Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 26

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 26
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 assets and fair value.

Prior
to the adoption of ASU 2023-08, digital assets were accounted for as intangible assets with indefinite useful lives and are recorded
at cost less impairment in accordance with ASC 350 - Intangibles-Goodwill and Other. An intangible asset with an indefinite useful
life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating
that it is more likely than not that the indefinite-lived asset is impaired. Digital assets held are accounted for as intangible assets
with indefinite useful lives and are subject to impairment losses if the fair value of digital assets decreases below the carrying value
at any time during the period. The fair value is measured using the quoted price of the digital assets at the time its fair value is
being measured. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether
it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists,
a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment
test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment
losses is not permitted. 

ASC
820 defines “principal market” as the market with the greatest volume and level of activity for the asset or liability. The
determination of the principal market (and, as a result, the market participants in the principal market) is made from the perspective
of the reporting entity. The digital assets held by the Company are traded on a number of active markets globally. The Company uses both
exchanges and Amber Group’s OTC desk to buy and sell digital assets, including transactions involving U.S. dollars or exchanges
between different types of digital assets. Prior to April 1, 2025, the Company considered CoinMarketCap to be its principal market. Effective
April 1, 2025, the Company determined that Coinbase is its principal market as it provides the most reliable and greatest volume and
level of activity for bitcoin and ETH for which the Company can access.

The
Company recognizes mining revenue by utilizing the spot price of Bitcoin determined using Coinbase at 0:00:00 UTC on the date of contract
inception and staking revenue by utilizing the daily close prices obtained from Coinbase. In 2022, the Company also used hourly