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CarrierEQ

Cover

Cover - shares9 Months Ended
Jun. 30, 2021Aug. 21, 2021
Cover [Abstract]
Document Type10-Q
Amendment Flagfalse
Document Quarterly Reporttrue
Document Transition Reportfalse
Document Period End DateJun. 30,
2021
Document Fiscal Period FocusQ3
Document Fiscal Year Focus2021
Current Fiscal Year End Date--09-30
Entity File Number000-56037
Entity Registrant NameCarrier EQ, LLC
Entity Central Index Key0001766352
Entity Tax Identification Number37-1981503
Entity Incorporation, State or Country CodeDE
Entity Address, Address Line One186 Lincoln Street
Entity Address, Address Line TwoThird Floor
Entity Address, City or TownBoston
Entity Address, State or ProvinceMA
Entity Address, Postal Zip Code02111
City Area Code(617)
Local Phone Number841-7207
Entity Current Reporting StatusYes
Entity Interactive Data CurrentYes
Entity Filer CategoryNon-accelerated Filer
Entity Small Businesstrue
Entity Emerging Growth Companytrue
Elected Not To Use the Extended Transition Periodfalse
Entity Shell Companyfalse
Entity Common Stock, Shares Outstanding0

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($)Jun. 30, 2021Sep. 30, 2020
Current assets:
Cash and cash equivalents $ 378,411 $ 1,658,028
Accounts receivable1,118
Prepaid expenses and other current assets771,520 1,083,527
Current assets of discontinued operations 2,788,888
Total current assets1,151,049 5,530,443
Non-current assets:
Intangibles, net3,355,461 4,292,046
Security deposits280,616 320,108
Lease right of use assets1,636,515 1,979,658
Investment in related affiliate252,000
Due from related party 1,400,000
Due from affiliates (4,589,610)
Non-current assets of discontinued operations 4,775,401
Total non-current assets5,524,592 8,177,603
Total assets6,675,641 13,708,046
Current liabilities:
Accounts payable151,237 301,003
Accrued liabilities555,891 1,149,514
AirToken refund liability115,044 163,561
Lease liability, current portion212,450 393,468
Due to related party5,514,493
Current liabilities of discontinued operations 4,741,902
Total current liabilities6,549,115 6,749,448
Long-term liabilities:
Deferred gain on issuance of AirTokens for Services 396,790
Lease liability, net of current portion1,601,564 1,758,196
Deferred revenue - AirToken Project 12,529,824
Long-term liabilities of discontinued operations 11,602,345
Total liabilities8,150,679 33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020(1,475,038)(20,899,904)
Accumulated other comprehensive income of discontinued operations 1,572,382
Total member's deficit attributable to Carrier EQ, LLC member(1,475,038)(19,327,522)
Non-controlling interest in subsidiary (1,035)
Total member's deficit(1,475,038)(19,328,557)
Total liabilities and member's deficit $ 6,675,641 $ 13,708,046

CONDENSED CONSOLIDATED BALANC_2

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - sharesJun. 30, 2021Sep. 30, 2020
Statement of Financial Position [Abstract]
Units outstanding1,277,635 1,277,635

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (Unaudited) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Jun. 30, 2020Jun. 30, 2021Jun. 30, 2020
Income Statement [Abstract]
Revenue
Operating expenses:
Cost of revenue
Selling, general and administrative2,046,330 5,105,903 7,714,303 12,283,660
Total operating expenses2,046,330 5,105,903 7,714,303 12,283,660
Loss from operations(2,046,330)(5,105,903)(7,714,303)(12,283,660)
Other (expense) income:
Realized loss on sale of digital assets (1,392)
Foreign currency transaction loss(507,761) (418,604)
Other miscellaneous income12,978,884 12,978,884
Interest income (expense), net(17,252)82,828 92,251 2,896
Other (expense) income, net12,453,871 82,828 12,652,531 1,504
Income (loss) from continuing operations before income taxes10,407,541 (5,023,075)4,938,228 (12,282,156)
Income tax benefit 47,620 178,662 129,661
Net income (loss) from continuing operations10,407,541 (4,975,455)5,116,890 (12,152,495)
Net loss from discontinued operations(4,264,548)(1,147,124)(10,851,961)(4,614,960)
Net loss (income) attributable to non-controlling interest(1,693)(44)(1,035)(461)
Net income (loss) attributable to Carrier EQ, LLC.6,141,300 (6,122,623)(5,736,106)(16,766,994)
Other comprehensive income
Foreign currency translation adjustment - discontinued operations(527,484)120,645 (875,085)1,118,914
Total comprehensive income (loss) $ 5,613,816 $ (6,001,978) $ (6,611,191) $ (15,648,080)

CONDENSED CONSOLIDATED STATEM_2

CONDENSED CONSOLIDATED STATEMENT OF MEMBER'S DEFICIT AND STOCKHOLDERS' DEFICIT (Unaudited) - USD ($)Preferred Stock Series One [Member]Preferred Stock Series Onea [Member]Common Stock [Member]Treasury Stock [Member]Additional Paid-in Capital [Member]AOCI Attributable to Parent [Member]Noncontrolling Interest [Member]Retained Earnings [Member]Carrier E Q L L C Accumulated Other Comprehensive Income [Member]Carrier E Q L L C Membership Interests [Member]Carrier E Q L L C Members Deficit [Member]Carrier E Q L L C Noncontrolling Interest [Member]Total
Beginning balance, value at Sep. 30, 2019 $ 27 $ 11 $ 78 $ (240,005) $ 2,014,658 $ 110,363 $ (252) $ (21,025,864) $ (19,140,984)
Beginning Balance SHARES at Sep. 30, 20192,652,072 1,046,147 6,813,928 914,893
Noncontrolling interest (248) (248)
Net loss (5,191,690) (5,191,690)
Foreign currency translation (101,576) (101,576)
Ending balance, value at Dec. 31, 2019 $ 27 $ 11 $ 79 $ (240,005)2,091,168 8,787 (500)(26,217,554) (24,357,987)
Ending Balance SHARES at Dec. 31, 20192,652,072 1,046,147 6,936,438 914,893
Stock based compensation 42,588 42,588
Options exercised $ 1 33,922 33,923
Options exercised shares122,510
Beginning balance, value at Sep. 30, 2019 $ 27 $ 11 $ 78 $ (240,005)2,014,658 110,363 (252)(21,025,864) (19,140,984)
Beginning Balance SHARES at Sep. 30, 20192,652,072 1,046,147 6,813,928 914,893
Conversion of Preferred One and Preferred One A shares to common stock38
Retirement of treasury stock240,005
Issuance of common stock to Option Stockholders80
Payment to Option Holders due to cancellation of stock options3,331,255
Purchase of membership units - Carrier EQ, LLC(263)
Ending balance, value at Jun. 30, 2020 1,229,277 1,277,635 (20,250,668)(713)(19,022,124)
Ending Balance SHARES at Jun. 30, 2020
Beginning balance, value at Dec. 31, 2019 $ 27 $ 11 $ 79 $ (240,005)2,091,168 8,787 (500)(26,217,554) (24,357,987)
Beginning Balance SHARES at Dec. 31, 20192,652,072 1,046,147 6,936,438 914,893
Noncontrolling interest (257) (257)
Net loss (5,452,681) (5,452,681)
Foreign currency translation 1,099,845 1,099,845
Ending balance, value at Mar. 31, 2020 $ 27 $ 11 $ 87 $ (240,005)2,413,632 1,108,632 (757)(31,670,235) (28,388,608)
Ending Balance SHARES at Mar. 31, 20202,652,072 1,046,147 7,753,069 914,893
Stock based compensation 168,015 168,015
Options exercised $ 8 154,449 154,457
Options exercised shares816,631
Convertible notes converted into common stock $ 133 9,999,867 10,000,000
Convertible notes converted into common stock shares13,339,510
Conversion of Preferred One and Preferred One A shares to common stock $ (27) $ (11) $ 38
Conversion of Preferred One and Preferred One A shares to common stock shares(2,652,072)(1,046,147)3,698,219
Cancellation of common stock previously outstanding $ (80) 80
Cancellation of common stock previously outstanding shares(8,003,706)
Simple Agreements for Future Equity converted into common stock $ 5 239,894 239,899
Simple Agreements for Future Equity converted into common stock shares474,996
Stock compensation related to accelerated vesting of options 114,979 114,979
Capital contribution - Via Varejo 1,921,004 1,921,004
Noncontrolling interest 44 44
Retirement of treasury stock $ 240,005 (240,005)
Retirement of treasury stock shares(914,893)
Net loss (6,122,623) (6,122,623)
Foreign currency translation 120,645 120,645
Issuance of common stock to Option Stockholders $ 80 (80)
Issuance of common stock to Option Stockholders shares8,003,706
Capital contribution from Via Varejo for payment to Option Holders due to cancellation of stock options 3,331,255 3,331,255
Payment to Option Holders due to cancellation of stock options (238,719) (238,719)
Purchase of membership units - Carrier EQ, LLC $ (263) (12,289,648)(1,108,632)713 31,670,235 1,108,632 1,277,635 (19,380,324)(713)
Purchase of membership units - Carrier EQ, LLC shares(25,265,794)
Ending balance, value at Jun. 30, 2020 1,229,277 1,277,635 (20,250,668)(713)(19,022,124)
Ending Balance SHARES at Jun. 30, 2020
Beginning balance, value at Sep. 30, 2020 1,572,382 1,277,635 (20,899,904)(1,035)(19,328,557)
Beginning Balance SHARES at Sep. 30, 2020
Noncontrolling interest (443)(443)
Net loss (6,899,387) (6,899,387)
Foreign currency translation (561,512) (561,512)
Ending balance, value at Dec. 31, 2020 1,010,870 1,277,635 (27,799,291)(1,478)(26,789,899)
Ending Balance SHARES at Dec. 31, 2020
Beginning balance, value at Sep. 30, 2020 1,572,382 1,277,635 (20,899,904)(1,035)(19,328,557)
Beginning Balance SHARES at Sep. 30, 2020
Conversion of Preferred One and Preferred One A shares to common stock
Retirement of treasury stock
Issuance of common stock to Option Stockholders
Payment to Option Holders due to cancellation of stock options
Purchase of membership units - Carrier EQ, LLC
Ending balance, value at Jun. 30, 2021 1,277,635 (1,475,038) (1,475,038)
Ending Balance SHARES at Jun. 30, 2021
Beginning balance, value at Dec. 31, 2020 1,010,870 1,277,635 (27,799,291)(1,478)(26,789,899)
Beginning Balance SHARES at Dec. 31, 2020
Noncontrolling interest (215)(215)
Net loss (4,978,019) (4,978,019)
Foreign currency translation 213,911 213,911
Additional paid-in-capital 2,806,672 2,806,672
Ending balance, value at Mar. 31, 2021 1,224,781 1,277,635 (29,970,638)(1,693)(28,747,550)
Ending Balance SHARES at Mar. 31, 2021
Noncontrolling interest 1,693 1,693
Net loss 6,141,300 6,141,300
Foreign currency translation (527,484) (527,484)
Additional paid-in-capital 1,150,000 1,150,000
Gain from Deconsolidation of subsidiary(697,297) 21,204,301 20,507,004
Ending balance, value at Jun. 30, 2021 $ 1,277,635 $ (1,475,038) $ (1,475,038)
Ending Balance SHARES at Jun. 30, 2021

CONDENSED CONSOLIDATED STATEM_3

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($)9 Months Ended
Jun. 30, 2021Jun. 30, 2020
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income (loss) from continuing operations $ 5,116,890 $ (12,152,495)
   Net (loss) from discontinued operations(10,851,961)(4,614,960)
   Adjustments to reconcile net loss to net cash (used in) provided by operating activities:
Amortization and Depreciation1,213,738 569,951
Impairment write-off736,594
Stock based compensation 325,582
Additional stock based compensation due to cancellation of stock options 3,092,536
Reversal of accrued interest related to conversion of convertible notes (104,856)
Realized loss on sale of digital assets 1,392
Gain on issuance of AirTokens for services(396,790)
Gain from reversal of deferred revenue due to discontinuance of Airtoken project(12,529,824)11,962,899
Inflation adjustment to deferred revenue Master card Program1,560,768
(Increase) decrease in assets, net of effect of deconsolidation
Transfer out of cash and restricted cash as part of deconsolidation(6,320,023)
Accounts receivable(422,386)(93,164)
Prepaid expenses and other current and long-term assets307,632 1,058,235
Investment in other companies
Due from related party1,400,000 (8,090)
Other assets130,664
Increase ( decrease) in liabilities, net of effect of deconsolidation
Accounts payable(149,766)(676,693)
Operating lease right of use assets and liabilities5,493 120,717
Accrued liabilities and other current liabilities5,084,085 2,200,572
Other deferred revenue(18,858)(188,695)
AirToken refund liability(48,517)(3,227,499)
Due to related party11,187,398 48,122
Net cash used in operating activities(3,994,863)(1,686,446)
CASH FLOWS FROM INVESTING ACTIVITIES:
  Acquisition of property and equipment(155,016)(2,249)
  Acquisition of intangible assets(1,825,960)(2,682,518)
Net cash used in investing activities(1,980,976)(2,684,767)
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from exercise of options 188,380
  Capital contributions - Via Varejo3,956,672 1,921,004
  Proceeds from Paycheck Protection Program SBA loan 537,732
  Payment of principal from  Paycheck Protection Program SBA loan (537,732)
  Proceeds from Via Varejo for payment to Option Holders due to cancellation of stock options 3,331,255
  Payment to Option Holders due to cancellation of stock options (3,331,255)
Net cash provided by financing activities3,956,672 2,109,384
Effect of exchange rate changes on cash and cash equivalents(875,086)(443,510)
Net decrease in cash and cash equivalents(2,894,253)(2,705,339)
Cash and cash equivalents, beginning of period3,272,664 5,451,348
Cash and cash equivalents, end of period378,411 2,746,009
Supplemental disclosure of non-cash transactions:
     Investment in related affiliate no longer eliminated in consolidation252,000
     Due to related party resulting from the deconsolidation of subsidiary5,431,853
Convertible debt instrument settled through issuance of common stock (10,000,000)
Simple agreement for future equity settled through issuance of common stock (239,899)
Cancellation of common stock (80)
Conversion to common stock - Series One (27)
Conversion to common stock - Series One A (11)
Par value of common stock from issuance to Lake Niassa
Conversion of Preferred One and Preferred One A shares to common stock 38
Operating lease right of use assets and liabilities 2,465,218
Retirement of treasury stock 240,005
Issuance of common stock to Option Stockholders 80
Purchase of membership units - Carrier EQ, LLC $ (263)

