Company: BTBT
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001213900-25-044155
Chunk: 16

Company: Bit Digital, Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 1
Chunk 16
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 believed the hourly close price can better reflect revenue recognized from
our digital asset mining activities as compared to daily close price from CoinMarketCap.

Purchases of digital assets by the Company and
digital assets awarded to the Company through its mining activities and staking activities are included within operating activities on
the accompanying consolidated statements of cash flows. The changes of digital assets are included within operating activities in the
accompanying consolidated statements of cash flows. After adopting ASU 2023-08, changes in fair value and realized gains or losses are
now reported as “gains (losses) on digital assets” in the consolidated statements of operations. Prior to this adoption, realized
gains or losses were reported as “realized gains (losses) on exchange of digital assets” in the consolidated statements of
operations. The Company accounts for its gains or losses in accordance with the first-in first-out method of accounting.

Deposits for property,
plant, and equipment

The deposits for property, plant, and equipment
represented advance payments for purchases of miner and high performance computing equipment. The Company initially recognizes deposits
for property, plant, and equipment when cash is advanced to our suppliers. Subsequently, the Company derecognizes and reclassifies deposits
for property, plant, and equipment to property, plant, and equipment when control is transferred to and obtained by the Company.

8

Below is the roll forward of the balance of deposits
for property and equipment for the three months ended March 31, 2025 and 2024, respectively.

    For the Three Months Ended March 31, 

    2025  
    2024 

    Opening balance 
    $39,059,707  
    $4,227,371 
  
    Reclassification to property, plant, and equipment 
     (80,305,941) 
     (7,540,304)
  
    Addition of deposits for property, plant, and equipment 
     58,342,495  
     3,412,933 
  
    Ending balance 
    $17,096,261  
    $100,000 

Property, plant, and equipment, net

Property, plant, and equipment are recorded at
cost and depreciated using the straight-line method over the estimated useful lives of the assets or declining-balance method. Direct
costs related to developing or obtaining software for internal use are capitalized as property, plant, and equipment.