Company: SLNH
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001756
Chunk: 275

Company: Soluna Holdings, Inc
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 275
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 not cover any interruption of our
mining activities; our insurance therefore may not be adequate to cover the losses we suffer as a result of any of these events. In the
event of an uninsured loss, including a loss in excess of insured limits, at any of the mines in our network, such mines may not be adequately
repaired in a timely manner or at all and we may lose some or all of the future revenues anticipated to be derived from such mines. The
potential impact on our business is currently magnified because we are currently operating only a single mine.

27

Our reliance on a third-party mining pool service
provider for our mining revenue payouts may have a negative impact on our operations. The same may be true in the case of our hosted customers.

We currently rely on Luxor’s mining pool that
supports Bitcoin to receive our mining rewards and fees from the network. Our mining pool has the sole discretion to modify the terms
of our agreement at any time, and, therefore, our future rights and relationship with our mining pool may change. In general, mining pools
allow miners to combine their computing power, increasing their chances of solving a block and getting paid by the network. The rewards
are distributed by the mining pool operator, proportionally to our contribution to the mining pool’s overall mining power, used
to generate each block. Should the mining pool operator’s system suffer downtime due to a cyber-attack, software malfunction, or
similar issues, it will negatively impact our ability to mine and receive revenue. Furthermore, we and many other Bitcoin miners are dependent
on the accuracy of the mining pool operator’s recordkeeping to accurately record the total processing power provided to the mining
pool for a given Bitcoin mining application in order to assess the proportion of that total processing power we provided. While we have
internal methods of tracking both our power provided and the total used by the mining pool, the mining pool operator uses its own recordkeeping
to determine our proportion of a given reward. We and other miners have little means of recourse against the mining pool operator if we
determine that the proportion of the reward that the mining pool operator pays out to us is incorrect, other than leaving the mining pool.
If we are unable to consistently obtain accurate proportionate rewards from our mining pool operator, we may experience reduced reward
for our efforts, which would have an adverse effect on our results of operations and financial condition.

Declining
block rewards, reliance on transaction fees, and network forks could adversely affect our mining operations