Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 11, 2019 | |
Document And Entity Information | ||
Entity Registrant Name | IDEANOMICS, INC. | |
Entity Central Index Key | 0000837852 | |
Trading Symbol | idex | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 133,871,256 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Current assets: | ||
Cash and cash equivalents | $ 1,686,596 | $ 3,106,244 |
Accounts receivable, net | 2,941,245 | 19,370,665 |
Licensed content, current | 0 | 16,958,149 |
Prepayments | 1,013,384 | 2,042,041 |
Other current assets | 2,371,913 | 3,594,942 |
Total current assets | 8,013,138 | 45,072,041 |
Property and Equipment, net | 14,504,993 | 15,029,427 |
Intangible assets, net | 81,960,331 | 3,036,352 |
Goodwill | 10,028,073 | 704,884 |
Long-term investments | 42,159,313 | 26,408,609 |
Operating lease right of use assets | 6,845,031 | 0 |
Other non-current assets | 1,252,797 | 3,983,799 |
Total assets | 164,763,676 | 94,235,112 |
Current liabilities: (including amounts of the consolidated VIEs without recourse to Ideanomics, Inc. See Note 4) | ||
Accounts payable | 1,543,291 | 19,265,094 |
Deferred revenue | 458,894 | 405,929 |
Amount due to related parties | 2,565,812 | 800,822 |
Other current liabilities | 9,141,870 | 5,321,697 |
Current portion of operating lease liabilities | 912,271 | 0 |
Convertible promissory note due to related parties | 1,288,032 | 4,140,055 |
Total current liabilities | 15,910,170 | 29,933,597 |
Deferred tax liabilities | 0 | 513,935 |
Asset retirement obligations | 6,392,500 | 8,000,000 |
Convertible promissory note due to related parties - long term | 3,000,000 | 0 |
Convertible note-long term | 12,627,531 | 11,313,770 |
Promissory note - long term | 3,000,000 | 0 |
Operating lease liability-long term | 6,329,533 | 0 |
Total liabilities | 47,259,734 | 49,761,302 |
Commitments and contingencies (Note 18) | ||
Convertible redeemable preferred stock: | ||
Series A - 7,000,000 shares issued and outstanding, liquidation and deemed liquidation preference of $3,500,000 as of September 30, 2019 and December 31, 2018 | 1,261,995 | 1,261,995 |
Equity: | ||
Common stock - $0.001 par value; 1,500,000,000 shares authorized, 132,696,071 shares and 102,766,006 shares issued and outstanding as of September 30, 2019 and December 31, 2018, respectively | 132,696 | 102,765 |
Additional paid-in capital | 255,737,318 | 195,779,576 |
Accumulated deficit | (138,468,441) | (149,975,302) |
Accumulated other comprehensive loss | (1,557,346) | (1,664,598) |
Total IDEX shareholder's equity | 115,844,227 | 44,242,441 |
Non-controlling interest | 397,720 | (1,030,626) |
Total equity | 116,241,947 | 43,211,815 |
Total liabilities, convertible redeemable preferred stock and equity | $ 164,763,676 | $ 94,235,112 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
CONSOLIDATED BALANCE SHEETS (Unaudited) | ||
Convertible redeemable preferred stock, Series A shares issued | 7,000,000 | 7,000,000 |
Convertible redeemable preferred stock, Series A shares outstanding | 7,000,000 | 7,000,000 |
Convertible redeemable preferred stock, Series A liquidation and deemed liquidation preference | $ 3,500,000 | $ 3,500,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, shares issued | 132,696,071 | 102,766,006 |
Common stock, shares outstanding | 132,696,071 | 102,766,006 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) | ||||
Revenue from third parties | $ 249,512 | $ 43,707,937 | $ 949,384 | $ 362,628,296 |
Revenue from related party | 2,854,178 | 0 | 43,554,178 | 0 |
Total revenue | 3,103,690 | 43,707,937 | 44,503,562 | 362,628,296 |
Cost of revenue from third parties | 243,360 | 42,844,876 | 750,290 | 115,729,433 |
Cost of revenue from related parties | 0 | 0 | 466,894 | 244,110,132 |
Gross profit | 2,860,330 | 863,061 | 43,286,378 | 2,788,731 |
Operating expenses: | ||||
Selling, general and administrative expense | 7,769,503 | 4,333,259 | 18,442,280 | 16,861,425 |
Research and development expense | 0 | 667,416 | 0 | 1,393,025 |
Professional fees | 1,388,842 | 1,927,431 | 3,918,461 | 3,280,729 |
Depreciation and amortization | 806,481 | 291,512 | 1,420,480 | 314,737 |
Impairment of property and equipment | 2,298,887 | 0 | 2,298,887 | 0 |
Total operating expense | 12,263,713 | 7,219,618 | 26,080,108 | 21,849,916 |
Income (Loss) from operations | (9,403,383) | (6,356,557) | 17,206,270 | (19,061,185) |
Interest and other income (expense): | ||||
Interest expense, net | (639,395) | (145,610) | (1,955,476) | (201,782) |
Equity in loss of equity method investees | (40,369) | (13,882) | (606,390) | (44,316) |
Gain on disposal of subsidiaries | 1,057,363 | 0 | 1,057,363 | 0 |
Loss on remeasurement of DBOT investment | (3,178,702) | 0 | (3,178,702) | 0 |
Other | (99,997) | (925,771) | (155,946) | (558,271) |
Income (Loss) before income taxes and non-controlling interest | (12,304,483) | (7,441,820) | 12,367,119 | (19,865,554) |
Income tax benefit | 0 | 0 | 513,935 | 0 |
Net income (loss) | (12,304,483) | (7,441,820) | 12,881,054 | (19,865,554) |
Net (income) loss attributable to non-controlling interest | (1,407,384) | 254,973 | (1,374,193) | 637,314 |
Net income (loss) attributable to IDEX common shareholders | $ (13,711,867) | $ (7,186,847) | $ 11,506,861 | $ (19,228,240) |
Earnings (loss) per share | ||||
Basic (in dollars per shares) | $ (0.11) | $ (0.10) | $ 0.10 | $ (0.27) |
Diluted (in dollars per shares) | $ (0.11) | $ (0.10) | $ 0.10 | $ (0.27) |
Weighted average shares outstanding: | ||||
Basic (in shares) | 127,609,748 | 74,063,495 | 113,964,933 | 71,574,303 |
Diluted (in shares) | 127,609,748 | 74,063,495 | 118,319,893 | 71,574,303 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited) | ||||
Net income (loss) | $ (12,304,483) | $ (7,441,820) | $ 12,881,054 | $ (19,865,554) |
Other comprehensive income (loss), net of nil tax | ||||
Foreign currency translation adjustments | 23,502 | 708,140 | 102,481 | 565,315 |
Comprehensive income (loss) | (12,280,981) | (6,733,680) | 12,983,535 | (19,300,239) |
Comprehensive loss attributable to non-controlling interest | (1,470,410) | 243,078 | (1,419,916) | 614,298 |
Comprehensive income (loss) attributable to IDEX common shareholders | $ (13,751,391) | $ (6,490,602) | $ 11,563,619 | $ (18,685,941) |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) | Common Stock | Additional Paid-in Capital | Retained Earnings / Accumulated Deficit | Accumulated Other Comprehensive Loss | Ideanomics Shareholders' equity | Non - controlling Interest | Total | |
Balance at Dec. 31, 2017 | $ 68,509 | $ 158,449,544 | $ (126,693,022) | $ (782,074) | $ 31,042,957 | $ (1,289,367) | $ 29,753,590 | |
Balance (in shares) at Dec. 31, 2017 | 68,509,090 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 121,190 | 121,190 | 121,190 | |||||
Common stock issuance for RSU vested | $ 13 | (13) | ||||||
Common stock issuance for RSU vested (in shares) | 13,464 | |||||||
Common stock issuance for option exercised | $ 43 | 2,589 | 2,632 | 2,632 | ||||
Common stock issuance for option exercised (in shares) | 42,501 | |||||||
Common stock issued for warrant exercised | $ 300 | 524,700 | 525,000 | 525,000 | ||||
Common stock issued for warrant exercised (in shares) | 300,000 | |||||||
Net income (loss) | (3,721,369) | (3,721,369) | (91,444) | (3,812,813) | ||||
Foreign currency translation adjustments, net of nil tax | (32,481) | (32,481) | (9,148) | (41,629) | ||||
Balance at Mar. 31, 2018 | $ 68,865 | 159,098,010 | (130,414,391) | (814,555) | 27,937,929 | (1,389,959) | 26,547,970 | |
Balance (in shares) at Mar. 31, 2018 | 68,865,055 | |||||||
Balance at Dec. 31, 2017 | $ 68,509 | 158,449,544 | (126,693,022) | (782,074) | 31,042,957 | (1,289,367) | 29,753,590 | |
Balance (in shares) at Dec. 31, 2017 | 68,509,090 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | (19,865,554) | |||||||
Foreign currency translation adjustments, net of nil tax | 565,315 | |||||||
Balance at Sep. 30, 2018 | $ 77,246 | 190,188,410 | (145,921,262) | (239,775) | 44,104,619 | (749,246) | 43,355,373 | |
Balance (in shares) at Sep. 30, 2018 | 77,246,801 | |||||||
Balance at Mar. 31, 2018 | $ 68,865 | 159,098,010 | (130,414,391) | (814,555) | 27,937,929 | (1,389,959) | 26,547,970 | |
Balance (in shares) at Mar. 31, 2018 | 68,865,055 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 3,239,727 | 3,239,727 | 3,239,727 | |||||
Investment from GTD and SSS | 5,900,000 | 5,900,000 | 5,900,000 | |||||
Common stock issuance for RSU vested | $ 1,227 | (1,227) | ||||||
Common stock issuance for RSU vested (in shares) | 1,227,244 | |||||||
Common stock issuance for acquisition of BDCG | $ 3,000 | 7,797,000 | 7,800,000 | 7,800,000 | ||||
Common stock issuance for acquisition of BDCG (in shares) | 3,000,000 | |||||||
Net income (loss) | (8,320,024) | (8,320,024) | (290,897) | (8,610,921) | ||||
Foreign currency translation adjustments, net of nil tax | (121,465) | (121,465) | 20,269 | (101,196) | ||||
Balance at Jun. 30, 2018 | $ 73,092 | 176,033,510 | (138,734,415) | (936,020) | 36,436,167 | (1,660,587) | 34,775,580 | |
Balance (in shares) at Jun. 30, 2018 | 73,092,299 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 11,530 | 11,530 | 11,530 | |||||
Investment from GTD and SSS | 5,288,502 | 5,288,502 | 5,288,502 | |||||
Common stock issuance for option exercised | $ 40 | (40) | ||||||
Common stock issuance for option exercised (in shares) | 40,295 | |||||||
Common stock issued for warrant exercised | $ 344 | 601,156 | 601,500 | 601,500 | ||||
Common stock issued for warrant exercised (in shares) | 343,714 | |||||||
Common stock issuance for Star Thrive Group Limited | $ 3,770 | 6,869,138 | 6,872,908 | 6,872,908 | ||||
Common stock issuance for Star Thrive Group Limited (in shares) | 3,770,493 | |||||||
Conversion feature of convertible note | 1,384,614 | 1,384,614 | 1,384,614 | |||||
Acquisition Of Grapevine | 1,154,419 | 1,154,419 | ||||||
Net income (loss) | (7,186,847) | (7,186,847) | (254,973) | (7,441,820) | ||||
Foreign currency translation adjustments, net of nil tax | 696,245 | 696,245 | 11,895 | 708,140 | ||||
Balance at Sep. 30, 2018 | $ 77,246 | 190,188,410 | (145,921,262) | (239,775) | 44,104,619 | (749,246) | 43,355,373 | |
Balance (in shares) at Sep. 30, 2018 | 77,246,801 | |||||||
Balance at Dec. 31, 2018 | $ 102,765 | 195,779,576 | (149,975,302) | (1,664,598) | 44,242,441 | (1,030,626) | 43,211,815 | |
Balance (in shares) at Dec. 31, 2018 | 102,766,006 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 224,484 | 224,484 | 224,484 | |||||
Common stock issuance for RSU vested | $ 130 | (130) | ||||||
Common stock issuance for RSU vested (in shares) | 129,840 | |||||||
Common stock issuance for acquisition (SolidOpinion, Inc) | $ 4,500 | 7,150,500 | 7,155,000 | 7,155,000 | ||||
Common Stock issuance for acquisition SolidOpinion (Note 5(a)) (in shares) | 4,500,000 | |||||||
Common stock issuance for convertible debt | $ 1,166 | 2,048,834 | 2,050,000 | 2,050,000 | ||||
Common stock issuance for convertible debt (in shares) | 1,166,113 | |||||||
Net income (loss) | 19,926,515 | 19,926,515 | (17,761) | 19,908,754 | ||||
Foreign currency translation adjustments, net of nil tax | 172,133 | 172,133 | (25,295) | 146,838 | ||||
Balance at Mar. 31, 2019 | $ 108,561 | 205,203,264 | (130,048,787) | (1,492,465) | 73,770,573 | (1,073,682) | 72,696,891 | |
Balance (in shares) at Mar. 31, 2019 | 108,561,959 | |||||||
Balance at Dec. 31, 2018 | $ 102,765 | 195,779,576 | (149,975,302) | (1,664,598) | 44,242,441 | (1,030,626) | 43,211,815 | |
Balance (in shares) at Dec. 31, 2018 | 102,766,006 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 12,881,054 | |||||||
Foreign currency translation adjustments, net of nil tax | 102,481 | |||||||
Balance at Sep. 30, 2019 | $ 132,696 | 255,737,318 | (138,468,441) | (1,557,346) | 115,844,227 | 397,720 | 116,241,947 | |
Balance (in shares) at Sep. 30, 2019 | 132,696,071 | |||||||
Balance at Mar. 31, 2019 | $ 108,561 | 205,203,264 | (130,048,787) | (1,492,465) | 73,770,573 | (1,073,682) | 72,696,891 | |
Balance (in shares) at Mar. 31, 2019 | 108,561,959 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 3,702,636 | 3,702,636 | 3,702,636 | |||||
Common stock issuance for asset acquisition-Fintalk (Note 5(b)) | $ 2,861 | 5,347,139 | 5,350,000 | 5,350,000 | ||||
Common stock issuance for asset acquisition-Fintalk (Note 5(b)) (in shares) | 2,860,963 | |||||||
Common stock issuance for acquisition of non-controlling interest Grapevine (Note 5(c)) | $ 591 | 491,027 | 491,618 | (491,618) | ||||
Common stock issuance for acquisition of non-controlling interest Grapevine (Note 5(c)) (in shares) | 590,671 | |||||||
Investment from SSSIG | [1] | $ 576 | (576) | |||||
Investment (in shares) | [1] | 575,431 | ||||||
Net income (loss) | 5,292,213 | 5,292,213 | (15,430) | 5,276,783 | ||||
Foreign currency translation adjustments, net of nil tax | (75,851) | (75,851) | 7,992 | (67,859) | ||||
Balance at Jun. 30, 2019 | $ 112,589 | 214,743,490 | (124,756,574) | (1,568,316) | 88,531,189 | (1,572,738) | 86,958,451 | |
Balance (in shares) at Jun. 30, 2019 | 112,589,024 | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Share-based compensation | 2,547,107 | 2,547,107 | 2,547,107 | |||||
Common stock issuance for acquisition of BlackHorse Ventures | [2] | $ 815 | 1,499,475 | 1,500,290 | 1,500,290 | |||
Common stock issuance for acquisition of BlackHorse Ventures (in shares) | [2] | 815,217 | ||||||
Common stock issuance for acquisition of Glory Connection (Note 5(e)) | $ 12,190 | 24,367,810 | 24,380,000 | 24,380,000 | ||||
Common stock issuance for acquisition of Glory Connection (Note 5(e)) (in shares) | 12,190,000 | |||||||
Common stock issuance for acquisition (DBOT) | $ 5,852 | 9,708,186 | 9,714,038 | 104,648 | 9,818,686 | |||
Common stock issuance for acquisition of DBOT (Note 5(f)) (in shares) | 5,851,830 | |||||||
Common stock issuance for releasing Grapevine as collateral | $ 250 | 372,250 | 372,500 | 372,500 | ||||
Common stock issuance for releasing Grapevine as collateral ( in shares) | 250,000 | |||||||
Common stock issuance for convertible debt | $ 1,000 | 2,499,000 | 2,500,000 | 2,500,000 | ||||
Common stock issuance for convertible debt (in shares) | 1,000,000 | |||||||
Deconsolidation of Amer | 445,894 | 445,894 | ||||||
Net income (loss) | (13,711,867) | (13,711,867) | 1,407,384 | (12,304,483) | ||||
Foreign currency translation adjustments, net of nil tax | 10,970 | 10,970 | 12,532 | 23,502 | ||||
Balance at Sep. 30, 2019 | $ 132,696 | $ 255,737,318 | $ (138,468,441) | $ (1,557,346) | $ 115,844,227 | $ 397,720 | $ 116,241,947 | |
Balance (in shares) at Sep. 30, 2019 | 132,696,071 | |||||||
[1] | In 2018, the Company entered into a subscription agreement and amended agreements with SSSIG to purchase $1.1 million of Common Stock at the then market price. The Company has received $1.1 million in total in 2018 and issued 575,431 shares of common stock in June 2019. | |||||||
[2] | On July 16, 2019, the Company entered into a share subscription agreement to subscribe 1,186 Pre-A preferred shares of BlackHorse Ventures, a Cayman Islands company, for a consideration of $1,500,290 paid in the form of common shares of the Company. The subscription shares represent 10% of the share capital of BlackHorse Ventures on a fully diluted basis. |
CONSOLIDATED STATEMENT OF EQUIT
CONSOLIDATED STATEMENT OF EQUITY (Unaudited) (Parentheticals) - USD ($) | Jul. 16, 2019 | Jun. 30, 2019 | |
Common Stock | |||
Proceeds from issuance of common stock in SSSIG | $ 1,100,000 | ||
Investment (in shares) | [1] | 575,431 | |
Blackhorse Ventures [Member] | Series A preferred stock | |||
Investment (in shares) | 1,186 | ||
Blackhorse Ventures [Member] | Common Stock | |||
Proceeds from issuance of common stock in SSSIG | $ 1,500,290 | ||
[1] | In 2018, the Company entered into a subscription agreement and amended agreements with SSSIG to purchase $1.1 million of Common Stock at the then market price. The Company has received $1.1 million in total in 2018 and issued 575,431 shares of common stock in June 2019. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Cash flows from operating activities: | ||
Net income (loss) | $ 12,881,054 | $ (19,865,554) |
Adjustments to reconcile net income (loss) to net cash used in operating activities | ||
Share-based compensation expense | 6,474,227 | 3,372,447 |
Depreciation and amortization | 1,420,480 | 314,737 |
Non-cash interest expense | 2,265,921 | 0 |
Equity in losses of equity method investees | 606,390 | 44,316 |
Digital currency received as payment for services | (40,700,000) | 0 |
Gain on disposal of subsidiaries | (1,057,363) | 0 |
Impairment of property and equipment | 2,298,887 | 0 |
Loss on remeasurement of DBOT investment | 3,178,702 | 0 |
Change in operating assets and liabilities, net of effects of businesses acquired: | ||
Accounts receivable | (2,814,198) | (78,572,438) |
Prepaid expenses and other assets | 2,446,822 | (3,332,696) |
Accounts payable | 1,024,370 | 6,560,434 |
Deferred revenue | 149,723 | 366,474 |
Amount due to related parties | (104,323) | 71,939,834 |
Accrued expenses, salary and other current liabilities | 3,217,279 | 1,530,544 |
Net cash used in operating activities | (8,712,029) | (17,641,902) |
Cash flows from investing activities: | ||
Acquisition of property and equipment | (1,809,092) | (167,891) |
Proceeds from disposal of subsidiaries | 694,282 | 0 |
Acquisition of subsidiaries, net of cash acquired | 246,929 | (2,840,219) |
Payments for long term investments | (870,000) | (2,035,190) |
Net cash used in investing activities | (1,737,881) | (5,043,300) |
Cash flows from financing activities: | ||
Proceeds from issuance of convertible note | 4,802,300 | 12,000,000 |
Proceeds from issuance of shares and warrant | 2,500,000 | 19,186,771 |
Borrowings from related parties | 1,764,992 | 0 |
Net cash provided by financing activities | 9,067,292 | 31,186,771 |
Effect of exchange rate changes on cash | (37,030) | (48,638) |
Net (decrease)/increase in cash and restricted cash | (1,419,648) | 8,452,931 |
Cash and cash equivalents at the beginning of the period | 3,106,244 | 7,577,317 |
Cash and cash equivalents at the end of the period | 1,686,596 | 16,030,248 |
Supplemental disclosure of cash flow information: | ||
Disposal of assets in exchange of GTB | 20,218,920 | 0 |
Service Revenue received in GTB | 40,700,000 | 0 |
Issuance of shares for acquisition of intangible assets | $ 10,005,000 | $ 0 |
Nature of Operations and Summar
Nature of Operations and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Nature of Operations and Summary of Significant Accounting Policies | Note 1. Nature of Operations and Summary of Significant Accounting Policies Nature of Operations Ideanomics, Inc. (Nasdaq: IDEX) is a Nevada corporation that primarily operates in the United States and Asia. The Company is comprised of two operating segments (i) our Legacy YOD business with primary operations in the PRC which has been winding down operations over the last 12 months and (ii) our Mobile Energy Group (MEG) (formally known as our Wecast Service) business, which is transitioning to focus on the commercial fleet market for electric vehicles in addition to the Company’s existing fintech advisory business. Our MEG business operates as an end-to-end solutions provider for the procurement, financing, charging and energy management needs for fleet operators of commercial Electronic Vehicles (EV). MEG operates through a series of joint ventures with the leading companies in the commercial EV space, principally in China, and earns fees for every transaction completed based on the spread for group buying of vehicles and fees derived from the arrangement of financing and energy management such as commercial purchasing of pre-paid electricity credits. MEG focuses on commercial EV rather than passenger EV, as commercial EV is on an accelerated adoption path when compared to consumer EV adoption – which is expected to take between ten to fifteen years. We focus on four distinct commercial vehicles types with supporting income streams: 1) Closed-area heavy commercial, in areas such as Mining, Airports, and Sea Ports; 2) Last-mile delivery light commercial; 3) Buses and Coaches; 4) Taxis. The purchase and financing of vehicles provides for one-time fees and the charging and energy management provides for recurring revenue streams. In July 2019 the company invested in Glory Connection Snd. Bhd, (Glory) a vehicle manufacturer based in Malaysia. Glory holds the only license granted so far for the manufacture of electric vehicles in Malaysia and is in the process of setting up its manufacturing and assembly capabilities. We continue to develop our FinTech services which principally consist of our ownership of the Delaware Board of Trade (DBOT) ATS, Intelligenta for marketing AI solutions to the Financial Services industry and FinTech Village, a 58 acre development site in West Hartford, Connecticut. The fintech business intends to offer customized services based on best-in-class blockchain, AI and other technologies to mature and emerging businesses across various industries. To do so, we are building a financial technology ecosystem through license agreements, joint ventures and strategic investments, which we refer to as our “Fintech Ecosystem”. Basis of Presentation In this Form 10‑Q, unless the context otherwise requires, the use of the terms "we," "us", "our" and the “Company” refers to Ideanomics, Inc, its consolidated subsidiaries and variable interest entities (“VIEs”). On April 24, 2018, the Company completed the acquisition of a 100% equity ownership in Shanghai Guang Ming Investment Management (“Guang Ming”), a PRC limited liability company. One of the two selling shareholders is a related party, an affiliate of Bruno Wu (“Dr. Wu”). Guang Ming holds a special fund management license. The acquisition will help the Company develop a fund management platform. Under Accounting Standard Codification (“ASC”) 805-50-05-5 and ASC 805-50-30-5, the transaction was accounted for as a reorganization of entities under common control, in a manner similar to a pooling of interest, using historical costs. As a result of the reorganization, the net assets of Guang Ming were transferred to the Company, and the accompanying consolidated financial statements as of and for the three and nine months ended September 30, 2018 have been prepared as if the current corporate structure had been in place at the beginning of the periods presented in which the common control existed. In the opinion of management, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. All significant intercompany transactions and balances are eliminated on consolidation. However, the results of operations included in such financial statements may not necessary be indicative of annual results. We use the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on April 1, 2019 (“2018 Annual Report”). Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the bad debt allowance, variable considerations, fair values of financial instruments, intangible assets (including digital currencies) and goodwill, useful lives of intangible assets and property and equipment, asset retirement obligations, income taxes, and contingent liabilities, among others. We base our estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Fair Value Measurements Accounting standards require the categorization of financial assets and liabilities, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The various levels of the fair value hierarchy are described as follows: · Level 1 - Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access. · Level 2 - Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability. · Level 3 - Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company reviews the valuation techniques used to determine if the fair value measurements are still appropriate on an annual basis and evaluate and adjust the unobservable inputs used in the fair value measurements based on current market conditions and third party information. Our financial assets and liabilities that are measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, other current liabilities and convertible notes. The fair values of these assets approximate carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Our financial assets that are measured at fair value on a nonrecurring basis include goodwill and other intangible assets, asset retirement obligations, and adjustment in carrying value of equity securities for which the measurement alternative of cost less impairment plus or minus observable price changes is used. There were no material impairments and no material adjustments to equity securities using the measurement alternative for the three and nine months ended September 30, 2019 and 2018. Digital Currency Digital currency consists of GTDollar Coins (“GTB”), Bitcoin and Ethereum. GTB is received in connection with the services agreement and assets purchase agreement with GT Dollar Pte. Ltd. (“GTD”), our minority shareholder at the time of the transaction (Note 3 and 14 (b)). As of September 30, 2019, GTD has disposed of its investment in the Company and is no longer a minority shareholder. GTB is a type of digital asset that is not a fiat currency and is not backed by hard assets or other financial instruments, and does not represent an investment in GTD or a right to access GTD’s platform. As a result, the value of GTB is determined by the value that various market participants place on GTB through their transactions. GTB holders make or lose money from buying and selling GTB. To date, the Asia EDX exchange has not permitted holders of GTB, Bitcoin or Ethereum to exchange digital currencies held in accounts at the exchange for fiat. The company is unable to predict when our cryptocurrency holdings will be convertible into fiat and consequently does not consider them to be part of the company’s liquid resources. During the nine months ended September 30, 2019, the Company gradually converted 1,038,778 GTB to 2,763 Bitcoins and 21,312 Ethereum. As of September 30, 2019, the Company holds 7,294,555 GTB, 2,763 Bitcoins and 21,312 Ethereum. These Bitcoins and Etheruem represent GTB denominated in Bitcoin & Etheruem and do not represent a direct holding of Bitcoin and Etheruem. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies and other digital currencies under current GAAP, the Company has determined to account for these currencies as indefinite-lived intangible assets in accordance with ASC 350, Intangibles-Goodwill and Other until further guidance is issued by the FASB. Indefinite-lived intangible assets are recorded at cost and are not subject to amortization, but shall be tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. If, at the time of an impairment test, the carrying amount of an intangible asset exceeds its fair value, an impairment loss in an amount equal to the excess is recognized. The fair value of GTB currency was a Level 2 measurement (see Note 3) based upon the consideration agreed by GTD and the Company with a discount considering volatility, risk and limitations at contract inception. Assets and Liabilities Held for Sale The Company classifies assets and liabilities (disposal group) to be sold as held for sale in the period in which all of the following criteria are met: management, having the authority to approve the action, commits to a plan to sell the disposal groups; the disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such disposal group; an active program to locate a buyer and other actions required to complete the plan to sell the disposal group have been initiated; the sale of the disposal group is probable, and transfer of the disposal group is expected to qualify as a completed sale within one year, except if events or circumstances beyond the Company’s control extend the period of time required to sell the disposal group beyond one year; the disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The Company initially measures a disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met. Gains are not recognized on the sale of a disposal group until the date of sale. The Company assesses the fair value of a disposal group, less any costs to sell, each reporting period it remains classified as held for sale and reports any subsequent losses as an adjustment to the carrying value of the disposal group. Reclassifications of a General Nature Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income. Note 2 provides information about our adoption of new accounting standards for leases. |
