RELATED PARTY BALANCES AND TRANSACTIONS (Tables)

6 Months Ended

Jun. 30, 2025

SCHEDULE OF CONVERTIBLE PROMISSORY NOTE RECEIVABLE ASSETS MEASURED AT FAIR VALUE ON A RECURRING BASIS

Convertible promissory note receivable - related party measured at fair value on a recurring basis are summarized below and disclosed on the consolidated balance sheets as of June 30, 2025 and December 31, 2024:

	Level 1		Level 2		Level 3		Fair Value
	Fair Value Measurement Using						Amount at
	Level 1		Level 2		Level 3		Fair Value
June 30, 2025
Assets
Convertible loans receivable – VEII	$	-	$	557,341	$	-	$	557,341

Total convertible promissory note receivable - related party at Fair Value	$	-	$	557,341	$	-	$	557,341

	Level 1		Level 2		Level 3		Fair Value
	Fair Value Measurement Using						Amount at
	Level 1		Level 2		Level 3		Fair Value
December 31, 2024
Assets
Convertible loans receivable – VEII		-		569,360		-		569,360

Total convertible promissory note receivable - related party at Fair Value	$	-	$	569,360	$	-	$	569,360

SCHEDULE OF FAIR VALUE OF CONVERTIBLE LOANS USING BINOMIAL TREE MODEL

The Company has elected to recognize the convertible loan at fair value and therefore there was no further evaluation of embedded features for bifurcation. The Company engaged third party valuation firm to perform the valuation of convertible loans. The fair value of the convertible loans is calculated using the binomial tree model based on probability of remaining as straight debt using discounted cash flow with the following assumptions:

CN#	1			2			3
Valuation date	June 30, 2025			June 30, 2025			June 30, 2025
Risk-free interest rate		4.176	%		3.854	%		3.718	%
Expected life		0.62 year			1.46 year			2.04 year
Discount rate		8.00	%		8.00	%		8.00	%
Expected volatility		140.110	%		140.110	%		140.110	%
Expected dividend yield		0	%		0	%		0	%

Fair value	$	28,844		$	431,583		$	98,914

SCHEDULE OF CONVERTIBLE NOTES RECEIVABLE

	December 31, 2024		Additions		Unrealized Loss			June 30, 2025
Convertible note receivable, related party	$	569,630	$	-	$	(12,289	)	$	557,341
Total	$	569,630	$	-	$	(12,289	)	$	557,341

	December 31, 2023		Additions		Unrealized Loss			June 30, 2024
Convertible note receivable, related party	$	1,207,627	$	-	$	(724,170	)	$	483,457
Total	$	1,207,627	$	-	$	(724,170	)	$	483,457

Hapi Metaverse Inc. 10-Q