Organization and Nature of Oper

Organization and Nature of Operations9 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Nature of OperationsNote 1 - Organization and Nature of Operations Carrier EQ, LLC, doing business as Airfox (the “Company”), was incorporated in Delaware on May 21, 2020 with a principal place of business in Boston, Massachusetts.
Airfox was previously formed as a corporation, CarrierEQ, Inc. and was incorporated in Delaware on January 19, 2016. Airfox had at that time a 100 On May 21, 2020, Airfox filed a certificate
of conversion (the “Certificate of Conversion”) to convert the Corporation to a Limited Liability Company and to change the
Airfox’s name from “CarrierEQ, Inc.” to “Carrier EQ, LLC” The conversion and name change became effective
on May 21, 2020. Airfox (the Company) filed a certificate of formation of Carrier EQ, LLC (the “Certificate of Formation”)
on May 21, 2020. On May 21, 2020, the Company was fully acquired
by Via Varejo S.A, a corporation organized under the laws of the Federative Republic of Brazil (“Via Varejo”) through Lake
Niassa Empreendimentos e Participações Ltda. ("Lake Niassa"), a limited liability company duly organized under
the laws of the Federative Republic of Brazil and wholly-owned by Via Varejo (the "Transaction"). On June 14, 2021, the Company, Lake Niassa and
banQi Instituição de Pagamento Ltda (formerly known as AirFox Servicos E Intermediacoes Ltda (“banQi”),
a limited liability company organized under the laws of the Federative Republic of Brazil entered into the 7th Amendment and Consolidation
of the Articles of Association of banQi (the “7th Amendment”). Pursuant to the terms of the 7th Amendment, the banQi and Lake
Niassa (i) increased banQi 's share capital from BRL 1,000,000.00 (one million reais) to BRL 69,870,000.00 (sixty-nine million, eight
hundred and seventy thousand reais), which represents an increase of BRL 68,870,000.00 (sixty-eight million, eight hundred and seventy
thousand reais); and (ii) issued 68,870,000 (sixty-eight million, eight hundred and seventy thousand) new quotas, with par value of BRL
1.00 (one real) each, fully subscribed and paid up, in Brazilian currency, through the capitalization of Advances for Future Capital Increase
("AFAC") made by Lake Niassa. Prior to entering into the 7th Amendment, the
Company had a 99.99 th As a result of this change in control, on June
14, 2021, the Company determined that it did not have a controlling interest over banQi, and banQi was deconsolidated from the Company's
condensed consolidated financial statements and presented as discontinued operations in the Company’s condensed consolidated financial
information presented within this quarterly report. The presentation of the operations and results of banQi is further explained in Note
3. Beginning in February 2017, the Company began
exploring consumer applications of its legacy prepaid mobile applications. The Company initiated a business plan to introduce a mobile
application that would allow users to earn digital tokens, exchange them for free or discounted mobile data and, ultimately, other goods
and services in South America as part of a new international business and ecosystem (the “AirToken Project”). The AirToken
Project included the issuance of digital tokens (“AirToken(s)”). The AirToken is an ERC-20 token issued on the Ethereum blockchain. The Company obtained Ether and Bitcoin (collectively
referred therein as the “Digital Assets”), in August 2017 through early October 2017 from those interested in obtaining AirTokens.
The Company raised approximately $ 15.4 On June 30, 2021, Lake Niassa the sole member
of Carrier EQ, LLC determined to discontinue the development of AirTokens and end the AirToken project related to the Company’s
business. At this time, the Company does not have the ability to further develop AirTokens as part of its business plan in the absence
of new laws or a definitive regulatory regime (in both the U.S. and Brazil) regarding the use and transferability of AirTokens (and other
similar tokens issued on the Ethereum block chain that are classified as securities). Current laws and regulatory regimes do not provide
for the Company to utilize the AirTokens as envisioned by the Company since AirTokens are no longer freely transferable and the previous
market for AirTokens no longer exists. AirTokens were never fully developed and never gained full functionality. As previously stated,
AirTokens are not currently freely transferable, and no market exists for AirTokens. Since the Company is no longer continuing with
the AirToken project, the Company should not recognize any revenue related to the research and development of the AirToken project, and
the deferred revenue is no longer appropriate to be recorded on the balance sheet. The liability - AirToken Project, of approximately
$ 12.5 Currently, the Company's main functions and activities
comprise of supporting banQi’s operation in Brazil, including assisting banQi with the management of the digital wallet application
and the financial services provided to those without bank accounts or credit cards. Primarily due to the cancellation of the AirToken
project and since the main features of the Company’s software and technology platform have been developed
and funded to be applied in the Brazilian market (as per the Services Agreement and the Call Option Agreement), the Company's main functions
and activities relating to the development and management of a software technology platform consisting of a digital wallet application
and an alternative credit scoring and lending application have substantially
migrated to the banQi entity in Brazil. In connection with the above strategy, the Company
is gradually transferring contracts with some suppliers to Brazil and reducing its activities in the US.

Financial Condition and Managem

Financial Condition and Management’s Plans9 Months Ended
Jun. 30, 2021
Financial Condition And Managements Plans
Financial Condition and Management’s PlansNote 2 - Financial Condition and Management’s
Plans The Company has experienced recurring losses
and negative cash flows from operations. At June 30, 2021, the Company had cash and cash equivalents of $ 378.4
5.4
1.5 The accompanying condensed consolidated financial
statements have been prepared assuming that the Company will continue as a going concern, which contemplates, among other things, the
realization of assets and satisfaction of liabilities in the ordinary course of business. The successful outcome of future activities cannot
be determined at this time and there is no assurance that, if achieved, the Company will have sufficient funds to execute its intended
business plan or generate positive operating results. The condensed financial statements do not include any adjustments related to this
uncertainty and as to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities
that might result should the Company be unable to continue as a going concern. In the event the Company is unable to raise additional
debt or equity financing, it may:
1. Have to cease operations, in which case the Company may file a petition for bankruptcy in U.S. Bankruptcy Court under Chapter 7, whereby a trustee will be appointed to sell off the Company’s assets, and the money will be used to pay off the Company’s debts in order of their priority. Or
2. File a petition for bankruptcy in U.S. Bankruptcy Court under Chapter 11 to restructure the Company’s debt. COVID-19 Risks, Impacts and Uncertainties On January 30, 2020, the World Health Organization
(“WHO”) announced a global health emergency because of a new strain of coronavirus originating in Wuhan, China (the “COVID-19
Outbreak”) and the risks to the international community as the virus spreads globally beyond its point of origin. In March 2020,
the WHO classified the COVID-19 Outbreak as a pandemic, based on the rapid increase in exposure globally. The Commonwealth’s “Reopening
Massachusetts” process is underway. The Company is subject to the risks arising from the COVID-19 Outbreak’s social and economic
impacts. The Company’s management believes that the
social and economic impacts, which include but are not limited to the following, could have a significant impact on future financial condition,
liquidity, and results of operations: (i) the duration and scope of the pandemic; (ii) governmental, business and individual actions that
have been and continue to be taken in response to the pandemic, including travel restrictions, quarantines, social distancing, work-from-home
and shelter-in-place orders and shut-downs; (iii) the impact on U.S. and global economies and the timing and rate of economic recovery;
(iv) potential adverse effects on the financial markets and access to capital; (v) potential goodwill or other impairment charges; (vi)
increased cybersecurity risks as a result of pervasive remote working conditions; and (vii) the Company’s ability to effectively
carry out its operations due to any adverse impacts on the health and safety of the Company’s employees and their families. In response to the COVID-19 Outbreak, the Company’s
employees have been required to work from home. The significant increase in remote working, particularly for an extended period of time,
has been exacerbating certain risks to the Company’s business, including an increased risk of cybersecurity events and improper
dissemination of personal or confidential information.

Summary of Significant Accounti

Summary of Significant Accounting Policies9 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Summary of Significant Accounting PoliciesNote 3 - Summary of Significant Accounting
Policies Basis of Presentation The accompanying unaudited condensed consolidated
interim financial statements (“interim statements”) of Airfox have been prepared in accordance with accounting principles
generally accepted in the United States of America (“GAAP”) as determined by Financial Accounting Standards Board (the “FASB”)
within its Accounting Standards Codification (“ASC”) and under the rules and regulations of the United States Securities and
Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by GAAP for complete
financial statements. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these interim
statements have been included. The results reported in these interim statements are not necessarily indicative of the results that may
be reported for the entire year. These interim statements should be read in conjunction with the Company’s consolidated financial
statements as of and for the year ended September 30, 2020. The Company has elected not to apply pushdown
accounting to the accompanying standalone condensed consolidated financial statements in accordance with ASC 805 Business Combinations The Company is an emerging growth company as the
term is used in The Jumpstart Our Business Startups Act, enacted on April 5, 2012 and has elected to comply with certain reduced public
company reporting requirements, however, the Company may adopt accounting standards based on the effective dates for public entities. As of June 14, 2021, the operations of banQi were
deconsolidated from the Company, as the Company no longer had a controlling interest in banQi. The Company accounted for the loss in controlling
interest as discontinued operations in banQi in accordance with Accounting Standards Codification, ASC 205, Discontinued Operations and
Accounting Standards Update, ASU, No. 2014-08, Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity.
ASC 205 requires that a component of an entity that has been disposed of or is classified as held for sale and has operations and cash
flows that can be clearly distinguished from the rest of the entity be reported as assets held for sale and discontinued operations. In
the period a component of an entity has been disposed of or classified as held for sale, the results of operations for the periods presented
are reclassified into separate line items, net of tax, in the unaudited condensed consolidated statements of comprehensive loss. Assets
and liabilities are also reclassified into separate line items on the related condensed consolidated balance sheets for the periods presented.
The statements of cash flows for the periods presented are also reclassified to reflect the results of discontinued operations as separate
line items. ASU 2014-08 requires that only a disposal of a component of an entity, or a group of components of an entity, that represents
a strategic shift that has, or will have, a major effect on the reporting entity’s operations and financial results be reported
in the financial statements as discontinued operations. ASU 2014-08 also provides guidance on the financial statement presentations and
disclosures of discontinued operations. Due to the deconsolidation of banQi during
the third quarter of fiscal 2021, in accordance with ASC 205, Discontinued Operations, the Company has classified the results of
banQi as discontinued operations in our unaudited condensed consolidated statements of operations and cash flows for all periods
presented. All assets and liabilities associated with banQi were therefore classified as assets and liabilities of discontinued
operations in our condensed consolidated balance sheets for the periods presented. All amounts included in the notes to the
unaudited condensed consolidated financial statements relate to continuing operations unless otherwise noted. For additional
information, see Note 4, Discontinued Operations. Principles of Consolidation Prior to June 14, 2021 the Company had a controlling
interest in banQi and, prior to April 6, 2020, had a 100 On June 14, 2021, the Company’s ownership
of banQi was reduced from 99.99% to 1.43 The change in ownership represents a transfer
of net assets between entities under common control, because all entities are owned by the same common parent entity, Lake Niassa, and
thus the gain on deconsolidation of banQi was recorded against accumulated deficit The Company will also record a cost method investment
in banQi for their respective investment in the entity, and any previously recorded non-controlling interest will be removed from the
balance sheet. All intercompany transactions have been eliminated
in consolidation. The Company is not involved with variable interest entities. Use of Estimates The preparation of financial statements in conformity
with GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenue and expenses during the reporting
periods. Actual results could differ significantly from those estimates. The most significant accounting estimates inherent in the preparation
of the Company's financial statements includes, but not limited to, estimated lives of intangible assets, intangible asset impairment,
revenue recognition and deferred tax valuation allowance. Foreign Currency The Company had operations in Brazil until June
14, 2021, where the local currency is used to prepare the financial statements which are translated into the Company’s reporting
currency, U.S. dollars. The local currency is the functional currency for the operations outside the United States. Changes in the exchange
rates between this currency and the Company’s reporting currency, are partially responsible for some of the periodic changes in
the condensed consolidated financial statements prior to June 14, 2021. Assets and liabilities of the Company’s foreign operations
until June 14, 2021 are translated into U.S. dollars at the spot rate in effect at the applicable reporting date. Revenues and expenses
of the Company’s foreign operations are translated at the average exchange rate during the applicable period. The resulting unrealized
cumulative translation adjustment is recorded as a component of accumulated other comprehensive income (loss) in stockholders’ equity.
Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional
currency of the applicable entity are recorded in other income (loss) in the period in which they occur. Revenue Recognition The Company recognizes revenue under ASC 606, Revenue
from Contracts with Customers ASC 606 prescribes a 5-step process to achieve
its core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the Company satisfies a performance obligation AirToken Project Development Services (Non
ASC 606 Revenue) The Company determined that its token issuances
represented obligations to perform software development services and accounts for the proceeds received in the token issuances in accordance
with ASC 730-20, Research and Development – Research and Development Arrangements The Company, beginning in August 2017 through
early October 2017, obtained Ether and Bitcoin totaling approximately $ 15.3 0.1 Pursuant to the Settlement Agreement (as defined
and described further in Note 13), the Company was obligated to refund amounts raised for the purpose of developing the AirToken Project
if valid claims were submitted. On or before December 28, 2019, the Company paid
all approved claims to approved claimants who returned their AirTokens to the Company (approximately 93.5% of the total dollar amount
of all approved claim refunds). All amounts were refunded in cash and paid through the Company’s existing cash and cash equivalent
reserves. The total claim amounts including interest, totaled $ 3.3 0.2 Effective October 1, 2019, the Company was not
able to estimate a date to conclude the development of the AirToken Project due to regulatory matters that affect the continuity of the
development process. Due to this reason, the AirToken Project was on hold and no revenue has been recognized from the AirToken Project. On June 30, 2021, Lake Niassa determined to
discontinue the development of AirTokens and end the AirToken project related to the Company’s business. At this time, the
Company does not have the ability to further develop AirTokens as part of its business plan in the absence of new laws or a
definitive regulatory regime (in both the U.S. and Brazil) regarding the use and transferability of AirTokens (and other similar
tokens issued on the Ethereum block chain that are classified as securities). Current laws and regulatory regimes do not provide for
the Company to utilize the AirTokens as envisioned by the Company since AirTokens are no longer freely transferable and the previous
market for AirTokens no longer exists. AirTokens were never fully developed and never gained full functionality. As previously
stated, AirTokens are not currently freely transferable and no market exists for AirTokens. As a result of the discontinuation of
the development of AirTokens, AirTokens will lose their functionality in full, and it is likely that no market for AirTokens will
ever be re-created and that AirTokens will not again ever be freely transferable. Since the Company is no longer continuing
with the AirToken project, the Company has not recognized any revenue related to the research and development of the AirToken
project, and the deferred revenue is no longer appropriate to be recorded on the balance sheet. The liability, Deferred revenue -
AirToken Project, of approximately $12.5
million 12,529,824 Mastercard Revenue and Sale Incentives (ASC
606 Revenue) On December 16, 2019, banQi, received
R$ 65 16 Pursuant to the Program Agreement, banQi,
as a licensee of MasterCard International, Inc. and a business partner of Mastercard Brasil, entered into the Incentive Program (as defined
in the Program Agreement) in order to issue, expand and boost the prepaid card (“Airfox Card”) base of banQi, as well
as the number of transactions and turnover (sales revenue) generated by MasterCard Cards. As a Mastercard prepaid card issuer, banQi is
entitled to receive Sales Revenue Incentives pursuant to the Program Agreement. As a result, the Sales Revenue Incentives is used to
amortize the Sales Revenue Incentive Prepayment received on December 11, 2019. Upon complete amortization of Incentive Prepayment, Mastercard
makes quarterly payments of the Sales Revenue Incentive, calculated according to the value of transactions completed with the prepaid
cards issued by the banQi. banQi have no minimum commitment of transaction volumes to be completed with the prepaid cards. The revenue from the Program Agreement was recognized
until June 14, 2021, the date on which the Company no longer had a controlling interest over banQi, thus no additional revenue was recognized
from that date through June 30, 2021. 343 10 3,085 6,802 In connection to the Program Agreement, the Company
also entered into an agreement with Mastercard, an Interchange Manual (“Interchange Fee Agreement”) from Mastercard dated
June 18, 2019, which details the fees paid by a merchant’s bank to banQi to compensate for the value and benefits that merchant
receives when it accepts electronic payments. The fee is a specified percentage of the total
dollar amount of a card transaction, and a fixed percentage based on the type of card transaction (i.e. merchant type, national vs. international,
etc.), based on the schedule of fees outlined in the Interchange Fee Agreement (“Interchange Fee Revenue”). On a monthly basis, the Company earns revenue
from the Interchange Fee received. The Company has identified one performance obligation that meets the series provision and recognizes
revenue over time. Interchange Fee Revenue totaling $ 94 3,085 66 6,802 Via Varejo Services Agreement Revenue (ASC
606 Revenue) The Company entered into a Services Agreement
(the “Services Agreement”) as of September 11, 2018 (“the Agreement Effective Date”) with Via Varejo (the “Client”). The Company was engaged to design and develop
a mobile software module and application programming interface that provides the Client’s customers with access to certain mobile
payment functionality, and that integrates banQi (“VV Wallet Services”). The Company provided certain services, including
hosting, maintenance and operation of banQi, The VV Wallet Services were structured into four phases. The Phases are - Phase 1: Specifications
and Customization; Phase 2: Features; Phase 3: License and Maintenance Services and Phase 4: Rollout. The development of the VV Wallet Services was
considered a bundled performance obligation that included the development of the API and software as a service which is hosted on the
Company’s servers. In addition to the software as a service performance obligation, the Company provided support services for the
software as a service. The Client was considered to simultaneously receive and consume the benefits provided by the Company’s performance
as the Company performed the services. Accordingly, the revenue from Service Charges was recognized over time based on the number of transactions
made by Client customers with banQi. During Phase 1, there was a payment of $0.3 million
(“Upfront Payment”) from the Client to be recognized as revenue commencing when the product was ready for its intended use
and ratably over the remaining term of the Services Agreement through the duration of the Services Agreement. The total revenue recognized
for the three months ended June 30, 2021 and 2020 totaled $ 159 12.1 202 24.9 Cash and Cash Equivalents The Company considers all highly liquid investments
with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks
and money market instruments. Accounts Receivable
and Allowance for Doubtful Accounts As of June 30, 2021, there was a minimal amount of accounts receivable as the Company no longer consolidates the operations of banQi. Concentrations of Credit Risk and Off-Balance
Sheet Risk The Company is subject to concentration of credit
risk with respect to their cash and cash equivalents, which the Company attempts to minimize by maintaining cash and cash equivalents
with institutions of sound financial quality. At times, cash balances may exceed limits federally insured by the Federal Deposit Insurance
Corporation. The Company had cash and cash equivalents, including amounts held in financial institutions in the USA that totaled $ 378
thousand. The Company believes it is not exposed to significant
credit risk due to the financial strength of the depository institutions in which the funds are held. The Company has no financial instruments
with off-balance sheet risk of loss. Long-Lived Assets, Including Definite Intangible
Assets Long-lived assets and other indefinite-lived intangibles
are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable
through the estimated undiscounted future cash flows derived from such assets. The Company’s definite-lived intangible assets primarily
consist of various domain names and websites. For long-lived assets used in operations, impairment losses are only recorded if the asset’s
carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment
loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are
written down to fair value. Security Deposits Security deposits primarily include monies being
held subject to a security agreement (“Security Agreement”) with Mastercard, Inc. executed on June 7, 2019. The Security Agreement
is related to the Services Agreement to ensure a minimum amount of users for the cards. On April 22, 2020 Mastercard returned $ 1.2 0.3 Included in the security deposits balance as of June
30, 2021 are $ 281 Investment in related affiliate After the deconsolidation of banQi, the Company's
remaining investment in banQi of $ 252 1.43 Due to Related Party Amounts due to banQi as of June 30, 2021 are $ 5.5 92 47 Software Development Costs The Company capitalizes costs related to software
developed or obtained for internal use in accordance with the ASC 350-40, Internal-Use Software ·
● Preliminary project stage: (a) conceptual formulation of alternatives; (b) evaluation of alternatives; (c) determination of existence of needed technology; and (d) final selection of alternatives. Internal and external costs incurred during the preliminary project stage
● Application development stage: (a) design of chosen path, including software configuration and software interfaces; (b) coding; (c) installation to hardware; and (d) testing, including parallel processing phase. Internal and external costs incurred to develop internal-use computer software during the application development stage are capitalized.
● Post-implementation-operation stage: (a) training; and (b) application maintenance. Internal and external costs incurred during the post-implementation-operation stage are expensed as incurred. Certain costs incurred are considered enhancements,
modifications to existing internal-use software that result in additional functionality. Enhancements normally require new software specifications
and may also require a change to all or part of the existing software specifications. When this additional functionality is determinable,
the related costs are capitalized. Otherwise, costs are expensed as incurred. Capitalization of internal-use software costs ceases when
a computer software project is substantially complete and ready for its intended use. The Company begins amortization when the product
is available for general release or use. The Company has capitalized software costs relating to the Via Varejo Services
Agreement and began amortization on January 1, 2020 as the product was ready for its intended use and has been amortized through the contract
term until September 2023. The amortization expense related to the Via Varejo Services Agreement capitalized software for the three and
nine months ended June 30, 2021 totaled $ 0.4 1.4 The Company capitalizes costs related to the
development and maintenance of its website in accordance with ASC 350-50, Website Development Costs Included in the net intangibles balance as of
June 30, 2021 are $ 3,295,256 has entered into discussions with Via Varejo and Lake Niassa
to transfer these assets to banQi. The companies are still working out the final details, which should close prior to Airfox's
September 30, 2021 year-end. Capitalizing Software Costs in Connection
with Hosting Arrangements and Software as a Service Arrangements For the operation in Brazil at banQi, the Company
developed certain software that are considered to be part of cloud computing arrangement (or hosting arrangement), whereby, a user or
a customer of software does not take possession of the Company’s software; rather, the software is accessed on an as-needed basis
over the Internet. Therefore, when the software is used to produce
a product or in a process to provide a service to a customer, and the customer is not given the right to obtain or use the software,
the related costs are accounted for in accordance with ASC 350-40. When a hosting arrangement includes multiple modules or components,
capitalized costs are amortized on a module-by-module basis. When a module or component is substantially ready for its intended use,
amortization begins, regardless of whether the overall hosting arrangement is being placed in service in planned stages. If the module’s
functionality is entirely dependent on the completion of one or more other modules, then amortization does not begin until that group
of interdependent modules is substantially ready for use. Impairment of Long-term Assets The Company evaluates the recoverability of tangible
and intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or
that indicate the asset may be impaired. Leases The Company categorizes leases at their inception
as either operating or finance leases based on the criteria in ASC 842, Leases (“ASC 842”) Advertising Advertising costs are expensed as incurred and included in selling, general
and administrative expenses and amounted to a reversal of $ 0.7 29 179 75 Income Taxes Income taxes are recorded in accordance with ASC
740, Income Taxes The Company accounts for uncertain tax positions
in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions
to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination
as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as
consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized
tax benefits as income tax expense. Gain on issuance of AirTokens for services AirTokens issued to vendors for services in connection
with raising monies for the purpose of developing the AirToken Project were accounted for in accordance with ASC 845-30-1, Nonmonetary
Transactions, which requires that the AirTokens to be recognized at fair value and resulted in recognizing a deferred gain of approximately
$ 1.7 0.02 On June 30, 2021, Lake Niassa determined to discontinue
the development of AirTokens and end the AirToken project related to the Company’s business. At this time, the Company does not
have the ability to further develop AirTokens as part of its business plan in the absence of new laws or a definitive regulatory regime
(in both the U.S. and Brazil) regarding the use and transferability of AirTokens (and other similar tokens issued on the Ethereum block
chain that are classified as securities). Current laws and regulatory regimes do not provide for the Company to utilize the AirTokens
as envisioned by the Company since AirTokens are no longer freely transferable and the previous market for AirTokens no longer exists.
AirTokens were never fully developed and never gained full functionality. As previously stated, AirTokens are not currently freely transferable,
and no market exists for AirTokens. As a result of the Company discontinuing the development of AirTokens, AirTokens will lose their functionality
in full, and it is likely that no market for AirTokens will ever be re-created and that AirTokens will not again ever be freely transferable. Since the Company is no longer continuing with
the AirToken project, the Company should not recognize any revenue related to the research and development of the AirToken project, and
the deferred revenue is no longer appropriate to be recorded on the balance sheet. The liability, Deferred revenue - AirToken Project,
of approximately $13 million, as of June 30, 2021, was extinguished and charged to Other Income in the Condensed Consolidated Statements
of Comprehensive Loss. Distinguishing Liabilities from Equity The Company relies on the guidance provided by
ASC 480, Distinguishing Liabilities from Equity Once the Company determines that a financial instrument
should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability
section and the equity section of the balance sheet. The Company will determine temporary equity classification if the redemption of the
financial instrument is outside the control of the Company (i.e., at the option of the holder). Otherwise, the Company accounts for the
financial instrument as permanent equity. The Company records its financial instruments
classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. The Company records its financial instruments
classified as liabilities at their fair value at each subsequent measurement date. The changes in fair value of these financial instruments
are recorded as other expense/income. Hedging The Company does not use derivative instruments
to hedge exposures to cash flows, market or foreign currency risks. The Company evaluates its financial instruments, including equity-linked
financial instruments, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives. Stock-based
Compensation The Company accounts for stock-based compensation
to employees and non-employees in conformity with the provisions of ASC 718, Compensation - Stock Based Compensation Common shares issued to third parties for services
provided are valued based on the estimated fair value of the Company’s common shares. All stock-based compensation costs are recorded
in selling, general and administrative expenses in the consolidated statements of operations. All stock-based compensation awards were
cancelled pursuant to the Transactions which occurred on May 21, 2020. In August 2020, the Company established the Share
Based Payment Program with Cash Settlement - Phantom Shares of Via Varejo S.A. (the "Plan"). Pursuant to the Plan, the Company's
Board of Directors may grant cash-settled shares, referred to as "Phantom Shares," to the Company's employees as part of the
employees' remuneration package. Each Phantom Share will represent the employee's right to receive the full amount corresponding to the
average quotation of 3 (three) common shares of Via Varejo S.A. in the 20 (twenty) trading sessions at B3 - Brazil, Bolsa, Balcão
immediately prior to vesting, as established in the Plan. The Phantom Shares vest over a service period of five years .
As of June 14, 2021, there is no liability reported
related to the Phantom Shares due the deconsolidation of banQi. No Phantom Shares have vested as of June 30, 2021. Fair Value Measurement The Company’s financial instruments include
cash and cash equivalents, accounts receivable, accounts payable and short and long-term debt. The fair values of cash and cash equivalents,
accounts receivable, and accounts payable approximate their stated amounts because of the short maturity of these financial instruments. The valuation hierarchy is composed of three levels.
The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.
The levels within the valuation hierarchy under ASC 820 are described below:
Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities.
Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.
Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities. Adoption of Recent Accounting Pronouncements In February 2016, the FASB established Topic
842, Leases Land Easement
Practical Expedient for Transition to Topic 842; Codification Improvements to Topic 842, Leases Targeted Improvements Narrow-Scope Improvements for Lessors The Company adopted ASU 2016-02 effective October
1, 2019 using the modified retrospective approach whereby the Company will continue to present prior period financial statements and disclosures
under ASC 840. In addition, the Company elected the transition package of three practical expedients permitted within the standard, which
eliminates the requirements to reassess prior conclusions about lease identification, lease classification and initial direct costs. Further,
the Company adopted a short-term lease exception policy, permitting the Company to not apply the recognition requirements of this standard
to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components
as a single component for certain classes of assets. Adoption of the new standard resulted in the recording
of right-of-use assets and lease liabilities related to the Company’s operating leases, totaling $ 2.3 2.4 In August 2018, the FASB issued ASU 2018-13, Fair
Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-15, Intangibles,
Goodwill and Other (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement
that is a Service Contract Recent Accounting Pronouncements The Company continually assesses any new accounting
pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial
reporting, the Company undertakes a study to determine the consequences of the change to its condensed consolidated financial statements
and assures that there are proper controls in place to ascertain that the Company's condensed consolidated financial statements properly
reflect the change. In June 2016, the FASB issued ASU 2016-13, Financial
Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In December 2019, the FASB issued ASU 2019-12,
Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In August 2020, the FASB issued ASU No. 2020-06,
Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Reclassifications Certain reclassifications have been made to the 2020 consolidated financial
statements in order to conform to the 2021 financial statement presentation.

