Company: XTKG
Filing Date: 2025-04-25
Form Type: 20-F
Source: 0001213900-25-035626
Chunk: 240

Company: X3 Holdings Co., Ltd.
Filing Date: 2025-04-25
Form: 20-F
Item: Item 19
Chunk 240
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 are financially sound based on public available information.
The Group conducts credit evaluations of its customers and suppliers, and generally does not require collateral or other security from
them. The Group establishes an accounting policy for allowance for credit losses on the individual customer’s and supplier’s
financial condition, credit history, and the current economic conditions.

  (b)      Foreign currency risk  

A majority of the Group’s
expense transactions are denominated in RMB and a significant portion of the Group and its subsidiaries’ assets and liabilities
are denominated in RMB. RMB is not freely convertible into foreign currencies. In the PRC, certain foreign exchange transactions are required
by law to be transacted only by authorized financial institutions at exchange rates set by the People’s Bank of China (“ PBOC”).
Remittances in currencies other than RMB by the Group in China must be processed through the PBOC or other China foreign exchange regulatory
bodies which require certain supporting documentation in order to affect the remittance.

The Group’s functional
currency is the RMB, and the Group’s financial statements are presented in U. S. dollars. The RMB deprecation by2.9% in fiscal year
2023 and further deprecation by2.8% in fiscal year 2024. It is difficult to predict how market forces or PRC or U. S. government policy
may impact the exchange rate between the RMB and the U. S. dollar in the future. The change in the value of the RMB relative to the U. S.
dollar may affect our financial results reported in the U. S. dollar terms without giving effect to any underlying changes in our business
or results of operations. Currently, our assets, liabilities, revenues and costs are denominated in RMB. To the extent that the Group
needs to convert U. S. dollars into RMB for capital expenditures and working capital and other business purposes, appreciation of RMB against
U. S. dollar would have an adverse effect on the RMB amount the Group would receive from the conversion. Conversely, if the Group decides
to convert RMB into U. S. dollar for the purpose of making payments for dividends, strategic acquisition or investments or other business
purposes, appreciation of U. S. dollar against RMB would have a negative effect on the U. S. dollar amount available to the Group.

  (c)      Significant customers  

For the year ended December 31, 2024, one customer