On January 3, 2025, the Company received an additional 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent to not renew the 10 MW total contracted capacity at its Plattsburgh, New York site, effective April 5, 2025.
On January 3, 2025, the Company received an additional 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent not to renew the 10 MW total contracted capacity at its Plattsburgh, New York site, effective April 5, 2025.
With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain.
With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain.
By providing computing power to successfully add a block to the blockchain, the Company is entitled to a fractional share of the digital assets award from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool to the total computing power contributed by all mining pool participants in solving the current algorithm.
By providing computing power to successfully add a block to the blockchain, the Company is entitled to a fractional share of the digital assets award from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool to the total computing power contributed by all mining pool participants in solving the current algorithm.
By staking, we receive receipt tokens for the ETH staked which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In addition, we receive rETH-H for rewards earned from Portara protocol.
By staking, we receive receipt tokens for the ETH staked which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In addition, we receive rETH-h for rewards earned from Portara protocol.
With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain.
With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain.
Financing Activities Net cash provided by financing activities was $242.9 million for the year ended December 31, 2024, attributable to net proceeds of $242.9 million from the at-the-market offering.
Net cash provided by financing activities was $242.9 million for the year ended December 31, 2024, attributable to net proceeds of $242.9 million from the at-the-market offering.
For the Years Ended December 31, Variance in 2024 2023 Amount Revenues Digital asset mining $ 58,591,608 44,240,418 14,351,190 Cloud services 45,727,735 - 45,727,735 Colocation services 1,361,241 - 1,361,241 ETH staking 1,819,876 675,713 1,144,163 Other 550,260 - 550,260 Total revenues 108,050,720 44,916,131 63,134,589 Operating costs and expenses Cost of revenue (exclusive of depreciation shown below) Digital asset mining (42,307,012 ) (29,505,783 ) (12,801,229 ) Cloud services (19,508,252 ) - (19,508,252 ) Colocation services (490,501 ) - (490,501 ) ETH staking (72,067 ) (50,802 ) (21,265 ) Depreciation and amortization expenses (32,311,056 ) (14,426,733 ) (17,884,323 ) General and administrative expenses (41,508,279 ) (27,668,592 ) (13,839,687 ) Gains on digital assets 55,709,711 - 55,709,711 Realized gain on exchange of digital assets - 18,789,998 (18,789,998 ) Impairment of digital assets - (6,632,437 ) 6,632,437 Loss on write-off of deposit to hosting facility - (2,041,491 ) 2,041,491 Total operating expenses (80,487,456 ) (61,535,840 ) (18,951,616 ) (Loss) income from operations 27,563,264 (16,619,709 ) 44,182,973 Net loss from disposal of property and equipment (859,083 ) (165,160 ) (693,923 ) Gain from sale of investment security - 8,220 (8,220 ) Other income, net 5,579,796 3,162,412 2,417,384 Total other income (expense), net 4,720,713 3,005,472 1,715,241 Income (loss) before income taxes 32,283,977 (13,614,237 ) 45,898,214 Income tax expenses (3,978,167 ) (279,044 ) (3,699,123 ) Net income (loss) $ 28,305,810 (13,893,281 ) 42,199,091 84 Revenue We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses.
For the Years Ended December 31, Variance in 2024 2023 Amount Revenues Digital asset mining $ 58,591,608 44,240,418 14,351,190 Cloud services 45,727,735 - 45,727,735 Colocation services 1,361,241 - 1,361,241 ETH staking 1,819,876 675,713 1,144,163 Other 550,260 - 550,260 Total revenues 108,050,720 44,916,131 63,134,589 Operating costs and expenses Cost of revenue (exclusive of depreciation shown below) Digital asset mining (42,307,012 ) (29,505,783 ) (12,801,229 ) Cloud services (19,508,252 ) - (19,508,252 ) Colocation services (490,501 ) - (490,501 ) ETH staking (72,067 ) (50,802 ) (21,265 ) Depreciation and amortization expenses (32,311,056 ) (14,426,733 ) (17,884,323 ) General and administrative expenses (41,508,279 ) (27,668,592 ) (13,839,687 ) Gains on digital assets 55,709,711 - 55,709,711 Realized gain on exchange of digital assets - 18,789,998 (18,789,998 ) Impairment of digital assets - (6,632,437 ) 6,632,437 Loss on write-off of deposit to hosting facility - (2,041,491 ) 2,041,491 Total operating expenses (80,487,456 ) (61,535,840 ) (18,951,616 ) (Loss) income from operations 27,563,264 (16,619,709 ) 44,182,973 Net loss from disposal of property and equipment (859,083 ) (165,160 ) (693,923 ) Gain from sale of investment security - 8,220 (8,220 ) Other income, net 5,579,796 3,162,412 2,417,384 Total other income (expense), net 4,720,713 3,005,472 1,715,241 Income (loss) before income taxes 32,283,977 (13,614,237 ) 45,898,214 Income tax expenses (3,978,167 ) (279,044 ) (3,699,123 ) Net income (loss) $ 28,305,810 (13,893,281 ) 42,199,091 90 Revenue We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses.