Discontinued Operations

Discontinued Operations9 Months Ended
Jun. 30, 2021
Discontinued Operations
Discontinued OperationsNote 4 – Discontinued Operations The Company has determined the loss of a controlling
interest and deconsolidation of the operations of banQi as of June 14, 2021 represents a strategic shift that will have a major effect
on the business and therefore meets the criteria for classification as discontinued operations at June 30, 2021 and prior periods presented
in the condensed consolidated financial information. Accordingly, the assets and liabilities associated with the operations of banQi have
been classified as discontinued operations in the accompanying condensed consolidated balance sheets, condensed consolidated statements
of comprehensive loss, and condensed consolidated cash flows for all periods presented. The assets and liabilities that were included in the June 14, 2021 deconsolidation
of banQi consist of the following:
Schedule of discontinued operations
BALANCE SHEET As of
Cash and cash equivalents 6,110,979
Restricted cash 209,044
Accounts receivable, net 1,279,169
Prepaid expenses and other current assets 369,445
Intangibles, net 855,156
Property and equipment, net 148,922
Security deposits 9,051
Due from affiliates 5,431,853
Accrued liabilities 8,789,203
Other deferred revenue, current portion 51,877
Due to related party 12,676,882
Deferred revenue - Mastercard Program Agreement 13,081,493
Other deferred revenue, net of current portion 69,168
Foreign capital 252,000
Gain from deconsolidation of banQi (20,507,004 ) The results from the discontinued operations have been reflected in the
Consolidated Statement of Comprehensive Loss for the three- and nine-month periods ended June 30, 2021 consist of the following:
Schedule of discontinued operations
Three
Months Ended Nine
Months Ended
June
30, 2021 June
30, 2021
Revenue $ 567,626 $ 1,065,450
Operating expenses:
Selling, general and administrative 4,816,514 12,017,284
Total operating expenses 4,816,514 12,017,284
Loss from operations (4,248,888 ) (10,951,835 )
Other (expense) income:
Foreign currency transaction loss (39,032 ) —
Interest income (expense), net 23,372 99,874
Other (expense) income, net (15,660 ) 99,874
Loss before income taxes (4,264,548 ) (10,851,961 )
Net income (loss) (4,264,548 ) (10,851,961 )
Net loss attributable to non-controlling interest — —
Net loss attributable to CarrierEQ, Inc, (4,264,548 ) (10,851,961 )
Other comprehensive loss
Foreign currency translation adjustment (527,484 ) (875,085 )
Total comprehensive loss (4,792,032 ) (11,727,046 ) As a result of the discontinued operations, the previously
presented 2020 financial statements have been revised to present the consolidated financial statements of the continuing operations separate
from the discontinued operations. The effects on the Consolidated Balance Sheet as of September 30, 2020 were as follows:
Schedule of discontinued operations, previously presented
September
30, 2020
As previously
Reported Adjustment As Revised
ASSETS
Current assets:
Cash and cash equivalents $ 3,272,664 $ 1,614,636 $ 1,658,028
Accounts receivable 857,901 857,901 —
Prepaid expenses and other current assets 1,399,878 316,351 1,083,527
Current assets of discontinued operations — (2,788,888 ) 2,788,888
Total current assets 5,530,443 — 5,530,443
Non-current assets:
Intangibles, net 4,325,105 33,059 4,292,046
Property and equipment. Net 3,790 3,790 —
Security deposits 338,386 18,278 320,108
Lease right of use assets 1,979,658 — 1,979,658
Investment in related affiliate — — —
Due from related party 1,400,000 — 1,400,000
Due from affiliates — 4,589,610 (4,589,610 )
Other assets 130,664 130,664 —
Non-current assets of discontinued operations — (4,775,401 ) 4,775,401
Total non-current assets 8,177,603 — 8,177,603
Total assets $ 13,708,046 $ — $ 13,708,046
LIABILITIES AND MEMBER'S DEFICIT
Current liabilities:
Accounts payable 301,003 — 301,003
Accrued liabilities 4,261,009 3,111,495 1,149,514
Other deferred revenue. current portion 58,283 58,283 —
AirToken refund liability 163,561 — 163,561
Lease liability, current portion 393,468 — 393,468
Due to related party 1,572,124 1,572,124 —
Current liabilities of discontinued operations — (4,741,902 ) 4,741,902
Total current liabilities 6,749,448 — 6,749,448
Long-term liabilities:
Deferred revenue - Mastercard Program Agreement 11,520,725 11,520,725 —
Deferred gain on issuance of AirTokens for Services 396,790 — 396,790
Lease liability, net of current portion 1,758,196 — 1,758,196
Deferred revenue - AirToken Project 12,529,824 — 12,529,824
Other deferred revenue, net of current portion 81,620 81,620 —
Long-term liabilities of discontinued operations — (11,602,345 ) 11,602,345
Total liabilities $ 33,036,603 $ — $ 33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020 (20,899,904 ) (10,352,340 ) (10,547,564 )
Accumulated other comprehensive income (loss) — 1,572,382 (1,572,382 )
Accumulated other comprehensive income of discontinued operations 1,572,382 8,779,958 (7,207,576 )
Total member's deficit attributable to Carrier EQ, LLC member (19,327,522 ) — (19,327,522 )
Non-controlling interest in subsidiary (1,035 ) — (1,035 )
Total member's deficit (19,328,557 ) — (19,328,557 )
Total liabilities and member's deficit $ 13,708,046 $ — $ 13,708,046 The effects on the Consolidated Statement of Comprehensive
Loss for the three- and nine-month periods ended June 30, 2020 were as follows:
Three Months Ended June 30, 2020 Nine Months Ended June 30, 2020
As Previously Reported Adjusted As Revised As Previously Reported Adjusted As Revised
Revenue $ 34,576 $ 34,576 — $ 58,407 $ 58,407 —
Operating expenses:
Cost of revenue 114,839 (114,839 ) — 114,839 (114,839 ) —
Selling, general and administrative 6,212,797 1,336,572 5,105,903 16,989,307 4,935,325 12,283,660
Impairment of digital assets — — — — — —
Total operating expenses 6,327,636 1,221,733 5,105,903 17,104,146 4,820,486 12,283,660
Loss from operations 6,293,060 1,187,157 5,105,903 17,045,739 4,762,079 12,283,660
Other (expense) income:
Realized loss on sale of digital assets — — — (1,392 ) — (1,392 )
Interest income (expense), net 122,861 40,033 82,828 150,015 147,120 2,895
Other (expense) income, net 122,861 40,033 82,828 148,623 147,120 1,503
Loss before income taxes (6,170,199 ) (1,147,124 ) (5,023,075 ) (16,897,116 ) (4,614,959 ) (12,282,157 )
Income tax benefit 47,620 — 47,620 129,661 — 129,661
Loss from Continuing Operations (6,122,579 ) (1,147,124 ) (4,975,455 ) (16,767,455 ) (4,614,959 ) (12,152,496 )
Net income (loss) from discontinued operations — (1,147,124 ) (1,147,124 ) — (4,614,960 ) (4,614,960 )
Net loss (6,122,579 ) (1,147,124 ) (6,122,579 ) (16,767,455 ) (4,614,960 ) (16,767,456 )
Net loss attributable to non-controlling interest (44 ) — (44 ) 461 — 461
Net loss attributable to Carrier EQ, LLC (6,122,623 ) (1,147,124 ) (6,122,623 ) (16,766,994 ) (4,614,960 ) (16,766,995 )
Other comprehensive income
Foreign currency translation adjustment 120,645 — 120,645 1,118,914 — 1,118,914
Total comprehensive loss (6,001,978 ) (1,147,124 ) (6,001,978 ) (15,648,080 ) (4,614,960 ) (15,648,081 ) The depreciation, amortization and significant operating noncash items
of the discontinued operations were as follows:
Three
Months Ended Nine
Months Ended
Depreciation and amortization $ 7,719 $ 29,472

