Company: FUFU
Filing Date: 2025-04-21
Form Type: 20-F
Source: 0001213900-25-033733
Chunk: 41

Company: Bitfufu Inc.
Filing Date: 2025-04-21
Form: 20-F
Item: Item 3
Chunk 41
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 may attempt to sell false digital assets. All of the above may adversely
affect the operation of the digital asset network which would erode user confidence in digital assets, which would negatively affect demand
for our services and products.

The “halving” of rewards available
on the Bitcoin network, or the reduction of rewards on other networks could have a negative impact on our ability to generate revenue
as there may not be adequate incentive to continue transaction processing and transaction processing operations may be ceased altogether,
which could have a material adverse effect on our business, financial condition and results of operations.

Under the current protocols
governing the Bitcoin network, the reward for validating a new block on that network is cut in half from time to time, which has been
referred to in our industry as “halving.” When the Bitcoin network was first launched, the reward for validating a new block
was 50 Bitcoin. In 2012, the reward for validating a new block was reduced to 25 Bitcoin. In July 2016, the reward for validating
a new block was reduced to 12.5 Bitcoin, and in May 2020, the reward was reduced to 6.25 Bitcoin. On April 20, 2024, the reward was
further reduced to 3.125 Bitcoin. The next halving for Bitcoin will occur when the block numbers reach 1,050,000 and is currently expected
to occur in 2028. In addition, other digital asset networks may operate under rules that, or may alter their rules to, limit the distribution
of new digital assets. If the reward of digital assets for solving blocks and transaction fees, in particular those for Bitcoins, are
not sufficiently high, neither we nor our customers may have an adequate incentive to continue transaction processing and may cease transaction
processing operations altogether, which may significantly reduce demand for our services. As a result, the halving of available rewards
on the Bitcoin network, or any reduction of rewards on other networks, would have a material adverse effect on our business, financial
condition and results of operations.

In addition, the reduction
of rewards may reduce our profit margins, which could result in us selling a substantial portion of our digital assets, which are subject
to high volatility. If we are forced to sell digital assets at low prices, it could have a material adverse effect on our business, financial
condition and results of operations.

Malicious actors or botnet may obtain control
of more than 50% of