Under this agreement, Soluna provides certain required mining colocation services to the Company at their hosting facility in Murray, Kentucky for the purpose of the operation and storage of bitcoin mining system to be delivered by the Company up to 6.6 MW (3.3 MW for terms of nine (9) months and 3.3 MW for terms of one (1) year), automatically renewing on a month-to-month basis unless terminated by either party.
Under this agreement, Soluna provides certain required mining colocation services to the Company at their hosting facility in Murray, Kentucky for the purpose of the operation and storage of bitcoin mining system to be delivered by the Company up to 6.6 MW (3.3 MW for terms of nine months and 3.3 MW for terms of one (1) year), automatically renewing on a month-to-month basis unless terminated by either party.
We are not privy to the emissions rate at the Coinmint facility or at any other hosting facility. However, the Coinmint facility operates in an upstate New York region that reportedly utilizes power that is 99% emissions-free, as determined based on the 2023 Load & Capacity Data Report published by the New York Independent System Operator, Inc.
We are not privy to the emissions rate at the Coinmint facility or at any other hosting facility. However, the Coinmint facility operates in an upstate New York region that reportedly utilizes power that is 99% emissions-free, as determined based on the 2023 Load & Capacity Data Report published by the New York Independent System Operator, Inc. (“NYISO”).
Cost of revenue - cloud services For the years ended December 31, 2024 and 2023, the cost of revenue from cloud services was comprised of the following: For the Years Ended December 31, 2024 2023 Electricity costs $ 1,007,112 $ - Datacenter lease expenses 3,558,987 - GPU servers lease expenses 13,640,737 - Other costs 1,301,416 - Total $ 19,508,252 $ - Electricity costs .
Cost of revenue - cloud services For the years ended December 31, 2024 and 2023, the cost of revenue from cloud services was comprised of the following: For the Years Ended December 31, 2024 2023 Electricity costs $ 1,007,112 $ - Datacenter lease expenses 3,558,987 - GPU servers lease expenses 13,640,737 - Other costs 1,301,416 - Total $ 19,508,252 $ - 92 Electricity costs .
On May 9, 2023, the Company entered into a Computation Capacity Services Agreement (the “Services Agreement”) with GreenBlocks. Pursuant to the Agreement, GreenBlocks will provide computational capacity services and other necessary ancillary services, such as operation, management, and maintenance, at the facility in Iceland for a term of two (2) years.
On May 9, 2023, the Company entered into a Computation Capacity Services Agreement (the “Services Agreement”) with GreenBlocks. Pursuant to the Agreement, GreenBlocks will provide computational capacity services and other necessary ancillary services, such as operation, management, and maintenance, at the facility in Iceland for a term of two years.
On April 27, 2023, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to ten (10) MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Massena, New York.
On April 27, 2023, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to 10 MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Massena, New York.
On January 26, 2024, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to six (6) MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Massena, New York.
On January 26, 2024, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to six MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Massena, New York.
We expect to continue to opportunistically invest in miners to increase our hash rate capacity. 85 Revenue from ETH staking During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking. For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand Global Limited (“MarsLand”).
We expect to continue to opportunistically invest in miners to increase our hash rate capacity. Revenue from ETH staking During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking. For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand Global Limited (“MarsLand”).
Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking since April 12, 2023 when the announced Shanghai upgrade was completed.
Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking since April 12, 2023 when the previously announced Shanghai upgrade was completed.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included elsewhere in this report. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included elsewhere in this Annual Report. This discussion contains forward-looking statements reflecting our current expectations that involve risks and uncertainties.
These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon.
These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators. In the fourth quarter of 2023, the Company terminated its native staking activities and reclaimed all staked Ethereum with Blockdaemon.
These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon.
These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company’s stake to the total ETH staked by all validators. 91 In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon.
As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. Our native staking operations with MarsProtocol Technologies Pte. Ltd.
As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. 82 Our native staking operations with MarsProtocol Technologies Pte. Ltd.
These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners. For the year ended December 31, 2024, electricity costs increased by $8.3 million, or 37%, compared to the electricity costs incurred for the year ended December 31, 2023.
These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners. For the year ended December 31, 2024, electricity costs increased by $8.3 million, or 37.4%, compared to the electricity costs incurred for the year ended December 31, 2023.
Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc. 79 We started participating in liquid staking via Liquid Collective protocol on the Coinbase platform in the first quarter of 2023.
Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc. We started participating in liquid staking via Liquid Collective protocol on the Coinbase platform in the first quarter of 2023.
Pursuant to the terms of the new agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of an up to twenty (20) MW bitcoin mining system to be delivered by Bit Digital.
Pursuant to the terms of the new agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of an up to 20 MW bitcoin mining system to be delivered by Bit Digital.