New Accounting Pronouncements
New Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2019 | |
New Accounting Pronouncements | |
New Accounting Pronouncements | Note 2. New Accounting Pronouncements Recently Adopted Accounting Pronouncements We adopted Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016‑02, Leases (Topic 842), as of January 1, 2019, using a modified retrospective transition method and as a result, the consolidated balance sheet prior to January 1, 2019 was not restated, continues to be reported under ASC Topic 840, Leases, or ASC 840. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The lease liability is based on the present value of the remaining minimum lease payments, determined under ASC 840, discounted using our incremental borrowing rate at the effective date of January 1, 2019, using the original lease term as the tenor. As permitted under the transition guidance, we elected several practical expedients that permit us to not reassess (1) whether a contract is or contains a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial indirect costs. The application of the practical expedients did not have a significant impact on the measurement of the operating lease liability. Adoption of the new standard resulted in the recording of operating right of use assets and the related lease liabilities of approximately $3.6 million and $3.7 million, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities was immaterial. The standard did not materially impact our consolidated operating results and had no impact on cash flows. Please see Note 10. In June 2018, the FASB issued ASU No. 2018‑07, Improvements to Nonemployee Share-Based Payment Accounting, which largely aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees. The ASU also clarifies that any share-based payment issued to a customer should be evaluated under ASC 606, Revenue from Contracts with Customers . The ASU requires a modified retrospective transition approach. We adopted ASU 2018‑07 as of January 1, 2019 and there is no impact to our consolidated financial statement because we did not have such payments in 2019. In July 2017, the FASB issued ASU No. 2017‑11, (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The new standard applies to issuers of financial instruments with down-round features. A down-round provision is a term in an equity-linked financial instrument (i.e. a freestanding warrant contract or an equity conversion feature embedded within a host debt or equity contract) that triggers a downward adjustment to the instrument’s strike price (or conversion price) if equity shares are issued at a lower price (or equity-linked financial instruments are issued at a lower strike price) than the instrument’s then-current strike price. The purpose of the feature is typically to protect the instrument’s counterparty from future issuances of equity shares at a more favorable price. The ASU amends (1) the classification of such instruments as liabilities or equity by revising the certain guidance relative to evaluating if they must be accounted for as derivative instruments and (2) the guidance on recognition and measurement of freestanding equity-classified instruments. For the Company, this ASU was effective January 1, 2019. Please see Note 12. Standards Issued and Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016‑13 (ASU 2016‑13) "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016‑13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. We will adopt ASU 2016‑13 effective January 1, 2020. We are currently evaluating the effect of the adoption of ASU 2016‑13 on our consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. |
Revenue
Revenue | 9 Months Ended |
Sep. 30, 2019 | |
Revenue | |
Revenue | Note 3. Revenue The Company recognizes revenue when its customer obtains control of promised goods or services in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. All of the Company’s revenue is derived from Mobile Energy Group (formerly Wecast Services). The following table presents our revenues disaggregated by revenue source, geography (based on our business locations) and timing of revenue recognition. Three Months Ended Nine Months Ended September 30, 2019 September 30, 2018 September 30, 2019 September 30, 2018 Geographic Markets Singapore $ — $ — $ — $ 260,034,401 USA 249,512 200,660 41,649,384 200,660 Hong Kong/PRC 2,854,178 43,507,277 2,854,178 102,393,235 Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 Services Lines -Mobile Energy Group (formerly Wecast Services) Crude oil $ — $ — $ — $ 260,034,401 Consumer electronics — 43,432,556 — 102,081,176 Digital asset management services — — 40,700,000 — Electric Vehicles (“EV”) 2,854,178 — 2,854,178 — Digital advertising services and other 249,512 275,381 949,384 512,719 Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 Timing of Revenue Recognition Products and services transferred at a point in time $ 3,103,690 $ 43,707,937 $ 3,803,562 $ 362,628,296 Services provided over time — — 40,700,000 — Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 Mobile Energy Group revenue (formerly Wecast Services) Mobile Energy Group is engaged in the sourcing, procurement, financing and management of commercial fleets of electronic vehicles. Historically, the Mobile Energy Group were mainly engaged in the logistics management, including sales of crude oil, consumer electronics, and digital consulting services such as assets management and marketing services. As of September 30, 2019, we no longer have control over Amer, the subsidiary that engaged in consumer electronics business, as disclosed in Note 5(h). Logistics management revenue: Revenue from the sales of crude oil and consumer electronics is recognized when the customer obtains control of the Company’s crude oil and consumer electronics, which occurs at a point in time, usually upon shipment or upon acceptance. The contracts are generally short-term contracts where the time between order confirmation and satisfaction of all performance obligations is less than one year. The most significant judgment is determining whether we are the principal or agent for the sales of crude oil and consumer electronics. We report revenues from these transactions on a gross basis where we are the principal considering the following principal versus agent indicators: (a) We are primarily responsible for fulfilling the promise to provide the goods to the customer. The Company enters into contracts with customers with specific quality requirements and the suppliers separately. The Company is obliged to provide the goods if the supplier fails to transfer the goods to the customer and responsible for the acceptability of the goods. (b) The Company has certain inventory risk. Although the Company has the title to the goods only momentarily before passing title on to the customer, the Company is responsible to arrange and issue bill of lading to the customer so that the customer can have the right to obtain the required oil product. In addition, the customer can seek remedies and submit the claim against the Company regarding the quality or quantity of the products delivered. (c) The Company has discretion in establishing prices. Upon delivery of the crude oil and consumer electronics to the customer, the terms of the contract between the Company and the supplier require the Company to pay the supplier the agreed-upon price. The Company and the customer negotiate the selling price, and the Company invoices the customer for the agreed-upon selling price. The Company’s profit is based on the difference between the sales price negotiated with the customer and the price charged by the supplier. The sales price for crude oil is based on the daily benchmark price of spot product plus any premium determined by the Company. During the fourth quarter of 2018, we began experiencing market demand for non-logistics management revenue -generating opportunities and have begun focusing our efforts on these new market fintech services opportunities, while phasing out of the oil trading and electronics trading businesses. Digital asset management service with GTD: On March 14, 2019, the Company entered into a service agreement with GTD, one of our minority shareholders, to provide digital asset management services including consulting, advisory and management services which will be delivered in two phases. There are two performance obligations: (1) the development of a master plan for GTD’s assets for 7,083,333 GTB agreed by both parties; and (2) exclusive marketing and business development management services for a fee as percentage (0.25%) of the total market value of GTB; based on a 10‑day average of the 10 business days leading up to the end of a respective calendar month, and paid on the first day of each new calendar month. No marketing and business development management services were delivered by the Company during the current quarter and, furthermore, the company does not anticipate providing these services in the fourth quarter. The Company recognizes revenue for the master plan development services over the contract period based on the progress of the services provided towards completed satisfaction. Based on ASC 606-10-32, at contract inception, the Company considered the following factors to estimate the value of GTB (noncash consideration): a) it only trades in one exchange, which operations have been less than one year; b) its historical volatility is high; c) the Company’s intention to hold the majority of GTB, as part of our digital asset management services; and d) associated risks discussed in Note 19 (f). Therefore, the value of 7,083,333 GTB using Level 2 measurement was approximately $40.7 million with a 76% discount to the fixed contract price agreed upon by both parties when signing the contract. We considered similar assets exchanges in Singapore and considered the volatility of the quoted prices and determined a discount of 76%. The estimated value of GTB is calculated using the Black-Scholes valuation model using the following assumptions: expected terms 3.0 years; volatility 155%; dividend yield: zero and risk free interest rate 2.25%. The Company considers the payments for marketing and business development management services as performance based consideration, in accordance with ASC 606 on constraining estimates of variable consideration, including the following factors: The susceptibility of the consideration amount to factors outside the Company’s influence. The uncertainty associated with the consideration amount is not expected to be resolved for a long period of time. The Company’s experience with similar types of contracts. Whether the Company expects to offer price concessions or change the payment terms. The range of possible consideration amounts. As of September 30, 2019, all performance obligations associated with the development of the master plan for GTD’s assets have been satisfied. Accordingly, the Company recognized revenue of $0 and $40.7 million, for the three months and nine months ended September 30, 2019, respectively. No marketing and business development management services were delivered by the Company during the current quarter and, furthermore, the company does not anticipate providing these services in the fourth quarter. Taxis Commission Revenue: During Q2 2019, the Company signed an agreement with iUnicorn (also known as Shenma Zhuanche) to form a strategic joint venture (“JV”) that will focus on green finance and integrated marketing services for new energy taxi vehicles as part of Ideanomics’ Mobile Energy Group (“MEG”). The Company agreed to contribute advisory and sales resources which include arranging ABS-based auto financing with its bank partners, and will have 50.01% ownership interest in the JV and will have control of the board. iUnicorn, which will own 49.99% of the JV, agreed to contribute its vehicles sales orders in Sichuan province. The JV will generate revenues from commissions on vehicle sales order and ABS fees related to the financing, which will vary accordingly to manufacturer and vehicle model. During Q3 2019, the JV took over an order of 4,172 EV taxis from a third-party and helped facilitate the completion of the order in Q3 2019. As part of the transaction, Qianxi agreed to pay a commission of $2.9 million to the JV for facilitating the completion of this order. There is no other remaining performance obligation relating to this commission. In addition, the commission revenue is considered revenue from related party as the minority shareholder of the JV is an affiliate of our customer, Qianxi. Legacy YOD revenue Since 2017, we have run our legacy YOD segment with limited resources. No revenue was recognized for the nine months ended September 30, 2019 and 2018. As of September 30, 2019, we have ceased operations in the YOD segment. Arrangements with multiple performance obligations Our contracts with customers may include multiple performance obligations. For such arrangements, we allocate revenue to each performance obligation based on its relative standalone selling price. We generally determine standalone selling prices based on the observable prices charged to customers or adjusted market assessment or using expected cost plus margin when one is available. Adjusted market assessment price is determined based on overall pricing objectives taking into consideration market conditions and entity specific factors. Variable consideration Certain customers may receive discounts, which are accounted for as variable consideration. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. Our revenue reserves, consisting of various discounts and allowances, which are components of variable consideration as discussed above, are considered an area of significant judgment. Additionally, our digital asset management service revenue, as discussed above, is calculated as a percentage (0.25%) of the total market value of GTB. For these areas of significant judgment, actual amounts may ultimately differ from our estimates and are adjusted in the period in which they become known. Deferred revenues We record deferred revenues when cash payments are received or due in advance of our performance, including amounts which are refundable. Our payment terms vary by the type and location of our customer and the products or services offered. For certain products or services and customer types, we require payment before the products or services are delivered to the customer. Practical expedients and exemptions We do not disclose the value of unsatisfied performance obligations for contracts with an original expected length of one year or less. |
VIE Structure and Arrangements
VIE Structure and Arrangements | 9 Months Ended |
Sep. 30, 2019 | |
VIE Structure and Arrangements | |
VIE Structure and Arrangements | Note 4. VIE Structure and Arrangements We consolidate VIEs in which we hold a variable interest and are the primary beneficiary through contractual agreements. We are the primary beneficiary because we have the power to direct activities that most significantly affect their economic performance and have the obligation to absorb the majority of their losses or benefits. The results of operations and financial position of these VIEs are included in our consolidated financial statements. For these consolidated VIEs, their assets are not available to us and their creditors do not have recourse to us. As of September 30, 2019 and December 31, 2018, assets (mainly long-term investments) that can only be used to settle obligations of these VIEs were approximately $0.2 million and $3.5 million, respectively, and the Company is the major creditor for the VIEs. In order to operate our Legacy YOD business in PRC and to comply with PRC laws and regulations that prohibit or restrict foreign ownership of companies that provides value-added telecommunication services, the Company entered into a series of contractual agreements with two VIEs: Beijing Sinotop Scope Technology Co., Ltd (“Sinotop Beijing”) and Tianjin Sevenstarflix Network Technology Limited (“SSF”). These contractual agreements will expire in March 2030 and April 2036, respectively and may not be terminated by the VIEs, except with the consent of the Company, or, in event of a material breach of the agreement by the Company . Currently, the Company is still evaluating the overall operating strategy for YOD legacy business and does not have plan to provide any funding to these two VIEs. Please refer to Note 19(a) for associated regulatory risks. Based on the contracts we entered with VIEs’ shareholders, we consider that there is no asset of the VIEs that can be used only to settle obligation of the Company, except for the registered capital of VIEs amounting to RMB 38.2 million (approximately $5.7 million). |
Acquisitions and Divestitures
Acquisitions and Divestitures | 9 Months Ended |
Sep. 30, 2019 | |
Acquisitions and Divestitures | |
Acquisitions and Divestitures | Note 5. Acquisitions and Divestitures Acquisitions (a) Assets Acquisition of SolidOpinion, Inc (“SolidOpinion”) On February 19, 2019, the Company completed the acquisition of certain assets from SolidOpinion in exchange for 4,500,000 shares of the Company’s common stock. The assets include cash ($2.5 million) and intellectual property (“IP”) which is complementary to the IP of Grapevine. The parties agreed that 450,000 of such shares of common stock (“Escrow Shares”) will be held in escrow until February 19, 2020 in connection with SolidOpinion’s indemnity obligations pursuant to the agreement. SolidOpinion have the rights to vote and receive the dividends paid with respect to the Escrow Shares. ( b) In September 2018, the Company entered into an agreement to purchase Fintalk Assets from Sun Seven Star International Limited, a Hong Kong company and an affiliate of Dr. Wu. FinTalk Assets include the rights, titles and interest in a secure mobile financial information, social, and messaging platform that has been designed for streamlining financial-based communication for professional and retail users. The purchase price for Fintalk Assets was $7.0 million payable with $1.0 million in cash and shares of the Company’s common stock with a fair market value of $6.0 million. The Company paid $1.0 million in October 2018 and recorded in prepaid expense as of December 31, 2018 because the transaction had not closed. In June 2019, the Company entered into an amendment to the agreement which amended the purchase price for Fintalk Assets to $6.35 million payable with $1.0 million in cash and shares of the Company’s common stock with a fair market value of $5.35 million. The Company issued 2,860,963 shares ($1.87 per share) in June 2019 and completed the transaction. In addition, upon completion of transaction the $1.0 million cash paid in 2018 was reclassified from prepaid expense to intangible assets. (c) In September 2018, the Company completed the acquisition of a 65.65% share of Grapevine for $2.4 million in cash. Fomalhaut Limited (“Fomalhaut”), a British Virgin Islands company and an affiliate of Dr. Wu, the Chairman of the Company, is the non-controlling equity holder of 34.35% in Grapevine (the “Fomalhaut Interest”). Fomalhaut entered into an option agreement, effective as of August 31, 2018 (the “Option Agreement”), with the Company pursuant to which the Company provided Fomalhaut with the option to sell the Fomalhaut Interest to the Company (the “Option”). The aggregate exercise price for the Option is the fair market value of the Fomalhaut Interest as of the close of business on the date preceding the date upon which the Option is exercised, and is payable in a combination of 1/3 in cash and 2/3 in the Company’s shares of common stock at the then market value on the exercise date. The Option Agreement will expire on August 31, 2021. In May 2019, the Company entered into two amendments to the Option Agreement, The aggregate exercise price for the Option is amended to the greater of (i) fair market value of the Fomalhaut Interest in Grapevine as of the close of business on the date preceding the date upon which the option is exercised; and (ii) $1.84 per share of the Company’s common stock. It was also agreed that the full amount of the exercise price shall be paid in the form of common stock of the Company. In June 2019, the Company issued 590,671 shares in exchange for a 34.35% ownership in Grapevine as a result of the exercise of the Option, at the completion of this transaction the Company owned 100% of Grapevine. At the completion date of the transaction, the carrying amount of the non-controlling interest in Grapevine was approximately $0.5 million. The difference between the value of the consideration exchanged of approximately $1.1 million and the carrying amount of the non-controlling interest in Grapevine is recorded as a debit to Additional Paid in Capital based on ASC 810-10-45-23. (d) Effective July 18, 2019, Ideanomics, Inc. (the “Company”) terminated its Acquisition Agreement with Tree Motion Sdn. Bhd., a Malaysian company (“Tree Motion”), pursuant to which the Company was to acquire 51% of Tree Motion in exchange for 25,500,000 shares of the Company’s common stock at $2.00 per share. Further, the Company terminated its Acquisition Agreement to acquire 11.22% of Tree Motion’s parent company, Tree Manufacturing Sdn. Bhd. (the “Parent Company”) for 12,190,000 shares of the Company’s common stock; provided, however, that the Company has acquired 250 acres in Malaysia-China Kuantan Industrial Park (MCKIP), the 1st Malaysia National Industrial Park joint developed by both Malaysia and China for $620,000. (e) On July 18, 2019, Ideanomics, Inc. (the “Company”) entered into an Acquisition Agreement (“Glory Agreement”) to purchase a 34% interest in Glory Connection Sdn. Bhd. a Malaysian Company, from its shareholder Beijing Financial Holding Limited, a Hong Kong registered company, for the consideration of 12,190,000 restricted common shares of Ideanomics (IDEX), representing $24.4 million at $2.00 per share. As part of this transaction, the Company was also granted an option to purchase a 40% interest in Bigfair Holdings Limited (“Bigfair”) from its shareholder Beijing Financial Holding Limited for an exercise price of $13.2 million in the form of common shares of Ideanomics. Bigfair currently holds a 51% ownership stake in Glory. The option is exercisable from July 18, 2020 to July 19, 2021. If the option was exercised, the Company would have 20.4% indirect ownership in Glory in addition to the 34% direct ownership it already has. As of September 30, 2019, the Company does not have control of Glory and has accounted for Glory as an equity method investment. The Company has performed a valuation analysis and allocated $23,000,000 and $1,380,000 of the consideration