Mercurity Fintech Holding: Regulatory Headwinds Threaten On-Chain Hopes

Summary MFH has now pivoted from Filecoin mining to a “DeFi Basket” focused on Solana and staking for yield. However, new Nasdaq oversight of token-funded treasuries could slow MFH’s on-chain treasury execution.

MFH has also pushed for AI/HPC operations via Aifinity Base that targets liquid-cooling hardware. Nevertheless, in 2024, they generated only $1.

0 million in revenues, with business consulting contributing about 44. 5% of that figure.

Ultimately, I’m bearish on MFH, especially since the recent regulatory headwinds could derail their Solana ambitions funded with an equity credit line. Mercurity Fintech Holding Inc.

( MFH ) is a diversified fintech in blockchain, artificial intelligence ((AI)), high-performance computing [HPC], and other regulated financial services. MFH mostly operates through a joint venture called Aifinity Base with ZJK Industrial to commercialize cooling solutions for AI and HPC systems.

They’re also working on a “DeFi Basket” treasury focused on institutional-grade digital assets, especially Solana (SOL-USD). However, the new NASDAQ regulations on token-heavy treasuries affected MFH’s DeFi strategy, which could become a near-term headwind.

However, even though it sounds promising on paper, the reality is much less exciting. MFH remains an expensive stock with a future that largely depends on crypto appreciating.

Thus, I feel it’s not worth adding to an investment portfolio. DeFi Basket Promises Mercurity Fintech Holding Inc.

is a fintech that operates through several subsidiaries to deliver financial solutions, blockchain services, and infrastructure. They were founded back in 2011 as JMU Limited, with an e-commerce platform business model.

However, by 2020, it was rebranded as MFH to focus on the crypto ecosystem. Eventually, in 2022 and 2023, MFH raised new funds to pivot further into next-gen tech with expanded partnerships in fintech.

They’re currently headquartered in New York City and are doubling down on their crypto strategy vision. Source: MFH’s Website.

Retrieved September 09, 2025. You see, MFH has three business segments in 1) blockchain & digital asset solutions, 2) AI and HPC infrastructure, and 3) financial services.

First of all, MFH’s blockchain and digital asset solutions segment offers distributed computing to support blockchain operations and crypto transactions. The company uses its computing resources (or partnerships) for mining, which involves solving cryptographic puzzles to earn rewards in networks.

Such rewards are often tokens like Bitcoin (BTC-USD) or Ethereum (ETH-USD). Additionally, MFH builds or manages the backbone systems for blockchain platforms.

This typically includes servers, validation nodes, APIs, and development frameworks that blockchains often require. On top of that, MFH manages digital assets (essentially cryptocurrencies) and other blockchain-based assets.

This is basically offering trading services, payments, safekeeping, and various advisory services related to cryptocurrencies. Source: MFH’s Website.

Retrieved September 09, 2025. As for MFH’s AI and HPC segment, here they offer hardware and software to deploy AI models and heavy computational systems with clusters of specialized processors.

MFH’s AI and HPC infrastructure has cooling solutions with energy-efficient liquid cooling systems to keep data centers stable and reduce electricity costs. MFH also has a joint venture called Aifinity Base with ZJK Industrial to commercialize this cooling tech.

Note that MFH does own 51% of this venture, so it effectively controls the JV. Interestingly, MFH’s Aifinity Base Limited was launched in February 2025 to capture market share in the AI supply chain.

The idea was to tackle liquid cooling for NVIDIA-based AI and HPC systems. It’s true that this is a growing niche with booming demand that broadens the company’s profile into infrastructure technology.

On paper, it grows MFH’s portfolio into cost-reduction hardware for AI through improved efficiency for data center operators. Also, its partner ZJK is a Chinese high-tech manufacturer with experience in AI-related hardware, so it seems promising in that sense.

Together, ZJK and MFH should have manufacturing expertise plus capital and fintech/AI strategic vision. Source: MFH’s Form 20-F.

April 2025 . Finally, their financial services segment operates via Chaince Securities LLC.

This is a FINRA-regulated company that acts as a middleman in securities transactions to trade stocks, bonds, ETFs, or other securities on the US markets. Chaince received FINRA CMA approval on March 21, 2025, and is also a registered investment adviser (RIA).

And interestingly, I calculate their “business consultation” services are actually around 44. 5% of their total revenues.

In 2024, total revenues were $1. 0 million, and $448.

9 thousand came from consulting, which, based on their 20-F filing (see above), appears to have little to do with actual AI or crypto activities. DeFi Basket And Regulatory Oversight Having said that, in July 2025, MFH announced the launch of a $500 million “ DeFi Basket ” treasury.