We believe Adjusted EBITDA can be an important financial measure because it allows management, investors, and our board of directors to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making such adjustments. 98 Adjusted EBITDA is provided in addition to and should not be considered to be a substitute for, or superior to net income, the comparable measures under U.S.
We believe Adjusted EBITDA can be an important financial measure because it allows management, investors, and our board of directors to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making such adjustments. 100 Adjusted EBITDA is provided in addition to and should not be considered to be a substitute for, or superior to net income, the comparable measures under U.S.
As of December 31, 2024, Bitdeer provided approximately 15.5 MW of capacity for our miners at their facility. In February 2025, we entered into two hosting services agreements with A.R.T. Digital Holdings Corp (“KaboomRacks”) for terms of nine (9) months and three (3) years automatically renewing on an annual basis unless terminated by either party.
As of December 31, 2025, Bitdeer provided approximately 15.5 MW of capacity for our miners at their facility. In February 2025, we entered into two hosting services agreements with A.R.T. Digital Holdings Corp (“KaboomRacks”) for terms of nine (9) months and three years automatically renewing on an annual basis unless terminated by either party.
Miners with a greater hash rate generally have a higher chance of solving a block and receiving an award. 78 We operate our mining assets with the primary intent of accumulating digital assets which we may sell for fiat currency from time to time depending on market conditions and management’s determination of our cash flow needs, and/or exchange into ETH or USD Coin (“USDC”).
Miners with a greater hash rate generally have a higher chance of solving a block and receiving an award. 77 We operate our mining assets with the primary intent of accumulating digital assets which we may sell for fiat currency from time to time depending on market conditions and management’s determination of our cash flow needs, and/or exchange into ETH or USD Coin (“USDC”).
The Company’s cost of revenue consists primarily of (i) direct production costs related to mining operations, including electricity costs, profit-sharing fees and other relevant costs, but excluding depreciation and amortization, which are separately stated in the Company’s consolidated statements of operations, (ii) direct production costs related to cloud services operations, including electricity costs, datacenter lease expense, GPU servers lease expense, and other relevant costs, but excluding depreciation and amortization, which are separately stated in the Company’s consolidated statements of operations, (iii) direct production costs related to colocation services, including electricity costs, lease costs and other relevant costs and (iv) direct cost related to ETH staking business including service fee and reward-sharing fees to the service providers.
The Company’s cost of revenue consists primarily of (i) direct production costs related to mining operations, including electricity costs, profit-sharing fees and other relevant costs, but excluding depreciation and amortization, which are separately stated in the Company’s consolidated statements of operations, (ii) direct production costs related to cloud services operations, including electricity costs, datacenter lease expense, GPU servers lease expense, and other relevant costs, but excluding depreciation and amortization, which are separately stated in the Company’s consolidated statements of operations, (iii) direct production costs related to colocation services, including electricity costs, lease costs, wage expenses and other relevant costs and (iv) direct cost related to ETH staking business including service fee and reward-sharing fees to the service providers.
GreenBlocks will own and operate the miners financed through the Loan Agreement for the purpose of providing computational capacity of up to 8.25 MW. The Company will pay power costs of five cents ($0.05) per kilowatt hour, a pod fee of $22,000 per pod per month, and a depreciation fee equal to 1/36 of the facility size per month.
GreenBlocks will own and operate the miners financed through the Loan Agreement for the purpose of providing computational capacity of up to 8.25 MW. The Company will pay power costs of $0.05 per kilowatt hour, a pod fee of $22,000 per pod per month, and a depreciation fee equal to 1/36 of the facility size per month.
As of the date of this report, the Company has collected the cash consideration of $0.8 million. 89 For the year ended December 31, 2024, the Company wrote off 19,889 BTC miners during the year, and the Company recorded a loss of $nil resulting from the writing off in the account of “net (loss) gain from disposal of property and equipment”.
As of the date of this report, the Company has collected the cash consideration of $0.8 million. 94 For the year ended December 31, 2024, the Company wrote off 19,889 BTC miners during the year, and the Company recorded a loss of $nil resulting from the writing off in the account of “net (loss) gain from disposal of property and equipment”.
We also continue to monitor the adoption of Pillar Two relating to the global minimum tax in each of our tax jurisdictions to evaluate its impact on our effective income tax rate. For the year ended December 31, 2024, we are not subject to Pillar Two global minimum tax. For more details on the Company’s tax profile, see Note 15.
We also continue to monitor the adoption of Pillar Two relating to the global minimum tax in each of our tax jurisdictions to evaluate its impact on our effective income tax rate. For the year ended December 31, 2024, we are not subject to Pillar Two global minimum tax. For more details on the Company’s tax profile, see Note 17.
These expenses were incurred by the data center for the high performance computing equipment and were closely correlated with the number of deployed GPU servers. For the year ended December 31, 2024 and 2023, electricity costs totaled $1.0 million and $nil, respectively. Data center lease expenses .
