debt financing in the future in the event that we require additional capital.~~

materially and adversely impacted. The Company’s promotion strategy of ~~the~~ CCM Shopping Mall previously mainly relied on the training of members and distributors through meetings and ~~conferences before the outbreak.~~conferences. Although China has already begun to recover from the outbreak of COVID-19, the Chinese government still put a restriction on large gatherings. These restrictions made the promotion strategy for ~~CCM Shopping Mall~~our online e-commerce platforms difficult to implement. The Company has experienced difficulties to subscribe new members for its online e-commerce platforms and has to transform its business model from member based platform to sales agent based platform during the second quarter of 2021.

~~Consequently, our results of operations have~~The global economy has also been materially ~~adversely affected. Any potential impact to our results will depend on, to a large extent, future developments~~negatively affected by the COVID-19 and ~~new information that may emerge regarding~~there is continued severe uncertainty about the duration and ~~severity~~intensity of its impacts. The Chinese and global growth forecast is extremely uncertain, which would seriously affect customer spending on our online shopping malls.

While the potential economic impact brought by, and the duration of COVID-19 and its new variants may be difficult to assess or predict, a widespread pandemic could result in significant disruption of global financial markets, reducing our ability to access capital, which could negatively affect our liquidity. In addition, a recession or market correction resulting from the ~~actions taken by government authorities~~spread of COVID-19 and ~~other entities to contain the COVID-19 or treat~~ its ~~impact, almost all of which are beyond our control.~~

~~PRC Regulations~~

~~We conduct substantially all of our operations and generate most of our revenue in the PRC. Accordingly, economic, political and legal developments in the PRC will significantly~~new variants could materially affect our business ~~financial condition, results~~and the value of ~~operations~~our common stock.

PRC Regulations

There are substantial uncertainties regarding the interpretation and ~~prospects.~~application of PRC laws and regulations including, but not limited to, the laws and regulations governing our business and the enforcement and performance of our arrangements with customers in certain circumstances. We are considered foreign persons or foreign funded enterprises under PRC laws and, as a result, we are required to comply with PRC laws and regulations related to foreign persons and foreign funded enterprises. These laws and regulations are sometimes vague and may be subject to future changes, and their official interpretation and enforcement may involve substantial uncertainty. The effectiveness of newly enacted laws, regulations or amendments may be delayed, resulting in detrimental reliance. New laws and regulations that affect existing and proposed future businesses may also be applied retroactively. We cannot predict what effect the interpretation of existing or new PRC ~~economy~~laws or regulations may have on our business.

16. SUBSEQUENT EVENTS

On July 7, 2021, the Company filed a Form S-8 to register the shares of Common Stock under the Company’s 2020 Omnibus Equity Plan (the “Equity Plan”). The Board of Directors of the Company approved and adopted the Equity Plan on October 27, 2020, which was approved by the shareholders at the Company’s annual shareholders meeting on December 18, 2021. The total aggregate shares of common stock authorized for issuance during the term of the Equity Plan is limited to 5,000,000 shares.

On July 12, 2021 (the “Grant Date”), the Compensation Committee of the Board of Directors (the “Board”) of the Company granted 1,953,000 shares of common stock of the Company, par value $0.001 (the “Shares”), pursuant to the Company’s 2020 Omnibus Equity Plan, to certain officers and employees of the Company and its subsidiaries (the “Grantees”), including: 500,000 shares to Shanchun Huang, Chief Executive Officer of the Company; 300,000 shares to Yongke Xue, President of the Company; 20,000 shares to Ming Yi, Chief Financial Officer of the Company, and 40,000 shares to Yang Liu, Chief Operating Officer of the Company (collectively, the “Grants”). The Grants vested immediately on the Grant Date and each of the Grantees also entered into an Unrestricted Stock Award Agreement with the Company on July 12, 2021. As of the date of this report, the Shares have been issued to the Grantees.

On July 22, 2021, the Company filed a shelf registration statement on Form S-3 under which the Company may, from time to time, sell securities in ~~transition from a planned economy~~one or more offerings up to a ~~market oriented economy subject to plans adopted by the government that set national economic development goals. Policies~~total dollar amount of $200,000,000. The shelf registration statement has not been declared effective as of the ~~PRC government can have significant effects on economic conditions in the PRC.~~date of this report.

~~Currency risks~~

A majority of the Company’s operating transactions are denominated in RMB and a significant portion of the Company’s assets and liabilities is denominated in RMB. RMB is not freely convertible into foreign currencies. The value of the RMB is subject to changes in the central government policies and to international economic and political developments. In the PRC, certain foreign exchange transactions are required by laws to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Company in China must be processed through PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to complete the remittance.

~~19. SUBSEQUENT EVENTS~~

On ~~November 2, 2020,~~July 22, 2021, the Company entered into a Securities Purchase Agreement (the “Agreement”) with certain investors identified on the signature pages thereto (the “Purchasers”), pursuant to which the Company agreed to sell to ~~these investors~~the Purchasers in a private placement ~~167,034~~548,799 shares (the “Shares”) of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at a purchase price of ~~$1.87~~$2.83 per share for an aggregate offering price of ~~$312,352. This private placement~~$1,553,101 (the “Private Placement”). The Private Placement will be completed pursuant to the exemption from registration provided by Regulation S promulgated under the Securities Act of 1933, as amended.

~~Item 2.~~

~~Management’s Discussion and Analysis of Financial Condition and Results of Operations.~~

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

This quarterly report on Form 10-Q and other reports filed by the Company from time to time with the SEC (collectively the “Filings”) contain or may contain forward-looking statements and information that are based upon beliefs of, and information currently available to, Company’s management as well as estimates and assumptions made by Company’s management. Readers are cautioned not to place undue reliance on these forward-looking statements, which are only predictions and speak only as of the date hereof. When used in the filings, the words “may”, “will”, “should”, “would”, “anticipate”, “believe”, “estimate”, “expect”, “future”, “intend”, “plan”, or the negative of these terms and similar expressions as they relate to Company or Company’s management identify forward-looking statements. Such statements reflect the current view of Company with respect to future events and are subject to risks, uncertainties, assumptions, and other factors (including the statements in the section “results of operations” below), and any businesses that Company may acquire. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ significantly from those anticipated, believed, estimated, expected, intended, or planned. Factors that might cause or contribute to such a discrepancy include, but are not limited to, those listed under the heading “Risk Factors” and those listed in our Annual Report on Form 10-K for the year ended December 31, ~~2019~~2020 (the ~~“2019~~“2020 Form 10-K”) and in this Form 10-Q. The following discussion should be read in conjunction with our Financial Statements and related Notes thereto included elsewhere in this report and in our ~~2019~~2020 Form 10-K.

Although the Company believes the expectations reflected in the forward-looking statements are based on reasonable assumptions, the Company cannot guarantee future results, levels of activity, performance, or achievements. Except as required by applicable law, including the securities laws of the United States, the Company does not intend to update any of the forward-looking statements to conform these statements to actual results. Readers are urged to carefully review and consider the various disclosures made throughout the entirety of this report, which attempts to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations, and prospects.