transferred to the equity method investment and the call option, respectively. The call option is accounted for as an equity security without readily determinable fair value. Pro forma results of operations for Glory have not been presented because they are not material to the consolidated results of operations. Glory is currently in the process of ramping up its operations. The following table summarizes the income statement information of Glory as of September 30, 2019: Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Revenue $ 2,041 $ 3,936 Gross Profit 1,379 769 Net loss from operations 173,465 354,502 Net loss 171,719 352,606 Net loss attributable to Glory $ 95,477 $ 195,121 (f) In April 2019, the Company entered into a securities purchase agreement to acquire 6,918,547 shares in DBOT in exchange for 4,427,870 shares of the Company’s common stock at $2.11 per share. In July 2019, the Company entered into another securities purchase agreement to acquire an additional 2,224,937 shares in DBOT in exchange for 1,423,960 shares of the Company’s common stock at $2.11 per share. The two transactions, which increased the Company’s ownership in DBOT to 99.04%, were completed in July 2019. The securities purchase agreements required the Company to issue additional shares of the Company’s common stock (“True-Up Common Stock”) in the event the stock price of the common stock fall below $2.11 at the close of trading on the date immediately preceding the lock-up date, which is 9 months from the closing date. The Company accounted for the additional True-Up Common Stock consideration as a liability in accordance with ASC 480. We recorded this liability at fair value of $2,217,034 on the date of acquisition. As of September 30, 2019, we remeasured this liability to $2,327,919 and the remeasurement loss of $(110,885) was recorded in the other income/(expense) of the income statement. DBOT operates three companies: (i) DBOT ATS LLC, an SEC recognized Alternative Trading System; (ii) DBOT Issuer Services LLC, focused on setting and maintaining issuer standards, as well as the provision of issuer services to DBOT designated issuers; and (iii) DBOT Technology Services LLC, focused on the provision of market data and marketplace connectivity. The consolidated statements of operation for the three months ended September 30, 2019 include the results of DBOT. Supplemental information on an unaudited pro forma basis, as if the acquisition had been consummated as of January 1, 2018 is as follows: Three Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2018 2019 2018 Revenue $ 43,798,865 $ 44,612,471 $ 363,004,917 Net Income (loss) attributable to IDEX common shareholders $ (7,818,047) $ 10,582,474 $ (21,387,162) The unaudited pro forma results of operations do not purport to represent what the Company’s results of operations would actually have been had the acquisition occurred on January 1, 2018. Actual future results may vary considerably based on a variety of factors beyond the Company’s control. For all intangible assets acquired, continuing membership agreements have useful life of 20 years and the customer list has useful life of 3 years. The following table summarizes the acquisition-date fair value of assets acquired and liabilities assumed, as well as the fair value of the non-controlling interest in DBOT recognized: Cash $ 246,929 Other financial assets 1,686,464 Financial liabilities (4,411,140) Noncontrolling interest (104,649) Goodwill 9,323,189 Intangible asset – continuing membership agreement 8,255,440 Intangible asset – customer list 58,830 $ 15,055,063 Divestitures The Company may divest certain businesses from time to time based upon review of the Company’s portfolio considering, among other items, factors relative to the extent of strategic and technological alignment and optimization of capital deployment, in addition to considering if selling the businesses results in the greatest value creation for the Company and for shareholders. (g) In May 2019, the Company determined to sell the Red Rock business and entered into an agreement with Redrock Capital Group Limited, an affiliate of Dr. Wu, to sell its entire interest in Red Rock for a consideration of $700,000. The Company decided to sell Red Rock primarily because it has incurred operating losses and its business is no longer needed based on our strategic plan. The transaction was completed in July 2019 and the company recorded a disposal gain of $552,215. (h) On June 30, 2019, the Company entered into an agreement with BCC Technology Company Limited (“BCC”) and Tekang Holdings Technology Co., Ltd (“Tekang ”) pursuant to which Tekang will inject certain assets in the robotics and electronic internet industry and IOT business consisting of manufacturing data, supply chain management & financing, and lease financing of industrial robotics into Amer in exchange for 71.81% of ownership interest in Amer. The parties subsequently entered into several amendments including (1) changing the name of Amer to Logistorm Technology Limited, (2) issuing 39,500 new shares in Amer or 71.81% ownership interest to BCC instead of Tekang, (3) issuing 5,500 new shares in Amer or 10% ownership interest to Merry Heart Technology Limited (“MHT”) and (4) the Company is responsible for 20% of any potential tax obligation associated with Amer, if Amer fails to be publicly listed in 36 months from the closing date of this transaction. The Company concluded that it’s not probable that this contingent liability would be incurred. As a result of this transaction, the Company’s ownership interest in Amer was diluted from 55% to 10%. The transaction was completed on August 31, 2019. The Company recognized a disposal gain of $505,148 as a result of the deconsolidating Amer. $95,104 of the gain is attributable to the 10% ownership interest retained in Amer. In addition, on the date Amer was deconsolidated, the Company recorded a bad debt expense of $622,286 relating to a receivable due from Amer to a subsidiary of the Company. The following table summarizes the Consolidated Statement of Operations for the three months and nine months ended September 30, 2018, on an unaudited pro forma basis, as if the dilution of the Company’s interest in Amer had been consummated as of January 1, 2018: Three Months Ended Nine Months Ended September 30, 2018 September 30, 2018 Revenue $ 275,380 $ 260,547,120 Net loss from operations (6,305,340) (18,548,258) Net loss (7,390,597) (19,351,526) Net loss attributable to IDEX common shareholders $ (7,158,674) $ (18,945,524) Pro forma results of operations for the period ended September 30, 2019 have not been presented because they are not material to the consolidated results of operations. Amer has no revenue and minimal operating expense in 2019. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2019 | |
Accounts Receivable | |
Accounts Receivable | Note 6. Accounts Receivable Accounts receivable is mainly from our Mobile Energy Group (formerly Wecast Services) business and consisted of the following: September 30, December 31, 2019 2018 Accounts receivable, gross $ 2,941,348 $ 19,370,665 Less: allowance for doubtful accounts (103) — Accounts receivable, net $ 2,941,245 $ 19,370,665 The following table outlines the aging of the accounts receivable: September 30, December 31, 2019 2018 Within 90 days $ 2,941,245 $ 1,219,526 91-180 days — 633 181-365 days — 12,385,193 More than 1 year — 5,765,313 Total $ 2,941,245 $ 19,370,665 The decrease in balance is mainly due to the deconsolidation of Amer as of September 30, 2019 as disclosed in Note 5(h). Our payment term is usually within 180 days upon the receipts of the goods. The Company has reviewed the outstanding balance by customers and concluded that the outstanding balances are collectible. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Sep. 30, 2019 | |
Property and Equipment, net | |
Property and Equipment, net | Note 7. Property and Equipment, net The following is a breakdown of property and equipment: September 30, December 31, 2019 2018 Furnitures and office equipment 602,548 357,064 Vehicle 60,951 63,135 Leasehold improvements 239,781 200,435 Total property and equipment 903,280 620,634 Less: accumulated depreciation (482,548) (186,514) Land 3,042,777 3,042,777 Building 1 308,779 2,607,666 Assets Retirement Obligations - Environmental Remediation 8,000,000 8,000,000 Capitalized direct development cost 2,732,705 944,864 Construction in progress (Fintech Village) 14,084,261 14,595,307 Property and Equipment, net $ 14,504,993 $ 15,029,427 Note 1 The $2.3 million decrease from the prior year represents the impairment charge recorded in connection with four of the five existing buildings on Fintech Village which are expected to be demolished. The Company recorded depreciation expense, which is included in its operating expense, of $65,862 and $14,820 for the three months ended September 30, 2019 and 2018 and $102,991 and $32,941 for the nine months ended September 30, 2019 and 2018, respectively. The Company recorded $8.0 million of Asset Retirement Obligations which are related to our legal contractual obligations in connection with the acquisition of Fintech Village. The Capitalized direct development costs mainly represent the architectural costs. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | Note 8. Goodwill and Intangible Assets Goodwill Changes in the carrying value of goodwill consist of following: Nine months ended Year Ended September 30, 2019 December 31, 2018 At the beginning of the year 704,884 — Goodwill Acquired 1 9,323,189 704,884 At the end of the period 10,028,073 704,884 Note 1 The change in carrying amount of goodwill in the current year was the result of the acquisition of DBOT as disclosed in Note 5(f). Intangible Assets Information regarding amortizing and indefinite lived intangible assets consisted of the following: September 30, 2019 December 31, 2018 Weighted Gross Accumulated Gross Accumulated Average Remaining Carry Accumulated Impairment Net Carry Accumulated Impairment Net Useful Life Amount Amortization Loss Balance Amount Amortization Loss Balance Amortizing Intangible Assets Animation Copyright (Note 14 (b)) — $ — $ — $ — $ — $ 301,495 $ (64,606) $ — $ 236,889 Software and licenses — 97,308 (97,308) — — 97,308 (93,251) — 4,057 SolidOpinion IP (Note 5 (a)) 4.4 4,655,000 (543,084) — 4,111,916 — — — — Fintalk intangible assets (Note 5 (b)) 4.8 6,350,000 (317,500) — 6,032,500 — — — — Influencer network 8.9 1,980,000 (214,500) — 1,765,500 1,980,000 (66,000) — 1,914,000 Customer contract 1 2.0 558,830 (185,458) — 373,372 500,000 (55,556) — 444,444 Continuing Membership Agreement 1 19.8 8,255,440 (103,193) — 8,152,247 — — — — Trade name 13.9 110,000 (7,944) — 102,056 110,000 (2,444) — 107,556 Technology platform 5.9 290,000 (44,881) — 245,119 290,000 (13,808) — 276,192 Total amortizing intangible assets $ 22,296,578 $ (1,513,868) $ — $ 20,782,710 $ 3,278,803 $ (295,665) $ — $ 2,983,138 Indefinite lived intangible assets Website name 159,504 — (134,290) 25,214 159,504 — (134,290) 25,214 Patent 28,000 — — 28,000 28,000 — — 28,000 GTB (Note 14 (b)) 61,124,407 — — 61,124,407 — — — — Total intangible assets $ 83,608,489 $ (1,513,868) $ (134,290) $ 81,960,331 $ 3,466,307 $ (295,665) $ (134,290) $ 3,036,352 Note 1 During the third quarter of 2019, the Company completed the acquisition of additional shares in DBOT which increased its ownership in DBOT to 99.04%. $8,314,270 of intangible assets were recognized on the date of acquisition as disclosed in Note 5(f). Amortization expense relating to intangible assets was $764,010 and $276,692 for the three months ended September 30, 2019 and 2018 and $1,317,419 and $281,796 for the nine months ended September 30, 2019 and 2018, respectively. The following table outlines the expected amortization expense for the following years: Amortization to be Years ending December 31, recognized 2019 (excluding the nine months ended September 30, 2019) $ 761,702 2020 3,046,811 2021 2,991,255 2022 2,870,339 2023 2,860,534 2024 and thereafter 8,252,069 Total amortization to be recognized $ 20,782,710 |
Long-term Investments
Long-term Investments | 9 Months Ended |
Sep. 30, 2019 | |
Long-term Investments. | |
Long-term Investments | Note 9. Long-term Investments Long-term investments consisted of Non-marketable Equity Investment and Equity Method Investment as below: September 30, December 31, 2019 2018 Non-marketable Equity Investment $ 9,147,170 $ 9,452,103 Equity Method Investment 33,012,143 16,956,506 Total $ 42,159,313 $ 26,408,609 Non-marketable equity investment Our non-marketable equity investments are investments in privately held companies without readily determinable fair values. These investments are carried at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. The Company reviews its equity securities without readily determinable fair values on a regular basis to determine if the investment is impaired. For purposes of this assessment, the Company considers the investee’s cash position, earnings and revenue outlook, liquidity and management ownership, among other factors, in its review. If management’s assessment indicates that an impairment exists, the Company estimates the fair value of the equity investment and recognizes in current earnings an impairment loss that is equal to the difference between the fair value of the equity investment and its carrying amount. There is no impairment for the nine months ended September 30, 2019. Equity method investments The Company’s investment in companies accounted for using the equity method of accounting consist of the following: September 30, 2019 Foreign currency December 31, Loss on Reclassification translation September 30, 2018 Addition investment to subsidiaries adjustments 2019 Wecast Internet (i) $ 4,114 $ — $ (5) $ — $ 1,930 $ 6,039 Hua Cheng (ii) 308,666 — (32,890) — (37,210) 238,566 Shandong Media (iii) — — — — — — BDCG (iv) 9,800,000 — — — — 9,800,000 DBOT (v) 6,843,726 — (3,719,735) (3,123,991) — — Glory (vi) — 23,000,000 (32,462) — — 22,967,538 Total $ 16,956,506 $ 23,000,000 $ (3,785,092) $ (3,123,991) $ (35,280) $ 33,012,143 All the investments above are privately held companies; therefore, quoted market prices are not available. We have not received any dividends since initial investments. (i) Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. (ii) Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”) The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. (iii) Shandong Lushi Media Co., Ltd (“Shandong Media”) The Company held 30% equity ownership in Shandong Media, a print based media business, for Legacy YOD business. The accumulated operating loss of Shandong Media reduced the Company’s investment in Shandong Media to zero. The Company has no obligation to fund future operating losses. (iv) In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. The Company received 40% equity ownership in BDCG from the initial joint venture agreement. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party for a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company’s common stock (valued at $2.60 per share and equal to 3 million shares of the Company’s common stock), increasing the Company’s ownership to 60% in BDCG. The remaining 40% of BDCG are held by Seasail ventures limited (“Seasail”). The accounting treatment of the joint venture is based on the equity method due to variable substantive participating rights (in accordance with ASC 810‑10‑25‑11) granted to Seasail. The new entity is currently in the process of ramping up its operations. In April 2019, the company rebranded the name of the BDCG joint venture to Intelligenta. As part of the rebranding, Intelligenta’s strategy will now include credit services, corporation services, index services and products, and capital market services and products. (v) Refer to Note 5(f). (vi) Refer to Note 5(e). |
Leases
Leases | 9 Months Ended |
Sep. 30, 2019 | |
Leases | |
Leases | Note 10. Leases We lease certain office space and equipment from third parties. Leases with an initial term of 12 months or less are not recorded on the balance sheet and we recognize lease expense for these leases on a straight-line basis over the lease term. For leases beginning in 2019 and later, at the inception of a contract we assess whether the contract is, or contains, a lease. Our assessment is based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether we obtain the right to substantially all the economic benefit from the use of the asset throughout the period, and (3) whether we have the right to direct the use of the asset. At inception of a lease, we allocate the consideration in the contract to each lease component based on its relative stand-alone price to determine the lease payments. Leases entered into prior to January 1, 2019, are accounted for under ASC 840 and were not reassessed. We account for lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) separately from the nonlease components (e.g.,common-area maintenance costs). Most leases include one or more options to renew, with renewal terms that can extend the lease term from one year or more. The exercise of lease renewal options is at our sole discretion. Our leases do not include options to purchase the leased property. The depreciable life of assets and leasehold improvements are limited by the expected lease term. Certain of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. All our leases are operating lease. We have elected not to recognize right-of-use assets and lease liabilities for short-term leases that have a term of 12 months or less. The effect of short-term leases and initial direct costs on our right-of-use asset and lease liability was not material. As of September 30, 2019, our operating lease right of use assets and operating lease liability are approximately $6.8 million and $7.2 million, respectively. The weighted-average remaining lease term is 6.6 years and the weighted-average discount rate is 7.5%. For the three and nine months ended September 30, 2019, the components of lease expense were as follows: Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Operating Lease Cost $ 390,577 $ 1,264,049 Short-Term Lease Cost 78,076 250,924 Sublease Income (10,605) (10,605) Total Lease Cost $ 458,048 $ 1,504,368 Supplemental information related to leases was as follows: Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 967,565 Right-of-use assets obtained in exchange for new operating lease liabilities $ 935,242 Maturity of operating lease liability is as follows: Maturity of Lease Liability Operating Lease 2019 (excluding the nine months ended September 30, 2019) $ 332,549 2020 1,307,783 2021 1,328,160 2022 1,422,965 2023 1,474,391 2024 and thereafter 3,377,653 Total lease payments 9,243,501 Less: Interest (2,001,696) Total $ 7,241,805 |
Supplemental Financial Statemen
Supplemental Financial Statement Information | 9 Months Ended |
Sep. 30, 2019 | |
Supplemental Financial Statement Information | |
Supplemental Financial Statement Information | Note 11. Supplemental Financial Statement Information Other Current Assets “Other current assets” were approximately $2.4 million and $3.6 million as of September 30, 2019 and December 31, 2018, respectively. Components of "Other current assets" that were more than 5 percent of total current assets: (1) other receivable due from third parties in our subsidiaries located in PRC and Hong Kong in the amount of $1.7 million and $3.3 million for the period ended September 30, 2019 and December 31, 2018 and (2) $0.6 million receivable due from ID Venturas 7 relating to the convertible debenture executed on September 27, 2019. As disclosed in Note 12(c), we have received the $0.6 million in October. Other Current Liabilities “Other current liabilities” were approximately $9.1 million and $5.3 million as of September 30, 2019 and December 31, 2018, respectively. Components of "Other current liabilities" that were more than 5 percent of total current liabilities: (1) $2.3 million liability relating to additional True-Up Common Stock consideration from the DBOT acquisition as disclosed in Note 5 (f) and (2) other payable due to third parties in the amount of $5.1 million and $4.6 million for the period ended September 30, 2019 and December 31, 2018, respectively. |
Convertible Note
Convertible Note | 9 Months Ended |
Sep. 30, 2019 | |
Convertible Note | |
Convertible Note | Note 12 . Convertible Note The following is the summary of outstanding convertible notes as of September 30, 2019 and December 31, 2018: September 30, December 31, 2019 2018 Convertible Note-Mr. McMahon(Note 14 (a)) $ 3,229,808 $ 3,140,055 Convertible Note-SSSIG (Note 14 (a)) 1,288,032 1,000,000 Convertible Note-Advantech 12,382,806 11,313,770 $2.05 million Senior Secured Convertible Note - ID Venturas 7 626,387 — $2.5 million Senior Secured Convertible Note - ID Venturas 7 14,917 — Total $ 17,541,950 $ 15,453,825 Short-term Note 1,914,419 4,140,055 Long-term Note 15,627,531 11,313,770 (a) $12 million Convertible Note – Advantech On June 28, 2018, the Company entered into a convertible note purchase agreement with Advantech Capital Investment II Limited (“Advantech”) in the aggregate principal amount of $12,000,000 (the Notes). The Notes bear interest at a rate of 8%, mature on June 28, 2021, and are convertible into approximately 6,593,406 shares of the Company’s common stock at a conversion price of $ 1.82 per share. The difference between the conversion price and the fair market value of the common stock on the commitment date (transaction date) resulted in a beneficial conversion feature recorded of approximately $1.4 million. For the three months ended September 30, 2019 and 2018, total interest expense recognized relating to the beneficial conversion feature was $117,000 and $112,000, respectively. For the nine months ended September 30, 2019 and 2018, total interest expense recognized relating to the beneficial conversion feature was $347,000 and $112,000, respectively. The agreement also requires the Company to comply with certain covenants, including restrictions on the use of the proceeds and other convertible note offering. As of September 30, 2019, the Company was in compliance with all ratios and covenants. (b) $2.05 million Senior Secured Convertible Debenture due in August 2020 - ID Ventura 7 On February 22, 2019, the Company executed a security purchase agreement with ID Venturas 7, LLC (“IDV”), whereby the Company issued $2,050,000 of senior secured convertible note. The note bears interest at a rate of 10% per year payable either in cash or in kind at the option of the Company on a quarterly basis and matures on August 22, 2020. In addition, IDV is entitled to the following: (i) the convertible note is senior secured; (ii) convertible at $1.84 per share of Company common stock at the option of IDV (approximately 1,114,130 shares), subject to adjustments if subsequent equity shares have a lower conversion price, (ii) 1,166,113 shares of common stock of the Company and (iii) a warrant exercisable for 150% of the number of shares of common stock which the note is convertible into (approximately 1,671,196 shares) at an exercise price of $1.84 per share and will expire 5 years after issuance. On October 29, 2019 the Company entered into a letter agreement (the “Agreement”) with ID Venturas pursuant to which the Company agreed to reduce the conversion price of the Debentures and the exercise price of the Warrants to $1.00, The Company received aggregate gross proceeds of $2 million, net of $50,000 for the issuance expenses paid by IDV. Total funds received were allocated to convertible note, common stocks and warrants based on their relative fair values in accordance with ASC 470‑20‑30. The value of the convertible note and common stocks was based on the closing price on February 22, 2019. The fair value of the warrants was determined using the Black-Scholes option-pricing model, with the following assumptions: expected life of 5 years, expected dividend rate of 0%, volatility of 111.83% and an interest rate of 2.48%. The relative fair value of the warrants was recorded as additional paid-in capital and reduced the carrying amount of the convertible note. The Company recognized a beneficial conversion feature discount on convertible note at its intrinsic value, which was the fair value of the common stock at the commitment date for convertible note, less the effective conversion price. The Company recognized approximately $600,000 of beneficial conversion feature as an increase in additional paid in capital and reduced (discount on) the carrying amount of the convertible note in the accompanying consolidated balance sheet. The discounts on the convertible note for the warrants and beneficial conversion feature are being amortized to interest expense, using the effective interest method over the term of the convertible note. As of September 30, 2019, the unamortized discount on the convertible note is approximately $1,424,000. Total interest expense recognized relating to the discount was approximately $175,000 and $626,000 for the three and nine months ended September 30, 2019, respectively. Interest on the convertible note is payable quarterly starting from April 1, 2019. The convertible note is redeemable at the option of the Company in whole at an initial redemption price of the principal amount of the convertible note plus additional warrants and accrued and unpaid interest to the date of redemption. The security purchase agreement contains customary representations, warranties and covenants. The convertible note is collateralized by the Company’s equity interest in Grapevine, which had a