Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 24

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 24
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 to the
    valuation methodology are unobservable.

Fair
value of digital assets is based on Level 1 inputs as these were based on observable quoted prices in the Company’s principal market
for identical assets. The fair value of the Company’s other financial instruments, including cash and cash equivalents, restricted
cash, loans receivable, deposits, accounts receivable, other receivables, accounts payable, and other payables, approximate their fair
values because of the short-term nature of these assets and liabilities. Non-financial assets, such as goodwill, intangible assets, operating
lease right-of-use assets, and property, plant and equipment, are adjusted to fair value when there is an indication of impairment and
the carrying amount exceeds the asset’s projected undiscounted cash flows. These assets are recorded at fair value only upon recognition
of an impairment charge.

USDC

USD
Coin (“USDC”) is accounted for as a financial instrument that can be redeemed one USDC for one U.S. dollar on demand from
the issuer. While not accounted for as cash or cash equivalents, we treat our USDC holdings as a liquidity resource.

Accounts
receivable, net

Accounts
receivable consist of amounts due from our customers. Receivables are recorded at the invoiced amount less current expected credit losses
for any potentially uncollectable accounts under the current expected credit loss (“CECL”) impairment model and presents
the net amount of the financial instrument expected to be collected. The CECL impairment model requires an estimate of expected credit
losses, measured over the contractual life of an instrument, that considers forecasts of future economic conditions in addition to information
about past events and current conditions. In accordance with ASC 326, Measurement of Credit Losses on Financial Instruments (“ASC
326”), the Company evaluates the collectability of outstanding accounts receivable balances to determine current expected credit
losses that reflects its best estimate of the lifetime expected credit losses. Uncollectible accounts are written off against the current
expected credit losses when collection does not appear probable.

Due
to the short-term nature of the Company’s accounts receivable, the estimate of expected credit loss is based on the aging of accounts
using an aging schedule as of period ends. In determining the amount of the current expected credit losses, the Company considers historical
collection history based on past due status, the current aging of receivables, customer-specific credit risk factors, including their
current financial condition, current market conditions, and probable future economic conditions which inform