Overview of Our Business

Future FinTech is a holding company incorporated under the laws of the State of Florida. The Company historically engaged in the production and sale of fruit juice concentrates (including fruit purees and fruit juices), fruit beverages (including fruit juice beverages and fruit cider beverages) in the PRC. Due to drastically increased production costs and tightened environmental laws in China, the Company had transformed its business from fruit juice manufacturing and distribution to a real-name blockchain ~~technology and~~based e-commerce platform ~~that integrates blockchain~~ and ~~internet technology~~supply chain financing and service business. The main business of the Company includes an online shopping platform, Chain Cloud Mall ~~(CCM)~~(“CCM”), which is based on blockchain technology; ~~a cross-border e-commerce platform (NONOGIRL) which started its trial operation in March 2020~~supply chain financing and ~~formally launched in July 2020;~~services; a blockchain-based application ~~incubator~~incubator; and technical service and support for ~~real name and~~ blockchain based assets and their operating ~~entities (DCON);~~entities; and the application and development of blockchain-based e-commerce technology and financial ~~technology.~~

Currently, the Android version app of the NONOGIRL platform has been launched on Googleplay, Tencent Application Treasure, Xiaomi, OPPO, and VIVO application stores, and the IOS version app of the platform has been launched on Apple App Store. As of September 30, 2020, there were 10,450 registered users of the NONOGIRL platform, of which 1,210 were in China and 9,240 were outside of China

technology services. The Company is also expanding into financial ~~service business.~~services. On ~~July 13, 2020,~~August 6, 2021, the Company ~~entered into a Share Exchange Agreement with Joy Rich Enterprises Limited (“Joy Rich”) to acquire~~completed acquisition of 90% of the issued and outstanding shares of Nice Talent Asset Management Limited (“NTAM”), a Hong Kong-based asset management company, from Joy ~~Rich.~~Rich Enterprises Limited (“Joy Rich”). NTAM is licensed under the Securities and Futures Commission of Hong Kong (“SFC”) to carry out regulated activities in Type 4: Advising on Securities and Type 9: Asset Management. ~~The transaction is expected to close by the end of November 2020.~~

In August 2020, the Company announced that it plans to enter the challenger bank and digital payment sector. The challenger banks distinguish themselves from the historic banks by modern financial technology practices, such as online-only operations without physical retail stores, which reduce the banking costs and avoid the complexities of traditional banking. In recent years, challenger banks and third-party payment systems have grown rapidly worldwide, rising to the top of the financial services industry, with personalized banking services that have reinvented the customer experience. Countries around the globe have enforced lockdowns recently and have advised their citizens to socially distance during the COVID-19 pandemic leading to traditional physical banking services declining due to health and safety concerns. This has expedited innovation in financial banking industries. FTFT has already recruited certain professionals from this industry, and has been in frequent contact with companies in this sector in Southeast Asia and Europe, in order to find M&A targets.

Chain Cloud Mall adopts a “multi-vendor hosted stores + platform self-hosted stores” model. The platform supports various marketing methods, including point rewards programs, coupons, live webcasts, game interaction, and social media sharing. Besides the blockchain-powered features, CCM is also fully equipped with the same functions and services that other Chinese leading traditional e-commerce platforms provide.

Based on blockchain technology, CCM is established to transform the relationship between companies and consumers from traditional selling and buying relationships to a value-sharing relationship. The platform will fairly distribute the benefit of the entire mall to users who engaged in the promotion, development, and consumption based on their contributions to the platform. The ~~members~~users of CCM are not only consumers and entrepreneurs but also participants, promoters and beneficiaries. The CCM shared shopping mall platform is designed to be a block-chain based shopping mall for merchants and goods, not the exchange of digital currencies, and it currently only accepts payment from credit cards, Alipay and WeChat.

Chain Cloud Mall is an enterprise and customer interactive and comprehensive shopping and sales service platform. It is an open network promotion system with a blockchain based anti-counterfeit system including referral point and discount points issuance and settlement. ~~The new~~Such business model creates a completely new source of data traffic for enterprises on our platform.

Merchants on the Chain Cloud Mall issue their own blockchain points and anti-counterfeiting QR codes. Every product comes with unique anti-counterfeiting QR codes on the label. Customers collect the points issued by the merchants by scanning products with their mobile phones on the anti-counterfeiting QR code. These QR codes are generated by blockchain system of Chain Cloud Mall and provided to merchants. The successful collection of the merchant points confirms that the authentication of product from such enterprise. The Chain Cloud Mall records and provides Chain Cloud Mall points to its ~~members~~customers upon a successful ~~new member and/or~~ product referral, which can be used as credit when making purchases on CCM. It incentivizes its ~~members~~customers to promote the platform and share the products with their social contacts, which in turn increases the sales through Chain Cloud Mall and helps the Company generate greater value.

The Company started its trial operation of NONOGIRL, a cross-border e-commerce platform, in March 2020 and formally launched it in July 2020. The cross-border e-commerce platform aimed to build a new s2b2c (supplier to business and consumer) outsourcing sales platform dominated by social media influencers. It was aimed at the growing female consumer market, with the ability to broadcast, short video, and all forms communication through the platform. It could also create a sales oriented sharing ecosystem with other major social media used by customers, etc. The Company’s promotion strategy previously mainly relied on the training of members and distributors through meetings and conferences. Due to the outbreak of COVID-19, the Chinese government put a restriction on large gatherings. These restrictions made the promotion strategy for our online e-commerce platforms difficult to implement and the Company has experienced difficulties to subscribe new members for its online e-commerce platforms. Due to the lack of new subscribers, in June 2021, the Company suspended its cross-border e-commerce platform (NONOGIRL). Also, during the second quarter of 2021, the Company has transformed its member-based business model of Chain Cloud Mall to sales agent based business model and began to provide supply chain financing and services for coal mines and power generation plants.

The Company currently has six direct wholly-owned subsidiaries: DigiPay FinTech Limited (“DigiPay”), a company incorporated under the laws of the British Virgin Islands, Future FinTech (Hong Kong) Limited, a company incorporated under the laws of Hong Kong, GlobalKey Shared Mall Limited, a company incorporated under the laws of Cayman Islands (“GlobalKey Shared Mall”), Tianjin Future Private Equity Fund Management Partnership( Limited Partnership), a company incorporated under the laws of China, FTFT UK Limited, a company incorporated under the laws of United Kingdom, and Future FinTech Labs Inc., a company incorporated under the laws of New York.

CCM Shopping Mall

Due to the lack of new member subscriptions caused by restrictions on our promotion strategy for the control of spread of COVID-19, we have transformed the CCM shopping mall ~~membership~~to an “Enterprise Communication As A Service” or eCAAS platform. The eCAAS platform is entrusted by the 315 Consumer Protection Foundation to run its Responsible Brand Program.

~~Members~~315 Consumer Protection Foundation (the “Foundation”) will review and accept the companies to join its Responsible Brand Program. After acceptance, these companies are ~~the key participants~~authorized to use 315 anti-counterfeiting label on ~~CCM~~their products and drivers of its growth. Our members typically pay to gain access to a dedicated app that provides access to a curated selection of products, exclusive membership benefits, and features, including discounted prices and point rewards. Members can refer others to become members and are rewarded for doing so. Memberssell them on our eCAAS platform. The companies can also ~~promote~~use sales agents to sell their products on ~~various social platforms~~our eCAAS platform and ~~are rewarded if those users purchase our products.~~parties can negotiate the commission percentages for the products sold. Any new sales agent must be recommended by existing agents and pay a one-time fee to the eCAAS platform to be admitted as the authorized agent to provide sales agent services on the platform.

Sales of Goods

We have a unique real-name ~~and membership–~~based blockchain e-commerce shopping platform that integrates blockchain, internet technology and distinguishes itself by utilizing the automatic value distribution system of the blockchain and sharing the value of the platform to all the participants in the system.

Our ~~latest CCM v3.0 creates~~eCAAC platform has a ~~new~~ value cycle system of online shopping mall with the real-name blockchain system with following characteristics:

Blockchain anti-counterfeiting

Using real-name blockchain technology to carry out anti-counterfeiting for products produced by the enterprises. The essence of anti-counterfeiting is to determine the person responsible for the product. Using real-name blockchain system, it provides the assurance to our customers to the authentication of the products they purchase and solve the problem of counterfeiting products in online shopping mall.