Mastercard Program Agreement

Mastercard Program Agreement9 Months Ended
Jun. 30, 2021
Mastercard Program Agreement
Mastercard Program AgreementNote 5 – Mastercard Program Agreement On December 16, 2019, banQi, received
R$ 65 16 Pursuant to the Program Agreement, banQi,
as a licensee of MasterCard International, Inc. and a business partner of Mastercard Brasil, entered into the Incentive Program (as defined
in the Program Agreement) in order to issue, expand and boost the prepaid card (“Airfox Card”) base of banQi as well
as the number of transactions and turnover (sales revenue) generated by MasterCard Cards. The Program Incentives monies (as defined in
the Program Agreement) cannot be used for the benefit of any product of any Mastercard competitor and/or any card brand other than the
Mastercard Network. As an incentive to support the launching of Airfox Card, on December 16, 2019 Mastercard Brasil made to BanQi
the incentive prepayment per sales revenue ("Sales Revenue Incentive Prepayment") totaling R$65 million. As a Mastercard prepaid card issuer, banQi will be entitled to receive
Sales Revenue Incentive pursuant to the Program Agreement. As a result, the Sales Revenue Incentive will be used to amortize the Sales
Revenue Incentive Prepayment received on December 11, 2019. Upon complete amortization of Incentive Prepayment, Mastercard will make quarterly
payments of the Sales Revenue Incentive, calculated according to the value of transactions completed with the prepaid cards issued by
the banQi. banQi will have no minimum commitment of transaction volumes to be completed with the prepaid cards. The Sales Revenue Incentive Prepayment constitutes
the creation of a direct financial obligation on banQi since it constitutes prepaid sales revenue from Mastercard Brasil to banQi. Via Varejo has agreed to act as a guarantor of banQi’s Sales Revenue Incentive Prepayment obligations to Mastercard
Brasil pursuant to the Program Agreement and a Guaranty Letter. The Program Agreement has a term of ten years,
unless earlier terminated by either party in accordance with specific provisions of the Program Agreement. The Program Agreement also
establishes that the remaining balance of the prepaid incentive amount shall be updated every twelve months at 72% of the Brazilian federal
funds rate, the "SELIC" rate (or 'over Selic') as of the payment date of the incentive, which turns the incentive agreement
into a financial debt instrument. If the Agreement was ever terminated, even as of the ending of the effective term of ten years or before,
the Company shall make the full payment of the remaining sales incentive prepaid balance at the actual termination date. The Company will recognize the revenue as earned
on a monthly basis, based on a fixed percentage of the total dollar value of card transactions completed during the month in accordance
with the terms in the agreement. Also, the company will recognize finance expenses related to the SELIC adjustment on a yearly basis,
as stated by the agreement. The Company has identified one performance obligation that meets the series provision and recognizes revenue
over time. The Company Sales incentives totaling $ 343 429 10 6

Prepaid Expenses and Other Curr

Prepaid Expenses and Other Current Assets9 Months Ended
Jun. 30, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid Expenses and Other Current Assets Note 6 - Prepaid Expenses and Other Current Assets Prepaid expenses and other current assets consisted
of the following:
Prepaid expenses and other current assets
June 30, 2021 September 30, 2020
Service contract $ — $ 349,000
Research and Development tax credit 675,627 496,965
Prepaid expense 95,893 237,562
Total Prepaid expenses and other current assets $ 771,520 $ 1,083,527

Intangible Assets, Net

Intangible Assets, Net9 Months Ended
Jun. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets, NetNote 7 - Intangible Assets, Net The following table summarizes the Company’s
definite-lived intangible assets:
Intangible Assets, Net
June 30, 2021
Estimated Gross Additions Impairment / Accumulated Net
Domain names 3 $ 140,012 $ — — $ (123,674 ) $ 16,338
Capitalized software costs towards VV Wallet 3 4,855,125 1,012,937 (736,604 ) (1,836,202 ) 3,295,256
Website 3 282,645 — — (220,893 ) 43,867
Software 3 42,123 — (42,123) — —
$ 5,319,905 $ 1,012,937 (778,727 ) $ (2,198,654 ) $ 3,355,461
September 30, 2020
Estimated Gross Additions Accumulated Net
Domain names 3 $ 140,012 $ — $ (98,137 ) $ 41,875
Capitalized software costs towards VV Wallet 3 1,500,058 3,355,067 (702,477 ) 4,152,648
Website 3 272,083 10,562 (185,122 ) 97,523
$ 1,912,153 $ 3,365,629 $ (994,800 ) $ 4,292,046 The Company uses the straight-line method to determine
the amortization expense for its definite-lived intangible assets. The amortization expense related to the definite-lived intangible assets
was $ 0.4 1.2 0.3 0.6 0.7 42.1

Accrued liabilities

Accrued liabilities9 Months Ended
Jun. 30, 2021
Payables and Accruals [Abstract]
Accrued liabilitiesNote 8 - Accrued liabilities Accrued liabilities consisted of the following:
Accrued liabilities
June 30, September 30,
Customer deposits $ — $ —
Accrued compensation 378,463 779,114
Other accrued liabilities 183 183
Operating third parties' liabilities — —
Accrued accounts payable 160,629 196,609
Tax and licenses — —
Credit card payable 16,616 23,261
Legal and professional — 130,347
Total accrued liabilities $ 555,891 $ 1,149,514

Preferred Stock

Preferred Stock9 Months Ended
Jun. 30, 2021
Equity [Abstract]
Preferred StockNote 9 - Preferred Stock Series One and One-A Preferred Stock Purchase
Agreement On July 15, 2016, the Company sold to accredited
investors an aggregate of 2,652,072 1,046,147 The Preferred Stock was convertible into the Company’s
Common Stock on a 1 for 1 basis at the holders’ option. The Preferred Stock did not contain any redemption provisions. The Preferred
Stock did not pay dividends and vote together with the common stock of the Company as a single class on all actions to be taken by the
stockholders of the Company. On May 21, 2020, in connection with the February
7, 2020 written Call Exercise Notice from Via Varejo (“Call Exercise Notice”), the aggregate of 2,652,072 1,046,146 The Company amended its Certificate of Incorporation
and filed the Second Restated Certificate of Incorporation (the “Restated Certificate of Incorporation”) with the Delaware
Secretary of State on May 21, 2020, to provide for (i) a single class of common stock (and automatic conversion of any and all outstanding
shares of preferred stock into common stock) and (ii) no preferential rights in favor of any shareholder.

Common Stock

Common Stock9 Months Ended
Jun. 30, 2021
Common Stock
Common StockNote 10 - Common Stock On January 25, 2016, the Company issued 497,873
20 The contingent issuance of shares of common stock
to the Investor was evaluated to determine whether the embedded feature would be required to be recorded as a derivative liability. It
was determined the embedded feature qualifies for equity classification. On February 28, 2018 the Company repurchased 414,893 0.2 On May 21, 2020, in connection with the Call Exercise
Notice, all of the Company’s previously outstanding common stock was purchased by the Buyer, which is included in the total aggregate
of 25,265,794

Stock Based Compensation

Stock Based Compensation9 Months Ended
Jun. 30, 2021
Share-based Payment Arrangement [Abstract]
Stock Based CompensationNote 11 -
Stock Based Compensation The Company established a 2016 Equity Incentive
Plan (the “Plan”) during 2016 and issued stock-based awards to certain employees and non-employees under this plan. The Plan
provided for the issuance of incentive stock options, non-statutory stock options, stock appreciation rights, restricted stock units and
other stock awards. On February 3, 2020, the Company’s
Board of Directors approved an amendment to the Plan to decrease the aggregate number of shares of the Company’s common stock that
may be issued pursuant to Stock Awards (as defined in the Plan) from 2,834,837 2,676,126 Additionally, on February 3, 2020, the Company’s
Board of Directors approved the acceleration of vesting of 751,849 On February 6, 2020, the Board approved the acceleration
of vesting of 149,564 On February 26, 2020, the Board approved the acceleration
of vesting of 277,564 On May 21, 2020, concurrently with the consummation
of the Transaction and as a condition precedent under the September 11, 2018 convertible note purchase and call option agreement (the
“Call Option Agreement”), the Company’s Board of Directors cancelled all outstanding options to purchase the Company’s
Common Stock granted under the Plan. All of the holders of the outstanding options issued under the Plan were immediately cancelled and,
in consideration for such cancellation were entitled to a lump sum cash payment from the Company. The Company lacks company-specific historical
and implied volatility information. Therefore, it estimates its expected stock volatility based on the historical volatility of a set
of publicly traded peer companies. Due to the lack of historical exercise history, the expected term of the Company’s stock options
for employees has been determined utilizing the “simplified” method for awards. The risk-free interest rate was determined
by reference to the U.S. Treasury yield curve in effect at the time of grant of the award for time periods approximately equal to the
expected term of the award. The expected dividend yield was zero based on the fact that the Company has never paid cash dividends and
does not expect to pay any cash dividends in the foreseeable future. The fair value of the Company’s common stock
was estimated to be $ 0.29 The Company used the Black-Scholes option-pricing
model to estimate the fair value of options issued using the following assumptions:
Stock option valuation assumptions
Nine Months Ended June 30, Nine Months Ended
Price of Common Stock $ — $ 0.25 0.29
Volatility — % 60 72
Expected term (in years) — 0 – 6.90
Risk free rate — % 1.39 1.74 On May 21, 2020, as a result of the
Transaction, there was a change in control when the Company was fully acquired by Via Varejo, and as a condition precedent under the
Call Option Agreement, the Company’s Board of Directors cancelled all outstanding options. As noted in the 2016 Equity
Incentive Plan Amendment, for instances where a change in control occurs, vesting will be accelerated for all outstanding stock
award and a cash payment will be paid to all Option Stockholders by Via Varejo. The total unrecognized compensation cost based on
the fair value of the options was recognized as stock-based compensation expense on May 21, 2020 totaling $ 0.1 3.3 0.2 3.1 no 0 3.2 0 3.4 0 0 0 0

Concentrations

Concentrations9 Months Ended
Jun. 30, 2021
Risks and Uncertainties [Abstract]
ConcentrationsNote 12 – Concentrations Accounts Payable As of June 30, 2021, and September 30, 2020, the
Company had approximately 99 85

Commitments and Contingencies

Commitments and Contingencies9 Months Ended
Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Commitments and ContingenciesNote 13 - Commitments and Contingencies Operating Leases The Company has operating leases primarily consisting of office space
with remaining lease terms of 1 to 8 years, subject to certain renewal options as applicable. Leases with an initial term of twelve months or
less are not recorded on the balance sheet, and the Company does not separate lease and non-lease components of contracts. There are no
material residual guarantees associated with any of the Company’s leases, and there are no significant restrictions or covenants
included in the Company’s lease agreements. Certain leases include variable payments related to common area maintenance and property
taxes, which are billed by the landlord, as is customary with these types of charges for office space. The Company determined that the exercise of the
renewal option became reasonably certain for its office space in Boston and Brazil; therefore, the payments associated with the renewal
are now included in the measurement of the lease liability and ROU asset for those locations. The useful life of the Boston and Brazil
office spaces will extend through February 2028 and September 2021, respectively. In February 2021, the Company modified the terms of
Brazilian Lease agreement with the landlord, and the Company decided to reduce the length of the contract to April 30, 2021, as the remote
work has been practiced by mostly employees and the office facilities are not being fully used. Considering the new terms, this agreement
specifically is not applicable to the Operating Lease approach and its ROU was fully amortized in the current quarter. The Company is
evaluating options of other locations. The remaining amounts of this agreement of lease liabilities and ROU were fully amortized. The Company’s lease agreements generally
do not provide an implicit borrowing rate. Therefore, the Company used a benchmark approach to derive an appropriate imputed discount
rate. The Company benchmarked itself against other companies of similar credit ratings and comparable quality and derived imputed rates,
which were used to discount its real estate lease liabilities. The Company used estimated incremental borrowing rates of 7.52 5.73 9.68 The Company entered into a sublease agreement with a subtenant on March
1, 2020, the rent commencement date was April 1, 2020, and the lease terminated on December 31, 2020. There was approximately $ 0 0 Lease Costs The table below prese nts
certain information related to the lease costs for the Company’s operating leases:
Lease cost
Three Months Ended June 30, 2021 Nine Months Ended June, 2021 Three Months Ended June 30, 2020 Nine Months Ended June, 2020
Components of total lease cost:
Operating lease expense $ 214,604 $ 294,133 $ 168,115 $ 504,345
Total lease cost $ 214,604 $ 294,133 $ 168,115 $ 504,345 Lease Position as of June 30, 2021 Right of use lease assets and lease liabilities
for our operating leases were recorded in the condensed consolidated balance sheet as follows:
Leases Recorded Balance Sheet
As of June 30, 2021
Assets
Operating lease right of use assets $ 1,636,515
Total lease assets 1,636,515
Liabilities
Current liabilities:
Operating lease liability, current portion $ 212,450
Noncurrent liabilities:
Operating lease liability, net of current portion 1,601,564
Total lease liability $ 1,814,014 Lease Terms and Discount Rate The table below presents certain information related
to the weighted average remaining lease term and the weighted average discount rate for the Company’s operating leases as of June
30, 2021:
Weighted average remaining lease term and weighted average discount rate
Weighted average remaining lease term (in years) – operating leases 6.61 %
Weighted average discount rate – operating leases 7.50 % Undiscounted Cash Flows Future lease payments included in the measurement
of lease liabilities on the condensed consolidated balance sheet as of June 30, 2021, for the following five fiscal years and thereafter
were as follows:
Future lease payments
Year ending September 30, Operating Leases
Remaining 2021 $ 803,668
2022 326,453
2023 333,104
2024 339,755
2025 346,406
2026 353,055
2027 359,714
2028 152,420
Total Minimum Lease Payments $ 2,291,273
Less effects of discounting (477,259 )
Present value of future minimum lease payments $ 1,814,014 Legal Proceedings The Company may be involved in various lawsuits,
claims and proceedings incidental to the ordinary course of business. The Company accounts for such contingencies when a loss is considered
probable and can be reasonably estimated. Between August and October 2017, the Company offered
and sold AirTokens pursuant to the 2017 ICO and raised approximately $ 15 0.3 On March 15, 2019, the Company filed an initial
registration statement on Form 10 with the SEC under the Exchange Act on a voluntary basis in connection with the Settlement Agreement
and to provide current information to Potential AirToken Claimants pursuant to Section 12(a) of the Securities Act. The Form 10 registration
statement became effective on May 14, 2019, and on October 18, 2019 we were notified that the SEC had completed its review of the
Form 10 registration statement. In conjunction with the Settlement Agreement,
Potential AirToken Claimants were entitled to return their AirTokens to the Company and receive a refund in the amount of consideration
paid, plus interest, less the amount of any income received thereon. Pursuant to the Settlement Agreement, as modified in May 2019, our
Company timely distributed the claim forms on June 28, 2019. The claims period closed on September 28, 2019. All forms were processed
in accordance with the terms and provisions set forth by the Settlement Agreement. The Company received claim forms from 174 Potential
AirToken Claimants during the claims period and the Company determined to approve payment on 163 out of the 174 claims, which is approximately
93% of the claim forms received during the claims period. On December 11, 2019, the Company commenced the process of notifying, via email
only, all 174 Potential AirToken Claimants of the Company’s resolution of their claim. On or before December 28, 2019 the Company paid
all approved claims to approved claimants who returned their AirTokens to us (approximately 93.5% of the total dollar amount of all approved
claim refunds). All amounts were refunded in cash and paid through the Company's existing cash and cash equivalent reserves. The total
claim amounts including interest, totaled $3.3 million on December 28, 2019. Certain approved claimants did not return their AirTokens
to the Company. The Company did not pay approved claims to approved claimants who did not return their AirTokens to the Company. As of
June 30, 2021, the amount that was not paid was approximately $ 0.2 Additionally, the Settlement Agreement requires
our Company to:
● Maintain timely filings of all reports required by Section 13(a) of the Exchange Act for at least one year from the date the Form 10 becomes effective (the “ Effective Date
● Provide monthly reports to the SEC which include the amount of the claims paid, and any claims not paid as well as the reasons for non-payment.
● Submit to the SEC a final report of its handling of all claims received within seven months from the Effective Date of the Form 10 filing. Also, on November 16, 2018, The Company entered
into a settlement with the Massachusetts Securities Division related to the issuance of AirTokens in the 2017 ICO whereby the Company
agreed to pay a penalty of $ 0.1 As a result of the Company’s inability
to timely resolve these accounting issues, the Company did not timely file with the SEC the Company’s Quarterly Reports on Form
10-Q for the quarters ended June 30, 2019 and June 30, 2019, and the Company’s annual report on Form 10-K for the year ended September
30, 2019, which puts the Company in violation of Section 13(a) of the Exchange Act and the Settlement Agreement. In addition, the Company
did not timely file certain Current Reports on Form 8-K. As a result of the Company’s failure to timely file these various reports,
the SEC may through civil or administrative actions seek monetary and non-monetary relief from the Company, including fines, penalties,
undertakings and conduct-based injunctions, and officer and director bars and suspensions. On December 30, 2019 a claimant who purchased
AirTokens in the 2017 ICO whose claim was denied for failure to comply with the deadlines and the claim process filed a civil lawsuit
against the Company in the Supreme Court of the State of New York, County of New York. The lawsuit alleges a claim of sale of unregistered
securities to the plaintiff under Section 12(a) of the Securities Act of 1933 in connection with the plaintiff’s purchase of AirTokens
in the 2017 ICO. The plaintiff demands a full refund in the amount of consideration paid, plus interest and other costs. On February 25,
2020 the Company settled this claim with the plaintiff and the lawsuit was dismissed. The claims period officially came to a close on September 28, 2019.
All claims were processed in accordance with the terms and provisions set forth in the SEC Order. Other than with respect to the matters described
above, the Company is not aware of any pending or threatened claims that we violated any federal or state securities laws. However, the
Company cannot assure that any such claim will not be asserted in the future or that the claimant in any such action will not prevail.
The possibility that such claims may be asserted in the future will continue until the expiration of the applicable federal and state
statutes of limitations. If the payment of additional rescission claims or fines is significant, it could have a material adverse effect
on the Company cash flow, financial condition or prospects and the value of the AirTokens.