carrying amount of $2.4 million as of September 30, 2019. The Company has the right to request for the removal of the guarantee and collateral by issuance of additional 250,000 shares of common stock . On September 27, 2019, the Company issued 250,000 shares of common stock to IDV in exchange for the release of Grapevine as collateral. IDV has registration rights that require the Company to file and register the common stock issued or issuable upon conversion of the convertible note or the exercise of the warrants, within 180 days following the closing of the transaction. The Company is also subject to penalty fee at 8% per annum for late payments of interests and compensation for the loss of IDV on failure to timely deliver conversion shares upon conversion. (c) On September 27, 2019, the Company executed a security purchase agreement with ID Venturas 7, LLC (“IDV”), whereby the Company issued $2,500,000 of senior secured convertible note. The note bears interest at a rate of 10% per year payable either in cash or in kind at the option of the Company on a quarterly basis and matures on March 27, 2021. In addition, IDV is entitled to the following: (i) the convertible note is senior secured; (ii) convertible at $1.84 per share of Company common stock at the option of IDV (approximately 1,358,696 shares), subject to adjustments if subsequent equity shares have a lower conversion price, (ii) 1,000,000 shares of common stock of the Company and (iii) a warrant exercisable for 150% of the number of shares of common stock which the note is convertible into (approximately 2,038,043 shares) at an exercise price of $1.84 per share and will expire 5 years after issuance. On October 29, 2019 the Company entered into a letter agreement (the "Agreement") with ID Venturas pursuant to which the Company agreed to reduce the conversion price of the Debentures and the exercise price of the Warrants to $1.00, The Company will receive aggregate gross proceeds of $2.5 million, net of $66,195 for the issuance expenses paid by IDV. The Company received $1.8 million proceed in September and the remaining $633,805 was received in October. Total gross proceeds were allocated to convertible note, common stocks and warrants based on their relative fair values in accordance with ASC 470-20-30. The value of the convertible note and common stocks was based on the closing price on September 27, 2019. The fair value of the warrants was determined using the Black-Scholes option-pricing model, with the following assumptions: expected life of 5 years, expected dividend rate of 0%, volatility of 110.36% and an interest rate of 1.55%. The relative fair value of the warrants was recorded as additional paid-in capital and reduced the carrying amount of the convertible note. The Company recognized a beneficial conversion feature discount on convertible note at its intrinsic value, which was the fair value of the common stock at the commitment date for convertible note, less the effective conversion price. The Company recognized approximately $989,000 of beneficial conversion feature as an increase in additional paid in capital and reduced (discount on) the carrying amount of the convertible note in the accompanying consolidated balance sheet. The discounts on the convertible note for the warrants and beneficial conversion feature are being amortized to interest expense, using the effective interest method over the term of the convertible note. As of September 30, 2019, the unamortized discount on the convertible note is approximately $2,488,000. Total interest expense recognized relating to the discount was approximately $12,000 and $12,000 for the three and nine months ended September 30, 2019, respectively. Interest on the convertible note is payable quarterly starting from October 1, 2019. The convertible note is redeemable at the option of the Company in whole at an initial redemption price of the principal amount of the convertible note plus additional warrants and accrued and unpaid interest to the date of redemption. The security purchase agreement contains customary representations, warranties and covenants. The convertible note is collateralized by the Company’s equity interest in DBOT, which had a carrying amount of $14.3 million as of September 30, 2019. IDV has registration rights that require the Company to file and register the common stock issued or issuable upon conversion of the convertible note or the exercise of the warrants, within 120 days following the closing of the transaction. The Company is also subject to penalty fee at 8% per annum for late payments of interests and compensation for the loss of IDV on failure to timely deliver conversion shares upon conversion. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity | |
Stockholders' Equity | Note 13. Stockholders’ Equity Convertible Preferred Stock Our board of directors has authorized 50 million shares of convertible preferred stock, $0.001 par value, issuable in series. As of September 30, 2019 and December 31, 2018, 7,000,000 shares of Series A preferred stock were issued and outstanding and is convertible, at any time at the option of the holder, into 933,333 shares of common stock (subject to customary adjustments). The Series A preferred stock shall be entitled to ten vote per common stock on an as-converted basis and only entitled to receive dividends when and if declared by the board. On liquidation, both series of preferred stock are entitled to a liquidation preference of $0.50 per share. The shares are not redeemable except on liquidation or if there is a change in control of the Company or a sale of all or substantially all of the assets of the Company. The conversion price of the Series A may only be adjusted for standard anti-dilution, such as stock splits and similar events. The Series A preferred stocks are considered to be equity instruments and therefore the embedded conversion options have not been separated. Because the preferred stocks have conditions for their redemption that may be outside the control of the Company, they have been classified outside of Shareholders’ Equity, in the mezzanine section of our balance sheet. Common Stock Our board of directors has authorized 1,500 million shares of common stock, $0.001 par value. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions | |
Related Party Transactions | Note 14. Related Party Transactions (a) Convertible Notes $3.0 Million Convertible Note with Mr. Shane McMahon (“Mr. McMahon”) On May 10, 2012, Mr. McMahon, our Vice Chairman, made a loan to the Company in the amount of $3,000,000. In consideration for the loan, the Company issued a convertible note to Mr. McMahon in the aggregate principal amount of $3,000,000 (the “Note”) at a 4% interest rate computed on the basis of a 365‑day year. We entered several amendments with respect to the effective conversion price (changed from $1.75 to $1.5), convertible stocks (changed from of Series E Preferred Stock to Common Stock) and extension of the maturity date to December 31, 2020. For the three and nine months ended September 30, 2019, the Company recorded interest expense of approximately $30,000 and $90,000,respectively, related to the Note. For the three and nine months ended September 30, 2018, the Company also recorded interest expense of approximately $30,000 and $90,000, respectively, related to the Note. Interest payable was $229,808 and $140,055 as of September 30, 2019 and December 31, 2018, respectively. $2.5 Million Convertible Promissory Note with SSSIG On February 8, 2019, the Company entered into a convertible promissory note agreement with SSSIG, an affiliate of Dr. Wu, in the aggregate principal amount of $2,500,000. The convertible promissory note bears interest at a rate of 4%, matures on February 8, 2020, and is convertible into the shares of the Company’s common stock at a conversion price of $1.83 per share anytime at the option of SSSIG. As of September 30, 2019, the Company received $1.3 million from SSSIG. The Company has not received the remaining $1.2 million as of the date of this report. For the three and nine months ended September 30, 2019, the Company recorded interest expense of approximately $13,000 and $36,000, respectively,related to the Note. (b) Transactions with GTD Disposal of Assets in exchange of GTB In March 2019, the Company completed the sale of the following assets (with total carrying amount of approximately $20.4 million) to GTD, a minority shareholder based in Singapore, in exchange for 1,250,000 GTB. The Company considers the arrangement as a nonmonetary transaction and the fair values of GTB are not reasonably determinable due to the reasons described in Note 3. Therefore, GTB received are recorded at the carrying amount of the assets exchanged and the Company did not recognize any gain or loss based on ASC 845‑10‑30. · License content (net carrying amount approximately $17.0 million) · Approximately 13% ownership interest in Nanjing Shengyi Network Technology Co., Ltd (“Topsgame”) (carrying amount approximately $3.2 million which was included in long-term investment-Non-marketable Equity Investment) · Animation copy right (net carrying amount approximately $0.2 million which was included in intangible asset.) Digital asset management services Please refer to Note 3. (c) Crude Oil Trading For the nine months ended September 30, 2018, we purchased crude oil in the amount of approximately $244.1 million from three suppliers that a minority shareholder of the Company has significant influence upon because this minority shareholder has significant influence on both our Singapore joint venture and these three suppliers. The Company has recorded the purchase on a separate line item referenced as “Cost of revenue from related parties” in its financial statements. There is no outstanding balance due (in Accounts Payable) as of September 30, 2019. No such related party transactions occurred for the same period in 2019. (d) Severance payments On February 20, 2019, the Company accepted the resignation of former Chief Executive Officer, former Chief Investment Officer and former Chief Strategy Officer and agreed to pay approximately $837,000 in total for salary, severance and expenses. The Company paid $637,000 in the first quarter of year 2019 and recorded $200,000 in other current liabilities on our consolidated balance sheet as of September 30, 2019. The $837,000 severance expenses were recorded in the Selling, general and administrative expenses of the income statement. (e) During the third quarter of 2019, the Company’s net borrowings from Dr. Wu and his affiliates increased by $1.0 million. We recorded these borrowings in amount due to related parties on our consolidated balance sheet as of September 30, 2019. These borrowings bear no interest. (f) Please refer to Note 5(b). (g) Please refer to Note 5(g). (h) Please refer to Note 5(c). (i) Please refer to Note 5(h). (j) Please refer to Note 3. |
Share-Based Payments
Share-Based Payments | 9 Months Ended |
Sep. 30, 2019 | |
Share-Based Payments | |
Share-Based Payments | Note 15. Share-Based Payments As of September 30, 2019, the Company had 14,971,431 options, 55,586 restricted shares and 3,709,240 warrants outstanding. The Company awards common stock and stock options to employees and directors as compensation for their services, and accounts for its stock option awards to employees and directors pursuant to the provisions of ASC 718, Stock Compensation . The fair value of each option award is estimated on the date of grant using the Black-Scholes Merton valuation model. The Company recognizes the fair value of each option as compensation expense ratably using the straight-line attribution method over the service period, which is generally the vesting period. Effective as of December 3, 2010 and amended on August 3, 2018, our Board of Directors approved the 2010 Stock Incentive Plan (“the 2010 Plan”) pursuant to which options or other similar securities may be granted. As of September 30, 2019, the maximum aggregate number of shares of our common stock that may be issued under the 2010 Plan is 31,500,000 shares. As of September 30, 2019, options and restricted shares available for issuance are 14,160,326 shares. The company recorded share-based payments expense of $2,547,107 and $11,530 for the three months ended September 30, 2019 and 2018 and $6,474,227 and $3,372,447 for the nine months ended September 30, 2019 and 2018, respectively. (a) Stock option activity for the nine months ended September 30, 2019 is summarized as follows: Weighted Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at January 1, 2019 1,706,431 $ 3.28 4.08 $ — Granted 14,325,000 1.98 8.75 — Exercised — — — — Expired (83,333) 1.98 — — Forfeited (976,667) 1.98 — — Outstanding at September 30, 2019 14,971,431 $ 2.13 8.72 $ — Vested and expected to be vested as of September 30, 2019 14,971,431 $ 2.13 8.72 $ — Options exercisable at September 30, 2019 (vested) 5,529,977 $ 2.38 7.55 $ — As of September 30, 2019, approximately $14,255,266 of total unrecognized compensation expense related to non-vested share options is expected to be recognized over a weighted average period of approximately 1.4 years. The total fair value of shares vested for the nine months ended September 30, 2019 and 2018 was $6,010,085 and $319,001, respectively. Cash received from options exercised during the nine months ended September 30, 2019 and 2018 was approximately $0 and $2,632, respectively. (b) In connection with the Company’s financings, the Warner Brother Agreement and the service agreements, the Company issued warrants to service providers to purchase common stock of the Company. The warrants issued to Warner Brother were expired without exercise on January 31, 2019. The Company issued warrants to IDV in connection with senior secured convertible notes (See Note 12) and the weighted average exercise price was $1.84 and the weighted average remaining life was approximately 4.73 years. September 30, 2019 December 31, 2018 Number of Number of Warrants Warrants Outstanding and Outstanding and Exercise Expiration Warrants Outstanding Exercisable Exercisable Price Date 2014 Broker Warrants (Series E Financing) — 60,000 $ 1.75 1/31/19 $2.05 million IDV Senior Secured Convertible Debenture 1,671,196 — $ 1.84 2/22/2024 $2.5 million IDV Senior Secured Convertible Debenture 2,038,044 — 1.84 9/27/2024 3,709,240 60,000 On September 24, 2018, the Company entered into employment agreements with three executives. As part of their employment agreements, they are entitled to warrants for an aggregate of 8,000,000 shares at an exercise price of $5.375 per share (the “Exercise Price”), which is a 25% premium to the $4.30 per share closing market price of the Company’s common stock on September 7, 2018, the date upon which the terms of the employment agreements were mutually agreed. In February 2019, the rights to receive warrants were terminated due to the resignation of three executives. (c) In January 2019, the Company granted 129,840 restricted shares to the two independent directors under the “2010 Plan” which was approved as part of the 2018 independent board compensation plan by the Board of Directors. The restricted shares were all vested immediately since commencement date. The aggregated grant date fair value of all those restricted shares was $161,001. A summary of the unvested restricted shares is as follows: Weighted-average Shares fair value Non-vested restricted shares outstanding at January 1, 2019 87,586 $ 2.46 Granted 129,840 $ 1.24 Forfeited (3,000) $ 2.60 Vested (158,840) $ 1.49 Non-vested restricted shares outstanding at September 30, 2019 55,586 $ 2.37 As of September 30, 2019, there was $33,800 of unrecognized compensation cost related to unvested restricted shares. This amount is expected to be recognized over a weighted-average period of 0.51 years. |
Earnings (Loss) Per Common Shar
Earnings (Loss) Per Common Share | 9 Months Ended |
Sep. 30, 2019 | |
Earnings (Loss) Per Common Share | |
Earnings (Loss) Per Common Share | Note 16. Earnings (Loss) Per Common Share Basic earnings (loss) per common share attributable to our shareholders is calculated by dividing the net earnings (loss) attributable to our shareholders by the weighted average number of outstanding common shares during the period. Diluted earnings (loss) per share is calculated by taking net earnings (loss), divided by the diluted weighted average common shares outstanding. The calculations of basic and diluted earnings (loss) per share for the three months and nine months ended, 2019 and 2018 are as follows: Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2019 2018 2019 2018 Net earnings (loss) attributable to common stockholders $ (13,711,867) $ (7,186,847) $ 11,506,861 $ (19,228,240) Interest expense attributable to convertible promissory note — — 125,485 — Net earnings (loss) assuming dilution (13,711,867) (7,186,847) 11,632,346 (19,228,240) Basic Basic weighted average common shares outstanding 127,609,748 74,063,495 113,964,933 71,574,303 Effect of dilutive securities — — — — Convertible preferred shares- Series A — — 933,333 — Conversion of restricted shares and employee stock options — — 22,823 — Convertible promissory notes — — 2,777,687 — Contingently issuable shares — — 621,117 — Diluted potential common shares 127,609,748 74,063,495 118,319,893 71,574,303 Net earnings (loss) per share: Basic $ (0.11) $ (0.10) $ 0.10 $ (0.27) Diluted $ (0.11) $ (0.10) $ 0.10 $ (0.27) In 2018, diluted net loss per share equals basic net loss per share because the effect of securities convertible into common shares was anti-dilutive. The following table includes the number of shares that may be dilutive potential common shares in the future. The holders of these shares do not have a contractual obligation to share in our earnings (losses) and thus these shares were not included in the computation of diluted earnings (loss) per share because the effect was antidilutive. Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2019 2018 2019 2018 Warrants 3,709,240 60,000 3,709,240 60,000 Options 14,971,431 1,797,017 14,965,598 1,797,017 Series A Preferred Stock 933,333 933,333 — 933,333 Convertible promissory note and interest 12,417,909 10,227,507 9,324,911 10,227,507 Total 32,031,913 13,017,857 27,999,749 13,017,857 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Taxes | |
Income Taxes | Note 17. Income Taxes During the nine months ended September 30, 2019, the Company recorded an income tax benefit of $513,935, $152,876 resulting from losses of Grapevine Logic, Inc. offsetting deferred tax liabilities that were recognized on the acquisition of Grapevine Logic, Inc. and a $361,059 reduction of the valuation allowance on Ideanomics, Inc. deferred tax assets in excess of those reversed to offset Ideanomics, Inc.'s income. The reduction in valuation allowance resulted from Ideanomics, Inc.'s acquisition of additional ownership interests in Grapevine Logic, Inc. which caused Grapevine Logic, Inc. to be included in a consolidated tax return with Ideanomics, Inc. beginning June 30, 2019. This meant that $361,059 of Ideanomics, Inc.'s deferred tax assets could be utilized to offset Grapevine Logic Inc.'s remaining deferred tax liabilities. This resulted in an effective tax rate of (4.43%). The effective tax rate for the nine months ended September 30, 2019 differs from the U.S. statutory tax rate primarily due to the effect of taxes on foreign earnings, non-deductible expenses and the reduction in the beginning of the year deferred tax valuation allowance. As of September 30, 2019, the Company had approximately $9.9 million of the U.S domestic cumulative tax loss carryforwards and approximately $30.9 million of the foreign cumulative tax loss carryforwards which may be available to reduce future income tax liabilities in certain jurisdictions. The remaining 2018 U.S. tax loss is not subject to expiration under the new Tax Law. The foreign tax loss carryforwards will expire beginning year 2019 through 2023. There was no identified unrecognized tax benefit as of September 30, 2019. We are not aware of any unrecorded tax liabilities which would impact our financial position or our results of operations. |
Contingencies and Commitments
Contingencies and Commitments | 9 Months Ended |
Sep. 30, 2019 | |
Contingencies and Commitments | |
Contingencies and Commitments | Note 18. Contingencies and Commitments Lawsuits and Legal Proceedings From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. Shareholder Class Action On July 19, 2019, a purported class action, captioned Jose Pinto Claro Da Fonseca Miranda v. Ideanomics, Inc., was filed in the United States District Court for the Southern District of New York against the Company and certain of its current and former officers. While the Company believes that the Class Action is without merit and plans to vigorously defend itself against these claims, there can be no assurance that the Company will prevail in the lawsuits. The Company cannot currently estimate the possible loss or range of losses, if any, that it may experience in connection with these litigations. |
Concentration, Credit and Other
Concentration, Credit and Other Risks | 9 Months Ended |
Sep. 30, 2019 | |
Concentration, Credit and Other Risks | |
Concentration, Credit and Other Risks | Note 19. Concentration, Credit and Other Risks (a) The PRC market in which the Company operates poses certain macro-economic and regulatory risks and uncertainties. These uncertainties extend to the ability of the Company to conduct wireless telecommunication services through contractual arrangements in the PRC since the industry remains highly regulated. The Company conducts legacy YOD business in China through a series of contractual arrangements (See Note 4). The Company believes that these contractual arrangements are in compliance with PRC law and are legally enforceable. If Sinotop Beijing, SSF or their respective legal shareholders fail to perform the obligations under the contractual arrangements or any dispute relating to these contracts remains unresolved, we can enforce its rights under the VIE contracts through PRC law and courts. However, uncertainties in the PRC legal system could limit the Company’s ability to enforce these contractual arrangements. In particular, the interpretation and enforcement of these laws, rules and regulations involve uncertainties. If we had direct ownership of Sinotop Beijing and SSF, we would be able to exercise our rights as a shareholder to effect changes in the board of directors of Sinotop Beijing or SSF, which in turn could affect changes at the management level, subject to any applicable fiduciary obligations. However, under the current contractual arrangements, the Company relies on Sinotop Beijing, SSF and their respective legal shareholders to perform their contractual obligations to exercise effective control. The Company also gives no assurance that PRC government authorities will not take a view in the future that is contrary to the opinion of the Company. If the current ownership structure of the Company and its contractual arrangements with the VIEs and their equity holders were found to be in violation of any existing or future PRC laws or regulations, the Company’s ability to conduct its business could be affected and the Company may be required to restructure its ownership structure and operations in the PRC to comply with the changes in the PRC laws which may result in deconsolidation of the VIEs. From time to time the PRC government imposes regulations that limit the amount and timing of foreign payments from companies operating in the PRC. Our ability to repatriate cash held in the PRC, or obtain funding from sources in the PRC, may be restricted by such regulations. In addition, the telecommunications, information and media industries remain highly regulated. Restrictions are currently in place and are unclear with respect to which segments of these industries foreign owned entities, like YOD WFOE, may operate. The PRC government may issue from time to time new laws or new interpretations on existing laws to regulate areas such as telecommunications, information and media, some of which are not published on a timely basis or may have retroactive effect. For example, there is substantial uncertainty regarding the Draft Foreign Investment Law, including, among others, what the actual content of the law will be as well as the adoption and effective date of the final form of the law. Administrative and court proceedings in China may also be protracted, resulting in substantial costs and diversion of resources and management attention. While such uncertainty exists, the Company cannot assure that the new laws, when it is adopted and becomes effective, and potential related administrative proceedings will not have a material and adverse effect on the Company’s ability to control the affiliated entities through the contractual arrangements. Regulatory risk also encompasses the interpretation by the tax authorities of current tax laws, and the Company’s legal structure and scope of operations in the PRC, which could be subject to further restrictions resulting in limitations on the Company’s ability to conduct business in the PRC. (b) For the nine months ended September 30, 2018, one customer individually accounted for more than 10% of the Company’s revenue from third parties. One customer individually accounted for more than 10% of the Company’s net accounts receivables as of September 30, 2018, respectively. For the nine months ended September 30, 2019, one customer individually accounted for more than 10% of the Company’s revenue. One customer individually