1.	~~Blockchain anti-counterfeiting~~

2.	Blockchain points settlement leads to secondary data traffic

Blockchain points are also discount coupons for merchants, guiding customers to the platform of the merchants, and provide them discounts when purchasing. This process is called secondary data traffic. Every company is aware of the importance of maintaining old customers. Blockchain anti-counterfeiting technology through scanning of QR codes by the customers helps companies identify such customers and allows them to systematically maintain contacts with such customers.

Points promotion system

Points promotion system brings secondary data traffic comes with volume and high turnover ratio. All such sales are directed to the merchants’ stores when customers possess and use merchants coupons. With a high level of user stickiness, customers are likely to purchase products again and collect more blockchain points.

~~Member community system to build~~4.

Building a high value community

Anti-counterfeiting technology plus the Company’s secondary data traffic platform have created great value for the merchants that have stores on our platform. By gathering all loyal customers to a merchant’s store, we can build a standard value community. With the common interest, the value community of a merchants can form a self-organizing system with customer groups to maximize the interests of such merchant. The anti-counterfeiting technology, combined with the company’s secondary data traffic platform, has created great value for merchants who set up shop on our platform. By gathering all our loyal customers into one merchant’s store, we can build a standard value community. With common interests, the value community of merchants can form a self-organizing system with customer groups to maximize the interests of merchants.

Coal Supply Chain Financing and Trading

To carry out coal supply chain financing and trading business, we sign the supply and sales contracts with upstream coal mines and downstream end users, respectively, while the upstream supplier is responsible for the ~~merchants that have stores on~~supply and transportation of coal to the end users’ designated freight yard. After the downstream end users issue relevant settlement documents, inspect and accept goods, we make payment to the upstream suppliers. The downstream end users shall pay us according to the payment terms under our ~~platform. By gathering all loyal customers to a merchant’s store, it can build a community of people with~~contracts. At present, we only provide supply chain financing services the ~~common interest. Through the community, the merchant can form a self-organizing system with customer groups to maximize the interests of such merchant.~~

Approximately $8,000 and $406,000 were recognized as revenues from orders on sales of the Company’s own products on the platform for the nine months ended September 30, 2020 and September, 2019, respectively.

During the third quarter of 2020, the Company’s Board of Directors passed a resolution to close the operation of CCM Logistics, a subsidiary located in the national kiwifruit Industrial Park of Baoji City. In July 2020, the Company established a winding-down plan to close this operation.

~~On November 12, 2020, CCM Tianjin, a wholly~~central government owned subsidiary of the Company entered into an Equity Transfer Agreement with Xi’an Yishengkang Information Technology, Ltd. (“Xi’an Yishengkang”), an unrelated third party, pursuant to which CCM Tianjin agreed to sell 90% of total issued and outstanding capital stock of Hedetang Market that it owns to Xi’an Yishengkang for RMB9,000 (approximately $1,324). On the same date, CCM Logistics entered into another Equity Transfer Agreement with an individual and unrelated third party, Liyuan Ying, pursuant to which CCM Tianjin agreed to sell 10% of total issued and outstanding capital stock of Hedetang Market that it owns to Liyuan Ying for RMB1,000 (approximately $147).

~~Impact of COVID-19 on our Business~~

~~In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, the pandemic quickly spread to many provinces, autonomous regions, and cities all over the China~~enterprises, local or state government owned enterprises or listed public companies and other parts of the world.COVID-19 has materially and adversely affected our business, especially during the first six months of 2020. In early 2020, Chinese government took emergency measures to combat the spread of the virus, including quarantines, travel restrictions, and the temporary closure of office buildings and facilities in China.customers with good credit rating.

Substantially all of our revenues are generated in China. In response to the evolving dynamics related to the COVID-19 outbreak, the Company is following the guidelines of local authorities as it prioritizes the health and safety of its employees, contractors, suppliers and business partners. Our offices in China was closed and all of the Company’s employees worked from home from Chinese New Year at the end of January until late March 2020. Other businesses in China started reopening around the end of the first quarter as well, and more and more businesses, transportation, logistic and marketing activities have gradually resumed since then. Our offices currently are in normal operation. However, quarantines, travel restrictions, and the temporary closure of office buildings have negatively impacted our business during the outbreak. Our suppliers have negatively been affected, and could continue to be negatively affected in their ability to supply and ship products to our customers by any further outbreak or resurgence of COVID-19 in China. Our customers that are negatively impacted by the outbreak of COVID-19 may reduce their budgets to purchase products and services from us, which may materially adversely impact our revenue. The business operations of the third parties’ stores on our platform have been and could continue to be negatively impacted by any further outbreak or resurgence of COVID-19, which may negatively impact their operations and business, which may in turn adversely affect the business of our platform as a whole as well as our financial condition and operating results. The outbreak has had and might continue to have disruption to our supply chain, logistics providers, customers or our marketing activities if there is a resurgence of COVID-19 in China, which could materially adversely impact our business and results of operations, including causing our suppliers to cease manufacturing products for a period of time or materially delay delivery to us and customers, which may also lead to loss of customers, as well as reputational, competitive and business harm to us. Some of our customers, contractors, suppliers and other business partners are small and medium-sized enterprises (SMEs), which may not have strong cash flows or be well capitalized, and may be vulnerable to an epidemic outbreak and slowing macroeconomic conditions. If the SMEs that we work with cannot weather the COVID-19 and the resulting economic impact, or cannot resume business as usual after a prolonged outbreak, our revenues and business operations may be materially and adversely impacted.

The global economy has also been materially negatively affected by the COVID-19 and there is continued severe uncertainty about the duration and intensity of its impacts. The Chinese and global growth forecast is extremely uncertain, which would seriously affect customer spending on our shopping mall.

While the potential economic impact brought by, and the duration of, COVID-19 may be difficult to assess or predict, a widespread pandemic could result in significant disruption of global financial markets, reducing our ability to access capital, which could negatively affect our liquidity. In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect our business and the value of the Company’s Common Stock.

Further, as we do not have access to a revolving credit facility, there can be no assurance that we would be able to secure commercial debt financing in the future in the event that we require additional capital. We currently believe that our financial resources will be adequate to see us through the outbreak. However, in the event that we do need to raise capital in the future, outbreak-related instability in the securities markets could adversely affect our ability to raise additional capital.

Consequently, our results of operations have been materially adversely affected. Any potential impact to our results will depend on, to a large extent, future developments and new information that may emerge regarding the duration and severity of the COVID-19 and the actions taken by government authorities and other entities to contain the COVID-19 or treat its impact, almost all of which are beyond our control.

~~SEC Subpoena~~

On February 21, 2020, the Company received a subpoena from the SEC’s Division of Enforcement requiring us to produce documents and detailed information relating to, among other things, the Company’s accounting procedures, management oversight, and the sale of HeDeTang holdings (HK) Ltd. to New Continent International Co., Ltd. The subpoena required the Company to produce all responsive documents created during, or concerning, the period January 1, 2016 to the present, unless otherwise specified.

