Company: BTBT
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001013762-25-000307
Chunk: 1188

Company: Bit Digital, Inc
Filing Date: 2025-03-14
Form: 10-K
Item: Item 2
Chunk 1188
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 be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes
the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of
unobservable inputs. The three levels of inputs used to measure fair value are as follows:

    ●
    Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

    ●
    Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data.

    ●
    Level 3 - inputs to the valuation methodology are unobservable.

Fair value of digital assets is based on Level
1 inputs as these were based on observable quoted prices in the Company’s principal market for identical assets. The fair value
of the Company’s other financial instruments including cash and cash equivalents, restricted cash, loans receivable, deposits, accounts
receivables, other receivables, accounts payable, and other payables, approximate their fair values because of the short-term nature of
these assets and liabilities. Non-financial assets, such as goodwill, intangible assets, operating lease right-of-use assets, and property,
plant and equipment, are adjusted to fair value when there is an indication of impairment and the carrying amount exceeds the asset’s
projected undiscounted cash flows. These assets are recorded at fair value only upon recognition of an impairment charge.

Cash
and cash equivalents

Cash includes
cash on hand and demand deposits in accounts maintained with commercial banks. The Company considers all highly liquid investment instruments
with an original maturity of three months or less from the date of purchase to be cash equivalents.

F-10

Restricted
Cash

Restricted
cash represents cash balances that support an outstanding letter of credit and are restricted from withdrawal. 

USDC

USD Coin
(“USDC”) is accounted for as a financial instrument that can be redeemed one USDC for one U.S. dollar on demand from the issuer.
While not accounted for as cash or cash equivalents, we treat our USDC holdings as a liquidity resource.

Accounts
Receivable

Accounts
receivable consist of amounts due from our customers. Receivables are recorded at the invoiced amount less an