accounted for more than 10% of the Company’s net accounts receivables as of September 30, 2019, respectively. (c) For the nine months ended September 30, 2018, two suppliers individually accounted for more than 10% of the Company’s cost of revenues. Two suppliers individually accounted for more than 10% of the Company’s accounts payable and amount due to related parties as of September 30, 2018. For the nine months ended September 30, 2019, one supplier individually accounted for more than 10% of the Company’s accounts payable as of September 30, 2019. (d) Financial instruments that potentially subject the Company to significant concentration of credit risk primarily consist of cash and accounts receivable. As of September 30, 2019 and December 31, 2018, the Company’s cash was held by financial institutions (located in the PRC, Hong Kong, the United States and Singapore) that management believes have acceptable credit. Accounts receivable are typically unsecured and are mainly derived from revenues from Mobile Energy Group (formerly Wecast Services). The risk with respect to accounts receivable is mitigated by regular credit evaluations that the Company performs on its distribution partners and its ongoing monitoring of outstanding balances. (e) We have certain operating transactions that are denominated in RMB and a portion of the Company’s assets and liabilities that is denominated in RMB. RMB is not freely convertible into foreign currencies. The value of the RMB is subject to changes in the central government policies and to international economic and political developments. In the PRC, certain foreign exchange transactions are required by laws to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“PBOC”). Remittances in currencies other than RMB by the Company in China must be processed through PBOC or other China foreign exchange regulatory bodies which require certain supporting documentation in order to complete the remittance. Cash consist of cash on hand and demand deposits at banks, which are unrestricted as to withdrawal. Time deposits, which mature within one year as of the balance sheet date, represent interest-bearing certificates of deposit with an initial term of greater than three months when purchased. Time deposits which mature over one year as of the balance sheet date are included in non-current assets. Cash and time deposits maintained at banks consist of the following: September 30, December 31, 2019 2018 RMB denominated bank deposits with financial institutions in the PRC $ 110,005 $ 1,523,622 US dollar denominated bank deposits with financial institutions in the PRC $ 30,666 $ 133,053 HKD denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 17,985 $ 13,133 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 13,708 $ 44,182 US dollar denominated bank deposits with financial institutions in Singapore (“Singapore”) $ 569,707 $ 697,099 SGD denominated bank deposits with financial institutions in Singapore $ 70,432 — US dollar denominated bank deposits with financial institutions in The United States of America (“USA”) $ 874,093 $ 695,155 Total $ 1,686,596 $ 3,106,244 As of September 30, 2019 and December 31, 2018, deposits of $855,915 and $0 were insured. To limit exposure to credit risk relating to bank deposits, the Company primarily places bank deposits only with large financial institutions in the PRC, HK SAR, USA, Singapore and Cayman with acceptable credit rating. (f) As of September 30, 2019, the Company holds 7,294,555 GTB, 2,763 Bitcoins and 21,312 Ethereum. These Bitcoins and Etheruem represent GTB denominated in Bitcoin & Etheruem and not direct holdings of Bitcoin and Etheruem. The risks related to our holdings of GTB including: · Digital currency is highly volatile due to the limited trading history, and singular currency exchange platform; · Under the circumstances where governments prohibit or effectively prohibit the trading of digital currency, this will significantly impact the financial statements of the Company since the digital currency market is currently largely unregulated; and · To date the company has not been able to convert any of its crypto currency holdings to fiat. The Asia EDX exchange has indicated that it continues work towards providing exchangeability for coins held on the exchange into fiat. Management is unable to give any assurance as to when, if ever, the Asia EDX exchange will permit conversion of the company’s crypto currency holdings into fiat. |
Defined Contribution Plan
Defined Contribution Plan | 9 Months Ended |
Sep. 30, 2019 | |
Defined Contribution Plan | |
Defined Contribution Plan | Note 20. Defined Contribution Plan For our U.S. employees, during 2019, the Company introduced a new 401(k) defined contribution plan which provides 100% employer matching up to 4% of each employee’s pay. Employee is eligible to participate after six months of employment. Company 401(k) matching contributions were approximately $8,700 and $487 for the three months ended September 30, 2019 and 2018 and $8,700 and $3,242 for the nine months ended September 30, 2019 and 2018, respectively. Full time employees in the PRC participate in a government-mandated defined contribution plan pursuant to which certain pension benefits, medical care, unemployment insurance, employee housing fund and other welfare benefits are provided to employees. PRC labor regulations require the Company to make contributions based on certain percentages of the employees’ basic salaries. Other than such contributions, there is no further obligation under these plans. The total contribution for such PRC employee benefits was $113,654 and $235,811 for the three months ended September 30, 2019 and 2018 and $267,868 and $607,872 for the nine months ended September 30, 2019 and 2018, respectively. |
Segments and Geographic Areas
Segments and Geographic Areas | 9 Months Ended |
Sep. 30, 2019 | |
Segments and Geographic Areas | |
Segments and Geographic Areas | Note 21. Segments and Geographic Areas The Company’s chief operating decision maker has been identified as the chief executive officer, who reviews consolidated results when making decisions about allocating resources and assessing performance of the Company. We operate our business in two operating segments: Legacy YOD and Mobile Energy Group (formerly Wecast Services). Segment disclosures are on a performance basis consistent with internal management reporting. The Company does not allocate expenses below segment gross profit since these segments share the same executive team, office space, occupancy expenses, information technology infrastructures, human resources and finance department. Information about segments during the periods presented were as follows: Nine Months Ended September 30, 2019 September 30, 2018 Revenue -Legacy YOD $ — $ — - Mobile Energy Group (formerly Wecast Services) 44,503,562 362,628,296 Total revenue 44,503,562 362,628,296 Cost of revenue -Legacy YOD — — - Mobile Energy Group (formerly Wecast Services) 1,217,184 359,839,565 Gross profit $ 43,286,378 $ 2,788,731 September 30, 2019 December 31, 2018 TOTAL ASSETS -Legacy YOD $ 635,128 $ 26,442,810 -Mobile Energy Group (formerly Wecast Services) 164,128,548 51,592,929 -Unallocated assets — 16,199,373 Total $ 164,763,676 $ 94,235,112 |
Going Concern and Management's
Going Concern and Management's Plans | 9 Months Ended |
Sep. 30, 2019 | |
Going Concern and Management's Plans | |
Going Concern and Management's Plans | Note 22. Going Concern and Management’s Plans As of September 30, 2019, the Company had cash and cash equivalents of approximately $1.7 million and the Company has incurred losses since its inception and must continue to rely on proceeds from debt and equity issuances to pay for ongoing operating expenses in order to execute its business plan. Management has taken several actions below to ensure that the Company will continue as a going concern through November 30, 2020, including the cessation of YOD legacy segment related expenses and discretionary expenditures. · As discussed in Note 12, the Company executed a security purchase agreement with ID Venturas 7, LLC ("IDV"), whereby the Company issued $2,500,000 of senior secured convertible note during the third quarter. · As discussed in Note 5, the Company has received $0.7 million proceeds from the sale of Redrock. The Company’s operating businesses are in the development and ramp up phase and are not yet cash generative as they generate minimal revenues and require investment to support their business plans. The Company intends to raise both debt and equity capital to cover its short and medium term capital needs. Although the Company may attempt to raise funds by issuing debt or equity instruments, future financing may not be available to the Company on terms acceptable to the Company or at all or such resources may not be received in a timely manner. If the Company is unable to raise additional capital when required or on acceptable terms, the Company may be required to scale back or to discontinue certain operations, scale back or discontinue the development of new business lines, reduce headcount, sell assets, file for bankruptcy, reorganize, merge with another entity, or cease operations. These conditions raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements have been prepared assuming that the Company will continue as a going concern and, accordingly, do not include any adjustments that might result from the outcome of this uncertainty. If the Company is in fact unable to continue as a going concern, the shareholders may lose their entire investment in the Company. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Measurements | |
Fair Value Measurements | Note 23. Fair Value Measurements The following table presents information about our financial instruments measured at fair value on a recurring basis, grouped into level 1 to 3 based on the degree to which the fair value is observable: September 30, 2019 Level I Level II Level III Total Contingent Consideration Liability 1 — — 2,327,919 2,327,919 Note 1 This represents the liability incurred in connection with the acquisition of DBOT shares during Q3 2019 as disclosed in Note 5(f). The fair value of the contingent consideration liability at September 30, 2019 was valued using the Black-Scholes Merton method. The following table presents the significant inputs and assumptions used in the model: September 30, 2019 Risk-free interest rate 1.8 % Expected volatility 30 % Expected term 0.5 year Expected dividend yield 0 % The significant unobservable inputs used in the fair value measurement of the Company’s contingent consideration liability includes the risk-free interest rate, expected volatility, expected term and expected dividend yield. Significant increases or decreases in any of those inputs in isolation would result in a significantly different fair value measurement. Reconciliation of level 3 fair value measurements: Contingent Consideration Liability January 1, 2019 $ — Addition (2,217,034) Remeasurement (loss)/gain recognized in the income statement (110,885) September 30, 2019 $ (2,327,919) |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events | |
Subsequent Events | Note 24. Subsequent Events Senior Secured Convertible Debentures - ID Ventura 7 On October 29, 2019, the Company entered into an Additional Issuance Agreement (the “Purchase Agreement”), with ID Venturas 7, LLC. (“ID Venturas”) an exempted company incorporated and existing under the laws of the Delaware, pursuant to which ID Venturas invested $400,000 of the up to $2,500,000 of additional investment rights granted to ID Venturas in the September SPA (as defined below) and received (i) a promissory note (the “Convertible Note”) which is senior secured and convertible at $1.00 per share of Company common stock, subject to anti-dilution adjustments and (ii) a warrant (the “Warrant”) exercisable for 150% of the number of shares of common stock which the Note is convertible into. The Convertible Note is convertible into common stock, par value $0.001 per share (the “Common Stock”), at a conversion price of $1.00, subject to anti-dilution adjustments. The Convertible Note matures on March 27, 2021, and accrues at a 10% interest rate. In connection with the above transaction, the Company also entered into a registration rights agreement with ID Venturas (the “ Registration Rights Agreement ”) which grants ID Venturas demand registration rights. As disclosed in Note 12, the Company entered into Securities Purchase Agreements, dated February 22, 2019 (“The Purchase Agreement”) and dated September 27, 2019 (“Convertible Note Agreement”) with ID Venturas pursuant to which ID Venturas purchased 10% Senior Secured Convertible Debentures (the “Debentures”) and common stock purchase warrants (the “Warrants”) and were granted additional investments rights to purchase up to an additional $2,500,000 of Debentures and Warrants (“Additional Investment Rights”). On October 29, 2019 Ideanomics, Inc. (the “Company”) entered into a letter agreement (the “Agreement”) with ID Venturas pursuant to which the Company agreed to reduce the conversion price of the Debentures and the exercise price of the Warrants to $1.00, subject to adjustment thereunder. The Agreement also reduced the conversion price of Debentures and the exercise price of the Warrants issuable pursuant to the Additional Investment Rights. GTB Impairment review On October 29, 2019, our digital currency, GTB tokens (see Note 1), had a one-time unexpected significant decline in quoted price from $17 to $1.84. The Company’s management is currently evaluating the risks and potential impacts of this incident and plans to perform its annual impairment test as of December 31, 2019. The Company is not able to make a meaningful estimate of the amount or range of potential impairment resulting from the subsequent decline in quoted price. |
Nature of Operations and Summ_2
Nature of Operations and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Nature of Operations and Summary of Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation In this Form 10‑Q, unless the context otherwise requires, the use of the terms "we," "us", "our" and the “Company” refers to Ideanomics, Inc, its consolidated subsidiaries and variable interest entities (“VIEs”). On April 24, 2018, the Company completed the acquisition of a 100% equity ownership in Shanghai Guang Ming Investment Management (“Guang Ming”), a PRC limited liability company. One of the two selling shareholders is a related party, an affiliate of Bruno Wu (“Dr. Wu”). Guang Ming holds a special fund management license. The acquisition will help the Company develop a fund management platform. Under Accounting Standard Codification (“ASC”) 805-50-05-5 and ASC 805-50-30-5, the transaction was accounted for as a reorganization of entities under common control, in a manner similar to a pooling of interest, using historical costs. As a result of the reorganization, the net assets of Guang Ming were transferred to the Company, and the accompanying consolidated financial statements as of and for the three and nine months ended September 30, 2018 have been prepared as if the current corporate structure had been in place at the beginning of the periods presented in which the common control existed. In the opinion of management, the unaudited interim consolidated financial statements reflect all adjustments of a normal recurring nature that are necessary for a fair presentation of the results for the interim periods presented. All significant intercompany transactions and balances are eliminated on consolidation. However, the results of operations included in such financial statements may not necessary be indicative of annual results. We use the same accounting policies in preparing quarterly and annual financial statements. Certain information and footnote disclosures normally included in the annual consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These unaudited consolidated financial statements should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on April 1, 2019 (“2018 Annual Report”). |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates. On an ongoing basis, we evaluate our estimates, including those related to the bad debt allowance, variable considerations, fair values of financial instruments, intangible assets (including digital currencies) and goodwill, useful lives of intangible assets and property and equipment, asset retirement obligations, income taxes, and contingent liabilities, among others. We base our estimates on assumptions, both historical and forward looking, that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. |
Fair Value Measurements | Fair Value Measurements Accounting standards require the categorization of financial assets and liabilities, based on the inputs to the valuation technique, into a three-level fair value hierarchy. The various levels of the fair value hierarchy are described as follows: · Level 1 - Financial assets and liabilities whose values are based on unadjusted quoted market prices for identical assets and liabilities in an active market that we have the ability to access. · Level 2 - Financial assets and liabilities whose values are based on quoted prices in markets that are not active or model inputs that are observable for substantially the full term of the asset or liability. · Level 3 - Financial assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The Company reviews the valuation techniques used to determine if the fair value measurements are still appropriate on an annual basis and evaluate and adjust the unobservable inputs used in the fair value measurements based on current market conditions and third party information. Our financial assets and liabilities that are measured at fair value on a recurring basis include cash and cash equivalents, accounts receivable, accounts payable, accrued expenses, other current liabilities and convertible notes. The fair values of these assets approximate carrying values because of the short-term nature of these instruments. If these instruments were measured at fair value in the financial statements, they would be classified as Level 1 in the fair value hierarchy. Our financial assets that are measured at fair value on a nonrecurring basis include goodwill and other intangible assets, asset retirement obligations, and adjustment in carrying value of equity securities for which the measurement alternative of cost less impairment plus or minus observable price changes is used. There were no material impairments and no material adjustments to equity securities using the measurement alternative for the three and nine months ended September 30, 2019 and 2018. |
Digital Currency | Digital Currency Digital currency consists of GTDollar Coins (“GTB”), Bitcoin and Ethereum. GTB is received in connection with the services agreement and assets purchase agreement with GT Dollar Pte. Ltd. (“GTD”), our minority shareholder at the time of the transaction (Note 3 and 14 (b)). As of September 30, 2019, GTD has disposed of its investment in the Company and is no longer a minority shareholder. GTB is a type of digital asset that is not a fiat currency and is not backed by hard assets or other financial instruments, and does not represent an investment in GTD or a right to access GTD’s platform. As a result, the value of GTB is determined by the value that various market participants place on GTB through their transactions. GTB holders make or lose money from buying and selling GTB. To date, the Asia EDX exchange has not permitted holders of GTB, Bitcoin or Ethereum to exchange digital currencies held in accounts at the exchange for fiat. The company is unable to predict when our cryptocurrency holdings will be convertible into fiat and consequently does not consider them to be part of the company’s liquid resources. During the nine months ended September 30, 2019, the Company gradually converted 1,038,778 GTB to 2,763 Bitcoins and 21,312 Ethereum. As of September 30, 2019, the Company holds 7,294,555 GTB, 2,763 Bitcoins and 21,312 Ethereum. These Bitcoins and Etheruem represent GTB denominated in Bitcoin & Etheruem and do not represent a direct holding of Bitcoin and Etheruem. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies and other digital currencies under current GAAP, the Company has determined to account for these currencies as indefinite-lived intangible assets in accordance with ASC 350, Intangibles-Goodwill and Other until further guidance is issued by the FASB. Indefinite-lived intangible assets are recorded at cost and are not subject to amortization, but shall be tested for impairment annually and more frequently if events or changes in circumstances indicate that it is more likely than not that the asset is impaired. If, at the time of an impairment test, the carrying amount of an intangible asset exceeds its fair value, an impairment loss in an amount equal to the excess is recognized. The fair value of GTB currency was a Level 2 measurement (see Note 3) based upon the consideration agreed by GTD and the Company with a discount considering volatility, risk and limitations at contract inception. |
Assets and Liabilities Held for Sale | Assets and Liabilities Held for Sale The Company classifies assets and liabilities (disposal group) to be sold as held for sale in the period in which all of the following criteria are met: management, having the authority to approve the action, commits to a plan to sell the disposal groups; the disposal group is available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such disposal group; an active program to locate a buyer and other actions required to complete the plan to sell the disposal group have been initiated; the sale of the disposal group is probable, and transfer of the disposal group is expected to qualify as a completed sale within one year, except if events or circumstances beyond the Company’s control extend the period of time required to sell the disposal group beyond one year; the disposal group is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. The Company initially measures a disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell. Any loss resulting from this measurement is recognized in the period in which the held for sale criteria are met. Gains are not recognized on the sale of a disposal group until the date of sale. The Company assesses the fair value of a disposal group, less any costs to sell, each reporting period it remains classified as held for sale and reports any subsequent losses as an adjustment to the carrying value of the disposal group. |
Reclassifications of a General Nature | Reclassifications of a General Nature Certain amounts in the prior periods presented have been reclassified to conform to the current period financial statement presentation. These reclassifications have no effect on previously reported net income. Note 2 provides information about our adoption of new accounting standards for leases. |
Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements We adopted Financial Accounting Standards Board (FASB) issued Accounting Standards Update (“ASU”) No. 2016‑02, Leases (Topic 842), as of January 1, 2019, using a modified retrospective transition method and as a result, the consolidated balance sheet prior to January 1, 2019 was not restated, continues to be reported under ASC Topic 840, Leases, or ASC 840. For all leases at the lease commencement date, a right-of-use asset and a lease liability are recognized. The right-of-use asset represents the right to use the leased asset for the lease term. The lease liability represents the present value of the lease payments under the lease. The lease liability is based on the present value of the remaining minimum lease payments, determined under ASC 840, discounted using our incremental borrowing rate at the effective date of January 1, 2019, using the original lease term as the tenor. As permitted under the transition guidance, we elected several practical expedients that permit us to not reassess (1) whether a contract is or contains a lease, (2) the classification of existing leases, and (3) whether previously capitalized costs continue to qualify as initial indirect costs. The application of the practical expedients did not have a significant impact on the measurement of the operating lease liability. Adoption of the new standard resulted in the recording of operating right of use assets and the related lease liabilities of approximately $3.6 million and $3.7 million, respectively, as of January 1, 2019. The difference between the additional lease assets and lease liabilities was immaterial. The standard did not materially impact our consolidated operating results and had no impact on cash flows. Please see Note 10. In June 2018, the FASB issued ASU No. 2018‑07, Improvements to Nonemployee Share-Based Payment Accounting, which largely aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees. The ASU also clarifies that any share-based payment issued to a customer should be evaluated under ASC 606, Revenue from Contracts with Customers . The ASU requires a modified retrospective transition approach. We adopted ASU 2018‑07 as of January 1, 2019 and there is no impact to our consolidated financial statement because we did not have such payments in 2019. In July 2017, the FASB issued ASU No. 2017‑11, (Part I) Accounting for Certain Financial Instruments with Down Round Features, (Part II) Replacement of the Indefinite Deferral for Mandatorily Redeemable Financial Instruments of Certain Nonpublic Entities and Certain Mandatorily Redeemable Noncontrolling Interests with a Scope Exception. The new standard applies to issuers of financial instruments with down-round features. A down-round provision is a term in an equity-linked financial instrument (i.e. a freestanding warrant contract or an equity conversion feature embedded within a host debt or equity contract) that triggers a downward adjustment to the instrument’s strike price (or conversion price) if equity shares are issued at a lower price (or equity-linked financial instruments are issued at a lower strike price) than the instrument’s then-current strike price. The purpose of the feature is typically to protect the instrument’s counterparty from future issuances of equity shares at a more favorable price. The ASU amends (1) the classification of such instruments as liabilities or equity by revising the certain guidance relative to evaluating if they must be accounted for as derivative instruments and (2) the guidance on recognition and measurement of freestanding equity-classified instruments. For the Company, this ASU was effective January 1, 2019. Please see Note 12. |