Results of Operations

Comparison of Three Months ended ~~September~~June 30, ~~2020~~2021 and ~~2019:~~ 2020:

Revenue

~~Revenue~~

The following table presents our consolidated revenues for ~~each of our main services~~the three months ended June 30, 2021 and ~~products~~2020, respectively:

	Three months ended June 30,				Change
	2021		2020		Amount			%
CCM Shopping Mall Membership		12		104,762		(104,750	)		(99.99	)%
Coal Supply Chain Financing/Trading		1,941,557		-		1,941,557			-
Sales of goods		-		1,786		(1,786	)		100	%
Others		13		7,139		(7,126	)		(99.82	)%
Total	$	1,941,582	$	113,687	$	1,827,895			1607.83	%

CCM Shopping Mall Membership fees decreased from $104,762 for the three months ended ~~September~~June 30, 2020 ~~and 2019, respectively (in thousands):~~

Three months ended
September 30, Change
2020 2019 Amount %
Service fees $ 38 208 $ (170 ) (81.7 )%
Sales of Goods 6 134 (128 ) (95.5 )%
Total $ 44 $ 342 $ (298 ) (87.1 )%

~~The Company’s promotion strategy previously mainly relied on~~to $12 for the training of members and distributors through meetings and conferences. Due to the outbreak of COVID-19, the Chinese government put a restriction on large gatherings and these restrictions made the promotion strategy for CCM Shopping Mall and NONOGIR difficult to implement. As a result,three months ended June 30, 2021 because there was ~~a decrease in the sales of good due to the lack of ability to promote the use of our CCM shopping mall and NONOGIR to purchase our products through existing marketing strategies.~~

~~Revenue from service fees includes CCM Shopping Mall and NONOGIRL membership, agent fees, commission on sales, service fees, etc. In~~no new member enrollment during the second quarter of ~~2020,~~2021 and the Company ~~launched~~has transformed its business model of CCM ~~v3.0. With~~Shopping Mall from a member-based platform to a sales agent based eCAAC platform. Due to COVID-19 related restriction on large gathering for meetings and conference which primarily used by us before the pandemic for marketing and business development of new ~~application,~~members, we were unable to attract new member enrollment during the Company charges RMB 1,000 (approximately $142) per year to the suppliers, who agree to adopt the QRO anti-counterfeiting code for their products, which they sell in CCM and NONOGIR. Members that serve as agents to sell products for CCM and NONOGIR suppliers are charged a one-time agent fee of RMB 3,820 (approximately $543) by CCM and NONOGIR. CCM and NONOGIR also charges commission from products sold on the platform, and service fee from the agent, who receive commission from the suppliers.three months ended June 30, 2021.

~~As there was~~Coal Supply Chain Financing and Trading business increased from $0 for the three months ended June 30, 2020 to $1.9 million for the three months ended June 30, 2021. This is a new business that did not exist last year.

Sale of goods decreased from $1,786 for the three months ended June 30, 2020 to $0 for the three months ended June 30, 2021 as no ~~promotion~~sale of ~~the CCM shopping mall and NONOGIR, revenue from service fees also decreased in the third quarter of fiscal year 2020, compared to~~goods during the same period of ~~2019.~~2021.

Other revenues decreased from $7,139 from three months ended June 30, 2020 to $13 for the three months ended June 30, 2021, mainly due to the service fee income during the three months ended June 30, 2020 and no such income during the same period of 2021.

Gross Margin

The following table presents the consolidated gross profit of each of our main ~~services~~products and ~~products~~services and the consolidated gross profit ~~margins~~margin, which is gross profit as a percentage of the related revenues, for the three months ended ~~September~~June 30, 2021 and 2020, ~~and 2019, respectively (in thousands):~~respectively:

Three months ended
September 30,
2020 2019
Gross profit Gross margin Gross profit Gross margin
Service fees $ 27 71.6 % $ 185 88.9 %
Sales of Goods 3 51.2 % 80 59.7 %
Total/Overall (for gross margin) $ 30 69.0 % $ 265 77.5 %

	Three months ended June 30,
	2021					2020
	Gross profit		Gross margin			Gross profit		Gross margin
CCM Shopping Mall Membership		12		100	%		100,803		99.9	%
Coal Supply Chain Financing/Trading		71,341		3.67	%		-		-
Sales of goods		-		-			1,067		59.75	%
Others		2		12.03	%		2,457		34.42	%
Total	$	71,355		3.68	%	$	104,327		91.77	%

~~The decrease in~~

Overall gross margin as a percentage of revenue was 3.68% for the ~~nine~~three months ended ~~September~~June 30, ~~2020 as~~2021, a decrease of 88.09% compared to 91.77% for the same period of last fiscal year, ~~was due to a decrease in gross margin from services fees, which accounts for 89.7% of total revenue for the three months ended September 30, 2020.~~

~~The decrease in gross profit from service fees for the nine months ended September 30, 2020 as compared to the same period of last year in dollar amount was~~ mainly due to less revenues from the membership fee which has a ~~decrease in revenue.~~much higher margin than that of sales of goods and coals.

Operating Expenses

The following table presents our consolidated operating expenses and operating expenses as a percentage of revenue for the three months ended ~~September~~June 30, 2021 and 2020, ~~and 2019, respectively~~respectively: (in thousands):

Third quarter of
2020 Third quarter of
2019
Amount % of
revenue Amount % of
revenue
General and administrative $ 809 1,839.0 % $ 921 269.3 %
Selling expenses 26 59.1 % 243 71.2 %
Bad debt provision 248 564.0 % 1 -
Total operating expenses $ 1,083 2,461.0 % $ 1,165 340.5 %

	June 30, 2021					June 30, 2020
	Amount		% of revenue			Amount		% of revenue
General and administrative	$	594		30.61	%	$	310		273	%
Selling expenses		10		0.52	%		8		0.01	%
Bad debt provision		-		-			230		0.20	%
Total operating expenses	$	604		31.13	%	$	548		0.48	%

~~The decrease in general~~General and administrative expenses increased by $0.28 million, or 91.85%, from $0.31 million to $0.59 million for the ~~nine~~three months ended ~~September~~June 30, ~~2020 as~~2021, compared to the same period of last ~~year~~fiscal year. The increase in general and administrative expenses was mainly due to increased wage costs, office rent expenses and professional service fee during the ~~decrease in payroll related expenses as a result of the Company’s cost control efforts.~~

~~The decrease in selling expenses for the nine~~three months ended ~~September~~June 30, ~~2020 as~~2021.

Selling expenses increased by $0.02 million during the three months ended June 30, 2021, compared to the same period of last ~~year~~fiscal year.

Write back of provision of doubtful debt was ~~mainly due to a decrease in payroll related expenses~~$0 for the ~~sales staff, which staffs, who now are mainly based on performance-based commission. In addition, the shipping expenses~~three months ended June 30, 2021, decreased ~~as a result of a decreased in the sales volume in the third quarter of 2020, compared~~by $0.23 million comparing to the same period of ~~2019.~~

~~Bad debt~~the last fiscal year, mainly due to provision ~~for~~was made in 2020 due to the ~~three months ended September 30, 2020 was mainly for~~age of the ~~other receivables, which are more than three months past due.~~account, and the age of the account in 2021 did not exceed the provision requirements.

Other (Expense) Income, ~~(Expense),~~ Net

Other expenses, net ~~increased~~decreased by ~~$1.44~~$0.02 million to ~~$1.42~~positive $0.02 million for the three months ended ~~September~~June 30, ~~2020~~2021 from ~~other expenses of $0.02~~negative $0.002 million in the same period of the last fiscal year, primarily due to an increase in loss of $1.95 million recorded in the third quarter of 2020 for the issuance of common stock for the Debt Repayment Agreement that the Company entered during fiscal year 2020.

year.

Income Tax

~~There were no provisions~~We did not have tax provision for ~~income taxes,~~the three months ended June 30, 2021 and 2020, as the ~~company suffered a loss.~~Company incurred losses in the second quarter of 2021 and 2020.

Non-controlling Interests

As of ~~September~~June 30, ~~2020,~~2021, Shaanxi Chunlv Ecological Agriculture Co., Ltd. (“Shaanxi Chunlv”) holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited, ~~(“CCM Logistics”), CCM Logistics holds 10% interest in ) Hedetang Farm Products Trading Market (Mei County) Co., Ltd.,~~ Nature Worldwide Resources Ltd. ~~held a~~holds 40% interest in DCON ~~Digipay,~~DigiPay Limited (“DCON Digipay”), Bin Wu and ~~Shaanxi Yinlian~~Lixiong Huang holds ~~45%~~25% and 20% interest in ~~Zhonglian Hengxin.~~FTFT Capital Investments L.L.C.