These expenses were incurred by the data center for the high performance computing equipment and were closely correlated with the number of deployed GPU servers. For the years ended December 31, 2024 and 2023, electricity costs totaled $1.0 million and $nil, respectively. Data center lease expenses .
In December 2023, we entered into a data center lease agreement for a fixed monthly recurring cost. For the year ended December 31, 2024 and 2023, data center lease expenses totaled $3.6 million and $nil, respectively. GPU servers lease expenses . In 2023, we entered into a GPU servers lease agreement to support our cloud services.
In December 2023, we entered into a data center lease agreement for a fixed monthly recurring cost. For the years ended December 31, 2024 and 2023, data center lease expenses totaled $3.6 million and $nil, respectively. GPU servers lease expenses . In 2023, we entered into a GPU servers lease agreement to support our cloud services.
We have signed service agreements with third-party hosting partners in North America and Iceland. These partners operate specialized mining data centers, where they install and operate the miners and provide IT consulting, maintenance, and repair work on site for us. Our mining facilities in New York are maintained by Coinmint LLC (“Coinmint”) and Digihost Technologies Inc. (“Digihost”).
We have signed service agreements with third-party hosting partners in North America and Iceland. These partners operate specialized mining data centers, where they install and operate the miners and provide IT consulting, maintenance, and repair work on site for us. Our mining facilities in New York are maintained by Digihost Technologies Inc. (“Digihost”).
GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets, liabilities, revenues, and expenses, to disclose contingent assets and liabilities on the dates of the unaudited condensed consolidated financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods.
GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets, liabilities, revenues, and expenses, to disclose contingent assets and liabilities on the dates of the consolidated financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods.
For the year ended December 31, 2024, we earned digital assets from mining services and ETH staking services. We exchanged BTC into ETH or USDC, exchanged BTC and ETH into cash, or used BTC and ETH to pay certain operating costs and other expenses.
For the year ended December 31, 2025, we earned digital assets from mining services and ETH staking services. We exchanged BTC into ETH or USDC, exchanged BTC and ETH into cash, or used BTC and ETH to pay certain operating costs and other expenses.
On December 10, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 191 S21 miners. As of the date of this report, none of the miners were delivered.
On December 10, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 191 S21 miners. As of the date of this report, all of the miners were delivered.
On December 15, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 750 S21 miners. As of the date of this report, none of the miners were delivered.
On December 15, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 750 S21 miners. As of the date of this report, all of the miners were delivered.
The Company’s subsidiary, Bit Digital Canada, Inc., entered into a Mining Services Agreement effective September 1, 2022, for Blockbreakers, Inc. to provide five (5) MW of incremental hosting capacity at its facility in Canada. The facility utilizes an energy source that is primarily hydroelectric.
Power and Hosting Overview The Company’s subsidiary, Bit Digital Canada, Inc., entered into a Mining Services Agreement effective September 1, 2022, for Blockbreakers, Inc. to provide five (5) MW of incremental hosting capacity at its facility in Canada. The facility utilizes an energy source that is primarily hydroelectric.
The Company will pay Coinmint electricity costs, plus operating costs required to operate the Company’s mining equipment, as well as a performance fee equal to 27.5% of the net profit, subject to a ten percent (10%) reduction if Coinmint fails to provide uptime of ninety-eight (98%) percent or better for any period.
The Company will pay Coinmint electricity costs, plus operating costs required to operate the Company’s mining equipment, as well as a performance fee equal to 27.5% of the net profit, subject to a 10% reduction if Coinmint fails to provide uptime of 98% percent or better for any period.
These expenses were closely correlated with the number of deployed servers hosted by the data center. For the year ended December 31, 2024 and 2023, electricity costs totaled $0.2 million and $nil, respectively. Lease expenses . These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.
These expenses were closely correlated with the number of deployed servers hosted by the data center. For the years ended December 31, 2024 and 2023, electricity costs totaled $0.2 million and $nil, respectively. Lease expenses . These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost. Wage expenses.
Our ability to realize revenue through digital asset production and successfully convert digital assets into cash or fund overhead with digital assets is subject to a number of risks, including regulatory, financial and business risks, many of which are beyond our control. Additionally, the value of digital asset rewards has historically been extremely volatile, and future prices cannot be predicted.
Our ability to realize revenue through conversion of digital assets into cash or fund overhead with digital assets is subject to a number of risks, including regulatory, financial and business risks, many of which are beyond our control. Additionally, the value of digital asset rewards has historically been extremely volatile, and future prices cannot be predicted.
(“NYISO”). 80 On April 5, 2023, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to ten (10) MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Plattsburgh, New York.
On April 5, 2023, the Company entered into a letter agreement and MMSA Amendment, as subsequently amended, with Coinmint pursuant to which Coinmint agreed to provide the Company with up to ten (10) MW of additional mining capacity to energize the Company’s mining equipment at Coinmint’s hosting facility in Plattsburgh, New York.