Standards Issued and Not Yet Adopted | Standards Issued and Not Yet Adopted In June 2016, the FASB issued Accounting Standards Update No. 2016‑13 (ASU 2016‑13) "Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments" which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016‑13 replaces the existing incurred loss impairment model with an expected loss model which requires the use of forward-looking information to calculate credit loss estimates. It also eliminates the concept of other-than-temporary impairment and requires credit losses related to available-for-sale debt securities to be recorded through an allowance for credit losses rather than as a reduction in the amortized cost basis of the securities. These changes will result in earlier recognition of credit losses. We will adopt ASU 2016‑13 effective January 1, 2020. We are currently evaluating the effect of the adoption of ASU 2016‑13 on our consolidated financial statements. The effect will largely depend on the composition and credit quality of our investment portfolio and the economic conditions at the time of adoption. |
Revenue (Tables)
Revenue (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Revenue | |
Schedule of revenues disaggregated by revenue source, geography and timing of revenue recognition | The following table presents our revenues disaggregated by revenue source, geography (based on our business locations) and timing of revenue recognition. Three Months Ended Nine Months Ended September 30, 2019 September 30, 2018 September 30, 2019 September 30, 2018 Geographic Markets Singapore $ — $ — $ — $ 260,034,401 USA 249,512 200,660 41,649,384 200,660 Hong Kong/PRC 2,854,178 43,507,277 2,854,178 102,393,235 Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 Services Lines -Mobile Energy Group (formerly Wecast Services) Crude oil $ — $ — $ — $ 260,034,401 Consumer electronics — 43,432,556 — 102,081,176 Digital asset management services — — 40,700,000 — Electric Vehicles (“EV”) 2,854,178 — 2,854,178 — Digital advertising services and other 249,512 275,381 949,384 512,719 Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 Timing of Revenue Recognition Products and services transferred at a point in time $ 3,103,690 $ 43,707,937 $ 3,803,562 $ 362,628,296 Services provided over time — — 40,700,000 — Total $ 3,103,690 $ 43,707,937 $ 44,503,562 $ 362,628,296 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Acquisition [Line Items] | |
Schedule of assets acquired and liabilities assumed | For all intangible assets acquired, continuing membership agreements have useful life of 20 years and the customer list has useful life of 3 years. The following table summarizes the acquisition-date fair value of assets acquired and liabilities assumed, as well as the fair value of the non-controlling interest in DBOT recognized: Cash $ 246,929 Other financial assets 1,686,464 Financial liabilities (4,411,140) Noncontrolling interest (104,649) Goodwill 9,323,189 Intangible asset – continuing membership agreement 8,255,440 Intangible asset – customer list 58,830 $ 15,055,063 |
Schedule Of Consolidated Statement Of Operations On Proforma Basis | The following table summarizes the Consolidated Statement of Operations for the three months and nine months ended September 30, 2018, on an unaudited pro forma basis, as if the dilution of the Company’s interest in Amer had been consummated as of January 1, 2018: Three Months Ended Nine Months Ended September 30, 2018 September 30, 2018 Revenue $ 275,380 $ 260,547,120 Net loss from operations (6,305,340) (18,548,258) Net loss (7,390,597) (19,351,526) Net loss attributable to IDEX common shareholders $ (7,158,674) $ (18,945,524) |
Glory | |
Business Acquisition [Line Items] | |
Schedule Of Income Statement Information | The following table summarizes the income statement information of Glory as of September 30, 2019: Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Revenue $ 2,041 $ 3,936 Gross Profit 1,379 769 Net loss from operations 173,465 354,502 Net loss 171,719 352,606 Net loss attributable to Glory $ 95,477 $ 195,121 |
DBOT [Member] | |
Business Acquisition [Line Items] | |
Schedule Of Income Statement Information | The consolidated statements of operation for the three months ended September 30, 2019 include the results of DBOT. Supplemental information on an unaudited pro forma basis, as if the acquisition had been consummated as of January 1, 2018 is as follows: Three Months Nine Months Nine Months Ended Ended Ended September 30, September 30, September 30, 2018 2019 2018 Revenue $ 43,798,865 $ 44,612,471 $ 363,004,917 Net Income (loss) attributable to IDEX common shareholders $ (7,818,047) $ 10,582,474 $ (21,387,162) |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounts Receivable | |
Schedule of Mobile Energy Group (formerly Wecast Services) business accounts receivable | September 30, December 31, 2019 2018 Accounts receivable, gross $ 2,941,348 $ 19,370,665 Less: allowance for doubtful accounts (103) — Accounts receivable, net $ 2,941,245 $ 19,370,665 |
Schedule of aging of accounts receivable | September 30, December 31, 2019 2018 Within 90 days $ 2,941,245 $ 1,219,526 91-180 days — 633 181-365 days — 12,385,193 More than 1 year — 5,765,313 Total $ 2,941,245 $ 19,370,665 |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Property and Equipment, net | |
Schedule of property and equipment | September 30, December 31, 2019 2018 Furnitures and office equipment 602,548 357,064 Vehicle 60,951 63,135 Leasehold improvements 239,781 200,435 Total property and equipment 903,280 620,634 Less: accumulated depreciation (482,548) (186,514) Land 3,042,777 3,042,777 Building 1 308,779 2,607,666 Assets Retirement Obligations - Environmental Remediation 8,000,000 8,000,000 Capitalized direct development cost 2,732,705 944,864 Construction in progress (Fintech Village) 14,084,261 14,595,307 Property and Equipment, net $ 14,504,993 $ 15,029,427 Note 1 The $2.3 million decrease from the prior year represents the impairment charge recorded in connection with four of the five existing buildings on Fintech Village which are expected to be demolished. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets | |
Schedule of changes in carrying amount of goodwill | Nine months ended Year Ended September 30, 2019 December 31, 2018 At the beginning of the year 704,884 — Goodwill Acquired 1 9,323,189 704,884 At the end of the period 10,028,073 704,884 |
Schedule of amortizing and indefinite lived intangible assets | September 30, 2019 December 31, 2018 Weighted Gross Accumulated Gross Accumulated Average Remaining Carry Accumulated Impairment Net Carry Accumulated Impairment Net Useful Life Amount Amortization Loss Balance Amount Amortization Loss Balance Amortizing Intangible Assets Animation Copyright (Note 14 (b)) — $ — $ — $ — $ — $ 301,495 $ (64,606) $ — $ 236,889 Software and licenses — 97,308 (97,308) — — 97,308 (93,251) — 4,057 SolidOpinion IP (Note 5 (a)) 4.4 4,655,000 (543,084) — 4,111,916 — — — — Fintalk intangible assets (Note 5 (b)) 4.8 6,350,000 (317,500) — 6,032,500 — — — — Influencer network 8.9 1,980,000 (214,500) — 1,765,500 1,980,000 (66,000) — 1,914,000 Customer contract 1 2.0 558,830 (185,458) — 373,372 500,000 (55,556) — 444,444 Continuing Membership Agreement 1 19.8 8,255,440 (103,193) — 8,152,247 — — — — Trade name 13.9 110,000 (7,944) — 102,056 110,000 (2,444) — 107,556 Technology platform 5.9 290,000 (44,881) — 245,119 290,000 (13,808) — 276,192 Total amortizing intangible assets $ 22,296,578 $ (1,513,868) $ — $ 20,782,710 $ 3,278,803 $ (295,665) $ — $ 2,983,138 Indefinite lived intangible assets Website name 159,504 — (134,290) 25,214 159,504 — (134,290) 25,214 Patent 28,000 — — 28,000 28,000 — — 28,000 GTB (Note 14 (b)) 61,124,407 — — 61,124,407 — — — — Total intangible assets $ 83,608,489 $ (1,513,868) $ (134,290) $ 81,960,331 $ 3,466,307 $ (295,665) $ (134,290) $ 3,036,352 |
Schedule of amortization expense | Amortization to be Years ending December 31, recognized 2019 (excluding the nine months ended September 30, 2019) $ 761,702 2020 3,046,811 2021 2,991,255 2022 2,870,339 2023 2,860,534 2024 and thereafter 8,252,069 Total amortization to be recognized $ 20,782,710 |
Long-term Investments (Tables)
Long-term Investments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Long-term Investments. | |
Schedule of long-term investments | September 30, December 31, 2019 2018 Non-marketable Equity Investment $ 9,147,170 $ 9,452,103 Equity Method Investment 33,012,143 16,956,506 Total $ 42,159,313 $ 26,408,609 |
Schedule of long term investment under equity method | September 30, 2019 Foreign currency December 31, Loss on Reclassification translation September 30, 2018 Addition investment to subsidiaries adjustments 2019 Wecast Internet (i) $ 4,114 $ — $ (5) $ — $ 1,930 $ 6,039 Hua Cheng (ii) 308,666 — (32,890) — (37,210) 238,566 Shandong Media (iii) — — — — — — BDCG (iv) 9,800,000 — — — — 9,800,000 DBOT (v) 6,843,726 — (3,719,735) (3,123,991) — — Glory (vi) — 23,000,000 (32,462) — — 22,967,538 Total $ 16,956,506 $ 23,000,000 $ (3,785,092) $ (3,123,991) $ (35,280) $ 33,012,143 All the investments above are privately held companies; therefore, quoted market prices are not available. We have not received any dividends since initial investments. (i) Wecast Internet Starting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. (ii) Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”) The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. (iii) Shandong Lushi Media Co., Ltd (“Shandong Media”) The Company held 30% equity ownership in Shandong Media, a print based media business, for Legacy YOD business. The accumulated operating loss of Shandong Media reduced the Company’s investment in Shandong Media to zero. The Company has no obligation to fund future operating losses. (iv) In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. The Company received 40% equity ownership in BDCG from the initial joint venture agreement. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party for a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company’s common stock (valued at $2.60 per share and equal to 3 million shares of the Company’s common stock), increasing the Company’s ownership to 60% in BDCG. The remaining 40% of BDCG are held by Seasail ventures limited (“Seasail”). The accounting treatment of the joint venture is based on the equity method due to variable substantive participating rights (in accordance with ASC 810‑10‑25‑11) granted to Seasail. The new entity is currently in the process of ramping up its operations. In April 2019, the company rebranded the name of the BDCG joint venture to Intelligenta. As part of the rebranding, Intelligenta’s strategy will now include credit services, corporation services, index services and products, and capital market services and products. (v) Refer to Note 5(f). (vi) Refer to Note 5(e). |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases | |
Schedule of Lease Expense Components, Supplemental Cash Flow Information and Other Information | For the three and nine months ended September 30, 2019, the components of lease expense were as follows: Three Months Ended Nine Months Ended September 30, 2019 September 30, 2019 Operating Lease Cost $ 390,577 $ 1,264,049 Short-Term Lease Cost 78,076 250,924 Sublease Income (10,605) (10,605) Total Lease Cost $ 458,048 $ 1,504,368 Supplemental information related to leases was as follows: Nine Months Ended September 30, 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 967,565 Right-of-use assets obtained in exchange for new operating lease liabilities $ 935,242 |
Schedule of maturity of operating lease liability | Maturity of Lease Liability Operating Lease 2019 (excluding the nine months ended September 30, 2019) $ 332,549 2020 1,307,783 2021 1,328,160 2022 1,422,965 2023 1,474,391 2024 and thereafter 3,377,653 Total lease payments 9,243,501 Less: Interest (2,001,696) Total $ 7,241,805 |
Convertible Note (Tables)
Convertible Note (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Convertible Note | |
Schedule of of outstanding convertible notes | September 30, December 31, 2019 2018 Convertible Note-Mr. McMahon(Note 14 (a)) $ 3,229,808 $ 3,140,055 Convertible Note-SSSIG (Note 14 (a)) 1,288,032 1,000,000 Convertible Note-Advantech 12,382,806 11,313,770 $2.05 million Senior Secured Convertible Note - ID Venturas 7 626,387 — $2.5 million Senior Secured Convertible Note - ID Venturas 7 14,917 — Total $ 17,541,950 $ 15,453,825 Short-term Note 1,914,419 4,140,055 Long-term Note 15,627,531 11,313,770 |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Share-Based Payments | |
Schedule of stock option activity | Weighted Weighted Average Average Remaining Aggregated Options Exercise Contractual Intrinsic Outstanding Price Life (Years) Value Outstanding at January 1, 2019 1,706,431 $ 3.28 4.08 $ — Granted 14,325,000 1.98 8.75 — Exercised — — — — Expired (83,333) 1.98 — — Forfeited (976,667) 1.98 — — Outstanding at September 30, 2019 14,971,431 $ 2.13 8.72 $ — Vested and expected to be vested as of September 30, 2019 14,971,431 $ 2.13 8.72 $ — Options exercisable at September 30, 2019 (vested) 5,529,977 $ 2.38 7.55 $ — |
Schedule of warrants outstanding and exercisable | September 30, 2019 December 31, 2018 Number of Number of Warrants Warrants Outstanding and Outstanding and Exercise Expiration Warrants Outstanding Exercisable Exercisable Price Date 2014 Broker Warrants (Series E Financing) — 60,000 $ 1.75 1/31/19 $2.05 million IDV Senior Secured Convertible Debenture 1,671,196 — $ 1.84 2/22/2024 $2.5 million IDV Senior Secured Convertible Debenture 2,038,044 — 1.84 9/27/2024 3,709,240 60,000 |
Schedule of summary of restricted shares | Weighted-average Shares fair value Non-vested restricted shares outstanding at January 1, 2019 87,586 $ 2.46 Granted 129,840 $ 1.24 Forfeited (3,000) $ 2.60 Vested (158,840) $ 1.49 Non-vested restricted shares outstanding at September 30, 2019 55,586 $ 2.37 |
Earnings (Loss) Per Common Sh_2
Earnings (Loss) Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings (Loss) Per Common Share | |
Schedule of basic and diluted earnings (loss) per common share | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2019 2018 2019 2018 Net earnings (loss) attributable to common stockholders $ (13,711,867) $ (7,186,847) $ 11,506,861 $ (19,228,240) Interest expense attributable to convertible promissory note — — 125,485 — Net earnings (loss) assuming dilution (13,711,867) (7,186,847) 11,632,346 (19,228,240) Basic Basic weighted average common shares outstanding 127,609,748 74,063,495 113,964,933 71,574,303 Effect of dilutive securities — — — — Convertible preferred shares- Series A — — 933,333 — Conversion of restricted shares and employee stock options — — 22,823 — Convertible promissory notes — — 2,777,687 — Contingently issuable shares — — 621,117 — Diluted potential common shares 127,609,748 74,063,495 118,319,893 71,574,303 Net earnings (loss) per share: Basic $ (0.11) $ (0.10) $ 0.10 $ (0.27) Diluted $ (0.11) $ (0.10) $ 0.10 $ (0.27) |
Schedule of number of securities convertible into common shares | Three Months Ended Nine Months Ended September 30, September 30, September 30, September 30, 2019 2018 2019 2018 Warrants 3,709,240 60,000 3,709,240 60,000 Options 14,971,431 1,797,017 14,965,598 1,797,017 Series A Preferred Stock 933,333 933,333 — 933,333 Convertible promissory note and interest 12,417,909 10,227,507 9,324,911 10,227,507 Total 32,031,913 13,017,857 27,999,749 13,017,857 |
Concentration, Credit and Oth_2
Concentration, Credit and Other Risks (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Concentration, Credit and Other Risks | |
Schedule of cash and time deposits | September 30, December 31, 2019 2018 RMB denominated bank deposits with financial institutions in the PRC $ 110,005 $ 1,523,622 US dollar denominated bank deposits with financial institutions in the PRC $ 30,666 $ 133,053 HKD denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 17,985 $ 13,133 US dollar denominated bank deposits with financial institutions in Hong Kong Special Administrative Region (“HK SAR”) $ 13,708 $ 44,182 US dollar denominated bank deposits with financial institutions in Singapore (“Singapore”) $ 569,707 $ 697,099 SGD denominated bank deposits with financial institutions in Singapore $ 70,432 — US dollar denominated bank deposits with financial institutions in The United States of America (“USA”) $ 874,093 $ 695,155 Total $ 1,686,596 $ 3,106,244 |
Segments and Geographic Areas (
Segments and Geographic Areas (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segments and Geographic Areas | |
Schedule of Revenue, Cost of revenue and Gross Profit by segment | Nine Months Ended September 30, 2019 September 30, 2018 Revenue -Legacy YOD $ — $ — - Mobile Energy Group (formerly Wecast Services) 44,503,562 362,628,296 Total revenue 44,503,562 362,628,296 Cost of revenue -Legacy YOD — — - Mobile Energy Group (formerly Wecast Services) 1,217,184 359,839,565 Gross profit $ 43,286,378 $ 2,788,731 |
Schedule of assets by segment | September 30, 2019 December 31, 2018 TOTAL ASSETS -Legacy YOD $ 635,128 $ 26,442,810 -Mobile Energy Group (formerly Wecast Services) 164,128,548 51,592,929 -Unallocated assets — 16,199,373 Total $ 164,763,676 $ 94,235,112 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Measurements | |
Schedule of financial instruments measured at fair value on a recurring basis | September 30, 2019 Level I Level II Level III Total Contingent Consideration Liability 1 — — 2,327,919 2,327,919 Note 1 This represents the liability incurred in connection with the acquisition of DBOT shares during Q3 2019 as disclosed in Note 5(f). |
Summary of significant inputs and assumptions used | The following table presents the significant inputs and assumptions used in the model: September 30, 2019 Risk-free interest rate 1.8 % Expected volatility 30 % Expected term 0.5 year Expected dividend yield 0 % |
Summary of reconciliation of level 3 fair value measurements | Reconciliation of level 3 fair value measurements: Contingent Consideration Liability January 1, 2019 $ — Addition (2,217,034) Remeasurement (loss)/gain recognized in the income statement (110,885) September 30, 2019 $ (2,327,919) |
Nature of Operations and Summ_3
Nature of Operations and Summary of Significant Accounting Policies (Details) | 9 Months Ended | |
Sep. 30, 2019asegmentitem | Apr. 24, 2018 | |
Business Acquisition [Line Items] | ||
Number of Operating Segments | segment | 2 | |
Mobile Energy Group, Formerly We Cast Services [Member] | Minimum [Member] | ||
Business Acquisition [Line Items] | ||
Commercial Electronic Vehicles, Economic Useful Life | 10 years | |
Mobile Energy Group, Formerly We Cast Services [Member] | Maximum [Member] | ||
Business Acquisition [Line Items] | ||
Commercial Electronic Vehicles, Economic Useful Life | 15 years | |
GTBs | ||
Business Acquisition [Line Items] | ||
Number of digital currencies converted | 1,038,778 | |
Number of tokens held | 7,294,555 | |
Bitcoins | ||
Business Acquisition [Line Items] | ||
Number of digital currencies converted | 2,763 | |
Number of tokens held | 2,763 | |
Ethereum | ||
Business Acquisition [Line Items] | ||
Number of digital currencies converted | 21,312 | |
Number of tokens held | 21,312 | |
Shanghai Guang Ming Investment Management ("Guang Ming") [Member] | ||
Business Acquisition [Line Items] | ||
Percentage of equity ownership | 100.00% | |
DBOT [Member] | ||
Business Acquisition [Line Items] | ||
Area of Land | a | 58 |
New Accounting Pronouncements (
New Accounting Pronouncements (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating right of use assets | $ 6,845,031 | $ 0 |
Operating lease liability | $ 7,241,805 | |
Accounting Standards Update 840 [Member] | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating right of use assets | 3,600,000 | |
Operating lease liability | $ 3,700,000 |
Revenue (Details)
Revenue (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Total | $ 3,103,690 | $ 43,707,937 | $ 44,503,562 | $ 362,628,296 |
Geographic Markets [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 3,103,690 | 43,707,937 | 44,503,562 | 362,628,296 |
Geographic Markets [Member] | Singapore (Singapore) | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 0 | 0 | 0 | 260,034,401 |
Geographic Markets [Member] | The United States of America (USA) | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 249,512 | 200,660 | 41,649,384 | 200,660 |
Geographic Markets [Member] | Hong Kong / PRC | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 2,854,178 | 43,507,277 | 2,854,178 | 102,393,235 |
Mobile Energy Group, Formerly We Cast Services [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 3,103,690 | 43,707,937 | 44,503,562 | 362,628,296 |
Mobile Energy Group, Formerly We Cast Services [Member] | Crude oil [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 0 | 0 | 0 | 260,034,401 |
Mobile Energy Group, Formerly We Cast Services [Member] | Consumer electronics [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 0 | 43,432,556 | 0 | 102,081,176 |
Mobile Energy Group, Formerly We Cast Services [Member] | Digital asset management services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 0 | 0 | 40,700,000 | 0 |
Mobile Energy Group, Formerly We Cast Services [Member] | Electric Vehicles [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 2,854,178 | 0 | 2,854,178 | 0 |
Mobile Energy Group, Formerly We Cast Services [Member] | Digital advertising services and other [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 249,512 | 275,381 | 949,384 | 512,719 |
Timing of Revenue Recognition [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 3,103,690 | 43,707,937 | 44,503,562 | 362,628,296 |
Timing of Revenue Recognition [Member] | Products and services transferred at a point in time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | 3,103,690 | 43,707,937 | 3,803,562 | 362,628,296 |
Timing of Revenue Recognition [Member] | Services provided over time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total | $ 0 | $ 0 | $ 40,700,000 | $ 0 |
Revenue - Additional Informatio
Revenue - Additional Information (Details) | Mar. 14, 2019USD ($)item | Sep. 30, 2019USD ($)item | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Jun. 30, 2019 | Mar. 31, 2019USD ($)item |
Disaggregation of Revenue [Line Items] | |||||||
Revenue from related party | $ 2,854,178 | $ 0 | $ 43,554,178 | $ 0 | |||
Revenue | 3,103,690 | 43,707,937 | $ 44,503,562 | 362,628,296 | |||
Qianxi [Member] | Joint Venture [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Revenue from related party | $ 2,900,000 | ||||||
IUnicorn, Also Known as Shenma Zhuanche [Member] | Joint Venture [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Noncontrolling Interest, Ownership Percentage by Parent | 50.01% | ||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 49.99% | ||||||
Number of Orders | item | 4,172 | ||||||
GTBs | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Percentage of marketing and business development management services | 0.25% | ||||||
GTD | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Number of GTB received for services provided to GTD | item | 1,250,000 | ||||||
Assets sold under agreements carrying amount | $ 20,400,000 | ||||||
GTD | Digital asset management services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Number of GTB received for services provided to GTD | item | 7,083,333 | ||||||
Percentage of marketing and business development management services | 0.25% | ||||||
Percentage of discount to fixed contract price | 76.00% | ||||||
GTD | Digital asset management services | Expected term [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Expecting holding period | 3 years | ||||||
GTD | Digital asset management services | Expected volatility [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Digital asset (liability) net, measurement input | 155 | 155 | |||||
GTD | Digital asset management services | Expected dividend yield [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Digital asset (liability) net, measurement input | 0 | 0 | |||||
GTD | Digital asset management services | Risk free interest rate [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Digital asset (liability) net, measurement input | 2.25 | 2.25 | |||||
GTD | Digital asset management services | Level II | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Number of GTB received for services provided to GTD | item | 7,083,333 | ||||||
Assets sold under agreements fair value | $ 40,700,000 | ||||||