~~Comparison~~Loss from Continuing Operations

Loss from continuing operations decreased by $0.37 million from $0.75 million for the three months ended June 30, 2020 to $0.38 million for the same period of ~~Nine Months~~2021 mainly due to the debt repayment with shares during the three months ended ~~September~~June 30, 2020 and ~~2019:~~no such expense during the same period of 2021.

Loss on disposal of discontinued operations

Loss on disposal of discontinued operation was $21,577 for the three months ended June 30, 2021, which was related to the dissolution and deregistration of FT Commercial Management (Beijing) Co., Ltd during the second quarter of 2021.

Comparison of Six Months Ended June 30, 2021 and 2020

Revenue

~~Revenue~~

The following table presents our consolidated revenues for ~~each of our main services~~the six months ended June 30, 2021 and ~~products~~2020, respectively:

	Six months ended June 30,				Change
	2021		2020		Amount			%
CCM Shopping Mall Membership		84		303,647		(303,563	)		(99.97	)%
Coal Supply Chain Financing/Trading		1,941,557		-		1,941,557			-
Sales of goods		-		2,852		(2,852	)		100	%
Others		6,554		7,139		(585	)		(8.19	)%
Total	$	1,948,195	$	313,638	$	1,634,557			521.16	%

CCM Shopping Mall Membership fees decreased from $303,647 for the ~~nine~~six months ended ~~September~~June 30, 2020 ~~and 2019, respectively (in thousands):~~

Nine months ended
September 30 Change
2020 2019 Amount %
Service fees $ 349 339 $ 10 2.9 %
Sales of Goods 8 406 (398 ) (98.0 )%
Total $ 357 $ 745 $ (388 ) (52.1 )%

~~The decrease in revenue~~to $84 for the ~~nine~~six months ended ~~September~~June 30, ~~2020 as compared~~2021 because the Company had difficulties to ~~the same period of last year was due to a decrease in sales of goods.~~

~~The decrease in sale of goods was mainly due to the negative impact of COVID-19 during this period, as the staff could not work in the office and shipments stopped~~enroll new members during the first ~~quarter. In addition,~~half of 2021 and the Company ~~is lack~~has transformed its business model of ~~ability~~CCM Shopping Mall from member-based platform to ~~promote the use of our CCM shopping mall and NONOGIRL to purchase our products through existing marketing strategies.~~

As a ~~percentage of total revenue, revenue from service fees was 97.8% and 45.5% for the nine months ended September 30, 2020 and September 30, 2019, respectively.~~

Insales agent based eCAAC platform during the second quarter of ~~2020, the Company launched CCM v3.0. With the new application, the Company charges RMB 1,000 (approximately $142) per year~~2021. Due to the ~~suppliers, who agree~~COVID-19 related restriction on large gathering for meetings and conference which primarily used by us before the pandemic for marketing and business development of new members, we were unable to ~~adopt~~attract more new members during first half of 2021.

Coal Supply Chain Financing and Trading business increased from $0 for the ~~QRO anti-counterfeiting code~~six months ended June 30, 2020 to $1.9 million for ~~their products, which they sell in CCM. Members~~the six months ended June 30, 2021. This is a new business that ~~serve~~did not exist last year.

Sale of goods decreased from $2,852 for the six months ended June 30, 2020 to $0 for the six months ended June 30, 2021 as ~~agents~~no sale of goods.

Other revenues decreased from $7,139 for the six months ended June 30, 2020 to ~~sell products from CCM suppliers are charged a one-time agent fee of RMB 3,820 (approximately $543) by CCM. CCM also charges commission from products sold on~~$6,554 for the ~~platform, and service fee from the agent, who receive commission from the suppliers.~~six months ended June 30, 2021.

Gross Margin

The following table presents the consolidated gross profit of each of our main ~~services~~products and ~~products~~services and the consolidated gross profit margin, which is gross profit as a percentage of the related revenues, for the ~~nine~~six months ended ~~September~~June 30, 2021 and 2020, ~~and 2019, respectively (in thousands):~~respectively:

Nine months ended
September 30,
2020 2019
Gross profit Gross margin Gross profit Gross margin
Service fees $ 329 94.3 % $ 305 90.0 %
Sales of Goods 5 62.5 % 117 28.8 %
Total/Overall (for gross margin) $ 334 93.5 % $ 422 56.7 %

	Six months ended June 30,
	2021					2020
	Gross profit		Gross margin			Gross profit		Gross margin
CCM Shopping Mall Membership		84		100	%		299,412		98.61	%
Coal Supply Chain Financing/Trading		71,341		3.67	%		-		-
Sales of goods		-			-		1,897		66.51	%
Others		520		7.93	%		2,457		34.42	%
Total	$	71,945		3.69	%	$	303,766		96.85	%

~~The increase in~~Overall gross margin as a percentage of revenue was 3.69% for the ~~nine~~six months ended ~~September~~June 30, ~~2020 as~~2021, a decrease of 93.16% compared to 96.85% for the same period of last fiscal year, ~~was~~ mainly ~~attributable~~due to less revenues from the ~~decrease in the revenue percentage~~membership fee which has a much higher margin than that of sales of goods relative to the total revenue. Sale of goods has a lower margin. The decrease in the dollar value of overall gross margin for the nine months ended September 30, 2020 as compared to the same period of last year was mainly due to the decrease in revenue from the sales of goods.and coals.

Operating Expenses

The following table presents our consolidated operating expenses and operating expenses as a percentage of revenue for the ~~nine~~six months ended ~~September~~June 30, 2021 and 2020, ~~and 2019, respectively~~respectively: (in thousands):

Nine months ended
September 30,
2020 Nine months ended
September 30,
2019
Amount % of revenue Amount % of revenue
General and administrative $ 3,082 862.7 % $ 2,555 343.0 %
Selling expenses 47 13.1 % 780 104.7 %
Bad Debt provision 247 69.2 % 8 1.0 %
Total operating expenses $ 3,376 944.9 % $ 3,343 448.7 %

	June 30, 2021						June 30, 2020
	Amount			% of revenue			Amount		% of revenue
General and administrative	$	2,194			112.63	%	$	2,193		699.28	%
Selling expenses		23			1.18	%		20		6.53	%
Bad debt provision		(18	)		(0.94	)%		4,433		1,413.51	%
Total operating expenses	$	2,199			112.87	%	$	6,646		2,119.32	%

~~The increase in general~~

General and administrative expenses increased by $981, or 0.05%, from $2.193 million for the ~~nine~~six months ended ~~September~~June 30, 2020 asto $2.194 million for the six months ended June 30, 2021.

Selling expenses increased by $2,561 during the six months ended June 30, 2021, compared to the same period of last fiscal year.

Write back of provision of doubtful debt was $18,000 for the six months ended June 30, 2021, decreased by $4.45 million comparing to the same period of the last fiscal ~~year~~year. Write back of provision was ~~mainly due to stock related expenses of $1,191 thousand~~for doubtful debts from subsidiaries that disposed during the Company recorded during first quarter of 2020, for a Consulting Service Agreement that the Company entered into on January 25, 2020 with Dragon Investment Holding Limited (Malta), which was partially offset by the decrease in payroll related expenses as a result of the Company’s cost control efforts.

~~The decrease in selling expenses thousand for the nine~~six months ended ~~September~~June 30, 2020, compared to the same period of the last fiscal year was mainly due to a decrease in payroll related expenses for the sales staffs, who now are mainly on performance based compensation. In addition, the shipping expenses decreased as a result of a decreased2020，but no such item in the ~~sales volume during the nine~~six months ended ~~September~~June 30, ~~2020.~~

~~Bad debt provision incurred during the period ended September 30, 2020 was mainly for the other receivables, which are more than three months past due.~~2021.

