Company: BTBT
Filing Date: 2025-07-02
Form Type: S-8
Source: 0001213900-25-061020
Chunk: 98

Company: Bit Digital, Inc
Filing Date: 2025-07-02
Form: S-8
Chunk 98
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 the SEC, or conducted in accordance with
an exemption from registration, which could severely limit its liquidity, usability and transactability. Further, it could draw negative
publicity and a decline in the general acceptance of the digital asset. Also, it may make it difficult for such digital asset to be traded,
cleared, and custodied as compared to other digital assets that are not considered to be securities.

Enactment of the Infrastructure Investment and Jobs Act of 2021 (the “Infrastructure Act”) may have an adverse impact on our business and financial condition.

On November 15, 2021, President Joseph R. Biden
signed the Infrastructure Act. Section 80603 of the Infrastructure Act modifies and amends the Internal Revenue Code of 1986 (the “Code”)
by requiring brokers of digital asset transactions to report their customers to the IRS. This provision was included to enforce the taxability
of digital asset transactions. Section 80603 defines “broker” as “any person who (for consideration) is responsible
for regularly providing any service effectuating transfers of digital assets on behalf of another person.” That could potentially
include miners, validators, and developers of decentralized applications. These functions play a critical role in our business and in
the functioning of the blockchain ecosystem. Importantly, these functions have no way of identifying their anonymous users. Indeed, bitcoin’s
blockchain was designed for anonymity.

This reporting requirement took effect on January
1, 2023, and the implementation of these requirements is ongoing. The Company is closely monitoring the situation and waiting for more
issuance of updated guidance from government agencies. The Company deems that it doesn’t qualify as “broker” under section
80603 and therefore it is not required to report its customers to the IRS under such provision. Disclosing the identity of our bitcoin
mining operations and associated accounts to ensure they can be taxed by the IRS could cause a significant devaluing of our business,
the bitcoin currency, and the entire digital assets market. Additionally, noncompliance with this provision could lead to significant
fines and or regulatory actions against our company.

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Risks related to material pending crypto legislation or regulations

On the federal level, by certain accounts, more
than 100 bills were introduced in Congress to regulate cryptocurrency and digital assets. Except as described in other specific risk factors
set forth herein, we do not believe that material pending crypto legislation or regulations would have a material effect on