The agreement is for one (1) year automatically renewing for three (3) months unless terminated by either party on at least ninety (90) days prior written notice. The performance fees under this letter agreement are 33% of the net profit. This new agreement brings the Company’s total contracted hosting capacity with Coinmint to approximately 40 MW.
The agreement was for one year automatically renewing for three (3) months unless terminated by either party on at least 90 days prior written notice. The performance fees under this letter agreement are 33% of the net profit. This new agreement brought the Company’s total contracted hosting capacity with Coinmint to approximately 40 MW.
Deposits for property and equipment The deposits for property and equipment consists of advance payments for property and equipment. The balance was derecognized once the control of the property and equipment was transferred to and obtained by us.
Deposits for property, plant and equipment The deposits for property, plant and equipment consists of advance payments for property, plant and equipment. The balance is derecognized once the control of the property, plant and equipment is transferred to and obtained by us.
As of December 31, 2024, we had 24,239 bitcoin miners with net book value of $17.9 million, cloud service computing equipment with a net book value of $47.2 million, property, plant, and equipment acquired as part of the acquisition of Enovum with a net book value of $36.4 million for colocation service, and construction in progress of $5.1 million.
As of December 31, 2024, we had 24,239 bitcoin miners with net book value of $17.9 million, cloud service computing equipment with a net book value of $47.2 million, property, plant, and equipment acquired as part of the acquisition of Enovum with a net book value of $16.9 million for colocation service, and construction in progress of $24.6 million.
Deployment is expected to begin in the first quarter of 2025. 82 In May 2022, our hosting partner Blockfusion advised us that the substation at its Niagara Falls, New York facility was damaged by an explosion and fire, and power was cut off to approximately 2,515 of the Company’s bitcoin miners and approximately 710 ETH miners that had been operating at the site immediately prior to the incident.
In May 2022, our hosting partner Blockfusion advised us that the substation at its Niagara Falls, New York facility was damaged by an explosion and fire, and power was cut off to approximately 2,515 of the Company’s bitcoin miners and approximately 710 ETH miners that had been operating at the site immediately prior to the incident.
See “Disclosure Regarding Forward-Looking Statements” for a discussion of the uncertainties, risks, and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this report.
See “Forward Looking Statements and Risk Factor Summary” for a discussion of the uncertainties, risks, and assumptions associated with these statements. Actual results and the timing of events could differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under “Risk Factors” and elsewhere in this Annual Report.
On September 5, 2024, the Company received a 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent not to renew 27 MW of the 36 MW total contracted capacity at its Massena, New York site, effective December 7, 2024.
This agreement brought the Company’s total contracted hosting capacity with Coinmint to approximately 46 MW. 79 On September 5, 2024, the Company received a 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent not to renew 27 MW of the 36 MW total contracted capacity at its Massena, New York site, effective December 7, 2024.
Liquid staking allows participants to achieve greater capital efficiency by utilizing their staked ETH as collateral and trading their staked ETH tokens on the secondary market. In the first quarter of 2024, we have reclaimed all the liquid staked ETH from Liquid Collective protocol.
Liquid staking allows participants to achieve greater capital efficiency by utilizing their staked ETH as collateral and trading their staked ETH tokens on the secondary market. In the first quarter of 2024, we have reclaimed all the liquid staked ETH from Liquid Collective protocol. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH.
(“Marsprotocol”) commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking with MarsLand Global Limited (“MarsLand”) in August 2023.
(“Marsprotocol”) commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking with MarsLand Global Limited (“MarsLand”) in August 2023. Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc.
Soluna shall also be entitled to 35% of the net profit generated by the miners. In December 2024, we entered into two additional co-location agreements with Soluna pursuant to which Soluna agreed to provide the Company with up to 11 MW (5.5 MW and 5.5 MW, respectively).
Soluna shall also be entitled to 35% of the net profit generated by the miners. In December 2024, we entered into two additional co-location agreements with Soluna DVSL ComputerCo, LLC. pursuant to which Soluna agreed to provide the Company with up to 11 MW (5.5 MW and 5.5 MW, respectively) at their hosting facility in Silverton, Texas.
Working capital is the difference between the Company’s current assets and current liabilities. To date, we have financed our operations primarily through cash flows from operations, and equity financing through public and private offerings of our securities. We plan to support our future operations primarily from cash generated from our operations and equity financings.
Working capital is the difference between the Company’s current assets and current liabilities. To date, we have financed our operations primarily through cash flows from operations, sales of our equity securities and the issuance of convertible notes. We plan to support our future operations primarily from cash generated from our operations and equity financings.
Our mining facilities in Texas are maintained by Dory Creek, LLC, a subsidiary of Bitdeer Technologies Group (“Bitdeer”) and A.R.T. Digital Holdings Corp (“KaboomRacks”). Soluna Computing, Inc and DVSL ComputeCo, LLC (collectively “Soluna”) maintained our mining facilities in Kentucky and Texas. Our mining facility in Iceland is maintained by GreenBlocks ehf, an Icelandic private limited company (“GreenBlocks”).