Other (Expense) Income, ~~(Expense),~~ Net

Other expenses, net, ~~increased~~decreased by ~~$2.04~~$1.94 million to ~~$2.17~~positive $0.77 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 from ~~other expenses of $0.13~~negative $1.17 million in the same period of the last fiscal year, ~~primarily~~mainly due to debt repayment with shares during the ~~increase~~six months ended June 30, 2020 and no such expense in the same period of ~~loss of $1.95 million related with the issuance of common stock~~2021.

Income Tax

We did not have tax provision for the ~~Debt Repayment Agreement that~~six months ended June 30, 2021 and 2020, as the Company ~~entered during~~incurred losses in the ~~nine~~six months ended ~~September~~June 30, 2021 and 2020.

Non-controlling Interests

As of ~~September~~June 30, ~~2020,~~2021, Shaanxi Chunlv Ecological Agriculture Co., Ltd. (“Shaanxi Chunlv”) holds 20.0% interest in Chain Cloud Mall Logistics Center (Shaanxi) Co., Limited, ~~(“CCM Logistics”), CCM Logistics holds 10% interest in Hedetang Farm Products Trading Market (Mei County) Co., Ltd.,~~ Nature Worldwide Resources Ltd. ~~held a~~holds 40% interest in DCON ~~Digipay,~~DigiPay Limited (“DCON Digipay”), Bin Wu and ~~Shaanxi Yinlian~~Lixiong Huang holds ~~45%~~25% and 20% interest in ~~Zhonglian Hengxin.~~FTFT Capital Investments L.L.C.

Loss from Continuing Operations

Loss from continuing operations decreased by $6.16 million from $7.52 million for the six months ended June 30, 2020 to $1.36 million for the same period of 2021 mainly due to a decrease in operating expenses, as discussed above.

Gain on disposal of discontinued operations

Gain on disposal of discontinued operation was $0.16 million for the six months ended June 30, 2021, which was related to the dissolution and deregistration of FT Commercial Management (Beijing) Co., Ltd and Chain Future Digital Tech (Beijing) Co., Ltd during the six months ended June 30, 2021.

Loss per Share

Basic and diluted loss per share from continuing operations were $0.02 and $0.02 for the six months ended June 30, 2021, respectively, as compared to a loss of $0.21 and $0.21 for the same periods of 2020, respectively. Basic and diluted income per share attributable to discontinued operations was nil for the six months ended June 30, 2021 respectively. Basic and diluted loss per share attributable to discontinued operations was $3.45 and $3.38 for the six months ended June 30, 2020 respectively.

Liquidity and Capital Resources

As of ~~September~~June 30, ~~2020,~~2021, we had cash and cash equivalents of ~~$0.96~~$72.01 million, as compared to ~~$0.53~~$9.79 million as of December 31, ~~2019.~~2020. The increase in cash, cash equivalents and restricted cash was mainly due to financing from the issuance of shares of common stock.

Our working capital has ~~historically~~mainly been generated from ~~our operating cash flows, advances from our customers and loans from bank facilities and~~financing activities of issuance of ~~stock.~~shares of common stock of the Company. Our working capital was ~~$4.0~~positive $76.91 million, as of ~~September~~June 30, ~~2020,~~2021, an increase of ~~$106~~$78.22 million from working capital of negative ~~$102~~$1.31 million, as of ~~September~~June 30, ~~2019,~~2020, mainly due to an increase in current assets and a decrease in current liabilities.

Net cash used in operating activities ~~decreased~~increased by ~~$6.5~~$1.27 million to ~~$0.8~~$2.99 million for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 from ~~$7.3~~a cash inflow of $1.72 million for the same period of the last fiscal year. The ~~decrease~~increase in net cash used inby operating activities was primarily due to an increase in ~~net income.~~accounts receivable during the six months ended June 30, 2021.

Net cash used in investing activities ~~was $5.1~~decreased by $2 million ~~for~~comparing the ~~nine~~six months ended ~~September~~June 30, ~~2020. Net cash used in investing activities was~~2021 and June 30, 2020, mainly ~~for the payment in short-term loan investment of $5.1 million and the~~due to purchase of ~~accounting software of $1,259 for the nine months ended September 30,~~intangible assets in 2020.

Net cash provided in financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2020~~2021 was ~~$7.2~~$65.52 million representing an increase of ~~$6.2~~$63.21 million, as compared to cash provided by financing activities of ~~$1.0~~$2.31 million during the ~~nine~~six months ended ~~September~~June 30, ~~2019.~~2020. The increase in cash provided by financing activities was mainly ~~attributable~~due to financing from the ~~proceeds~~issuance of ~~$5.5 million from loan payables that the Company received during the nine months ended September 30, 2020.~~shares of common stock.

Off-balance ~~Sheet Arrangements~~sheet arrangements

As of ~~September~~June 30, ~~2020,~~2021, we did not have any off-balance sheet arrangements.

~~Item 3.~~

~~Quantitative and Qualitative Disclosures about Market Risk~~

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not applicable.

~~Not applicable.~~

Item 4. Controls and Procedures

~~Item 4.~~

~~Controls and Procedures~~

Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, our principal executive officer and principal interim financial officer, respectively, evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this report. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as of ~~September~~June 30, ~~2020,~~2021, our disclosure controls and procedures were not effective due to a material weakness in our internal control over financial reporting. Specifically, we currently lack sufficient accounting personnel with the appropriate level of knowledge, experience and training in U.S. GAAP and SEC reporting requirements.

~~Changes to Internal Control over Financial Reporting~~

We have taken, and are taking, certain actions to remediate the material weakness related to our lack of U.S. GAAP experience. We have engaged ~~consultants~~an outside consultant with U.S. GAAP knowledge and experience to supplement our current internal accounting personnel and assist us in the preparation of our financial statements to ensure that our financial statements are prepared in accordance with U.S. GAAP. We believe the measures described above will remediate the material weakness from the quarter identified above. As we continue to evaluate and work to improve our internal control over financial reporting, we may determine that additional measures.

Changes to Internal Control over Financial Reporting

Other than discussed above, there were no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

~~Item 1.~~

~~Legal Proceedings~~

Item 1. Legal Proceedings

~~As described~~

Legal case with FT Global Litigation

In January 2021, FT Global Capital, Inc. (“FT Global”), a former placement agent of the Company filed a lawsuit against the Company in ~~our Annual Report~~the Superior Court of Fulton County, Georgia. FT Global served the complaint upon the Company in January 2021. In the complaint, FT Global alleges claims, most of which attempt to hold the Company liable under legal theories that relate back to an alleged breach of an exclusive placement agent agreement between FT Global and the Company in July 2020 which had a term of three months. FT Global claims that the Company failed to compensate FT Global for securities purchase transactions between December 2020 and April 2021, pursuant to the terms of the expired exclusive placement agent agreement. Allegedly, the exclusive placement agent agreement required the Company to pay FT Global for capital received during the term of the agreement and for the ~~year ended December 31, 2019 and~~12-month period following the ~~footnotes~~termination of ~~this Quarterly Report, we are party~~the agreement involving any investors that FT Global introduced and/or wall-crossed to ~~a number of legal proceedings. There have been no material developments in those proceedings~~the Company. However, the Company believes the securities purchase transactions at issue did not involve the one investor which FT Global introduced or wall-crossed to the Company during the ~~three months ended September~~term of the agreement. FT Global claims approximately $7,000,000 in damages and attorneys’ fees.