Income Taxes

Income Taxes9 Months Ended
Jun. 30, 2021
Income Tax Disclosure [Abstract]
Income TaxesNote 14 - Income Taxes A nominal provision for taxes has been recorded
as the Company has incurred net operating losses since inception. Significant components of the Company’s net deferred income tax
assets as of December 31, 2020 and September 30, 2020 consist of income tax loss carryforwards. These amounts are available for carryforward
indefinitely for use in offsetting taxable income. Realization of the future tax benefits is dependent on the Company’s ability
to generate sufficient taxable income within the carry-forward period. Prior to May 21, 2020 the Company was organized as a C Corporation
for tax purposes. As of May 21, 2020, the Company was converted from a C Corporation to a limited liability company ("LLC").
As a result of this transaction the Company believes it has lost the right to utilize its net operating loss carryovers, non-refundable
tax credits and charitable contribution carryover assets associated with the original corporation with which the Company was organized
within. Generally, only a Company that has generated a net operating loss should be able to then utilize that net operating loss to reduce
its own future profits. In late December 2020, the Company filed Form 8832 with the Internal Revenue Service in order to elect C corporation
tax classification for the LLC. The Company filed this request within the 90-day time period allowed for automatic approval of the Company’s
tax classification request. On May 21, 2020, the Company was fully acquired by Via Varejo S.A, a corporation organized under the laws
of the Federative Republic of Brazil (“Via Varejo”) through Lake Niassa Empreendimentos e Participações Ltda.,
a limited liability company duly organized under the laws of the Federative Republic of Brazil and wholly-owned by Via Varejo (“Transaction”).
As a result of the Transaction, the utilization of some of the net operating loss carryforwards generated in both prior and the current
fiscal years may be subject to a substantial annual limitation due to the ownership change limitations provided by the Internal Revenue
Code of 1986, as amended, and similar state provisions. As of the date of these financial statements, the Company has not undertaken an
effort to convince the IRS that the Company’s net operating losses prior to and through May 21, 2020 should be maintained and available
for the Company’s future benefit. The Company may or may not do this in the future. The Company may also have lost the use of the
net operating loss assets as a result of IRC 382. The Company may undertake an Internal Revenue Code (“IRC”) 382 study to
estimate the amount of the net operating losses that may be utilized in the future. However, whatever the outcome of the IRC 382 study
is, the IRS would still have to approve the Company’s right to utilize such carryovers in the future. However, throughout the Company’s
history the Company has generated substantial net operating losses. These deferred tax assets arising from the future tax benefits are
currently considered not likely to be realized and are thus reduced to zero by an offsetting valuation allowance. As a result, there is
no provision for income taxes other than those amounts required to properly accrued for the various state minimum income taxes owed by
the Company to the jurisdictions in which it operates. The income tax benefit for the three and nine months ended June 30, 2021 and 2020
is the result of research and development tax credits. Brazil Income Taxation The Company operates a subsidiary in Brazil. All
Brazilian resident companies are taxed on their world-wide income. Corporate income tax (IRPJ) is generally assessed at a fixed rate of
15% on annual taxable income, using either the 'actual profits' method (APM) or the 'presumed profits' method (PPM). All legal entities
are further subject to Social Contribution on Net Income (CSLL) at the rate of 9% (except for financial institutions, private insurance,
as well as certain other prescribed entities, who are taxed at a 15% rate). This amount is not deductible for IRPJ purposes. The tax base
is therefore the profit before income tax, after some adjustments, depending on the calculation method (i.e. APM or PPM). Corporate taxpayers may also be subject to a surcharge
of 10% on annual taxable income in excess of 240,000 Brazilian reais (BRL).

Related Party Transaction

Related Party Transaction9 Months Ended
Jun. 30, 2021
Related Party Transactions [Abstract]
Related Party TransactionNote 15 – Related Party Transaction The related party transactions between the Company
and Via Varejo were revenue totaling $ 32.3 361.9

Subsequent Events

Subsequent Events9 Months Ended
Jun. 30, 2021
Subsequent Events [Abstract]
Subsequent EventsNote 16 – Subsequent Events On July 8, 2021, Lake Niassa made a capital contribution
to Airfox in the amount of $ 480