Percentage of discount to fixed contract price | 76.00% | ||||||
Mobile Energy Group, Formerly We Cast Services [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Revenue | $ 3,103,690 | 43,707,937 | $ 44,503,562 | 362,628,296 | |||
Mobile Energy Group, Formerly We Cast Services [Member] | Digital asset management services | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Revenue | 0 | 0 | 40,700,000 | 0 | |||
Mobile Energy Group, Formerly We Cast Services [Member] | Electric Vehicles [Member] | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Revenue | $ 2,854,178 | $ 0 | 2,854,178 | 0 | |||
Legacy YOD | |||||||
Disaggregation of Revenue [Line Items] | |||||||
Revenue | $ 0 | $ 0 |
VIE Structure and Arrangements
VIE Structure and Arrangements (Details) ¥ in Millions, $ in Millions | 9 Months Ended | ||
Sep. 30, 2019CNY (¥)entity | Sep. 30, 2019USD ($) | Dec. 31, 2018USD ($) | |
VIE Structure and Arrangements | |||
Number of variable interest entity | entity | 2 | ||
VIE | |||
VIE Structure and Arrangements | |||
Assets that settle obligations of VIEs | $ | $ 0.2 | $ 3.5 | |
VIE | Contractual Agreements | YOD Hong Kong | |||
VIE Structure and Arrangements | |||
Registered capital | ¥ 38.2 | $ 5.7 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Assets Acquisition of Fintalk Assets (Details) - USD ($) | 1 Months Ended | |||
Jun. 30, 2019 | Oct. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2019 | |
Acquisitions and Divestitures | ||||
Intangible assets | $ 20,782,710 | |||
Fintalk | ||||
Acquisitions and Divestitures | ||||
Total purchase price paid | $ 6,350,000 | $ 7,000,000 | ||
Cash paid to acquire entity | 1,000,000 | $ 1,000,000 | ||
Value of capital stock issued | $ 5,350,000 | $ 6,000,000 | ||
Number of common stock issued | 2,860,963 | |||
Shares Issued, Price Per Share | $ 1.87 | |||
Intangible assets | $ 1,000,000 |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Acquisition of Grapevine Logic, Inc (Details) $ / shares in Units, $ in Millions | 1 Months Ended | ||
Jun. 30, 2019USD ($)shares | May 31, 2019item$ / shares | Sep. 30, 2018USD ($) | |
Grapevine Logic, Inc. ("Grapevine") | |||
Acquisitions and Divestitures | |||
Noncontrolling Interest, Ownership Percentage by Parent | 100.00% | ||
Grapevine Logic, Inc. ("Grapevine") | |||
Acquisitions and Divestitures | |||
Percentage of ownership interest acquired | 34.35% | 65.65% | |
Cash paid to acquire entity | $ 2.4 | ||
Business Acquisition Ratio Of Consideration Payable In Cash | 0.333 | ||
Business Acquisition Ratio Of Consideration Payable In Common Stock | 0.667 | ||
Number Of Amendments | item | 2 | ||
Shares Issued, Price Per Share | $ / shares | $ 1.84 | ||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | shares | 590,671 | ||
Non Controlling Interest Carrying Amount | $ 0.5 | ||
Change In Additional Paid In Capital | $ 1.1 | ||
Grapevine Logic, Inc. ("Grapevine") | Fomalhaut Limited [Member] | |||
Acquisitions and Divestitures | |||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 34.35% |
Acquisitions and Divestitures_3
Acquisitions and Divestitures - Acquisition of Solid Opinion and Termination of Agreement wth Tree Motion (Details) | Jul. 18, 2019USD ($)a$ / sharesshares | Feb. 19, 2019USD ($)shares | Jun. 30, 2018USD ($) |
Acquisitions and Divestitures | |||
Amount received on share issued | $ | $ 7,800,000 | ||
Tree Motion Sdn. Bhd. ("Tree Motion") | |||
Acquisitions and Divestitures | |||
Acquisition percentage | 51.00% | ||
Number of shares issued | 25,500,000 | ||
Number Of Acres Acquired | a | 250 | ||
Shares issued, price per share (in dollars per share) | $ / shares | $ 2 | ||
SolidOpinion, Inc ("SolidOpinion") | |||
Acquisitions and Divestitures | |||
Number of common stock ("Escrow Shares") held in escrow (in shares) | 450,000 | ||
Amount received on share issued | $ | $ 2,500,000 | ||
Number of shares exchange | 4,500,000 | ||
Tree Manufacturing Sdn. Bhd | Tree Motion Sdn. Bhd. ("Tree Motion") | |||
Acquisitions and Divestitures | |||
Acquisition percentage | 11.22% | ||
Number of shares issued | 12,190,000 | ||
cash consideration for land | $ | $ 620,000 |
Acquisitions and Divestitures_4
Acquisitions and Divestitures - Acquisition of Glory Connection Sdn. Bhd (Details) - USD ($) | Jul. 18, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 |
Income Statement Information [Abstract] | |||||||||
Revenue | $ 3,103,690 | $ 43,707,937 | $ 44,503,562 | $ 362,628,296 | |||||
Gross profit | 2,860,330 | 863,061 | 43,286,378 | 2,788,731 | |||||
Net loss from operations | (9,403,383) | (6,356,557) | 17,206,270 | (19,061,185) | |||||
Net loss | (12,304,483) | $ 5,276,783 | $ 19,908,754 | (7,441,820) | $ (8,610,921) | $ (3,812,813) | 12,881,054 | (19,865,554) | |
Net loss attributable to Glory | (13,711,867) | $ (7,186,847) | 11,506,861 | $ (19,228,240) | |||||
Glory | |||||||||
Acquisitions and Divestitures | |||||||||
Percentage of voting equity interests acquired | 34.00% | ||||||||
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares | 12,190,000 | ||||||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 24,400,000 | ||||||||
Shares Issued, Price Per Share | $ 2 | ||||||||
Allocation Of Consideration To Equity Method Investment | 23,000,000 | ||||||||
Allocation Of Consideration To Call Option | 1,380,000 | ||||||||
Glory | Call option | |||||||||
Acquisitions and Divestitures | |||||||||
Percentage of voting equity interests acquired | 20.40% | ||||||||
Glory | |||||||||
Income Statement Information [Abstract] | |||||||||
Revenue | 2,041 | 3,936 | |||||||
Gross profit | 1,379 | 769 | |||||||
Net loss from operations | 173,465 | 354,502 | |||||||
Net loss | 171,719 | 352,606 | |||||||
Net loss attributable to Glory | $ 95,477 | $ 195,121 | |||||||
Bigfair Holdings Limited [Member] | Call option | |||||||||
Acquisitions and Divestitures | |||||||||
Percentage of voting equity interests acquired | 40.00% | ||||||||
Business Combination, Consideration Transferred, Equity Interests Issued and Issuable | $ 13,200,000 | ||||||||
Bigfair Holdings Limited [Member] | Glory | |||||||||
Acquisitions and Divestitures | |||||||||
Percentage of voting equity interests acquired | 51.00% |
Acquisitions and Divestitures_5
Acquisitions and Divestitures - Acquisition of Delaware Board of Trade Holdings, Inc (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2019USD ($)$ / sharesshares | Apr. 30, 2019$ / sharesshares | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)company | Sep. 30, 2018USD ($) | |
Supplemental information on an unaudited pro forma basis | ||||||
Revenue | $ 3,103,690 | $ 43,707,937 | $ 44,503,562 | $ 362,628,296 | ||
Net income (loss) attributable to IDEX common stockholders | (13,711,867) | (7,186,847) | 11,506,861 | (19,228,240) | ||
DBOT [Member] | ||||||
Acquisitions and Divestitures | ||||||
Shares in DBOT | shares | 2,224,937 | 6,918,547 | ||||
Number of common stock issued | shares | 1,423,960 | 4,427,870 | ||||
Shares issued, price per share (in dollars per share) | $ / shares | $ 2.11 | $ 2.11 | ||||
Percentage of voting equity interests acquired | 99.04% | |||||
Maximum Stock Price Consideration For Additional Shares | $ / shares | $ 2.11 | |||||
Liability at Fair value | $ 2,217,034 | |||||
Liability Remeasured | 2,327,919 | 2,327,919 | ||||
Loss on Remeasurement | $ (110,885) | |||||
Number Of Companies Operated By DBOT | company | 3 | |||||
Supplemental information on an unaudited pro forma basis | ||||||
Revenue | 43,798,865 | $ 44,612,471 | 363,004,917 | |||
Net income (loss) attributable to IDEX common stockholders | $ (7,818,047) | 10,582,474 | $ (21,387,162) | |||
Acquisition-date fair value of assets acquired and liabilities assumed | ||||||
Cash | 246,929 | 246,929 | ||||
Other financial assets | 1,686,464 | 1,686,464 | ||||
Financial liabilities | (4,411,140) | (4,411,140) | ||||
Noncontrolling interest | (104,649) | (104,649) | ||||
Goodwill | 9,323,189 | 9,323,189 | ||||
Net assets assumed | 15,055,063 | 15,055,063 | ||||
DBOT [Member] | Continuing Membership Agreements [Member] | ||||||
Acquisitions and Divestitures | ||||||
Useful Life | 20 years | |||||
Acquisition-date fair value of assets acquired and liabilities assumed | ||||||
Intangible asset | 8,255,440 | 8,255,440 | ||||
DBOT [Member] | Customer List [Member] | ||||||
Acquisitions and Divestitures | ||||||
Useful Life | 3 years | |||||
Acquisition-date fair value of assets acquired and liabilities assumed | ||||||
Intangible asset | $ 58,830 | $ 58,830 |
Acquisitions and Divestitures_6
Acquisitions and Divestitures - Divestures (Details) - USD ($) | Aug. 31, 2019 | Aug. 30, 2019 | Jun. 30, 2019 | Jul. 31, 2019 | Jun. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2018 | May 31, 2019 |
Red Rock Global Capital LTD [Member] | ||||||||
Acquisitions and Divestitures | ||||||||
Disposal Group, Including Discontinued Operation, Consideration | $ 700,000 | |||||||
Disposal Gain | $ 552,215 | |||||||
Amer Global Technology Limited [Member] | ||||||||
Acquisitions and Divestitures | ||||||||
Percentage of potential tax obligation | 20.00% | |||||||
Period for Publicly Listing | 36 months | |||||||
Diluted Ownership Interest In Disposal Group | 10.00% | 55.00% | ||||||
Disposal Gain | $ 505,148 | |||||||
Bad debt expense relating to receivable due to subsidiary | 622,286 | |||||||
Gain On Disposal Attributable To Ownership Interest Retained | $ 95,104 | |||||||
Disposal Group Not Discontinued Operation Proforma Income Statement Disclosures [Abstract] | ||||||||
Revenue | $ 275,380 | $ 260,547,120 | ||||||
Net loss from operations | (6,305,340) | (18,548,258) | ||||||
Net Loss | (7,390,597) | (19,351,526) | ||||||
Net loss attributable to IDEX common shareholders | $ (7,158,674) | $ (18,945,524) | ||||||
BCC Technology Company Limited [Member] | Amer Global Technology Limited [Member] | ||||||||
Acquisitions and Divestitures | ||||||||
Exchange Of Ownership Interest Due To Disposal | 71.81% | |||||||
Number of shares issued | 39,500 | |||||||
Merry Heart Technology Limited [Member] | Amer Global Technology Limited [Member] | ||||||||
Acquisitions and Divestitures | ||||||||
Exchange Of Ownership Interest Due To Disposal | 10.00% | |||||||
Number of shares issued | 5,500 |
Accounts Receivable - Mobile En
Accounts Receivable - Mobile Energy Group (formerly Wecast Services) business (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Accounts Receivable | ||
Accounts receivable, gross | $ 2,941,348 | $ 19,370,665 |
Less: allowance for doubtful accounts | (103) | 0 |
Accounts receivable, net | $ 2,941,245 | $ 19,370,665 |
Accounts Receivable - aging of
Accounts Receivable - aging of the accounts receivable (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Aging of Accounts Receivable | ||
Accounts Receivable, Net, Current | $ 2,941,245 | $ 19,370,665 |
Within 90 days | ||
Aging of Accounts Receivable | ||
Accounts Receivable, Net, Current | 2,941,245 | 1,219,526 |
91-180 days | ||
Aging of Accounts Receivable | ||
Accounts Receivable, Net, Current | 0 | 633 |
181-365 days | ||
Aging of Accounts Receivable | ||
Accounts Receivable, Net, Current | 0 | 12,385,193 |
More than 1 year | ||
Aging of Accounts Receivable | ||
Accounts Receivable, Net, Current | $ 0 | $ 5,765,313 |
Property and Equipment, net (De
Property and Equipment, net (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Property and Equipment net | ||
Total property and equipment | $ 903,280 | $ 620,634 |
Less: accumulated depreciation | (482,548) | (186,514) |
Property and Equipment, net | 14,504,993 | 15,029,427 |
Furnitures and office equipment | ||
Property and Equipment net | ||
Total property and equipment | 602,548 | 357,064 |
Vehicle | ||
Property and Equipment net | ||
Total property and equipment | 60,951 | 63,135 |
Leasehold improvements | ||
Property and Equipment net | ||
Total property and equipment | 239,781 | 200,435 |
Land | ||
Property and Equipment net | ||
Property and Equipment, net | 3,042,777 | 3,042,777 |
Building | ||
Property and Equipment net | ||
Property and Equipment, net | 308,779 | 2,607,666 |
Decrease in Impairment Charges, Property and Equipment | 2,300,000 | |
Assets Retirement Obligations - Environmental Remediation | ||
Property and Equipment net | ||
Property and Equipment, net | 8,000,000 | 8,000,000 |
Capitalized direct development cost | ||
Property and Equipment net | ||
Property and Equipment, net | 2,732,705 | 944,864 |
Construction in progress (Fintech Village) | ||
Property and Equipment net | ||
Property and Equipment, net | $ 14,084,261 | $ 14,595,307 |
Property and Equipment net - Ad
Property and Equipment net - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||||
Asset Retirement Obligations | $ 6,392,500 | $ 6,392,500 | $ 8,000,000 | ||
Operating expense | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation expense | $ 65,862 | $ 14,820 | $ 102,991 | $ 32,941 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Goodwill [Roll Forward] | ||
Balance | $ 704,884 | |
Goodwill Acquired | 9,323,189 | $ 704,884 |
Balance | $ 10,028,073 | $ 704,884 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Amortizing and Indefinite lived intangible assets (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Amortizing Intangible Assets | ||
Total amortization to be recognized | $ 20,782,710 | |
Total intangible assets | ||
Gross Carry Amount | 83,608,489 | $ 3,466,307 |
Accumulated Amortization | (1,513,868) | (295,665) |
Impairment Loss | (134,290) | (134,290) |
Net Balance | $ 81,960,331 | 3,036,352 |
Animation Copyright | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 0 years | |
Gross Carry Amount | $ 0 | 301,495 |
Accumulated Amortization | 0 | (64,606) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 0 | 236,889 |
Software and licenses | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 0 years | |
Gross Carry Amount | $ 97,308 | 97,308 |
Accumulated Amortization | (97,308) | (93,251) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 0 | 4,057 |
SolidOpinion Intellectual property (Note 5 (a)) | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 4 years 4 months 24 days | |
Gross Carry Amount | $ 4,655,000 | 0 |
Accumulated Amortization | (543,084) | 0 |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 4,111,916 | 0 |
Fintalk Intangible Assets [Member] | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 4 years 9 months 18 days | |
Gross Carry Amount | $ 6,350,000 | 0 |
Accumulated Amortization | (317,500) | 0 |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 6,032,500 | 0 |
Influencer network | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 8 years 10 months 24 days | |
Gross Carry Amount | $ 1,980,000 | 1,980,000 |
Accumulated Amortization | (214,500) | (66,000) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 1,765,500 | 1,914,000 |
Customer contract | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 2 years | |
Gross Carry Amount | $ 558,830 | 500,000 |
Accumulated Amortization | (185,458) | (55,556) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 373,372 | 444,444 |
Continuing Membership Agreements [Member] | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 19 years 9 months 18 days | |
Gross Carry Amount | $ 8,255,440 | 0 |
Accumulated Amortization | (103,193) | 0 |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 8,152,247 | 0 |
Trade name | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 13 years 10 months 24 days | |
Gross Carry Amount | $ 110,000 | 110,000 |
Accumulated Amortization | (7,944) | (2,444) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | $ 102,056 | 107,556 |
Technology platform | ||
Amortizing Intangible Assets | ||
Weighted Average Remaining Useful Life (in years) | 5 years 10 months 24 days | |
Gross Carry Amount | $ 290,000 | 290,000 |
Accumulated Amortization | (44,881) | (13,808) |
Impairment Loss | 0 | 0 |
Total amortization to be recognized | 245,119 | 276,192 |
Website and mobile app development | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 159,504 | 159,504 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | (134,290) | (134,290) |
Net Balance | 25,214 | 25,214 |
Website name | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 22,296,578 | 3,278,803 |
Accumulated Amortization | (1,513,868) | (295,665) |
Impairment Loss | 0 | 0 |
Net Balance | 20,782,710 | 2,983,138 |
Patent | Patent and trademark | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 28,000 | 28,000 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | 0 | 0 |
Net Balance | 28,000 | 28,000 |
GTB Tokens | GTB Tokens | ||
Indefinite lived intangible assets | ||
Gross Carry Amount | 61,124,407 | 0 |
Accumulated Amortization | 0 | 0 |
Impairment Loss | 0 | 0 |
Net Balance | $ 61,124,407 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Expected amortization expenses (Details) | Sep. 30, 2019USD ($) |
Goodwill and Intangible Assets | |
2019 (excluding the three months ended March 31, 2019) | $ 761,702 |
2020 | 3,046,811 |
2021 | 2,991,255 |
2022 | 2,870,339 |
2023 | 2,860,534 |
2024 and thereafter | 8,252,069 |
Total amortization to be recognized | $ 20,782,710 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Business Acquisition [Line Items] | ||||
Amortization expense relating to intangible assets | $ 764,010 | $ 276,692 | $ 1,317,419 | $ 281,796 |
DBOT [Member] | ||||
Business Acquisition [Line Items] | ||||
Finite-lived Intangible Assets Acquired | $ 8,314,270 |
Long-term Investments (Details)
Long-term Investments (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Long-term Investments. | ||
Non-marketable Equity Investment | $ 9,147,170 | $ 9,452,103 |
Equity Method Investment | 33,012,143 | 16,956,506 |
Total | $ 42,159,313 | $ 26,408,609 |
Long-term Investments - Additio
Long-term Investments - Additional Information (Details) $ / shares in Units, shares in Millions | 1 Months Ended | 9 Months Ended | |||||||
Apr. 24, 2018USD ($)$ / sharesshares | Oct. 31, 2016CNY (¥) | Oct. 31, 2016USD ($) | Sep. 30, 2019USD ($)item | Oct. 29, 2019$ / shares | Oct. 28, 2019$ / shares | Dec. 31, 2018 | |||
Long-term Investments | |||||||||
Initial investment balance | $ 23,000,000 | ||||||||
Subsequent Event | |||||||||
Long-term Investments | |||||||||
GTB quoted price | $ / shares | $ 1.84 | $ 17 | |||||||
Seasail Ventures Limited [Member] | |||||||||
Long-term Investments | |||||||||
Percentage of equity ownership | 40.00% | ||||||||
BDCG | |||||||||
Long-term Investments | |||||||||
Percentage of equity ownership | 20.00% | 60.00% | 40.00% | ||||||
Number of unrelated party | item | 2 | ||||||||
Total cash consideration paid | $ 9,800,000 | ||||||||
Cash paid to acquire entity | 2,000,000 | ||||||||
Value of capital stock issued | $ 7,800,000 | ||||||||
Number of common stock issued | shares | 3 | ||||||||
Share price of capital stock issued | $ / shares | $ 2.60 | ||||||||
Wecast Internet Limited ("Wecast Internet") | |||||||||
Long-term Investments | |||||||||
Percentage of equity ownership | 50.00% | 50.00% | |||||||
Initial investment balance | ¥ 1,000,000 | $ 149,750 | $ 0 | [1] | |||||
Hua Cheng | |||||||||
Long-term Investments | |||||||||
Percentage of equity ownership | 39.00% | ||||||||
Initial investment balance | [2] | $ 0 | |||||||
Shandong Media | |||||||||
Long-term Investments | |||||||||
Percentage of equity ownership | 30.00% | ||||||||
Initial investment balance | $ 0 | ||||||||
[1] | Wecast InternetStarting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. | ||||||||
[2] | Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”)The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. |
Long-term Investments - Equity
Long-term Investments - Equity method investments (Details) | 1 Months Ended | 9 Months Ended | |||
Oct. 31, 2016CNY (¥) | Oct. 31, 2016USD ($) | Sep. 30, 2019USD ($) | |||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | $ 16,956,506 | ||||
Capital increase | 23,000,000 | ||||
Loss on investment | (3,785,092) | ||||
Reclassification to subsidiaries | (3,123,991) | ||||
Foreign currency translation adjustments | (35,280) | ||||
Ending balance | 33,012,143 | ||||
Wecast Internet Limited ("Wecast Internet") | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [1] | 4,114 | |||
Capital increase | ¥ 1,000,000 | $ 149,750 | 0 | [1] | |
Loss on investment | [1] | (5) | |||
Reclassification to subsidiaries | [1] | 0 | |||
Foreign currency translation adjustments | [1] | 1,930 | |||
Ending balance | [1] | 6,039 | |||
Hua Cheng | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [2] | 308,666 | |||
Capital increase | [2] | 0 | |||
Loss on investment | [2] | (32,890) | |||
Reclassification to subsidiaries | [2] | 0 | |||
Foreign currency translation adjustments | [2] | (37,210) | |||
Ending balance | [2] | 238,566 | |||
Shandong Media | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Capital increase | 0 | ||||
Loss on investment | 0 | ||||
Reclassification to subsidiaries | 0 | ||||
Foreign currency translation adjustments | 0 | ||||
Ending balance | 0 | ||||
BDCG | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | [3] | 9,800,000 | |||
Capital increase | [3] | 0 | |||
Loss on investment | [3] | 0 | |||
Reclassification to subsidiaries | [3] | 0 | |||
Foreign currency translation adjustments | [3] | 0 | |||
Ending balance | [3] | 9,800,000 | |||
DBOT | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Beginning balance | 6,843,726 | ||||
Capital increase | 0 | ||||
Loss on investment | (3,719,735) | ||||
Reclassification to subsidiaries | (3,123,991) | ||||
Foreign currency translation adjustments | 0 | ||||
Ending balance | 0 | ||||
Glory | |||||
Schedule Of Equity Method Investment [Roll Forward] | |||||
Capital increase | 23,000,000 | ||||
Loss on investment | (32,462) | ||||
Reclassification to subsidiaries | 0 | ||||
Foreign currency translation adjustments | 0 | ||||
Ending balance | $ 22,967,538 | ||||
[1] | Wecast InternetStarting from October 2016, we have 50% interest in Wecast Internet Limited (“Wecast Internet”) and initial investment was invested RMB 1,000,000 (approximately $149,750). Wecast Internet is in the process of liquidation and the remaining carrying value is immaterial. | ||||
[2] | Hua Cheng Hu Dong (Beijing) Film and Television Communication Co., Ltd.(“Hua Cheng”)The Company held 39% equity ownership in Hua Cheng, a company established to provide integrated value-added service solutions for the delivery of VOD and enhanced content for cable providers. | ||||
[3] | BBD Digital Capital Group Ltd. (“BDCG”)In 2018, we signed a joint venture agreement with two unrelated parties, to establish BDCG located in the United States for providing block chain services for financial or energy industries by utilizing AI and big data technology in the United States. The Company received 40% equity ownership in BDCG from the initial joint venture agreement. On April 24, 2018, the Company acquired 20% equity ownership in BDCG from one noncontrolling party for a total consideration of $9.8 million which consists of $2 million in cash and $7.8 million paid in the form of the Company’s common stock (valued at $2.60 per share and equal to 3 million shares of the Company’s common stock), increasing the Company’s ownership to 60% in BDCG. The remaining 40% of BDCG are held by Seasail ventures limited (“Seasail”). The accounting treatment of the joint venture is based on the equity method due to variable substantive participating rights (in accordance with ASC 810102511) granted to Seasail. The new entity is currently in the process of ramping up its operations. In April 2019, the company rebranded the name of the BDCG joint venture to Intelligenta. As part of the rebranding, Intelligenta’s strategy will now include credit services, corporation services, index services and products, and capital market services and products. |
Leases (Details)
Leases (Details) | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | |
Lease, Cost [Abstract] | ||
Operating Lease Cost | $ 390,577 | $ 1,264,049 |
Short-Term Lease Cost | 78,076 | 250,924 |
Sublease Income | (10,605) | (10,605) |
Total Lease Cost | 458,048 | 1,504,368 |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | 967,565 | |
Right-of-use assets obtained in exchange for new operating lease liabilities | 935,242 | |
2019 (excluding the nine months ended September 30, 2019) | 332,549 | 332,549 |
2020 | 1,307,783 | 1,307,783 |
2021 | 1,328,160 | 1,328,160 |
2022 | 1,422,965 | 1,422,965 |
2023 | 1,474,391 | 1,474,391 |
2024 and thereafter | 3,377,653 | 3,377,653 |
Total lease payments | 9,243,501 | 9,243,501 |
Less: Interest | (2,001,696) | (2,001,696) |
Total | $ 7,241,805 | $ 7,241,805 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Leases | ||
Leases initial term | 12 months | |
Operating right of use assets | $ 6,845,031 | $ 0 |
Operating lease liability | $ 7,241,805 | |
Weighted-average remaining lease term | 6 years 7 months 6 days | |
Average discount rate | 7.50% |
Supplementary Financial Stateme
Supplementary Financial Statement Information (Details) - USD ($) | Sep. 27, 2019 | Oct. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2019 | Dec. 31, 2018 |
Supplemental Financial Statement Information | |||||
Other Assets, Current | $ 2,371,913 | $ 2,371,913 | $ 3,594,942 | ||
Other Liabilities, Current | 9,141,870 | $ 9,141,870 | 5,321,697 | ||
Description of other current liabilities component | more than 5 percent | ||||
Other payable to third party | 5,100,000 | $ 5,100,000 | 4,600,000 | ||
$2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||
Supplemental Financial Statement Information | |||||
Proceeds from convertible debt | $ 2,500,000 | $ 633,805 | 1,800,000 | ||
ID Ventura 7 [Member] | |||||
Supplemental Financial Statement Information | |||||