The Company timely removed the case to the United States District Court for the Northern District of Georgia (the (“Court) on February 9, 2021 based on diversity of jurisdiction. On March 9, 2021, the Company filed a motion to dismiss based on FT Global’s failure to state a claim which is pending before the Court. On March 23, 2021, FT Global filed its response to the Company’s motion to dismiss. FT Global argues that the Court should deny the Company’s motion to dismiss. However, if the Court is inclined to grant the Company’s motion to dismiss, FT Global requested that the Court permit it to file an amended complaint. On April 8, 2021, the parties filed a Joint Preliminary Report and Discovery Plan. On April 12, 2021, the Court approved the Joint Preliminary Report and Discovery Plan and issued a Scheduling Order placing this case on a six-month discovery tract. On April 30, ~~2020.~~2021, the Company served FT Global with its Initial Disclosures. On May 6, 2021, FT Global served the Company with its Initial Disclosures. On May 17, 2021, FT Global served the Company with its First Amended Initial Disclosures. The Company will continue to vigorously defend the action against FT Global.

Item 1A. Risk Factors

~~Item 1A.~~

~~Major Risk Factors~~

Not applicable.

~~Item 2.~~

~~Unregistered Sales of Equity Securities and Use of Proceeds~~

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

~~None.~~

The Company did not make any sales of unregistered securities during the three months ended June 30, 2021 that were not previously disclosed in a quarterly report on Form 10-Q or a current report on Form 8-K.

~~Item 3.~~

~~Defaults upon Senior Securities~~

Item 3. Defaults upon Senior Securities

None.

~~Item 4.~~

~~Mine Safety Disclosure~~

Item 4. Mine Safety Disclosure

Not applicable.

~~Item 5.~~

~~Other Information~~

Item 5. Other Information

None.

Item 6. Exhibits

~~Item 6.~~

~~Exhibits~~

Exhibit No.		Description
31.1		Certification of Principal Executive Officer pursuant to Rule 13a-14(a) and Rule15d-14(a) of the Securities Exchange Act of 1934, as amended*
31.2		Certification of Principal Financial Officer pursuant to Rule 13a-14(a) and Rule 15d-14(a) of the Securities Exchange Act of 1934, as amended*
32.1		Certification of Principal Executive Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+
32.2		Certification of Principal Financial Officer, pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002+
101.INS		Inline XBRL Instance Document*
101.SCH		Inline XBRL Taxonomy Extension Schema Document*
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document*
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document*
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document*
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document*
104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

filed herewith

Furnished herewith

~~filed herewith~~

~~Furnished herewith~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	FUTURE FINTECH GROUP INC.

	By:	/s/ Shanchun Huang
		Shanchun Huang
		Chief Executive Officer
		(Principal Executive Officer)

		~~November~~August 16, ~~2020~~2021

	By:	/s/ Ming Yi
	~~By:~~	~~/s/~~ ~~Jing Chen~~Ming Yi
		~~Jing Chen~~
		Chief Financial Officer
		(Principal Financial and Accounting Officer)

		~~November~~August 16, ~~2020~~2021

PART I. FINANCIAL INFORMATION		1
Item 1.	Financial Statements	1
Item 1.2.	~~Financial Statements~~	1
~~Item 2.~~	Management’s Discussion and Analysis of Financial Condition and Results of Operations	2027
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	2835
Item 4.	Controls and Procedures	2936

PART II. OTHER INFORMATION		3037
Item 1.	Legal Proceedings	37
Item 1.1A.	Risk Factors	~~Legal Proceedings~~	3038
Item ~~1A.~~2.	~~Risk Factors~~	30
~~Item 2.~~	Unregistered Sales of Equity Securities and Use of Proceeds	3038
Item 3.	Defaults upon Senior Securities	3038
Item 4.	Mine Safety Disclosure	3038
Item 5.	Other Information	~~Other Information~~	3038
Item 6.	Exhibits	~~Exhibits~~	3038

SIGNATURES		3139

	September 30,			December 31,
	2020			2019
CURRENT ASSETS
Cash and cash equivalents	$	957,676		$	531,067
Accounts receivable		483			4,954
Other receivables, net		136,857			7,040
Inventories		3,336			3,594
Advances to suppliers and other current assets		46,688			1,670,947
Loan receivables		5,131,643			-
Assets related to discontinued operations		5,343,518			98,128,199
TOTAL CURRENT ASSETS	$	11,620,201		$	100,345,801

Property, plant and equipment, net	$	19,692		$	17,855
Right of use assets		306,965			-
Intangible assets, net		1,869,185			40,853
Amount due from related parties		3,170,470			3,326,061
Long term investments		12,250,000			12,250,000
TOTAL ASSETS	$	29,236,513		$	115,980,570

LIABILITIES

CURRENT LIABILITIES
Accounts payable	$	257,431		$	249,683
Accrued expenses and other payables		1,398,097			1,342,698
Advances from customers		270,765			534,089
Convertible loan payables		1,159,935			957,990
Loans payables		861,964			109,430
Lease liability-current		156,259			-
Liabilities related to discontinued operations		3,513,970			199,595,785
TOTAL CURRENT LIABILITIES	$	7,618,421		$	202,789,675

NON-CURRENT LIABILITIES
Amount due to related parties	$	1,517,678		$	1,268,101
Lease liability-non-current		148,613			-
TOTAL NON-CURRENT LIABILITIES		1,666,291			1,268,101
TOTAL LIABILITIES	$	9,284,712		$	204,057,776

Commitments and contingencies (Note 17)

STOCKHOLDER’S EQUITY

Future Fintech Group Inc., Stockholders’ equity
Common stock, $0.001 par value; 60,000,000 shares authorized and 41,959,545 shares issued and outstanding as of September 30, 2020 and 33,810,416 shares issued and outstanding as of December 31, 2019, respectively	$	41,959		$	33,810
Additional paid-in capital		117,562,942			107,852,827
Accumulated deficits		(99,061,634	)		(213,314,612	)
Accumulated other comprehensive income		3,437,881			12,989,408
Total Future FinTech Group Inc. stockholders’ equity		21,981,148			(92,438,567	)
Non-controlling interests		(2,029,347	)		4,361,361
Total stockholders’ equity		19,951,801			(88,077,206	)

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	29,236,513		$	115,980,570

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019*			2020			2019*
Revenue	$	43,657		$	342,083		$	357,295		$	744,977
Cost of goods sold		13,516			77,165			23,388			322,942
Gross profit		30,141			264,918			333,907			422,035

Operating Expenses
General and administrative expenses		809,424			921,235			3,082,462			2,555,149
Selling expenses		26,167			243,411			46,641			780,259
Bad debt provision		31,549			48			247,097			7,491
Total operating expenses		867,140			1,164,694			3,376,200			3,342,899

Loss from operations		(836,999	)		(899,776	)		(3,042,293	)		(2,920,864	)

Other income (expense)
Interest income		593			61			781			3,977
Interest expenses		(289,419	)		(21,400	)		(343,206	)		(134,207	)
Loss on debt settlement		(1,946,028	)		-			(1,946,028	)		-
Other income (expenses), net		597,962			(1,741	)		119,310			(4,521	)
Total other income (expenses)		(1,636,892	)		(23,080	)		(2,169,143	)		(134,751	)

Loss from Continuing Operations before Income Tax		(2,473,891	)		(922,856	)		(5,211,436	)		(3,055,615	)
Income tax provision		-			-			-			76
Loss from Continuing Operations, net of tax		(2,473,891)			(922,856	)		(5,211,436	)		(3,055,691	)

Discontinued Operations (Note 12)
Loss from discontinued operations		(80,983	)		(479,224	)		(140,794	)		(1,970,862	)
Gain on disposal of discontinued operations		115,947			-			119,582,658			-
NET INCOME (LOSS)		(2,438,927	)		(1,402,080	)		114,230,428			(5,026,553	)

