Company: DDC
Filing Date: 2025-07-22
Form Type: F-3
Source: 0001213900-25-066338
Chunk: 104

Company: DDC Enterprise Ltd
Filing Date: 2025-07-22
Form: F-3
Chunk 104
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 our private keys. Our custodial services contracts do not restrict our ability to reallocate our bitcoin among
our custodians, and our bitcoin holdings may be concentrated with a single custodian from time to time. In light of the significant amount
of bitcoin we hold, we continually seek to engage additional custodians to achieve a greater degree of diversification in the custody
of our bitcoin as the extent of potential risk of loss is dependent, in part, on the degree of diversification. If there is a decrease
in the availability of digital asset custodians that we believe can safely custody our bitcoin, for example, due to regulatory developments
or enforcement actions that cause custodians to discontinue or limit their services in the United States, we may need to enter into agreements
that are less favorable than our current agreements or take other measures to custody our bitcoin, and our ability to seek a greater degree
of diversification in the use of custodial services would be materially adversely affected.

As of July 15, 2025, the insurance that covers
losses of our bitcoin holdings covers only a small fraction of the value of the entirety of our bitcoin holdings, and there can be no
guarantee that such insurance will be maintained as part of the custodial services we have or that such coverage will cover losses with
respect to our bitcoin. Moreover, our use of custodians exposes us to the risk that the bitcoin our custodians hold on our behalf could
be subject to insolvency proceedings and we could be treated as a general unsecured creditor of the custodian, inhibiting our ability
to exercise ownership rights with respect to such bitcoin. Any loss associated with such insolvency proceedings is unlikely to be covered
by any insurance coverage we maintain related to our bitcoin.

Bitcoin is controllable only by the possessor of
both the unique public key and private key(s) relating to the local or online digital wallet in which the bitcoin is held. While the Bitcoin
blockchain ledger requires a public key relating to a digital wallet to be published when used in a transaction, private keys must be
safeguarded and kept private in order to prevent a third party from accessing the bitcoin held in such wallet. To the extent the private
key(s) for a digital wallet are lost, destroyed, or otherwise compromised and no backup of the private key(s) is accessible, neither we
nor our custodians will be able to access the bitcoin held in the related digital wallet. Furthermore, we