Company: OCG
Filing Date: 2025-05-15
Form Type: 20-F
Source: 0001213900-25-043484
Chunk: 138

Company: Oriental Culture Holding LTD
Filing Date: 2025-05-15
Form: 20-F
Item: Item 19
Chunk 138
---
ibles and artwork, the Company
has also expanded its platform to trade commodities principally teas.

The Company generates revenue from its services
in connection with the trading of artwork and commodities on its platforms, primarily consisting of listing service fees, transaction
fees, marketing services fees and other revenues collected from traders (the Company’s customers).

The Company has cooperative agreements with third
parties who are experts and possess new ideas and resources for collectibles/commodities business to co-develop certain niche markets
(such as vintage coins and teas) to be traded on the Company’s online platforms. These parties are required to place a security
deposit with the Company until termination of the cooperative agreements and deposit amounts will need to increase as the trading volume
increases. Revenue generated from these niche markets will be shared between the Company and these parties based on pre-agreed rates and
trading volume. The Company accounts for the portion of revenue that needs to be reimbursed to the third parties as a reduction of total
contract revenue to be received from customers. Approximately nil, nil, and nil has been recorded as a reduction of revenue and payables
to these parties for the years ended December 31, 2024, 2023 and 2022, respectively.

Listing service fees

One-time nonrefundable listing service fees are
collected from owners and traders for listing their products on the platform. The Company’s only performance obligation is to provide
the listing on the Company’s platform over the period requested. The Company recognizes the related revenue upon the completion
of its performance obligations. The fees are determined by contracts with the customers as a fixed percentage of the listing price.

Transaction fee revenue

Transaction fee revenue is generally calculated
based on the transaction value of collectibles, artwork and commodities per transaction. Transaction value is the dollar amount of the
purchase or sale of the collectibles, artwork and commodities after they are listed on the Company’s platforms. The Company’s
performance obligation is to facilitate the trading transactions. Transaction fee revenue is recognized and collected at the point-in-time
when the transaction is completed. Transaction fee revenue also includes predetermined monthly transaction fees for select traders with
large transactions and are negotiated on a case-by-case basis. Predetermined transaction fees are recognized and earned over the specified
service period.

In 2018, the Company started a customer reward
points program, pursuant to which reward points were issued for opening a new account or referring customers to open accounts with us
during our promotion period. In that regard, customers