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)9 Months Ended
Jun. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of PresentationBasis of Presentation The accompanying unaudited condensed consolidated
interim financial statements (“interim statements”) of Airfox have been prepared in accordance with accounting principles
generally accepted in the United States of America (“GAAP”) as determined by Financial Accounting Standards Board (the “FASB”)
within its Accounting Standards Codification (“ASC”) and under the rules and regulations of the United States Securities and
Exchange Commission (“SEC”). Accordingly, they do not include all the information and footnotes required by GAAP for complete
financial statements. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these interim
statements have been included. The results reported in these interim statements are not necessarily indicative of the results that may
be reported for the entire year. These interim statements should be read in conjunction with the Company’s consolidated financial
statements as of and for the year ended September 30, 2020. The Company has elected not to apply pushdown
accounting to the accompanying standalone condensed consolidated financial statements in accordance with ASC 805 Business Combinations The Company is an emerging growth company as the
term is used in The Jumpstart Our Business Startups Act, enacted on April 5, 2012 and has elected to comply with certain reduced public
company reporting requirements, however, the Company may adopt accounting standards based on the effective dates for public entities. As of June 14, 2021, the operations of banQi were
deconsolidated from the Company, as the Company no longer had a controlling interest in banQi. The Company accounted for the loss in controlling
interest as discontinued operations in banQi in accordance with Accounting Standards Codification, ASC 205, Discontinued Operations and
Accounting Standards Update, ASU, No. 2014-08, Reporting of Discontinued Operations and Disclosures of Disposals of Components of an Entity.
ASC 205 requires that a component of an entity that has been disposed of or is classified as held for sale and has operations and cash
flows that can be clearly distinguished from the rest of the entity be reported as assets held for sale and discontinued operations. In
the period a component of an entity has been disposed of or classified as held for sale, the results of operations for the periods presented
are reclassified into separate line items, net of tax, in the unaudited condensed consolidated statements of comprehensive loss. Assets
and liabilities are also reclassified into separate line items on the related condensed consolidated balance sheets for the periods presented.
The statements of cash flows for the periods presented are also reclassified to reflect the results of discontinued operations as separate
line items. ASU 2014-08 requires that only a disposal of a component of an entity, or a group of components of an entity, that represents
a strategic shift that has, or will have, a major effect on the reporting entity’s operations and financial results be reported
in the financial statements as discontinued operations. ASU 2014-08 also provides guidance on the financial statement presentations and
disclosures of discontinued operations. Due to the deconsolidation of banQi during
the third quarter of fiscal 2021, in accordance with ASC 205, Discontinued Operations, the Company has classified the results of
banQi as discontinued operations in our unaudited condensed consolidated statements of operations and cash flows for all periods
presented. All assets and liabilities associated with banQi were therefore classified as assets and liabilities of discontinued
operations in our condensed consolidated balance sheets for the periods presented. All amounts included in the notes to the
unaudited condensed consolidated financial statements relate to continuing operations unless otherwise noted. For additional
information, see Note 4, Discontinued Operations.
Principles of ConsolidationPrinciples of Consolidation Prior to June 14, 2021 the Company had a controlling
interest in banQi and, prior to April 6, 2020, had a 100 On June 14, 2021, the Company’s ownership
of banQi was reduced from 99.99% to 1.43 The change in ownership represents a transfer
of net assets between entities under common control, because all entities are owned by the same common parent entity, Lake Niassa, and
thus the gain on deconsolidation of banQi was recorded against accumulated deficit The Company will also record a cost method investment
in banQi for their respective investment in the entity, and any previously recorded non-controlling interest will be removed from the
balance sheet. All intercompany transactions have been eliminated
in consolidation. The Company is not involved with variable interest entities.
Use of EstimatesUse of Estimates The preparation of financial statements in conformity
with GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the balance sheet and the reported amounts of revenue and expenses during the reporting
periods. Actual results could differ significantly from those estimates. The most significant accounting estimates inherent in the preparation
of the Company's financial statements includes, but not limited to, estimated lives of intangible assets, intangible asset impairment,
revenue recognition and deferred tax valuation allowance.
Foreign CurrencyForeign Currency The Company had operations in Brazil until June
14, 2021, where the local currency is used to prepare the financial statements which are translated into the Company’s reporting
currency, U.S. dollars. The local currency is the functional currency for the operations outside the United States. Changes in the exchange
rates between this currency and the Company’s reporting currency, are partially responsible for some of the periodic changes in
the condensed consolidated financial statements prior to June 14, 2021. Assets and liabilities of the Company’s foreign operations
until June 14, 2021 are translated into U.S. dollars at the spot rate in effect at the applicable reporting date. Revenues and expenses
of the Company’s foreign operations are translated at the average exchange rate during the applicable period. The resulting unrealized
cumulative translation adjustment is recorded as a component of accumulated other comprehensive income (loss) in stockholders’ equity.
Realized and unrealized transaction gains and losses generated by transactions denominated in a currency different from the functional
currency of the applicable entity are recorded in other income (loss) in the period in which they occur.
Revenue RecognitionRevenue Recognition The Company recognizes revenue under ASC 606, Revenue
from Contracts with Customers ASC 606 prescribes a 5-step process to achieve
its core principle:
Step 1: Identify the contract with the customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the Company satisfies a performance obligation AirToken Project Development Services (Non
ASC 606 Revenue) The Company determined that its token issuances
represented obligations to perform software development services and accounts for the proceeds received in the token issuances in accordance
with ASC 730-20, Research and Development – Research and Development Arrangements The Company, beginning in August 2017 through
early October 2017, obtained Ether and Bitcoin totaling approximately $ 15.3 0.1 Pursuant to the Settlement Agreement (as defined
and described further in Note 13), the Company was obligated to refund amounts raised for the purpose of developing the AirToken Project
if valid claims were submitted. On or before December 28, 2019, the Company paid
all approved claims to approved claimants who returned their AirTokens to the Company (approximately 93.5% of the total dollar amount
of all approved claim refunds). All amounts were refunded in cash and paid through the Company’s existing cash and cash equivalent
reserves. The total claim amounts including interest, totaled $ 3.3 0.2 Effective October 1, 2019, the Company was not
able to estimate a date to conclude the development of the AirToken Project due to regulatory matters that affect the continuity of the
development process. Due to this reason, the AirToken Project was on hold and no revenue has been recognized from the AirToken Project. On June 30, 2021, Lake Niassa determined to
discontinue the development of AirTokens and end the AirToken project related to the Company’s business. At this time, the
Company does not have the ability to further develop AirTokens as part of its business plan in the absence of new laws or a
definitive regulatory regime (in both the U.S. and Brazil) regarding the use and transferability of AirTokens (and other similar
tokens issued on the Ethereum block chain that are classified as securities). Current laws and regulatory regimes do not provide for
the Company to utilize the AirTokens as envisioned by the Company since AirTokens are no longer freely transferable and the previous
market for AirTokens no longer exists. AirTokens were never fully developed and never gained full functionality. As previously
stated, AirTokens are not currently freely transferable and no market exists for AirTokens. As a result of the discontinuation of
the development of AirTokens, AirTokens will lose their functionality in full, and it is likely that no market for AirTokens will
ever be re-created and that AirTokens will not again ever be freely transferable. Since the Company is no longer continuing
with the AirToken project, the Company has not recognized any revenue related to the research and development of the AirToken
project, and the deferred revenue is no longer appropriate to be recorded on the balance sheet. The liability, Deferred revenue -
AirToken Project, of approximately $12.5
million 12,529,824 Mastercard Revenue and Sale Incentives (ASC
606 Revenue) On December 16, 2019, banQi, received
R$ 65 16 Pursuant to the Program Agreement, banQi,
as a licensee of MasterCard International, Inc. and a business partner of Mastercard Brasil, entered into the Incentive Program (as defined
in the Program Agreement) in order to issue, expand and boost the prepaid card (“Airfox Card”) base of banQi, as well
as the number of transactions and turnover (sales revenue) generated by MasterCard Cards. As a Mastercard prepaid card issuer, banQi is
entitled to receive Sales Revenue Incentives pursuant to the Program Agreement. As a result, the Sales Revenue Incentives is used to
amortize the Sales Revenue Incentive Prepayment received on December 11, 2019. Upon complete amortization of Incentive Prepayment, Mastercard
makes quarterly payments of the Sales Revenue Incentive, calculated according to the value of transactions completed with the prepaid
cards issued by the banQi. banQi have no minimum commitment of transaction volumes to be completed with the prepaid cards. The revenue from the Program Agreement was recognized
until June 14, 2021, the date on which the Company no longer had a controlling interest over banQi, thus no additional revenue was recognized
from that date through June 30, 2021. 343 10 3,085 6,802 In connection to the Program Agreement, the Company
also entered into an agreement with Mastercard, an Interchange Manual (“Interchange Fee Agreement”) from Mastercard dated
June 18, 2019, which details the fees paid by a merchant’s bank to banQi to compensate for the value and benefits that merchant
receives when it accepts electronic payments. The fee is a specified percentage of the total
dollar amount of a card transaction, and a fixed percentage based on the type of card transaction (i.e. merchant type, national vs. international,
etc.), based on the schedule of fees outlined in the Interchange Fee Agreement (“Interchange Fee Revenue”). On a monthly basis, the Company earns revenue
from the Interchange Fee received. The Company has identified one performance obligation that meets the series provision and recognizes
revenue over time. Interchange Fee Revenue totaling $ 94 3,085 66 6,802 Via Varejo Services Agreement Revenue (ASC
606 Revenue) The Company entered into a Services Agreement
(the “Services Agreement”) as of September 11, 2018 (“the Agreement Effective Date”) with Via Varejo (the “Client”). The Company was engaged to design and develop
a mobile software module and application programming interface that provides the Client’s customers with access to certain mobile
payment functionality, and that integrates banQi (“VV Wallet Services”). The Company provided certain services, including
hosting, maintenance and operation of banQi, The VV Wallet Services were structured into four phases. The Phases are - Phase 1: Specifications
and Customization; Phase 2: Features; Phase 3: License and Maintenance Services and Phase 4: Rollout. The development of the VV Wallet Services was
considered a bundled performance obligation that included the development of the API and software as a service which is hosted on the
Company’s servers. In addition to the software as a service performance obligation, the Company provided support services for the
software as a service. The Client was considered to simultaneously receive and consume the benefits provided by the Company’s performance
as the Company performed the services. Accordingly, the revenue from Service Charges was recognized over time based on the number of transactions
made by Client customers with banQi. During Phase 1, there was a payment of $0.3 million
(“Upfront Payment”) from the Client to be recognized as revenue commencing when the product was ready for its intended use
and ratably over the remaining term of the Services Agreement through the duration of the Services Agreement. The total revenue recognized
for the three months ended June 30, 2021 and 2020 totaled $ 159 12.1 202 24.9
Cash and Cash EquivalentsCash and Cash Equivalents The Company considers all highly liquid investments
with an original maturity of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on deposit with banks
and money market instruments.
Accounts Receivable and Allowance for Doubtful AccountsAccounts Receivable
and Allowance for Doubtful Accounts As of June 30, 2021, there was a minimal amount of accounts receivable as the Company no longer consolidates the operations of banQi.
Concentrations of Credit Risk and Off-Balance Sheet RiskConcentrations of Credit Risk and Off-Balance
Sheet Risk The Company is subject to concentration of credit
risk with respect to their cash and cash equivalents, which the Company attempts to minimize by maintaining cash and cash equivalents
with institutions of sound financial quality. At times, cash balances may exceed limits federally insured by the Federal Deposit Insurance
Corporation. The Company had cash and cash equivalents, including amounts held in financial institutions in the USA that totaled $ 378
thousand. The Company believes it is not exposed to significant
credit risk due to the financial strength of the depository institutions in which the funds are held. The Company has no financial instruments
with off-balance sheet risk of loss.
Long-Lived Assets, Including Definite Intangible AssetsLong-Lived Assets, Including Definite Intangible
Assets Long-lived assets and other indefinite-lived intangibles
are evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable
through the estimated undiscounted future cash flows derived from such assets. The Company’s definite-lived intangible assets primarily
consist of various domain names and websites. For long-lived assets used in operations, impairment losses are only recorded if the asset’s
carrying amount is not recoverable through its undiscounted, probability-weighted future cash flows. The Company measures the impairment
loss based on the difference between the carrying amount and the estimated fair value. When an impairment exists, the related assets are
written down to fair value.
Security DepositsSecurity Deposits Security deposits primarily include monies being
held subject to a security agreement (“Security Agreement”) with Mastercard, Inc. executed on June 7, 2019. The Security Agreement
is related to the Services Agreement to ensure a minimum amount of users for the cards. On April 22, 2020 Mastercard returned $ 1.2 0.3 Included in the security deposits balance as of June
30, 2021 are $ 281
Investment in related affiliateInvestment in related affiliate After the deconsolidation of banQi, the Company's
remaining investment in banQi of $ 252 1.43
Due to Related PartyDue to Related Party Amounts due to banQi as of June 30, 2021 are $ 5.5 92 47
Software Development CostsSoftware Development Costs The Company capitalizes costs related to software
developed or obtained for internal use in accordance with the ASC 350-40, Internal-Use Software ·
● Preliminary project stage: (a) conceptual formulation of alternatives; (b) evaluation of alternatives; (c) determination of existence of needed technology; and (d) final selection of alternatives. Internal and external costs incurred during the preliminary project stage
● Application development stage: (a) design of chosen path, including software configuration and software interfaces; (b) coding; (c) installation to hardware; and (d) testing, including parallel processing phase. Internal and external costs incurred to develop internal-use computer software during the application development stage are capitalized.
● Post-implementation-operation stage: (a) training; and (b) application maintenance. Internal and external costs incurred during the post-implementation-operation stage are expensed as incurred. Certain costs incurred are considered enhancements,
modifications to existing internal-use software that result in additional functionality. Enhancements normally require new software specifications
and may also require a change to all or part of the existing software specifications. When this additional functionality is determinable,
the related costs are capitalized. Otherwise, costs are expensed as incurred. Capitalization of internal-use software costs ceases when
a computer software project is substantially complete and ready for its intended use. The Company begins amortization when the product
is available for general release or use. The Company has capitalized software costs relating to the Via Varejo Services
Agreement and began amortization on January 1, 2020 as the product was ready for its intended use and has been amortized through the contract
term until September 2023. The amortization expense related to the Via Varejo Services Agreement capitalized software for the three and
nine months ended June 30, 2021 totaled $ 0.4 1.4 The Company capitalizes costs related to the
development and maintenance of its website in accordance with ASC 350-50, Website Development Costs Included in the net intangibles balance as of
June 30, 2021 are $ 3,295,256 has entered into discussions with Via Varejo and Lake Niassa
to transfer these assets to banQi. The companies are still working out the final details, which should close prior to Airfox's
September 30, 2021 year-end.
Capitalizing Software Costs in Connection with Hosting Arrangements and Software as a Service ArrangementsCapitalizing Software Costs in Connection
with Hosting Arrangements and Software as a Service Arrangements For the operation in Brazil at banQi, the Company
developed certain software that are considered to be part of cloud computing arrangement (or hosting arrangement), whereby, a user or
a customer of software does not take possession of the Company’s software; rather, the software is accessed on an as-needed basis
over the Internet. Therefore, when the software is used to produce
a product or in a process to provide a service to a customer, and the customer is not given the right to obtain or use the software,
the related costs are accounted for in accordance with ASC 350-40. When a hosting arrangement includes multiple modules or components,
capitalized costs are amortized on a module-by-module basis. When a module or component is substantially ready for its intended use,
amortization begins, regardless of whether the overall hosting arrangement is being placed in service in planned stages. If the module’s
functionality is entirely dependent on the completion of one or more other modules, then amortization does not begin until that group
of interdependent modules is substantially ready for use.
Impairment of Long-term AssetsImpairment of Long-term Assets The Company evaluates the recoverability of tangible
and intangible assets periodically by taking into account events or circumstances that may warrant revised estimates of useful lives or
that indicate the asset may be impaired.
LeasesLeases The Company categorizes leases at their inception
as either operating or finance leases based on the criteria in ASC 842, Leases (“ASC 842”)
AdvertisingAdvertising Advertising costs are expensed as incurred and included in selling, general
and administrative expenses and amounted to a reversal of $ 0.7 29 179 75
Income TaxesIncome Taxes Income taxes are recorded in accordance with ASC
740, Income Taxes The Company accounts for uncertain tax positions
in accordance with the provisions of ASC 740. When uncertain tax positions exist, the Company recognizes the tax benefit of tax positions
to the extent that the benefit would more likely than not be realized assuming examination by the taxing authority. The determination
as to whether the tax benefit will more likely than not be realized is based upon the technical merits of the tax position as well as
consideration of the available facts and circumstances. The Company recognizes any interest and penalties accrued related to unrecognized
tax benefits as income tax expense.
Gain on issuance of AirTokens for servicesGain on issuance of AirTokens for services AirTokens issued to vendors for services in connection
with raising monies for the purpose of developing the AirToken Project were accounted for in accordance with ASC 845-30-1, Nonmonetary
Transactions, which requires that the AirTokens to be recognized at fair value and resulted in recognizing a deferred gain of approximately
$ 1.7 0.02 On June 30, 2021, Lake Niassa determined to discontinue
the development of AirTokens and end the AirToken project related to the Company’s business. At this time, the Company does not
have the ability to further develop AirTokens as part of its business plan in the absence of new laws or a definitive regulatory regime
(in both the U.S. and Brazil) regarding the use and transferability of AirTokens (and other similar tokens issued on the Ethereum block
chain that are classified as securities). Current laws and regulatory regimes do not provide for the Company to utilize the AirTokens
as envisioned by the Company since AirTokens are no longer freely transferable and the previous market for AirTokens no longer exists.
AirTokens were never fully developed and never gained full functionality. As previously stated, AirTokens are not currently freely transferable,
and no market exists for AirTokens. As a result of the Company discontinuing the development of AirTokens, AirTokens will lose their functionality
in full, and it is likely that no market for AirTokens will ever be re-created and that AirTokens will not again ever be freely transferable. Since the Company is no longer continuing with
the AirToken project, the Company should not recognize any revenue related to the research and development of the AirToken project, and
the deferred revenue is no longer appropriate to be recorded on the balance sheet. The liability, Deferred revenue - AirToken Project,
of approximately $13 million, as of June 30, 2021, was extinguished and charged to Other Income in the Condensed Consolidated Statements
of Comprehensive Loss.
Distinguishing Liabilities from EquityDistinguishing Liabilities from Equity The Company relies on the guidance provided by
ASC 480, Distinguishing Liabilities from Equity Once the Company determines that a financial instrument
should not be classified as a liability, the Company determines whether the financial instrument should be presented between the liability
section and the equity section of the balance sheet. The Company will determine temporary equity classification if the redemption of the
financial instrument is outside the control of the Company (i.e., at the option of the holder). Otherwise, the Company accounts for the
financial instrument as permanent equity. The Company records its financial instruments
classified as liability, temporary equity or permanent equity at issuance at the fair value, or cash received. The Company records its financial instruments
classified as liabilities at their fair value at each subsequent measurement date. The changes in fair value of these financial instruments
are recorded as other expense/income.
HedgingHedging The Company does not use derivative instruments
to hedge exposures to cash flows, market or foreign currency risks. The Company evaluates its financial instruments, including equity-linked
financial instruments, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives.
Stock-based CompensationStock-based
Compensation The Company accounts for stock-based compensation
to employees and non-employees in conformity with the provisions of ASC 718, Compensation - Stock Based Compensation Common shares issued to third parties for services
provided are valued based on the estimated fair value of the Company’s common shares. All stock-based compensation costs are recorded
in selling, general and administrative expenses in the consolidated statements of operations. All stock-based compensation awards were
cancelled pursuant to the Transactions which occurred on May 21, 2020. In August 2020, the Company established the Share
Based Payment Program with Cash Settlement - Phantom Shares of Via Varejo S.A. (the "Plan"). Pursuant to the Plan, the Company's
Board of Directors may grant cash-settled shares, referred to as "Phantom Shares," to the Company's employees as part of the
employees' remuneration package. Each Phantom Share will represent the employee's right to receive the full amount corresponding to the
average quotation of 3 (three) common shares of Via Varejo S.A. in the 20 (twenty) trading sessions at B3 - Brazil, Bolsa, Balcão
immediately prior to vesting, as established in the Plan. The Phantom Shares vest over a service period of five years .
As of June 14, 2021, there is no liability reported
related to the Phantom Shares due the deconsolidation of banQi. No Phantom Shares have vested as of June 30, 2021.
Fair Value MeasurementFair Value Measurement The Company’s financial instruments include
cash and cash equivalents, accounts receivable, accounts payable and short and long-term debt. The fair values of cash and cash equivalents,
accounts receivable, and accounts payable approximate their stated amounts because of the short maturity of these financial instruments. The valuation hierarchy is composed of three levels.
The classification within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement.
The levels within the valuation hierarchy under ASC 820 are described below:
Level 1 — Assets and liabilities with unadjusted, quoted prices listed on active market exchanges. Inputs to the fair value measurement are observable inputs, such as quoted prices in active markets for identical assets or liabilities.
Level 2 — Inputs to the fair value measurement are determined using prices for recently traded assets and liabilities with similar underlying terms, as well as direct or indirect observable inputs, such as interest rates and yield curves that are observable at commonly quoted intervals.
Level 3 — Inputs to the fair value measurement are unobservable inputs, such as estimates, assumptions, and valuation techniques when little or no market data exists for the assets or liabilities.
Adoption of Recent Accounting PronouncementsAdoption of Recent Accounting Pronouncements In February 2016, the FASB established Topic
842, Leases Land Easement
Practical Expedient for Transition to Topic 842; Codification Improvements to Topic 842, Leases Targeted Improvements Narrow-Scope Improvements for Lessors The Company adopted ASU 2016-02 effective October
1, 2019 using the modified retrospective approach whereby the Company will continue to present prior period financial statements and disclosures
under ASC 840. In addition, the Company elected the transition package of three practical expedients permitted within the standard, which
eliminates the requirements to reassess prior conclusions about lease identification, lease classification and initial direct costs. Further,
the Company adopted a short-term lease exception policy, permitting the Company to not apply the recognition requirements of this standard
to short-term leases (i.e. leases with terms of 12 months or less) and an accounting policy to account for lease and non-lease components
as a single component for certain classes of assets. Adoption of the new standard resulted in the recording
of right-of-use assets and lease liabilities related to the Company’s operating leases, totaling $ 2.3 2.4 In August 2018, the FASB issued ASU 2018-13, Fair
Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement In August 2018, the FASB issued ASU 2018-15, Intangibles,
Goodwill and Other (Subtopic 350-40): Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement
that is a Service Contract
Recent Accounting PronouncementsRecent Accounting Pronouncements The Company continually assesses any new accounting
pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial
reporting, the Company undertakes a study to determine the consequences of the change to its condensed consolidated financial statements
and assures that there are proper controls in place to ascertain that the Company's condensed consolidated financial statements properly
reflect the change. In June 2016, the FASB issued ASU 2016-13, Financial
Instruments — Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In December 2019, the FASB issued ASU 2019-12,
Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes In August 2020, the FASB issued ASU No. 2020-06,
Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity
ReclassificationsReclassifications Certain reclassifications have been made to the 2020 consolidated financial
statements in order to conform to the 2021 financial statement presentation.