Our mining facilities in Texas are maintained by Dory Creek, LLC, a subsidiary of Bitdeer Technologies Group (“Bitdeer”) and Digital Energy Partner LLC (“DEP”). Soluna Computing, Inc. and DVSL ComputeCo, LLC (collectively, “Soluna”) previously maintained our mining facilities in Kentucky and Texas, and GreenBlocks ehf, an Icelandic private limited company (“GreenBlocks”), previously maintained our mining facility in Iceland.
Net cash provided by operating activities was $1.1 million for the year ended December 31, 2023, derived mainly from (i) net loss of $13.9 million for the year ended December 31, 2023 adjusted for digital assets mined of $44.2 million from our mining services, depreciation expenses of property and equipment of $14.4 million, gain from exchange of digital assets of $18.8 million, impairment of digital assets of $6.6 million, and share-based compensation expenses of $9.1 million, and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in digital assets and stable coins of $46.9 million as net proceeds from sales of and payments of digital assets and stable coins. 101 Net cash provided by operating activities was $8.5 million for the year ended December 31, 2022, derived mainly from (i) net loss of $105.3 million for the year ended December 31, 2022, adjusted for digital assets mined of $32.3 million from our mining services, depreciation expenses of miners of $27.8 million, gain from exchange of digital assets of $6.5 million, impairment of digital assets of $24.7 million, impairment of property and equipment of $50.0 million, and share-based compensation expenses of $2.3 million, and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in digital assets and stable coins of $25.1 million as net proceeds from sales of digital assets and stable coins, and an increase in accounts payable of $3.2 million.
Net cash provided by operating activities was $1.1 million for the year ended December 31, 2023, derived mainly from (i) net loss of $13.9 million for the year ended December 31, 2023 adjusted for digital assets mined of $44.2 million from our mining services, depreciation expenses of property and equipment of $14.4 million, gain from exchange of digital assets of $18.8 million, impairment of digital assets of $6.6 million, and share-based compensation expenses of $9.1 million, and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in digital assets and stable coins of $46.9 million as net proceeds from sales of and payments of digital assets and stable coins.
For the year ended December 31, 2023, we received 1,507.3 bitcoins from Foundry mining pool. As of December 31, 2023, our maximum hash rate was at an aggregate of 3.9 EH/s for our bitcoin miners. For the year ended December 31, 2023, we recognized revenue of $44.2 million from bitcoin mining services.
For the year ended December 31, 2024, we received 949.9 bitcoins from Foundry mining pool. As of December 31, 2024, our maximum hash rate was at an aggregate of 2.6 EH/s for our bitcoin miners. For the year ended December 31, 2024, we recognized revenue of $58.6 million from bitcoin mining services.
We also continue to monitor the adoption of Pillar Two relating to the global minimum tax in each of our tax jurisdictions to evaluate its impact on our effective income tax rate. For the year ended December 31, 2023, we are not subject to Pillar Two global minimum tax. For more details on the Company’s tax profile, see Note 15.
We also continue to monitor the adoption of Pillar Two relating to the global minimum tax in each of our tax jurisdictions to evaluate its impact on our effective income tax rate. For the year ended December 31, 2025, we are not subject to Pillar Two global minimum tax.
Furthermore, regardless of our ability to generate revenue from our high performance computing business, or our digital asset business, we may need to raise additional capital in the form of equity or debt to fund our operations and pursue our business strategy, including purchases in order to fund our high performance computing business.
Regardless of our ability to generate revenue from our high performance computing business, or our Ethereum staking business, we may need to raise additional capital in the form of equity or debt to fund our operations and pursue our business strategy.
Profit-sharing fees. In 2021, we entered into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.
The decrease primarily resulted from a decrease in the number of deployed miners. Profit-sharing fees. We enter into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.
The total balance of investment securities was $30.8 million and $4.4 million as of December 31, 2024, and December 31, 2023, respectively.
The total balance of investment securities was $69.1 million and $30.8 million as of December 31, 2025, and December 31, 2024, respectively.
Net cash used in investing activities was $69.2 million for the year ended December 31, 2023, primarily attributable to purchases of and deposits made for property and equipment of $66.7 million, investment of $2.2 million in three equity investments, and loans of $0.4 million made to one third party, partially offset by proceeds of $90 thousand from the divestment of an equity investment.
Net cash used in investing activities was $149.0 million for the year ended December 31, 2024, primarily attributable to purchases of and deposits made for property, plant and equipment of $94.0 million, cash paid for acquisition of subsidiary of $39.0 million, investment in a SAFE of $1.0 million and investment in two equity investees of $16.0 million. 103 Net cash used in investing activities was $69.2 million for the year ended December 31, 2023, primarily attributable to purchases of and deposits made for property and equipment of $66.7 million, investment of $2.2 million in three equity investments, and loans of $0.4 million made to one third party, partially offset by proceeds of $90 thousand from the divestment of an equity investment.