Other receivable from third party | $ 600,000 | ||||
PRC | |||||
Supplemental Financial Statement Information | |||||
Description of other current assets component | more than 5 percent | ||||
Other receivable from third party | $ 1,700,000 | $ 1,700,000 | $ 3,300,000 |
Convertible Note (Details)
Convertible Note (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Short-term Debt [Line Items] | ||
Convertible note | $ 17,541,950 | $ 15,453,825 |
Short-term Note | 1,914,419 | 4,140,055 |
Long-term Note | 15,627,531 | 11,313,770 |
Convertible Note | SSSIG | ||
Short-term Debt [Line Items] | ||
Convertible note | 1,288,032 | 1,000,000 |
Convertible Note | Advantech Capital Investment II Limited | ||
Short-term Debt [Line Items] | ||
Convertible note | 12,382,806 | 11,313,770 |
Convertible Note | Mr.McMahon | ||
Short-term Debt [Line Items] | ||
Convertible note | 3,229,808 | 3,140,055 |
$2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | ||
Short-term Debt [Line Items] | ||
Convertible note | 626,387 | 0 |
$2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | ||
Short-term Debt [Line Items] | ||
Convertible note | $ 14,917 | $ 0 |
Convertible Note - Additional I
Convertible Note - Additional Information (Details) - USD ($) | Sep. 27, 2019 | Feb. 22, 2019 | Oct. 31, 2019 | Sep. 30, 2019 | Jun. 28, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Oct. 29, 2019 | Apr. 24, 2018 |
Debt Instrument [Line Items] | |||||||||||
Exercise price of warrants | $ 1.84 | $ 1.84 | $ 1.84 | $ 5.375 | |||||||
$2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate | 10.00% | 8.00% | 8.00% | 8.00% | |||||||
Common stock issued from conversion of convertible note | 1,114,130 | ||||||||||
Conversion price | $ 1.84 | ||||||||||
Amount of beneficial conversion feature | $ 600,000 | ||||||||||
Maturity date of the note | Aug. 22, 2020 | ||||||||||
Senior secured convertible note | $ 2,050,000 | ||||||||||
Number of shares issued | 1,166,113 | ||||||||||
Exercise price of warrants | $ 1.84 | $ 1 | |||||||||
Number of common stock convertible | 1,671,196 | ||||||||||
Warrant expiry period | 5 years | ||||||||||
Percentage of warrant exercisable | 150.00% | ||||||||||
Proceeds from convertible debt | $ 2,000,000 | ||||||||||
Convertible note issuance expenses | $ 50,000 | ||||||||||
Unamortized discount convertible note | $ 1,424,000 | $ 1,424,000 | $ 1,424,000 | ||||||||
Interest expense relating to discount | 175,000 | 626,000 | |||||||||
$2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate | 10.00% | ||||||||||
Common stock issued from conversion of convertible note | 1,358,696 | ||||||||||
Conversion price | $ 1.84 | ||||||||||
Amount of beneficial conversion feature | $ 989,000 | ||||||||||
Senior secured convertible note | $ 2,500,000 | 2,500,000 | 2,500,000 | 2,500,000 | |||||||
Number of shares issued | 1,000,000 | ||||||||||
Exercise price of warrants | $ 1.84 | $ 1 | |||||||||
Number of common stock convertible | 2,038,043 | ||||||||||
Warrant expiry period | 5 years | ||||||||||
Percentage of warrant exercisable | 150.00% | ||||||||||
Proceeds from convertible debt | $ 2,500,000 | $ 633,805 | 1,800,000 | ||||||||
Convertible note issuance expenses | $ 66,195 | ||||||||||
Unamortized discount convertible note | 2,488,000 | 2,488,000 | 2,488,000 | ||||||||
Interest expense relating to discount | 12,000 | 12,000 | |||||||||
Grapevine Logic, Inc. ("Grapevine") | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of convertible note | 2,400,000 | 2,400,000 | $ 2,400,000 | ||||||||
Number of additional shares issued | 250,000 | ||||||||||
DBOT | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Carrying amount of convertible note | $ 14,300,000 | $ 14,300,000 | $ 14,300,000 | ||||||||
ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Penalty fee for late payments of interests and compensation | 8.00% | ||||||||||
Expected term [Member] | $2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrant, Term | 5 years | ||||||||||
Expected term [Member] | $2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrant, Term | 5 years | ||||||||||
Expected dividend yield [Member] | $2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 0 | ||||||||||
Expected dividend yield [Member] | $2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 0 | ||||||||||
Expected volatility [Member] | $2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 111.83 | ||||||||||
Expected volatility [Member] | $2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 110.36 | ||||||||||
Risk free interest rate [Member] | $2.05 million Senior Secured Convertible Debenture due in August 2020, ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 2.48 | ||||||||||
Risk free interest rate [Member] | $2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Warrants and rights outstanding, Measurement Input | 1.55 | ||||||||||
Advantech Capital Investment II Limited | Private placement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Common stock issuance (GTD) | $ 12,000,000 | ||||||||||
Interest rate | 8.00% | ||||||||||
Common stock issued from conversion of convertible note | 6,593,406 | ||||||||||
Conversion price | $ 1.82 | ||||||||||
Amount of beneficial conversion feature | $ 1,400,000 | ||||||||||
Maturity date of the note | Jun. 28, 2021 | ||||||||||
Interest expense recognized to beneficial conversion feature | $ 117,000 | $ 112,000 | $ 347,000 | $ 112,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | |
Stockholders Equity [Line Items] | ||
Common stock, shares authorized | 1,500,000,000 | 1,500,000,000 |
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 |
Convertible preferred stock | ||
Stockholders Equity [Line Items] | ||
Preferred stock, shares authorized | 50,000,000 | |
Preferred stock, par value (in dollars per share) | $ 0.001 | |
Series A preferred stock | ||
Stockholders Equity [Line Items] | ||
Preferred stock, shares issued | 7,000,000 | 7,000,000 |
Preferred stock, shares outstanding | 7,000,000 | 7,000,000 |
Number of common stock issued for conversion | 933,333 | |
Preferred stock, voting rights | ten vote | |
Liquidation preference value, per share | $ 0.50 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) | Feb. 08, 2019 | May 10, 2012 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 |
Related Party Transaction [Line Items] | |||||||
Amount due to related parties | $ 2,565,812 | $ 2,565,812 | $ 800,822 | ||||
$2.5 Million Convertible Promissory Note | SSSIG | |||||||
Related Party Transaction [Line Items] | |||||||
Principal amount of convertible note | $ 2,500,000 | ||||||
Interest rate of convertible note | 4.00% | ||||||
Conversion price of note convertible | $ 1.83 | ||||||
Maturity date of the note | Feb. 8, 2020 | ||||||
Interest expenses related to note | 13,000 | 36,000 | |||||
Principal amount of convertible note received | 1,300,000 | 1,300,000 | |||||
Convertible promissory note amount not received | 1,200,000 | 1,200,000 | |||||
Mr. Shane McMahon | Convertible Note | |||||||
Related Party Transaction [Line Items] | |||||||
Amount due to related parties | $ 3,000,000 | ||||||
Principal amount of convertible note | $ 3,000,000 | ||||||
Interest rate of convertible note | 4.00% | ||||||
Conversion price of note convertible | $ 1.75 | ||||||
Conversion price of convertible note after amendment | $ 1.5 | ||||||
Maturity date of the note | Dec. 31, 2020 | ||||||
Interest expenses related to note | 30,000 | $ 30,000 | 90,000 | $ 90,000 | |||
Interest payable | $ 229,808 | $ 229,808 | $ 140,055 |
Related party Transactions - Ad
Related party Transactions - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 20, 2019USD ($) | Mar. 31, 2019USD ($)item | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Mar. 14, 2019item | Dec. 31, 2018USD ($) | |
Related Party Transaction [Line Items] | ||||||
Purchase of crude oil, commitment amount | $ 244,100,000 | |||||
Intangible assets, net | $ 81,960,331 | $ 3,036,352 | ||||
Licensed content, current | 0 | 16,958,149 | ||||
Long term investment | 42,159,313 | 26,408,609 | ||||
Salary, severance and expenses | $ 837,000 | $ 637,000 | ||||
Due to other related parties | 200,000 | |||||
Short-term Debt | 1,914,419 | $ 4,140,055 | ||||
Selling, general and administrative expenses | ||||||
Related Party Transaction [Line Items] | ||||||
Salary, severance and expenses | 837,000 | |||||
Borrowing from Dr. Wu. and his affiliates | ||||||
Related Party Transaction [Line Items] | ||||||
Short-term Debt | $ 1,000,000 | |||||
GTD | ||||||
Related Party Transaction [Line Items] | ||||||
Assets sold under agreements carrying amount | $ 20,400,000 | |||||
Number of GTB received for services provided to GTD | item | 1,250,000 | |||||
GTD | Digital asset management services | ||||||
Related Party Transaction [Line Items] | ||||||
Number of GTB received for services provided to GTD | item | 7,083,333 | |||||
GTD | Animation copy right | ||||||
Related Party Transaction [Line Items] | ||||||
Intangible assets, net | $ 200,000 | |||||
GTD | License content | ||||||
Related Party Transaction [Line Items] | ||||||
Licensed content, current | 17,000,000 | |||||
GTD | Nanjing Shengyi Network Technology Co., Ltd | ||||||
Related Party Transaction [Line Items] | ||||||
Long term investment | $ 3,200,000 | |||||
GTD | Nanjing Shengyi Network Technology Co., Ltd | Ideanomics, Inc [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of ownership interest | 13.00% |
Share-Based Payments (Details)
Share-Based Payments (Details) - Options - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Options Outstanding | ||
Outstanding at January 1, 2019 | 1,706,431 | |
Granted | 14,325,000 | |
Exercised | 0 | |
Expired | (83,333) | |
Forfeited | (976,667) | |
Outstanding at September 30, 2019 | 14,971,431 | 1,706,431 |
Vested and expected to be vested as of September 30, 2019 | 14,971,431 | |
Options exercisable at September 30, 2019 (vested) | 5,529,977 | |
Weighted Average Exercise Price | ||
Outstanding at January 1, 2019 | $ 3.28 | |
Granted | 1.98 | |
Exercised | 0 | |
Expired | 1.98 | |
Forfeited | 1.98 | |
Outstanding at September 30, 2019 | 2.13 | $ 3.28 |
Vested and expected to be vested as of September 30, 2019 | 2.13 | |
Options exercisable at September 30, 2019 (vested) | $ 2.38 | |
Weighted Average Remaining Contractual Life (Years) | ||
Outstanding at January 1,, 2019 | 8 years 8 months 19 days | 4 years 29 days |
Granted | 8 years 9 months | |
Outstanding at September 30,2019 | 8 years 8 months 19 days | 4 years 29 days |
Vested and expected to be vested as of September 30, 2019 | 8 years 8 months 19 days | |
Options exercisable at September 30, 2019 (vested) | 7 years 6 months 18 days | |
Aggregated Intrinsic Value | ||
Outstanding at January 1, 2019 | $ 0 | $ 0 |
Vested and expected to be vested as of September 30, 2019 | 0 | |
Options exercisable at September 30, 2019 (vested) | $ 0 |
Share-Based Payments - Warrants
Share-Based Payments - Warrants (Details) - $ / shares | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Dec. 31, 2018 | Apr. 24, 2018 | |
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 3,709,240 | 60,000 | 8,000,000 |
Exercise price of warrants | $ 1.84 | $ 5.375 | |
2014 Broker Warrants (Series E Financing) | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 0 | 60,000 | |
Exercise price of warrants | $ 1.75 | $ 1.75 | |
Expiration Date | Jan. 31, 2019 | Jan. 31, 2019 | |
$2.05 million IDV Senior Secured Convertible Debenture | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 1,671,196 | 0 | |
Exercise price of warrants | $ 1.84 | $ 1.84 | |
Expiration Date | Feb. 22, 2024 | Feb. 22, 2024 | |
$2.5 million IDV Senior Secured Convertible Debenture | |||
Class of Warrant or Right [Line Items] | |||
Number of Warrants Outstanding and Exercisable | 2,038,044 | 0 | |
Exercise price of warrants | $ 1.84 | $ 1.84 | |
Expiration Date | Sep. 27, 2024 | Sep. 27, 2024 |
Share-Based Payments - Summary
Share-Based Payments - Summary of unvested shares (Details) - Restricted Stock | 9 Months Ended |
Sep. 30, 2019$ / sharesshares | |
Shares | |
Non-vested restricted shares outstanding at January 1, 2019 | shares | 87,586 |
Granted | shares | 129,840 |
Forfeited | shares | (3,000) |
Vested | shares | (158,840) |
Non-vested restricted shares outstanding at September 30, 2019 | shares | 55,586 |
Weighted-average fair value | |
Non-vested restricted shares outstanding at January 1, 2019 | $ / shares | $ 2.46 |
Granted | $ / shares | 1.24 |
Forfeited | $ / shares | 2.60 |
Vested | $ / shares | 1.49 |
Non-vested restricted shares outstanding at September 30, 2019 | $ / shares | $ 2.37 |
Share-Based Payments - Addition
Share-Based Payments - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | ||||
Jan. 31, 2019USD ($)directorshares | Apr. 24, 2018$ / sharesshares | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)$ / sharesshares | Sep. 30, 2018USD ($) | Dec. 31, 2018shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Warrants outstanding to purchase shares of common stock | 8,000,000 | 3,709,240 | 3,709,240 | 60,000 | |||
Share-based payments expense | $ | $ 2,547,107 | $ 11,530 | $ 6,474,227 | $ 3,372,447 | |||
Unrecognized compensation expense related to non-vested share options | $ | $ 14,255,266 | 14,255,266 | |||||
Total fair value of vested shares | $ | $ 6,010,085 | 319,001 | |||||
Weighted average exercise price of warrants | $ / shares | $ 5.375 | $ 1.84 | $ 1.84 | ||||
Weighted average remaining life of warrants | 4 years 8 months 23 days | ||||||
Cash received from options exercised | $ | $ 0 | $ 2,632 | |||||
Percentage of premium on exercise price | 25.00% | ||||||
Closing market price | $ / shares | $ 4.30 | ||||||
Weighted average period for recognition related to non-vested stock options | 1 year 4 months 24 days | ||||||
2010 Stock Incentive Plan ("the Plan") | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of shares authorized for issuance | 31,500,000 | 31,500,000 | |||||
Number of options available for issuance | 14,160,326 | 14,160,326 | |||||
Board of Directors | 2010 Stock Incentive Plan ("the Plan") | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Restricted shares granted | 129,840 | ||||||
Amount of grant date fair value of the restricted shares | $ | $ 161,001 | ||||||
Number of directors | director | 2 | ||||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Number of non-vested restricted shares | 55,586 | 55,586 | 87,586 | ||||
Restricted shares granted | 129,840 | ||||||
Restricted shares vested | 158,840 | ||||||
Unrecognized compensation cost related to unvested restricted shares | $ | $ 33,800 | $ 33,800 | |||||
Weighted average period for recognition related to non-vested stock options | 6 months 4 days | ||||||
Options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Options outstanding to purchase shares of common stock | 14,971,431 | 14,971,431 | 1,706,431 | ||||
Stock options issued to employees | 14,325,000 |
Earnings (Loss) Per Common Sh_3
Earnings (Loss) Per Common Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Earnings (Loss) Per Common Share | ||||
Net earnings (loss) attributable to common stockholders | $ (13,711,867) | $ (7,186,847) | $ 11,506,861 | $ (19,228,240) |
Interest expense attributable to convertible promissory note | 0 | 0 | 125,485 | 0 |
Net earnings (loss) assuming dilution | $ (13,711,867) | $ (7,186,847) | $ 11,632,346 | $ (19,228,240) |
Basic weighted average common shares outstanding | 127,609,748 | 74,063,495 | 113,964,933 | 71,574,303 |
Effect of dilutive securities | ||||
Convertible preferred shares- Series A | 933,333 | |||
Conversion of restricted shares and employee stock options | 22,823 | |||
Convertible promissory notes | 2,777,687 | |||
Contingently issuable shares | 621,117 | 0 | ||
Diluted potential common shares | 127,609,748 | 74,063,495 | 118,319,893 | 71,574,303 |
Net earnings (loss) per share: | ||||
Basic | $ (0.11) | $ (0.10) | $ 0.10 | $ (0.27) |
Diluted | $ (0.11) | $ (0.10) | $ 0.10 | $ (0.27) |
Earnings (Loss) Per Common Sh_4
Earnings (Loss) Per Common Share - Computation of diluted earnings (loss) per share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 32,031,913 | 13,017,857 | 27,999,749 | 13,017,857 |
Warrants | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 3,709,240 | 60,000 | 3,709,240 | 60,000 |
Options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 14,971,431 | 1,797,017 | 14,965,598 | 1,797,017 |
Series A preferred stock | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 933,333 | 933,333 | 0 | 933,333 |
Convertible promissory note and interest | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Total | 12,417,909 | 10,227,507 | 9,324,911 | 10,227,507 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Operating Loss Carryforwards [Line Items] | ||||
Income tax benefit | $ 0 | $ 0 | $ (513,935) | $ 0 |
Effective income tax rate | 4.43% | |||
Valuation allowance | 361,059 | $ 361,059 | ||
U.S domestic cumulative tax loss carryforwards | 9,900,000 | 9,900,000 | ||
Foreign cumulative tax loss carryforwards | $ 30,900,000 | 30,900,000 | ||
Grapevine Logic, Inc. ("Grapevine") | ||||
Operating Loss Carryforwards [Line Items] | ||||
Benefit from reduction in deferred tax valuation allowance | $ 152,876 |
Concentration, Credit and Oth_3
Concentration, Credit and Other Risks (Details) - USD ($) | Sep. 30, 2019 | Dec. 31, 2018 |
Bank Deposits [Line Items] | ||
Total | $ 1,686,596 | $ 3,106,244 |
RMB denominated bank deposits | PRC | ||
Bank Deposits [Line Items] | ||
Total | 110,005 | 1,523,622 |
U.S dollar denominated bank deposits | PRC | ||
Bank Deposits [Line Items] | ||
Total | 30,666 | 133,053 |
U.S dollar denominated bank deposits | Hong Kong / PRC | ||
Bank Deposits [Line Items] | ||
Total | 13,708 | 44,182 |
U.S dollar denominated bank deposits | Singapore (Singapore) | ||
Bank Deposits [Line Items] | ||
Total | 569,707 | 697,099 |
U.S dollar denominated bank deposits | The United States of America (USA) | ||
Bank Deposits [Line Items] | ||
Total | 874,093 | 695,155 |
HKD denominated bank deposits | Hong Kong / PRC | ||
Bank Deposits [Line Items] | ||
Total | 17,985 | 13,133 |
SGD denominated bank deposits | Singapore (Singapore) | ||
Bank Deposits [Line Items] | ||
Total | $ 70,432 | $ 0 |
Concentration, Credit and Oth_4
Concentration, Credit and Other Risks - Major Customers (Details) - Major Customers - Mobile Energy Group, Formerly We Cast Services [Member] - customer | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Revenue | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major customer | more than 10 | more than 10 |
Number of customers | 1 | 1 |
Accounts receivables | ||
Revenue, Major Customer [Line Items] | ||
Description of percentage of revenue for major customer | more than 10 | more than 10 |
Number of customers | 1 | 1 |
Concentration, Credit and Oth_5
Concentration, Credit and Other Risks - Major Suppliers (Details) | 9 Months Ended | ||
Sep. 30, 2019USD ($)item | Sep. 30, 2018item | Dec. 31, 2018USD ($) | |
Digital currency [line items] | |||
Insured deposit | $ | $ 855,915 | $ 0 | |
Major Suppliers | Cost of revenues | |||
Digital currency [line items] | |||
Description of percentage of revenue for major supplier | more than 10 | ||
Number of suppliers | 2 | ||
Major Suppliers | Accounts payable | |||
Digital currency [line items] | |||
Description of percentage of revenue for major supplier | more than 10 | more than 10 | |
Number of suppliers | 1 | 2 | |
GTBs | |||
Digital currency [line items] | |||
Number of GTB tokens held | 7,294,555 | ||
Bitcoins | |||
Digital currency [line items] | |||
Number of GTB tokens held | 2,763 | ||
Ethereum | |||
Digital currency [line items] | |||
Number of GTB tokens held | 21,312 |
Defined Contribution Plan (Deta
Defined Contribution Plan (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Defined Contribution Plan | ||||
Employer matching contribution, percent | 100.00% | |||
Employer matching contribution, amount | $ 8,700 | $ 487 | $ 8,700 | $ 3,242 |
Maximum [Member] | ||||
Defined Contribution Plan | ||||
Employer matching contribution pay, percent | 4.00% | |||
PRC | ||||
Defined Contribution Plan | ||||
Employer matching contribution, amount | $ 113,654 | $ 235,811 | $ 267,868 | $ 607,872 |
Segments and Geographic Areas_2
Segments and Geographic Areas (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | $ 3,103,690 | $ 43,707,937 | $ 44,503,562 | $ 362,628,296 | |
Cost of Sales | |||||
Cost of Sales | 243,360 | 42,844,876 | 750,290 | 115,729,433 | |
GROSS PROFIT | |||||
Gross profit | 2,860,330 | 863,061 | 43,286,378 | 2,788,731 | |
TOTAL ASSETS | |||||
Assets | 164,763,676 | 164,763,676 | $ 94,235,112 | ||
Operating Segments | |||||
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | 44,503,562 | 362,628,296 | |||
GROSS PROFIT | |||||
Gross profit | 43,286,378 | 2,788,731 | |||
TOTAL ASSETS | |||||
Assets | 164,763,676 | 164,763,676 | 94,235,112 | ||
Legacy YOD | |||||
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | 0 | 0 | |||
Legacy YOD | Operating Segments | |||||
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | 0 | 0 | |||
Cost of Sales | |||||
Cost of Sales | 0 | 0 | |||
TOTAL ASSETS | |||||
Assets | 635,128 | 635,128 | 26,442,810 | ||
Mobile Energy Group, Formerly We Cast Services [Member] | |||||
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | 3,103,690 | $ 43,707,937 | 44,503,562 | 362,628,296 | |
Mobile Energy Group, Formerly We Cast Services [Member] | Operating Segments | |||||
NET SALES TO EXTERNAL CUSTOMERS | |||||
Net sales | 44,503,562 | 362,628,296 | |||
Cost of Sales | |||||
Cost of Sales | 1,217,184 | $ 359,839,565 | |||
TOTAL ASSETS | |||||
Assets | 164,128,548 | 164,128,548 | 51,592,929 | ||
Unallocated | Operating Segments | |||||
TOTAL ASSETS | |||||
Assets | $ 0 | $ 0 | $ 16,199,373 |
Segments and Geographic Areas -
Segments and Geographic Areas - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2019segment | |
Segments and Geographic Areas | |
Number of operating segments | 2 |
Going Concern and Management'_2
Going Concern and Management's Plans (Details) | 9 Months Ended | ||||
Sep. 30, 2019USD ($)item | Sep. 27, 2019USD ($) | Dec. 31, 2018USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017USD ($) | |
Going Concern and Management's Plans | |||||
Cash and cash equivalents | $ | $ 1,686,596 | $ 3,106,244 | $ 16,030,248 | $ 7,577,317 | |
Red Rock Group Limited | |||||
Going Concern and Management's Plans | |||||
Consideration to be received | $ | $ 700,000 | ||||
GTBs | |||||
Going Concern and Management's Plans | |||||
Number Of Tokens Held | item | 7,294,555 | ||||
Bitcoins | |||||
Going Concern and Management's Plans | |||||
Number Of Tokens Held | item | 2,763 | ||||
Ethereum | |||||
Going Concern and Management's Plans | |||||
Number Of Tokens Held | item | 21,312 | ||||
$2.5 million Senior Secured Convertible Debenture due in March 2021 - ID Ventura 7 [Member] | |||||
Going Concern and Management's Plans | |||||
Senior secured convertible note | $ | $ 2,500,000 | $ 2,500,000 |
Fair Value Measurements (Detail
Fair Value Measurements (Details) | Sep. 30, 2019USD ($) | [1] |
Fair Value Measurements | ||
Contingent Consideration Liability | $ 2,327,919 | |
Level I | ||
Fair Value Measurements | ||
Contingent Consideration Liability | 0 | |
Level II | ||
Fair Value Measurements | ||
Contingent Consideration Liability | 0 | |
Level III | ||
Fair Value Measurements | ||
Contingent Consideration Liability | $ 2,327,919 | |
[1] | This represents the liability incurred in connection with the acquisition of DBOT shares during Q3 2019 as disclosed in Note 5(f) |
Fair Value Measurements - Signi
Fair Value Measurements - Significant inputs and assumptions (Details) | Sep. 30, 2019 |
Risk free interest rate [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Contingent consideration liability, measurement input | 1.8 |
Expected volatility [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Contingent consideration liability, measurement input | 30 |
Expected term [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Contingent consideration liability, measurement input | 0.5 |
Expected dividend yield [Member] | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Contingent consideration liability, measurement input | 0 |
Fair Value Measurements - Recon
Fair Value Measurements - Reconciliation of Level 3 fair value measurements (Details) - Contingent consideration liability [Member] | 9 Months Ended |
Sep. 30, 2019USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Balance at the beginning | $ 0 |
Addition | (2,217,034) |
Remeasurement (loss)/gain recognized in the income statement | (110,885) |
Balance at the end | $ (2,327,919) |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | Oct. 29, 2019 | Oct. 28, 2019 | Sep. 30, 2019 | Sep. 27, 2019 | Dec. 31, 2018 | Apr. 24, 2018 |
Subsequent Event [Line Items] | ||||||
Common stock, par value (in dollars per share) | $ 0.001 | $ 0.001 | ||||
Exercise price of warrants | $ 1.84 | $ 5.375 | ||||
Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
GTB quoted price | $ 1.84 | $ 17 | ||||
Additional Issuance Agreement with ID Venturas 7, LLC [Member] | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Amount invested | $ 400,000 | |||||
Additional investment rights granted | $ 2,500,000 | |||||
Conversion price | $ 1 | |||||
Percentage Of Warrant Exercisable | 150.00% | |||||
Common stock, par value (in dollars per share) | $ 0.001 | |||||
Interest rate | 10.00% | |||||
Security purchase agreement with ID Venturas 7, LLC [Member] | ||||||
Subsequent Event [Line Items] | ||||||
Interest rate | 10.00% | |||||
Letter agreement [Member] | Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Exercise price of warrants | $ 1 |