Discontinued Operations (Tables

Discontinued Operations (Tables)9 Months Ended
Jun. 30, 2021
Discontinued Operations
Schedule of discontinued operationsSchedule of discontinued operations
BALANCE SHEET As of
Cash and cash equivalents 6,110,979
Restricted cash 209,044
Accounts receivable, net 1,279,169
Prepaid expenses and other current assets 369,445
Intangibles, net 855,156
Property and equipment, net 148,922
Security deposits 9,051
Due from affiliates 5,431,853
Accrued liabilities 8,789,203
Other deferred revenue, current portion 51,877
Due to related party 12,676,882
Deferred revenue - Mastercard Program Agreement 13,081,493
Other deferred revenue, net of current portion 69,168
Foreign capital 252,000
Gain from deconsolidation of banQi (20,507,004 )
Disposal Groups, Including Discontinued Operations [Table Text Block]Schedule of discontinued operations
Three
Months Ended Nine
Months Ended
June
30, 2021 June
30, 2021
Revenue $ 567,626 $ 1,065,450
Operating expenses:
Selling, general and administrative 4,816,514 12,017,284
Total operating expenses 4,816,514 12,017,284
Loss from operations (4,248,888 ) (10,951,835 )
Other (expense) income:
Foreign currency transaction loss (39,032 ) —
Interest income (expense), net 23,372 99,874
Other (expense) income, net (15,660 ) 99,874
Loss before income taxes (4,264,548 ) (10,851,961 )
Net income (loss) (4,264,548 ) (10,851,961 )
Net loss attributable to non-controlling interest — —
Net loss attributable to CarrierEQ, Inc, (4,264,548 ) (10,851,961 )
Other comprehensive loss
Foreign currency translation adjustment (527,484 ) (875,085 )
Total comprehensive loss (4,792,032 ) (11,727,046 )
Schedule of discontinued operations, previously presentedSchedule of discontinued operations, previously presented
September
30, 2020
As previously
Reported Adjustment As Revised
ASSETS
Current assets:
Cash and cash equivalents $ 3,272,664 $ 1,614,636 $ 1,658,028
Accounts receivable 857,901 857,901 —
Prepaid expenses and other current assets 1,399,878 316,351 1,083,527
Current assets of discontinued operations — (2,788,888 ) 2,788,888
Total current assets 5,530,443 — 5,530,443
Non-current assets:
Intangibles, net 4,325,105 33,059 4,292,046
Property and equipment. Net 3,790 3,790 —
Security deposits 338,386 18,278 320,108
Lease right of use assets 1,979,658 — 1,979,658
Investment in related affiliate — — —
Due from related party 1,400,000 — 1,400,000
Due from affiliates — 4,589,610 (4,589,610 )
Other assets 130,664 130,664 —
Non-current assets of discontinued operations — (4,775,401 ) 4,775,401
Total non-current assets 8,177,603 — 8,177,603
Total assets $ 13,708,046 $ — $ 13,708,046
LIABILITIES AND MEMBER'S DEFICIT
Current liabilities:
Accounts payable 301,003 — 301,003
Accrued liabilities 4,261,009 3,111,495 1,149,514
Other deferred revenue. current portion 58,283 58,283 —
AirToken refund liability 163,561 — 163,561
Lease liability, current portion 393,468 — 393,468
Due to related party 1,572,124 1,572,124 —
Current liabilities of discontinued operations — (4,741,902 ) 4,741,902
Total current liabilities 6,749,448 — 6,749,448
Long-term liabilities:
Deferred revenue - Mastercard Program Agreement 11,520,725 11,520,725 —
Deferred gain on issuance of AirTokens for Services 396,790 — 396,790
Lease liability, net of current portion 1,758,196 — 1,758,196
Deferred revenue - AirToken Project 12,529,824 — 12,529,824
Other deferred revenue, net of current portion 81,620 81,620 —
Long-term liabilities of discontinued operations — (11,602,345 ) 11,602,345
Total liabilities $ 33,036,603 $ — $ 33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020 (20,899,904 ) (10,352,340 ) (10,547,564 )
Accumulated other comprehensive income (loss) — 1,572,382 (1,572,382 )
Accumulated other comprehensive income of discontinued operations 1,572,382 8,779,958 (7,207,576 )
Total member's deficit attributable to Carrier EQ, LLC member (19,327,522 ) — (19,327,522 )
Non-controlling interest in subsidiary (1,035 ) — (1,035 )
Total member's deficit (19,328,557 ) — (19,328,557 )
Total liabilities and member's deficit $ 13,708,046 $ — $ 13,708,046 The effects on the Consolidated Statement of Comprehensive
Loss for the three- and nine-month periods ended June 30, 2020 were as follows:
Three Months Ended June 30, 2020 Nine Months Ended June 30, 2020
As Previously Reported Adjusted As Revised As Previously Reported Adjusted As Revised
Revenue $ 34,576 $ 34,576 — $ 58,407 $ 58,407 —
Operating expenses:
Cost of revenue 114,839 (114,839 ) — 114,839 (114,839 ) —
Selling, general and administrative 6,212,797 1,336,572 5,105,903 16,989,307 4,935,325 12,283,660
Impairment of digital assets — — — — — —
Total operating expenses 6,327,636 1,221,733 5,105,903 17,104,146 4,820,486 12,283,660
Loss from operations 6,293,060 1,187,157 5,105,903 17,045,739 4,762,079 12,283,660
Other (expense) income:
Realized loss on sale of digital assets — — — (1,392 ) — (1,392 )
Interest income (expense), net 122,861 40,033 82,828 150,015 147,120 2,895
Other (expense) income, net 122,861 40,033 82,828 148,623 147,120 1,503
Loss before income taxes (6,170,199 ) (1,147,124 ) (5,023,075 ) (16,897,116 ) (4,614,959 ) (12,282,157 )
Income tax benefit 47,620 — 47,620 129,661 — 129,661
Loss from Continuing Operations (6,122,579 ) (1,147,124 ) (4,975,455 ) (16,767,455 ) (4,614,959 ) (12,152,496 )
Net income (loss) from discontinued operations — (1,147,124 ) (1,147,124 ) — (4,614,960 ) (4,614,960 )
Net loss (6,122,579 ) (1,147,124 ) (6,122,579 ) (16,767,455 ) (4,614,960 ) (16,767,456 )
Net loss attributable to non-controlling interest (44 ) — (44 ) 461 — 461
Net loss attributable to Carrier EQ, LLC (6,122,623 ) (1,147,124 ) (6,122,623 ) (16,766,994 ) (4,614,960 ) (16,766,995 )
Other comprehensive income
Foreign currency translation adjustment 120,645 — 120,645 1,118,914 — 1,118,914
Total comprehensive loss (6,001,978 ) (1,147,124 ) (6,001,978 ) (15,648,080 ) (4,614,960 ) (15,648,081 ) The depreciation, amortization and significant operating noncash items
of the discontinued operations were as follows:
Three
Months Ended Nine
Months Ended
Depreciation and amortization $ 7,719 $ 29,472

Prepaid Expenses and Other Cu_2

Prepaid Expenses and Other Current Assets (Tables)9 Months Ended
Jun. 30, 2021
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid expenses and other current assetsPrepaid expenses and other current assets
June 30, 2021 September 30, 2020
Service contract $ — $ 349,000
Research and Development tax credit 675,627 496,965
Prepaid expense 95,893 237,562
Total Prepaid expenses and other current assets $ 771,520 $ 1,083,527

Intangible Assets, Net (Tables)

Intangible Assets, Net (Tables)9 Months Ended
Jun. 30, 2021
Goodwill and Intangible Assets Disclosure [Abstract]
Intangible Assets, NetIntangible Assets, Net
June 30, 2021
Estimated Gross Additions Impairment / Accumulated Net
Domain names 3 $ 140,012 $ — — $ (123,674 ) $ 16,338
Capitalized software costs towards VV Wallet 3 4,855,125 1,012,937 (736,604 ) (1,836,202 ) 3,295,256
Website 3 282,645 — — (220,893 ) 43,867
Software 3 42,123 — (42,123) — —
$ 5,319,905 $ 1,012,937 (778,727 ) $ (2,198,654 ) $ 3,355,461
September 30, 2020
Estimated Gross Additions Accumulated Net
Domain names 3 $ 140,012 $ — $ (98,137 ) $ 41,875
Capitalized software costs towards VV Wallet 3 1,500,058 3,355,067 (702,477 ) 4,152,648
Website 3 272,083 10,562 (185,122 ) 97,523
$ 1,912,153 $ 3,365,629 $ (994,800 ) $ 4,292,046

Accrued liabilities (Tables)

Accrued liabilities (Tables)9 Months Ended
Jun. 30, 2021
Payables and Accruals [Abstract]
Accrued liabilitiesAccrued liabilities
June 30, September 30,
Customer deposits $ — $ —
Accrued compensation 378,463 779,114
Other accrued liabilities 183 183
Operating third parties' liabilities — —
Accrued accounts payable 160,629 196,609
Tax and licenses — —
Credit card payable 16,616 23,261
Legal and professional — 130,347
Total accrued liabilities $ 555,891 $ 1,149,514

Stock Based Compensation (Table

Stock Based Compensation (Tables)9 Months Ended
Jun. 30, 2021
Share-based Payment Arrangement [Abstract]
Stock option valuation assumptionsStock option valuation assumptions
Nine Months Ended June 30, Nine Months Ended
Price of Common Stock $ — $ 0.25 0.29
Volatility — % 60 72
Expected term (in years) — 0 – 6.90
Risk free rate — % 1.39 1.74

Commitments and Contingencies (

Commitments and Contingencies (Tables)9 Months Ended
Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Lease costLease cost
Three Months Ended June 30, 2021 Nine Months Ended June, 2021 Three Months Ended June 30, 2020 Nine Months Ended June, 2020
Components of total lease cost:
Operating lease expense $ 214,604 $ 294,133 $ 168,115 $ 504,345
Total lease cost $ 214,604 $ 294,133 $ 168,115 $ 504,345
Leases Recorded Balance SheetLeases Recorded Balance Sheet
As of June 30, 2021
Assets
Operating lease right of use assets $ 1,636,515
Total lease assets 1,636,515
Liabilities
Current liabilities:
Operating lease liability, current portion $ 212,450
Noncurrent liabilities:
Operating lease liability, net of current portion 1,601,564
Total lease liability $ 1,814,014
Weighted average remaining lease term and weighted average discount rateWeighted average remaining lease term and weighted average discount rate
Weighted average remaining lease term (in years) – operating leases 6.61 %
Weighted average discount rate – operating leases 7.50 %
Future lease paymentsFuture lease payments
Year ending September 30, Operating Leases
Remaining 2021 $ 803,668
2022 326,453
2023 333,104
2024 339,755
2025 346,406
2026 353,055
2027 359,714
2028 152,420
Total Minimum Lease Payments $ 2,291,273
Less effects of discounting (477,259 )
Present value of future minimum lease payments $ 1,814,014

Organization and Nature of Op_2

Organization and Nature of Operations (Details Narrative) - USD ($)6 Months Ended9 Months Ended
Jun. 30, 2021Jun. 30, 2021Sep. 30, 2018
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Organization and nature of operations, descriptionPursuant to the terms of the 7th Amendment, the banQi and Lake
Niassa (i) increased banQi 's share capital from BRL 1,000,000.00 (one million reais) to BRL 69,870,000.00 (sixty-nine million, eight
hundred and seventy thousand reais), which represents an increase of BRL 68,870,000.00 (sixty-eight million, eight hundred and seventy
thousand reais); and (ii) issued 68,870,000 (sixty-eight million, eight hundred and seventy thousand) new quotas, with par value of BRL
1.00 (one real) each, fully subscribed and paid up, in Brazilian currency, through the capitalization of Advances for Future Capital Increase
("AFAC") made by Lake Niassa.  
AirToken obligation $ 15,400,000
Extinguished charged $ 12,500,000
Air Token Gmbh [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership percentage100.00%
Air Fox Brazil [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership percentage99.99%

Financial Condition and Manag_2

Financial Condition and Management’s Plans (Details Narrative) - USD ($)Jun. 30, 2021Sep. 30, 2020Jun. 30, 2020Sep. 30, 2019
Financial Condition And Managements Plans
Cash and Cash Equivalents, at Carrying Value $ 378,411 $ 3,272,664 $ 2,746,009 $ 5,451,348
Working Capital Deficit5,400,000
Members' Equity $ 1,475,038 $ 19,327,522

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details Narrative)Apr. 22, 2020USD ($)Dec. 28, 2019USD ($)Dec. 16, 2019USD ($)Dec. 16, 2019BRL (R$)Jun. 30, 2021USD ($)Jun. 30, 2020USD ($)Oct. 31, 2017USD ($)$ / sharesJun. 30, 2021USD ($)Jun. 30, 2020USD ($)Jul. 31, 2021USD ($)Sep. 30, 2020USD ($)Sep. 30, 2019USD ($)
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Payments for Ether and Bitcoin $ 15,300,000
Cash obtained for Ether and Bitcoin100,000
Approved claims paid $ 33
Unpaid amount $ 200,000
Deferred revenue - AirToken Project $ 12,529,824
Prepayment Incentive Agreement $ 16,000,000
Sales incentives earned343,000 $ 3,085 10,000 $ 6,802
Interchange fee revenue94,000 3,085 66,000 6,802
Upfront payment revenue159,000 12,100 202 24,900
Security deposit returned $ 1,200,000
Upfront payment Phase I300,000
Investment $ 252,000 $ 252,000
Ownership percentage1.43%1.43%
Due to related party $ 5,500,000 $ 5,500,000
Effect of Exchange Variance92,000 47,000
Amortization expense1,213,738 569,951
Capitalized software costs3,295,256
Advertising costs700,000 $ 29,000 179,000 $ 75,000
Deferred gain on fair value of AirTokens $ 1,700,000
Last price paid by investors | $ / shares $ 0.02
Right of use asset1,636,515 1,636,515 $ 1,979,658 $ 2,300,000
Operating lease liability1,814,014 1,814,014 $ 2,400,000
Via Varejo Services Agreement [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Amortization expense400,000 1,400,000
V V Wallet [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Security deposits $ 281,000 $ 281,000
Brazil, Brazil Real
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Prepayment Incentive Agreement | R$R$ 65000000
Air Token Gmbh [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership percentage100.00%
Ban Qi [Member]
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items]
Ownership percentage1.43%

Discontinued Operations (Detail

Discontinued Operations (Details) - USD ($)Jun. 30, 2021Jun. 14, 2021Sep. 30, 2020Jun. 30, 2020Sep. 30, 2019
Entity Listings [Line Items]
Cash and cash equivalents $ 378,411 $ 3,272,664 $ 2,746,009 $ 5,451,348
Accounts receivable, net1,118
Prepaid expenses and other current assets771,520 1,083,527
Intangibles, net3,355,461 4,292,046
Accrued liabilities555,891 1,149,514
Due to related party $ 5,514,493
Ban Qi [Member]
Entity Listings [Line Items]
Cash and cash equivalents $ 6,110,979
Restricted cash209,044
Accounts receivable, net1,279,169
Prepaid expenses and other current assets369,445
Intangibles, net855,156
Property and equipment, net148,922
Security deposits9,051
Due from affiliates5,431,853
Accrued liabilities8,789,203
Other deferred revenue, current portion51,877
Due to related party12,676,882
Deferred revenue - Mastercard Program Agreement13,081,493
Other deferred revenue, net of current portion69,168
Foreign capital252,000
Gain from deconsolidation of banQi $ (20,507,004)

Discontinued Operations (Deta_2

Discontinued Operations (Details 1) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Jun. 30, 2020Jun. 30, 2021Jun. 30, 2020
Revenue
Operating expenses:
Selling, general and administrative2,046,330 5,105,903 7,714,303 12,283,660
Total operating expenses2,046,330 5,105,903 7,714,303 12,283,660
Loss from operations(2,046,330)(5,105,903)(7,714,303)(12,283,660)
Other (expense) income:
Foreign currency transaction loss(507,761) (418,604)
Interest income (expense), net(17,252)82,828 92,251 2,896
Other (expense) income, net12,453,871 82,828 12,652,531 1,504
Loss before income taxes10,407,541 (5,023,075)4,938,228 (12,282,156)
Net income (loss)(4,264,548)(1,147,124)(10,851,961)(4,614,960)
Net loss attributable to non-controlling interest(1,693)(44)(1,035)(461)
Net loss attributable to CarrierEQ, Inc,6,141,300 (6,122,623)(5,736,106)(16,766,994)
Other comprehensive loss
Foreign currency translation adjustment(527,484)120,645 (875,085)1,118,914
Total comprehensive loss5,613,816 $ (6,001,978)(6,611,191) $ (15,648,080)
Discontinued Operations [Member]
Revenue567,626 1,065,450
Operating expenses:
Selling, general and administrative4,816,514 12,017,284
Total operating expenses4,816,514 12,017,284
Loss from operations(4,248,888)(10,951,835)
Other (expense) income:
Foreign currency transaction loss(39,032)0
Interest income (expense), net23,372 99,874
Other (expense) income, net(15,660)99,874
Loss before income taxes(4,264,548)(10,851,961)
Net income (loss)(4,264,548)(10,851,961)
Net loss attributable to non-controlling interest
Net loss attributable to CarrierEQ, Inc,(4,264,548)(10,851,961)
Other comprehensive loss
Foreign currency translation adjustment(527,484)(875,085)
Total comprehensive loss $ (4,792,032) $ (11,727,046)