As of December 31, 2024, we had 24,239 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 2.6 EH/s. 83 Bitcoin Production From the inception of our bitcoin mining business in February 2020 to December 31, 2024, we earned an aggregate of 7,280.1 bitcoins.
As of December 31, 2025, we had 21,354 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 2.8 EH/s. Bitcoin Production From the inception of our bitcoin mining business in February 2020 to December 31, 2025, we earned an aggregate of 7,550.8 bitcoins.
On December 23, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 4,300 S21+ miners. As of the date of this report, none of the miners were delivered. For the year ended December 31, 2024, the Company disposed approximately 25,495 bitcoin miners.
On December 23, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 4,300 S21+ miners. As of the date of this report, 2,630 miners were delivered. For the year ended December 31, 2025, the Company disposed approximately 7,900 bitcoin miners and wrote off 3 bitcoin miners.
Both agreements are for one (1) year automatically renewing on a month-to-month basis unless terminated by either party on at least sixty (60) days prior written notice. Soluna shall also be entitled to 35% and 27.5%, respectively, of the net profit generated by the miners.
Both agreements are for one (1) year automatically renewing on a month-to-month basis unless terminated by either party on at least 60 days prior written notice. Soluna shall also be entitled to 35% and 27.5%, respectively, of the net profit generated by the miners. These new agreements bring the Company’s total contracted hosting capacity with Soluna to approximately 17.6 MW.
Cost of revenue - ETH staking business For the year ended December 31, 2024, cost of revenue from ETH staking business increased by $21,265, or 42%, compared to the cost of revenue incurred for the year ended December 31, 2023.
Cost of revenue - ETH staking business For the year ended December 31, 2024, cost of revenue from ETH staking business increased by $21,265, or 42%, compared to the cost of revenue incurred for the year ended December 31, 2023. The increase primarily resulted from increased service costs due to the increased number of staked ETH.
As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. As of December 31,2023, we had all of our liquid staking activities with Liquid Collective protocol which began in the first quarter of 2023.
As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum.
The small increase in the balance of USDC was primarily due to receipt of USDC of $2.4 million from sales of other digital assets, partially offset by the payment of USDC for other expenses of $2.3 million, and payment of USDC for service charges from mining facilities of $0.1 million. Digital assets Digital assets primarily consist of BTC and ETH.
The small increase in the balance of USDC was primarily due to the receipt of USDC from sales of other digital assets of $2.3 million and receipt of USDC from other income of $40,100, partially offset by the payment of USDC for other expenses of $2.3 million. Digital assets Digital assets primarily consist of BTC and ETH.
We intend to delegate or stake our ETH holdings to an Ethereum validator node to help secure and strengthen the blockchain network. Stakers are compensated for this commitment in the form of a reward of the native network token.
We delegate or stake our ETH holdings to an Ethereum validator node to help secure and strengthen the blockchain network. Stakers are compensated for this commitment in the form of a reward of the native network token. We initiated our native staking operations with MarsLand Global Limited (“MarsLand”) in August 2023.
Our revenues from ETH liquid staking decreased by $139,508, or 96.9%, to $4,503 for the year ended December 31, 2024 from $144,011 for the year ended December 31, 2023.
Our revenues from ETH liquid staking decreased by $139,508, or 96.9%, to $4,503 for the year ended December 31, 2024 from $144,011 for the year ended December 31, 2023. The decrease was due to the termination of liquid staking activities in the first quarter of 2024.
General and administrative expenses For the year ended December 31, 2023, our general and administrative expenses, totaling $27.7 million, were primarily comprised of shared-based compensation expenses of $9.1 million, salary and bonus expenses of $5.5 million, professional and consulting expenses of $5.4 million, directors and officers insurance expenses of $1.7 million, marketing expenses of $1.2 million, travel expenses of $0.8 million, and transportation expenses of $0.2 million to relocate miners.
For the year ended December 31, 2024, our general and administrative expenses, totaling $41.5 million, were primarily comprised of shared-based compensation expenses of $9.9 million, salary and bonus expenses of $9.8 million, professional and consulting expenses of $13.5 million, directors and officers insurance expenses of $0.9 million, marketing expenses of $1.8 million, and travel expenses of $1.0 million.
For the liquid staking business, the Company has deployed ETH into Portara protocol (formerly known as Harbour) supported by liquid staking solution provider under the consortium of Blockdaemon and Stakewise, and Liquid Collective protocol supported by Coinbase.
Since December 31, 2024, all of native staking operations are with Figment. For the liquid staking business, the Company has deployed ETH into Portara protocol (formerly known as Harbour) supported by liquid staking solution provider under the consortium of Blockdaemon and Stakewise, and Liquid Collective protocol supported by Coinbase.
The total balance of cash and cash equivalents were $95.2 million and $16.9 million as of December 31, 2024 and December 31, 2023, respectively.
The total balance of cash and cash equivalents were $118.4 million and $95.2 million as of December 31, 2025 and December 31, 2024, respectively.
