Company: BTBT
Filing Date: 2025-07-02
Form Type: S-8
Source: 0001213900-25-061020
Chunk: 76

Company: Bit Digital, Inc
Filing Date: 2025-07-02
Form: S-8
Chunk 76
---
 personal information and/or resulted in the theft of users’ digital assets. The cryptography underlying
ETH could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing,
algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, a malicious
actor may be able to take the ETH held by the Company. Moreover, functionality of the Ethereum network may be negatively affected such
that it is no longer attractive to users, thereby dampening demand for ETH. Even if digital assets other than ETH were affected by similar
circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect
the demand for digital assets and therefore adversely affect the business of the Company.

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Disputes on the Development of the Ethereum Network may lead to Delays in the Development of the Network

There can be disputes between contributors on
the best paths forward in building and maintaining the Ethereum network’s software. Furthermore, the stakers supporting the network
and other developers and users of the network can disagree with the contributors as well, creating greater debate. Therefore, the Ethereum
community often iterates slowly upon contentious protocol issues, which many perceive as prudently conservative, while others worry that
it inhibits innovation. It will be important for the community to continue to develop at a pace that meets the demand for transacting
in ETH, otherwise users may become frustrated and lose faith in the network. As a decentralized network, strong consensus and unity is
particularly important to respond to potential growth and scalability challenges.

The Ethereum Blockchain may Temporarily or Permanently Fork and/or Split

The Ethereum network’s software and protocol
are open source. When a modification is released by the developers and a substantial majority of participants consent to the modification,
the change is implemented and the Ethereum network continues uninterrupted. However, if a change were activated with less than a substantial
majority consenting to the proposed modification, and the modification is not compatible with the software prior to its modification,
the consequence would be what is known as a “hard fork” (i.e., a split) of the Ethereum network (and the blockchain). One
blockchain would be maintained by the pre-modification software and the other by the post-modification software. The effect is that both
blockchain algorithms would be running parallel to one another, but each would be building an independent blockchain with independent
native assets.

A hard fork could present