Note 1 - Organization and Nature of Operations

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Nature of Operations [Text Block]

1. Organization and nature of operations

ChinaNet Online Holdings, Inc. (the “Company”), through its subsidiaries or Variable Interest Entities (“VIEs”), is engaged in providing advertising, precision marketing, online to offline (

O2O

) sales channel expansion and the related data services to small and medium enterprises (“SMEs”) and entrepreneurial management and networking services for entrepreneurs in the PRC. In

January 2018,

the Company announced its expansion into the blockchain industry and the related technology. The Company aims to develop credible, traceable and highly secured blockchain applications for the large demand from the SMEs and gradually shift from an information services provider to a transaction services provider for business opportunities in the near future.

On

January 17, 2018,

the Company consummated a registered direct offering of

2,150,001

shares of the Company’s common stock to certain institutional investors at a purchase price of

$5.15

per share (“the Financing”). As part of the transaction, the Company also issued to the investors warrants for the purchase of up to

645,000

shares of the Company’s common stock at an exercise price of

$6.60

per share. The warrants have a term of

30

months from the date of issuance. The Company received gross proceeds of approximately

$11.1

million (See Note

20

).

In

May 2018,

the Company, through its wholly owned subsidiary in the PRC, incorporated a new majority-owned subsidiary, Business Opportunity Chain (Beijing) Technology Development Co., Ltd. (“Business Opportunity Chain”) with

three

unrelated parties. The registered capital of Business Opportunity Chain is

RMB10

million (approximately

US$1.5

million) and the Company beneficially owns

51%

equity interest in this entity. Business Opportunity Chain was established to provide research and develop and other technical support for the Company’s blockchain business units. As of

September 30, 2018,

Business Opportunity Chain is still in its start-up stage.