Company: BTBT
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001013762-25-000307
Chunk: 1195

Company: Bit Digital, Inc
Filing Date: 2025-03-14
Form: 10-K
Item: Item 2
Chunk 1195
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 to receive the payment is established. 

F-14

Investment
in SAFE

SAFE investments
provide the Company with the right to participate in future equity financing of preferred stock. The Company accounted for this investment
under ASC 320, Investments - Debt Securities and elected the fair value option for the SAFE investment under ASC 825, Financial
Instruments, which requires financial instruments to be remeasured to fair value each reporting period, with changes in fair value
recorded in the consolidated statements of operations. The fair value estimate includes significant inputs not observable in the market,
which represents a Level 3 measurement within the fair value hierarchy.

Investment in Innovation Fund/Digital assets
held in fund

On October 1, 2023, the Company made an investment
of 2,701 Ethereum, with a fair value of $4.7 million, into Bit Digital Innovation Master Fund SPC Ltd. (the “Fund”). The Fund
was subsequently consolidated based on the Company’s controlling financial interest. As a result, the assets held in the Fund are
included in current assets in the consolidated balance sheets under the caption “Digital assets held in Fund” as of June 30,
2023 before the disposition.

The Fund qualified and operated as an investment
company for accounting purposes pursuant to the accounting and reporting guidance under ASC 946, “Financial Services – Investment
Companies” (“ASC 946”), which requires fair value measurement of the Fund. The Company retains the Fund’s investment
company specific accounting principles under ASC 946 upon consolidation. The digital assets held by the Fund were traded on a number of
active markets globally. A fair value measurement under ASC 820, “Fair Value Measurement” (“ASC 820”) for an asset
assumes that the asset is exchanged in an orderly transaction between market participants either in the principal market for the asset
or, in the absence of a principal market, the most advantageous market for the asset (ASC 820-10-35-5). The fair value of the assets within
the Fund was primarily determined using the price from CoinMarketCap. Any changes in the fair value of the assets were recorded in Other
income (expense), net in the consolidated statements of operations.

On July 1, 2024, the Company entered into a share
purchase agreement with Pleasanton Ventures Limited (“Pleasanton Ventures”) for the disposition of Bit Digital Innovation
Master Fund SPC Ltd and Bit Digital Investment Management Limited. Refer to Note 21, Dis