Discontinued Operations (Deta_3

Discontinued Operations (Details 2) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Mar. 31, 2021Dec. 31, 2020Jun. 30, 2020Mar. 31, 2020Dec. 31, 2019Jun. 30, 2021Jun. 30, 2020Sep. 30, 2020Sep. 30, 2019
Current assets:
Cash and cash equivalents $ 378,411 $ 2,746,009 $ 378,411 $ 2,746,009 $ 3,272,664 $ 5,451,348
Accounts receivable1,118 1,118
Prepaid expenses and other current assets771,520 771,520 1,083,527
Current assets of discontinued operations 2,788,888
Total current assets1,151,049 1,151,049 5,530,443
    Non-current assets:
Intangibles, net3,355,461 3,355,461 4,292,046
Security deposits280,616 280,616 320,108
Lease right of use assets1,636,515 1,636,515 1,979,658 $ 2,300,000
Investment in related affiliate252,000 252,000
Due from related party 1,400,000
Due from affiliates (4,589,610)
Non-current assets of discontinued operations 4,775,401
Total non-current assets5,524,592 5,524,592 8,177,603
Total assets6,675,641 6,675,641 13,708,046
Current liabilities:
Accounts payable151,237 151,237 301,003
Accrued liabilities555,891 555,891 1,149,514
AirToken refund liability115,044 115,044 163,561
Lease liability, current portion212,450 212,450 393,468
Due to related party5,514,493 5,514,493
Current liabilities of discontinued operations 4,741,902
Total current liabilities6,549,115 6,549,115 6,749,448
Long-term liabilities:
Deferred gain on issuance of AirTokens for Services 396,790
Lease liability, net of current portion1,601,564 1,601,564 1,758,196
Deferred revenue - AirToken Project 12,529,824
Long-term   liabilities of discontinued operations  11,602,345
Total liabilities8,150,679 8,150,679 33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020(1,475,038)(1,475,038)(20,899,904)
Accumulated other comprehensive income of discontinued operations 1,572,382
Total member's deficit attributable to Carrier EQ, LLC member(1,475,038)(1,475,038)(19,327,522)
Non-controlling interest in subsidiary (1,035)
Total member's deficit(1,475,038)(1,475,038)(19,328,557)
Total liabilities and member's deficit6,675,641 6,675,641 13,708,046
Revenue
Operating expenses:
Cost of revenue
Selling, general and administrative2,046,330 5,105,903 7,714,303 12,283,660
Total operating expenses2,046,330 5,105,903 7,714,303 12,283,660
Loss from operations(2,046,330)(5,105,903)(7,714,303)(12,283,660)
Other (expense) income:
Realized loss on sale of digital assets (1,392)
Interest income (expense), net(17,252)82,828 92,251 2,896
Other (expense) income, net12,453,871 82,828 12,652,531 1,504
Loss before income taxes10,407,541 (5,023,075)4,938,228 (12,282,156)
Income tax benefit 47,620 178,662 129,661
Loss from Continuing Operations10,407,541 (4,975,455)5,116,890 (12,152,495)
Net loss from discontinued operations(4,264,548)(1,147,124)(10,851,961)(4,614,960)
Net loss6,141,300 $ (4,978,019) $ (6,899,387)(6,122,623) $ (5,452,681) $ (5,191,690)
Net loss attributable to non-controlling interest(1,693)(44)(1,035)(461)
Net loss attributable to Carrier EQ, LLC6,141,300 (6,122,623)(5,736,106)(16,766,994)
Other comprehensive income
Foreign currency translation adjustment(527,484)120,645 (875,085)1,118,914
Total comprehensive loss5,613,816 (6,001,978)(6,611,191)(15,648,080)
Previously Reported [Member]
Current assets:
Cash and cash equivalents3,272,664
Accounts receivable857,901
Prepaid expenses and other current assets1,399,878
Current assets of discontinued operations
Total current assets5,530,443
    Non-current assets:
Intangibles, net4,325,105
Property and equipment. Net3,790
Security deposits338,386
Lease right of use assets1,979,658
Investment in related affiliate
Due from related party1,400,000
Due from affiliates
Other assets130,664
Non-current assets of discontinued operations
Total non-current assets8,177,603
Total assets13,708,046
Current liabilities:
Accounts payable301,003
Accrued liabilities4,261,009
Other deferred revenue. current portion58,283
AirToken refund liability163,561
Lease liability, current portion393,468
Due to related party1,572,124
Current liabilities of discontinued operations
Total current liabilities6,749,448
Long-term liabilities:
Deferred revenue - Mastercard Program Agreement11,520,725
Deferred gain on issuance of AirTokens for Services396,790
Lease liability, net of current portion1,758,196
Deferred revenue - AirToken Project12,529,824
Other deferred revenue, net of current portion81,620
Long-term   liabilities of discontinued operations 
Total liabilities33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020(20,899,904)
Accumulated other comprehensive income (loss)
Accumulated other comprehensive income of discontinued operations1,572,382
Total member's deficit attributable to Carrier EQ, LLC member(19,327,522)
Non-controlling interest in subsidiary(1,035)
Total member's deficit(19,328,557)
Total liabilities and member's deficit13,708,046
Revenue34,576 58,407
Operating expenses:
Cost of revenue114,839 114,839
Selling, general and administrative6,212,797 16,989,307
Impairment of digital assets
Total operating expenses6,327,636 17,104,146
Loss from operations6,293,060 17,045,739
Other (expense) income:
Realized loss on sale of digital assets (1,392)
Interest income (expense), net122,861 150,015
Other (expense) income, net122,861 148,623
Loss before income taxes(6,170,199)(16,897,116)
Income tax benefit(47,620)(129,661)
Loss from Continuing Operations(6,122,579)(16,767,455)
Net loss from discontinued operations
Net loss(6,122,579)(16,767,455)
Net loss attributable to non-controlling interest(44)461
Net loss attributable to Carrier EQ, LLC(6,122,623)(16,766,994)
Other comprehensive income
Foreign currency translation adjustment120,645 1,118,914
Total comprehensive loss(6,001,978)(15,648,080)
Depreciation and amortization $ 7,719 $ 29,472
Revision of Prior Period, Adjustment [Member]
Current assets:
Cash and cash equivalents1,614,636
Accounts receivable857,901
Prepaid expenses and other current assets316,351
Current assets of discontinued operations(2,788,888)
Total current assets
    Non-current assets:
Intangibles, net33,059
Property and equipment. Net3,790
Security deposits18,278
Lease right of use assets
Investment in related affiliate
Due from related party
Due from affiliates4,589,610
Other assets130,664
Non-current assets of discontinued operations(4,775,401)
Total non-current assets
Total assets
Current liabilities:
Accounts payable
Accrued liabilities3,111,495
Other deferred revenue. current portion58,283
AirToken refund liability
Lease liability, current portion
Due to related party1,572,124
Current liabilities of discontinued operations(4,741,902)
Total current liabilities
Long-term liabilities:
Deferred revenue - Mastercard Program Agreement11,520,725
Deferred gain on issuance of AirTokens for Services
Lease liability, net of current portion
Deferred revenue - AirToken Project
Other deferred revenue, net of current portion81,620
Long-term   liabilities of discontinued operations (11,602,345)
Total liabilities
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020(10,352,340)
Accumulated other comprehensive income (loss)1,572,382
Accumulated other comprehensive income of discontinued operations8,779,958
Total member's deficit attributable to Carrier EQ, LLC member
Non-controlling interest in subsidiary
Total member's deficit
Total liabilities and member's deficit
Revenue34,576 58,407
Operating expenses:
Cost of revenue(114,839)(114,839)
Selling, general and administrative1,336,572 4,935,325
Impairment of digital assets
Total operating expenses1,221,733 4,820,486
Loss from operations1,187,157 4,762,079
Other (expense) income:
Realized loss on sale of digital assets
Interest income (expense), net40,033 147,120
Other (expense) income, net40,033 147,120
Loss before income taxes(1,147,124)(4,614,959)
Income tax benefit
Loss from Continuing Operations(1,147,124)(4,614,959)
Net loss from discontinued operations(1,147,124)(4,614,960)
Net loss(1,147,124)(4,614,960)
Net loss attributable to non-controlling interest
Net loss attributable to Carrier EQ, LLC(1,147,124)(4,614,960)
Other comprehensive income
Foreign currency translation adjustment
Total comprehensive loss(1,147,124)(4,614,960)
As Revised [Member]
Current assets:
Cash and cash equivalents1,658,028
Accounts receivable
Prepaid expenses and other current assets1,083,527
Current assets of discontinued operations2,788,888
Total current assets5,530,443
    Non-current assets:
Intangibles, net4,292,046
Property and equipment. Net
Security deposits320,108
Lease right of use assets1,979,658
Investment in related affiliate
Due from related party1,400,000
Due from affiliates(4,589,610)
Other assets
Non-current assets of discontinued operations4,775,401
Total non-current assets8,177,603
Total assets13,708,046
Current liabilities:
Accounts payable301,003
Accrued liabilities1,149,514
Other deferred revenue. current portion
AirToken refund liability163,561
Lease liability, current portion393,468
Due to related party
Current liabilities of discontinued operations4,741,902
Total current liabilities6,749,448
Long-term liabilities:
Deferred revenue - Mastercard Program Agreement
Deferred gain on issuance of AirTokens for Services396,790
Lease liability, net of current portion1,758,196
Deferred revenue - AirToken Project12,529,824
Other deferred revenue, net of current portion
Long-term   liabilities of discontinued operations 11,602,345
Total liabilities33,036,603
Carrier EQ, LLC member's deficit:
Member's deficit; 1,277,635 limited liability company units outstanding as of June 30, 2021 and September 30, 2020(10,547,564)
Accumulated other comprehensive income (loss)(1,572,382)
Accumulated other comprehensive income of discontinued operations(7,207,576)
Total member's deficit attributable to Carrier EQ, LLC member(19,327,522)
Non-controlling interest in subsidiary(1,035)
Total member's deficit(19,328,557)
Total liabilities and member's deficit $ 13,708,046
Revenue
Operating expenses:
Cost of revenue
Selling, general and administrative5,105,903 12,283,660
Impairment of digital assets
Total operating expenses5,105,903 12,283,660
Loss from operations5,105,903 12,283,660
Other (expense) income:
Realized loss on sale of digital assets (1,392)
Interest income (expense), net82,828 2,895
Other (expense) income, net82,828 1,503
Loss before income taxes(5,023,075)(12,282,157)
Income tax benefit(47,620)(129,661)
Loss from Continuing Operations(4,975,455)(12,152,496)
Net loss from discontinued operations(1,147,124)(4,614,960)
Net loss(6,122,579)(16,767,456)
Net loss attributable to non-controlling interest(44)461
Net loss attributable to Carrier EQ, LLC(6,122,623)(16,766,995)
Other comprehensive income
Foreign currency translation adjustment120,645 1,118,914
Total comprehensive loss $ (6,001,978) $ (15,648,081)

Mastercard Program Agreement (D

Mastercard Program Agreement (Details Narrative)Dec. 16, 2019USD ($)Dec. 16, 2019BRL (R$)Jun. 30, 2021USD ($)Jun. 30, 2020USD ($)Jun. 30, 2021USD ($)Jun. 30, 2020USD ($)
Prepayment Incentive Agreement $ 16,000,000
Sales incentives $ 343,000 $ 429 $ 10,000 $ 6,000
Brazil, Brazil Real
Prepayment Incentive Agreement | R$R$ 65000000

Prepaid Expenses and Other Cu_3

Prepaid Expenses and Other Current Assets (Details) - USD ($)Jun. 30, 2021Sep. 30, 2020
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Service contract $ 349,000
Research and Development tax credit675,627 496,965
Prepaid expense95,893 237,562
Total Prepaid expenses and other current assets $ 771,520 $ 1,083,527

Intangible Assets, Net (Details

Intangible Assets, Net (Details) - USD ($)9 Months Ended12 Months Ended
Jun. 30, 2021Sep. 30, 2020
Finite-Lived Intangible Assets [Line Items]
Gross $ 5,319,905 $ 1,912,153
Additions1,012,937 3,365,629
Impairment(778,727)
Accumulated amortization(2,198,654)(994,800)
Net Carrying Value $ 3,355,461 $ 4,292,046
Internet Domain Names [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life3 years3 years
Gross $ 140,012 $ 140,012
Additions
Impairment
Accumulated amortization(123,674)(98,137)
Net Carrying Value $ 16,338 $ 41,875
In Process Research and Development [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life3 years3 years
Gross $ 4,855,125 $ 1,500,058
Additions1,012,937 3,355,067
Impairment(736,604)
Accumulated amortization(1,836,202)(702,477)
Net Carrying Value $ 3,295,256 $ 4,152,648
Website [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life3 years3 years
Gross $ 282,645 $ 272,083
Additions 10,562
Impairment
Accumulated amortization(220,893)(185,122)
Net Carrying Value $ 43,867 $ 97,523
Computer Software, Intangible Asset [Member]
Finite-Lived Intangible Assets [Line Items]
Useful life3 years
Gross $ 42,123
Additions
Impairment(42,123)
Accumulated amortization
Net Carrying Value

Intangible Assets, Net (Detai_2

Intangible Assets, Net (Details Narrative) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Jun. 30, 2020Jun. 30, 2021Jun. 30, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense $ 400,000 $ 300,000 $ 1,200,000 $ 600,000
Impairment $ 700,000
Effect of deconsolidation $ 42,100

Accrued liabilities (Details)

Accrued liabilities (Details) - USD ($)Jun. 30, 2021Sep. 30, 2020
Payables and Accruals [Abstract]
Customer deposits
Accrued compensation378,463 779,114
Other accrued liabilities183 183
Operating third parties' liabilities
Accrued accounts payable160,629 196,609
Tax and licenses
Credit card payable16,616 23,261
Legal and professional 130,347
Total accrued liabilities $ 555,891 $ 1,149,514

Preferred Stock (Details Narrat

Preferred Stock (Details Narrative) - sharesMay 21, 2020Jul. 15, 2016Jan. 25, 2016
Class of Stock [Line Items]
Stock sold497,873
Convertible Preferred Stock Series One [Member]
Class of Stock [Line Items]
Stock sold2,652,072
Stock cancelled2,652,072
Convertible Preferred Stock Series Onea [Member]
Class of Stock [Line Items]
Stock sold1,046,147
Stock cancelled1,046,146

Common Stock (Details Narrative

Common Stock (Details Narrative) - USD ($)May 21, 2020Feb. 28, 2018Jan. 25, 2016
Common Stock
Stock shares sold497,873
Stock sold $ 20,000
Purchase of treasury stock shares414,893
Purchase of treasury stock $ 200,000
Common stock cancelled25,265,794

Stock Based Compensation (Detai

Stock Based Compensation (Details) - $ / shares9 Months Ended
Jun. 30, 2021Jun. 30, 2020
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Price of Common Stock
Volatility
Risk free interest rate
Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Price of Common Stock $ 0.25
Volatility60.00%
Risk free interest rate1.39%
Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Price of Common Stock $ 0.29
Volatility72.00%
Expected term (in years)6 years 10 months 24 days
Risk free interest rate1.74%

Stock Based Compensation (Det_2

Stock Based Compensation (Details Narrative) - USD ($)May 21, 2020Feb. 26, 2020Feb. 06, 2020Feb. 03, 2020May 21, 2020Jun. 30, 2021Jun. 30, 2020Jun. 30, 2021Jun. 30, 2020Sep. 30, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock authorized under plan2,676,126 2,834,837
Accelerated vested shares277,564 149,564 751,849
Fair value of stock $ 0.29
Unrecognized compensation $ 100,000 $ 100,000
Lump sum cash payment3,300,000
Original fair value of the stock options $ 200,000
Additional stock based compensation $ 3,100,000
Outstanding0 0
Issued0
Compensation expense $ 325,582
Equity Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense $ 0 $ 3,200,000 0 3,400,000
Phantom Share Units (PSUs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Compensation expense $ 0 $ 0 $ 0 $ 0

Concentrations (Details Narrati

Concentrations (Details Narrative)9 Months Ended12 Months Ended
Jun. 30, 2021Sep. 30, 2020
Liabilities, Total [Member]
Concentration Risk [Line Items]
Percentage99.00%85.00%

Commitments and Contingencies_2

Commitments and Contingencies (Details) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Jun. 30, 2020Jun. 30, 2021Jun. 30, 2020
Commitments and Contingencies Disclosure [Abstract]
Operating lease expense $ 214,604 $ 168,115 $ 294,133 $ 504,345
Total lease cost $ 214,604 $ 168,115 $ 294,133 $ 504,345

Commitments and Contingencies_3

Commitments and Contingencies (Details 1) - USD ($)Jun. 30, 2021Sep. 30, 2020Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Operating lease right of use assets $ 1,636,515 $ 1,979,658 $ 2,300,000
Lease liability, current portion212,450 393,468
Lease liability, net of current portion1,601,564 $ 1,758,196
Total lease liability $ 1,814,014 $ 2,400,000

Commitments and Contingencies_4

Commitments and Contingencies (Details 2)Jun. 30, 2021
Commitments and Contingencies Disclosure [Abstract]
Weighted average remaining lease term (in years) - operating leases6 years 7 months 9 days
Weighted average discount rate - operating leases7.50%

Commitments and Contingencies_5

Commitments and Contingencies (Details 3) - USD ($)Jun. 30, 2021Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]
Remaining 2021 $ 803,668
2022326,453
2023333,104
2024339,755
2025346,406
2026353,055
2027359,714
2028152,420
Total Minimum Lease Payments2,291,273
Less effects of discounting(477,259)
Present value of future minimum lease payments $ 1,814,014 $ 2,400,000

Commitments and Contingencies_6

Commitments and Contingencies (Details Narrative) - USD ($)3 Months Ended9 Months Ended
Jun. 30, 2021Oct. 31, 2017Jun. 30, 2021Sep. 30, 2020Nov. 16, 2018
Commitments and Contingencies Disclosure [Abstract]
Incremental borrowing rate lease one7.52%
Incremental borrowing rate lease two5.73%
Incremental borrowing rate lease three9.68%
Sublease income $ 0 $ 0
Capital raised sale of AirTokens $ 15,000,000
Penalties to the SEC $ 300,000
AirToken refunds not paid $ 200,000
Penalties Commonwealth of Massachusetts $ 100,000

Related Party Transaction (Deta

Related Party Transaction (Details Narrative)9 Months Ended
Jun. 30, 2021USD ($)
Related Party Transactions [Abstract]
Upfront payment for software development services $ 32,300
Transactional fees $ 361,900

Subsequent Events (Details Narr

Subsequent Events (Details Narrative)Jul. 08, 2021USD ($)
Subsequent Event [Member]
Subsequent Event [Line Items]
Proceeds from Contributed Capital $ 480,000