The idea here is to build a portfolio of high-utility DeFi tokens and projects with institutional adoption and proven use cases. In other words, this sounds like they want to accumulate “blue chip” crypto tokens such as ETH, Solana ((SOL)), or stablecoins (USDC, USDT, DAI).

Yet, they historically had a major focus on Filecoin (FIL-USD) mining in 2022 and 2023. At the time, the bet was on decentralized storage, which FIL is supposedly targeting as well, and MFH spent its resources mining this crypto.

In fact, on December 15, 2022, they spent around $6. 0 million on “ Web3 decentralized storage ” infrastructure to support their FIL mining business.

But unfortunately, FIL plunged during that period (see image below), which seems to broadly correlate with MFH’s stock decline at the time. Source: Seeking Alpha Charts.

MFH stock and Filecoin price (green line). In any event, they’ve more recently moved towards integrating their business more closely with Solana .

MFH says they plan to accumulate SOL tokens as a core holding and run validator nodes on SOL’s network. Essentially, it sounds similar to what they intended to do on the Filecoin network back in 2022 and 2023.

But instead, this time they’ll become an active infrastructure participant in Solana, which includes staking tokens and earning rewards. This will give them passive yield on top of any appreciation in the token price, so it’s a nice added bonus with this blockchain.

However, after their “DeFi Basket” treasury launch, MFH was affected by a new NASDAQ regulation that could constrain them from executing this plan. On September 4, 2025, it was reported that NASDAQ will increase oversight on companies that issue new stock and use the proceeds to buy crypto tokens.

Under this regulation, NASDAQ will now require shareholder approval before such stock-for-token purchases to protect investors from dilution risks. In other words, this is a direct regulatory hit to companies where buying and holding crypto is the main business model.

But for MFH, this rule increases friction in executing their on-chain treasury strategy. Valuation And Risk Analysis Now, from a valuation perspective, MFH currently trades at a $386.

1 million market cap. The latest financials we have are from their annual 20-F report with a cut date of December 2024.

However, that report shows their balance sheet had only $23. 9 million in cash and equivalents, plus $1.

0 million in short-term investments. That amounts to roughly $24.

9 million in available liquidity against a $7. 5 million convertible note.

By February 2025, they disclosed they repaid $4. 0 million on that note, and there’s only $3.

5 million outstanding in convertible notes. Source: Seeking Alpha.

So, I’m going to assume that their cash likely declined by $4. 0 million as well (to partially repay the note) to $20.

9 million. Also, their book value was $24.

1 million by year-end 2024, indicating a P/B of 16. 0, which is inherently expensive.

For comparison, their sector’s median P/B is much lower at just 3. 6.

Similarly, their total 2024 revenues were only approximately $1. 0 million, which results in an extremely pricey P/S of 381.

1 as well. And as far as I can tell, their growth prospects now largely hinge on cryptocurrencies appreciating substantially to justify these premium valuation multiples.

But I believe MFH probably doesn’t justify a premium valuation, given that it has a highly complex corporate structure in the Cayman Islands with negligible revenues. Source: MFH’s Form 20-F.

April 2025 . Furthermore, I calculate their full-year 2024 cash burn at $1.

6 million. Note that I got this figure by simply adding their cash flows from operations and CAPEX.

But in this case, their cash burn would have been higher if they hadn’t been refunded around $2. 0 million in a cancelled PPE purchase in 2024.

Still, if we assume only $1. 6 million in cash burn, that suggests a runway of 13.

1 years. Plus, we know they have their recently announced $200.

0 million equity credit line for their plans with Solana. So, I doubt they’re going to run out of funds any time soon, but I’m also skeptical about actually delivering tangible shareholder value aside from just accumulating tokens.

Conclusion: Not Worth The Risk Overall, MFH has always been focused on cryptocurrencies. Their main bet was on Bitcoin mining until they pivoted into Filecoin mining in 2022.

However, Filecoin plunged and lost its flair, which I imagine spurred MFH to pivot into the more vibrant Solana ecosystem. Still, I don’t see many tangible AI activities so far, and their Solana ambitions largely hinge on the Nasdaq allowing them to issue equity to purchase crypto tokens.

In that sense, that leaves MFH with negligible mining or consulting revenues, and an uncertain outlook if they can’t even use their equity to purchase tokens. Ultimately, I think if MFH manages to accumulate Solana and this token appreciates, it could work out well for investors.

But, in my view, if MFH is going to simply hold Solana, then you might as well just buy Solana for yourself and avoid MFH’s additional risks. Thus, I give MFH a “Sell” rating at these levels.