Company: CIFRW
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001819989-25-000081
Chunk: 164

Company: Cipher Mining Inc.
Filing Date: 2025-08-07
Form: 10-Q
Item: Part II, Item 2
Chunk 164
---
ant Power Agreement, the initial term of which is five years, and a remaining term of approximately 2.1 years. The valuations performed by the third-party valuation firm engaged by the Company utilized pre-tax discount rates of 5.33% and 5.96% as of June 30, 2025 and December 31, 2024, respectively, and include observable market inputs, but also include unobservable inputs based on qualitative judgment related to company-specific risk factors. Unrealized gains associated with the derivative asset within the Level 3 category include changes in fair value that were attributable to amendments to the Luminant Power Agreement, changes to the quoted forward electricity rates, as well as unobservable inputs (e.g., changes in estimated usage rates and discount rate assumptions). The following table presents the changes in the estimated fair value of the derivative asset measured using significant unobservable inputs (Level 3) for the six months ended June 30, 2025 and 2024 (amounts in thousands):Six Months Ended June 30,20252024Opening balance$85,670 $93,591 Change in fair value(8,150)29,339 Ending balance$77,520 $122,930 Level 3 liabilityThe Company’s Private Placement Warrants (as defined in Note 16. Warrants) were its only liability classified within Level 3 of the fair value hierarchy because the fair value is based on significant inputs that are unobservable in the market. The valuation of the Private Placement Warrants used assumptions and estimates the Company believes would be made by a market participant in making the same valuation. As of March 31, 2024, all Private Placement Warrants were converted to Public Warrants, and as such no Private Placement Warrants were outstanding as of June 30, 2025.The Company engaged a valuation firm to determine the fair value of the Private Placement Warrants using a Black-Scholes option-pricing model and the quoted price of Common Stock. The following table presents significant assumptions utilized in the valuations of the Private Placement Warrants as of the dates indicated: December 31, 2023Risk-free rate4.00%Dividend yield rate0.00%Volatility124.0%Contractual term (in years)2.7Exercise price$11.50The following table presents changes in the estimated fair value of the Private Placement Warrants (amounts in thousands):Balance as of December 31, 2024$—