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Risks
 9 Months Ended
Sep. 30, 2025
Risks [Abstract]  
Risks

4. Risks

 

Currency risk

 

The function currency of the Company is US$ and these unaudited condensed consolidated financial statements are presented in US$. The Company’s business activities and its assets and liabilities are predominately denominated in the function currency. Therefore, the Company is not exposed to significant foreign currency risk as majority of the operations and transactions are denominated in the functional currency.

 

Concentration and credit risks

 

Financial instruments that potentially subject the Company to the credit risks consist of cash and cash equivalents, accounts receivable and other assets. The maximum exposures of such assets to credit risk are their carrying amounts as of the balance sheet dates.

 

The Company deposits its cash and cash equivalents with reputable banks located in the United States and maintains a balance with PayPal Inc, a financial institution in the United States. As of September 30, 2025 and December 31, 2024, $688,857 and $153,203 were deposited with these banks and PayPal Inc., respectively. Balances maintained with banks in the United Stated are insured under the Federal Deposit Insurance Act introduced by the Federal Deposit Insurance Corporation for a maximum amount of $250,000 for each depositor at one bank, whilst the balances maintained by the Company may at times exceed the insured limits. Cash balances maintained with banks in the United States are not otherwise insured by the Federal Deposit Insurance Act or other programs. The Company has not experienced any losses in these bank accounts and management believes that the Company is not exposed to any significant credit risk on cash and cash equivalents.

 

Assets that potentially subject the Company to significant credit risks primarily consist of accounts receivable and other assets. The Company performs regular and ongoing credit assessments of the counterparts’ financial conditions and credit histories. The Company also assesses historical collection trends, aging of receivables and general economic conditions. The Company considers that it has adequate controls over these receivables in order to minimize the related credit risk. As of September 30, 2025 and December 31, 2024, the balances of allowance for expected credit losses were $541,934 and $563,269, respectively.

 

For the nine months ended September 30, 2025 and 2024, most of the Company’s assets were located in the United States. At the same time, the Company considers that it is exposed to the following concentrations of risk:

 

(a)    Major customers

 

For the nine months ended September 30, 2025 and 2024, the customers who accounted for 10% or more of the Company’s revenues and their respective outstanding balances at year end dates, are presented as follows:

 

   Nine Months ended
September 30, 2025		   As of
September 30, 2025		 
Customer  Revenue   Percentage of
revenue		   Accounts
receivables,
gross		   Percentage of
accounts
receivables,
gross		 
Customer A  $15,115,107    27%  $1,737,404    22%
Customer B   13,728,920    25%   4,793,336    60%
Total:  $28,844,027    52%  $6,530,740    82%

 

   Nine Months ended
September 30, 2024		   As of
September 30, 2024		 
Customer  Revenue   Percentage of
revenue		   Accounts
receivables,
gross		   Percentage of
accounts
receivables,
gross		 
Customer A  $19,249,073    32%  $1,614,468    24%
Customer C   8,618,564    14%   2,131,253    32%
Total:  $27,867,637    46%  $3,745,721    56%

 

All the concentration percentages of accounts receivable are calculated before allowance for expected credit losses.  

 

(b)    Major vendors

 

For the nine months ended September 30, 2025 and 2024, the vendors who accounted for 10% or more of the Company’s purchase and their respective outstanding balances at year end dates, are presented as follows:

 

   Nine Months ended
September 30, 2025		   As of
September 30, 2025		 
Vendor  Purchase   Percentage of
total purchase		   Accounts
payable		   Percentage of
Accounts
payable		 
Vendor A  $11,300,733        37%  $3,493,483    22%
Vendor B   5,613,136    18%   3,229,694    20%
Vendor C   5,541,633    18%   1,409,469    9%
Vendor D   3,829,668    12%   3,556,333    22%
Total:  $26,285,170    85%  $11,688,979    73%

 

   Nine Months ended
September 30, 2024		   As of
September 30, 2024		 
Vendor  Purchase   Percentage of
total purchase		   Accounts
payable		   Percentage of
Accounts
payable		 
Vendor B  $18,699,491        39%  $17,416,011    67%
Vendor E   17,924,407    37%   1,549,692    6%
Vendor C   8,818,263    18%   1,939,640    7%
Total:  $45,442,161    94%  $20,905,343    80%

 

Interest rate risk

 

Fluctuations in market interest rates may negatively affect the Company’s financial condition and results of operations. The Company is exposed to floating interest rate risk on bank deposits and bank borrowings, particularly during periods when the interest rate is expected to significant changes. Nevertheless, given the amounts of bank deposits and bank borrowings in question, the Company considers its interest rate risk not material, and the Company has not used any derivatives to manage or hedge its interest rate risk exposure.