The increase in profit-sharing fees was primarily due to the higher average BTC price for the year ended December 31, 2024, partially offset by a lower bitcoin production as a result of the halving of BTC, which occurred on April 19, 2024.
The increase in profit-sharing fees was primarily due to the higher average BTC price for the year ended December 31, 2024, partially offset by a lower bitcoin production as a result of the halving of BTC, which occurred on April 19, 2024. 93 We expect a proportionate increase in the cost of revenue as we continue to focus on the expansion and upgrade of our miner fleet.
Pursuant to the Loan Agreement, GreenBlocks has requested the Company to extend one or more loans (“Advances”) under a senior secured term loan facility in an aggregate outstanding principal amount not to exceed $5 million.
On May 9, 2023 (“Effective Date”), the Company entered into a Term Loan Facility and Security Agreement (the “Loan Agreement”) with GreenBlocks. Pursuant to the Loan Agreement, GreenBlocks has requested the Company to extend one or more loans (“Advances”) under a senior secured term loan facility in an aggregate outstanding principal amount not to exceed $5 million.
Basic and diluted weighted average number of shares was 87,534,052 and 87,534,052 for the year ended December 31, 2023, respectively. 90 Results of Operations for the Year Ended December 31, 2023 and 2022 The following table summarizes the results of our operations during the year ended December 31, 2023 and 2022, respectively, and provides information regarding the dollar increase or (decrease) during the period.
Basic and diluted weighted average number of shares was 140,346,322 and 141,507,497 for the year ended December 31, 2024, respectively. 89 Results of Operations for the Years Ended December 31, 2024 and 2023 The following table summarizes the results of our operations during the years ended December 31, 2024 and 2023, respectively, and provides information regarding the dollar increase or (decrease) during period.
Our native staking operations are enhanced by a partnership with Blockdaemon, the leading institutional-grade blockchain infrastructure company for node management and staking.
Stakers are compensated for this commitment in the form of a reward of the native network token. Our native staking operations are enhanced by a partnership with Blockdaemon, the leading institutional-grade blockchain infrastructure company for node management and staking.
The increase primarily resulted from increased service costs due to the increased number of staked ETH. 88 Depreciation and amortization expenses For the years ended December 31, 2024 and 2023, depreciation and amortization expenses were $32.3 million and $14.4 million, respectively based on an estimated useful life of property, plant, and equipment as discussed in Note 2.
Depreciation and amortization expenses For the years ended December 31, 2024 and 2023, depreciation and amortization expenses were $32.3 million and $14.4 million, respectively, based on an increase in estimated useful life of property, plant, and equipment as discussed in Note 2. Summary of Significant Accounting Policies .
Digihost also provides services to maintain the premises for a term of two (2) years, automatically renewing for a period of one (1) year. Digihost shall also be entitled to 30% of the net profit generated by the miners.
Digihost also provides services to maintain the premises for a term of two years, automatically renewing for a period of one (1) year. Digihost shall also be entitled to 30% of the net profit generated by the miners. As of December 31, 2025, Digihost provided approximately 6.0 MW of capacity for our miners at their facility.
On October 11, 2024, the Company acquired all of the issued and outstanding capital stock of Enovum Data Centers Corp. in a transaction valued at approximately CAD 62.8 million (approximately $46.0 million).
On October 11, 2024, the Company acquired all of the issued and outstanding capital stock of Enovum Data Centers Corp. in a transaction valued at approximately CAD 62.8 million (approximately $46.0 million). 101 In the first quarter of 2025, the Company sold an aggregate of 3,149,887 ordinary shares in connection with the at-the-market offering.
Property, plant, and equipment, net Property, plant, and equipment primarily consisted of equipment used in our HPC and digital asset businesses as well as construction in progress representing assets received but not yet put into service.
Property, plant, and equipment, net Property, plant, and equipment primarily consist of service equipment used in our Cloud services and Colocation businesses, digital asset businesses, internally developed software used in our Cloud services business, and construction in progress (“CIP”) representing assets received but not yet put into service in our Cloud services and Colocation businesses.
Our native staking operations with Marsprotocol commenced in the first quarter of 2023 and concluded in July of the same year. After ceasing operations with Marsprotocol, we initiated our native staking with MarsLand Global Limited in August 2023. As of December 31,2023, we had all of our native staking activities with MarsLand.
Our native staking operations with Marsprotocol commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking operations with MarsLand in August 2023. In the first quarter of 2024, we concluded our operations with MarsLand and initiated our native staking operations with Figment.
The agreement is for one (1) year automatically renewing for three (3) months unless terminated by either party on at least ninety (90) days prior written notice. The performance fees under this letter agreement are 28% of the net profit. This new agreement brings the Company’s total contracted hosting capacity with Coinmint to approximately 46 MW.
The agreement was for one year automatically renewing for three months unless terminated by either party on at least 90 days prior written notice. The performance fees under this letter agreement are 28% of the net profit.