Less: Loss attributable to the non-controlling interest		(13,910	)		(324,647	)		(22,550	)		(1,030,611	)

Net income (loss) attributable to Future Fintech Group, Inc. Common Shareholders	$	(2,425,017	)	$	(1,077,433	)	$	114,252,978		$	(3,995,942	)
Comprehensive income (loss):
Net income (loss)	$	(2,438,927	)		(1,402,080	)		114,230,428			(5,026,553	)
Foreign currency translation		(147,759	)		2,135,361			(630,390)			7,327,449
Comprehensive income (loss)		(2,586,686	)		733,281			113,600,038			2,300,896
Less: Comprehensive income (loss) attributable to non-controlling interest		68,176			324,648			(2,079,581	)		1,030,611
Comprehensive Income (loss) Attributable to Future Fintech Group, Inc. Common Shareholders	$	(2, 654,862	)	$	408,632		$	115,679,619		$	1,270,285

Basic Earnings (Loss) per Share:
Basic loss per share from continuing operations	$	(0.07	)	$	(0.02	)	$	(0.14	)	$	(0.07	)
Basic earnings (loss) per share from discontinued operations		-			(0.01	)		3.23			(0.06	)
Basic Earnings (Loss) per Share from Net Income (Loss)	$	(0.07	)		(0.03	)	$	3.09		$	(0.13	)

Diluted Earnings (Loss) per Share:
Diluted loss per share from continuing operations	$	(0.07	)	$	(0.02	)	$	(0.14	)	$	(0.07	)
Diluted earnings (loss) per share from discontinued operations		-			(0.01	)		3.18			(0.06	)
Diluted Earnings (Loss) per Share from Net Income (Loss)	$	(0.07	)		(0.03	)	$	3.04		$	(0.13	)

Weighted average number of shares outstanding
Basic		35,175,728			31,340,160			36,982,973			31,340,160
Diluted		35,845,251			32,009,683			37,652,496			32,009,683

	For the Nine Months Ended September 30,
	2020			2019*
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)	$	114,230,428		$	(5,026,553	)
Adjustments to reconcile net loss to net cash provided by operating activities
Depreciation and amortization		182,822			2,350,807
Bad debt expenses		247,097			-
Gain on sale of discontinued operations		(119,582,658	)		-
Loss on debt settlement		1,946,028			-
Share based compensation		1,191,000			-
Interest converted to convertible note		170,939			-
Changes in operating assets and liabilities
Accounts receivable		4,471			31,029
Other receivable		(129,817	)		8,100,183
Advances to suppliers and other current assets		(250,181	)		(135,714	)
Inventories		258			(128,688	)
Accounts payable		7,749			39,651
Accrued expenses		55,400			(16,180,323	)
Change in net assets related to discontinued operations		860,377			3,977,933
Advances from customers		295,970			(352,848	)
Net Cash Provided by (Used in) Operating Activities		(770,117	)		(7,324,523	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and plant		(2,944	)		-
Purchase of intangible assets		(1,259	)		-
Payments for loan receivables		(5,131,643	)		-
Net cash used in investing activities		(5,135,846)			-

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock		920,000			-
Proceeds from amount due from related parties, net		348,356			-
Proceeds from secured convertible promissory note		5,464,277			-
Proceeds from loans		571,760			1,003,809
Repayment of loans		(206,006	)		-
Proceeds from sale of discontinued operations		85,714			-
Net cash provided by financing activities		7,184,101			1,003,809

Effect of change in exchange rate		(851,530	)		6,324,145

NET INCREASE IN CASH AND CASH EQUIVALENTS		426,609			3,431
Cash and cash equivalents, beginning of year		531,067			33,461
Cash and cash equivalents, end of period	$	957,676		$	36,892

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid for interest	$	-		$	-
Cash paid for income taxes	$	-		$	-

SUPPLEMENTARY DISCLOSURE OF SIGNIFICANT NON-CASH TRANSACTION
Debt settlement by issuance of Common Stock	$	4,901,600			-

	Common Stock				Additional paid-in			Accumulated			Accumulative other comprehensive			Non- controlling
	Shares		Amount		capital			deficits			income			interests			Total
Balance at June 30, 2019		31,667,083	$	31,667	$	115,335,406		$	(191,004,189	)	$	(3,769,461	)	$	3,895,157		$	(75,511,420	)
Issuance of common stocks		650,000		650	$	(650	)		-			-			-			-
Net loss		-		-	$	-		$	(1,077,433	)	$	-		$	(324,647	)	$	(1,402,080	)
Foreign currency translation adjustment		-		-	$	-		$	-		$	2,135,361					$	2,135,361
Balance at September 30, 2019		32,317,083	$	32,317	$	115,334,756		$	(192,081,622	)	$	(1,634,100	)	$	3,570,510		$	(74,778,139	)

	CCM						Accounting Software
	September 30,			December 31,			September 30,			December 31,
	2020			2019			2020			2019
Cost	$	1,952,982		$	43,004		$	1,292		$	-
Less: Accumulated amortization		(85,046	)		(2,114	)		(43	)		-
Balance as of September 30, 2020	$	1,867,936			40,890		$	1,249		$	-

	Amortization
Year ending December 31,	to be recognized
2020 (excluding the nine months ended September 30, 2020)	$	79
2021		315
2022		315
2023		315
2024		315
2025 and thereafter		530
Total	$	1,869

	September 30, 2020				December 31, 2019
	Total Assets		Total Liabilities		Assets		Total Liabilities
Hedetang Farm (1)	$	5,343,518	$	3,367,129	$	5,353,790	$	3,237,113
Zhonglian Hengxin (1)		-		-		1,623		96,924
CCM Logistics (1)		-		146,841		-		-
Digital Online Marketing Limited (1)		-		-		-		-
SkyPeople Foods Holding Ltd. (1)		-		-		-		-
HeDeTang HK (2)		-		-		92,772,786		196,261,748
Total	$	5,343,518	$	3,513,970	$	98,128,199	$	199,595,785

	September 30, 2020		December 31, 2019
Acquisition of Intangibles	$	320,267	$	15,374
Legal fee and other professionals		364,924		361,279
Wages and employee reimbursement		321,350		452,389
Suppliers		254,702		350,992
Accrued interest		67,025		85,600
Accrued tax payable		58,073		77,064
Others		11,756		-
Total	$	1,398,097	$	1,342,698

	Three Months Ended				Nine Months Ended *
	September 30, 2020		September 30, 2019		September 30, 2020		September 30, 2019
Revenue
Service fees	$	38,109	$	207,563	$	348,896	$	338,469
Sales of Goods		5,548		134,520		8,399		406,508
Total	$	43,657	$	342,083	$	357,295	$	744,977

	Third quarter of 2020					Third quarter of 2019
	Amount		% of revenue			Amount		% of revenue
General and administrative	$	809		1,839.0	%	$	921		269.3	%
Selling expenses		26		59.1	%		243		71.2	%
Bad debt provision		248		564.0	%		1		-
Total operating expenses	$	1,083		2,461.0	%	$	1,165		340.5	%

	Nine months ended September 30				Change
	2020		2019		Amount			%
Service fees	$	349		339	$	10			2.9	%
Sales of Goods		8		406		(398	)		(98.0	)%
Total	$	357	$	745	$	(388	)		(52.1	)%

	Nine months ended September 30, 2020					Nine months ended September 30, 2019
	Amount		% of revenue			Amount		% of revenue
General and administrative	$	3,082		862.7	%	$	2,555		343.0	%
Selling expenses		47		13.1	%		780		104.7	%
Bad Debt provision		247		69.2	%		8		1.0	%
Total operating expenses	$	3,376		944.9	%	$	3,343		448.7	%