Company: FUFU
Filing Date: 2025-04-21
Form Type: 20-F
Source: 0001213900-25-033733
Chunk: 138

Company: Bitfufu Inc.
Filing Date: 2025-04-21
Form: 20-F
Item: Item 5
Chunk 138
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 were incurred as a result of being a public company following BitFuFu’s
listing in March 2024.

Research and development expenses

Our research and development
expenses increased significantly from US$1.7 million in 2023 to US$5.6 million in 2024. The increase was primarily due to share-based
compensation expenses of US$3.9 million compared to no such expense in 2023.

Impairment loss on digital assets

Impairment loss on digital
assets in 2024 was nil, compared to an impairment loss of US$7.0 million in 2023, primarily due to the early adoption of the FASB’s
fair value accounting standard, ASU No. 2023-08, Accounting for and Disclosure of Crypto Assets.

Impairment loss on mining equipment

We recognized an impairment
loss on mining equipment of nil in 2023 and US$8.1 million in 2024.

Unrealized gain on digital assets

Beginning from January 1, 2024, the Company implemented the early adoption
of FASB fair value accounting rules, ASU No. 2023-08, Accounting for and Disclosure of Crypto Assets. The Company recognized a unrealized
gain of US$37.6 million on BTC, reflecting a favorable mark-to-market adjustment of BTC price in 2024.

Unrealized loss on digital asset receivables
and payables

In 2024, we entered into borrowing
arrangements with institutions that require us to pledge certain digital assets of us as collateral in connection with loans obtained.
We also offered interest-bearing credit periods to some customers that require the customers to pledge digital assets as collateral. These
arrangements resulted in the recognition of digital asset collateral receivable and obligation to return collateral digital assets, measured
at fair value. We recognized a net loss of $1.32 million for the fair value changes on the balance as of December 31, 2024. There were
no such activities in the previous year.

Realized gain on sales of digital assets

Realized gain on sales of
digital assets increased from US$18.2 million in 2023 to US$39.3 million in 2024, primarily due to the increase in the volume of BTC sold
and the growth of BTC price in 2024.

Year ended December 31, 2023 compared to
year ended December 31, 2022

Revenues