Company: BTBT
Filing Date: 2025-07-02
Form Type: S-8
Source: 0001213900-25-061020
Chunk: 66

Company: Bit Digital, Inc
Filing Date: 2025-07-02
Form: S-8
Chunk 66
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 safe or practical way to custody the new asset,
that trying to do so may pose an unacceptable risk to our holdings in the old asset, or that the costs of taking possession and/or maintaining
ownership of the new bitcoin exceed the benefits of owning the new bitcoin. Additionally, laws, regulation or other factors may prevent
us from benefitting from the new asset even if there is a safe and practical way to custody and secure the new asset.

There is a possibility of bitcoin mining algorithms transitioning to proof of stake validation and other mining related risks, which could make us less competitive and ultimately adversely affect our business and the value of our shares.

The protocol pursuant to which transactions are
confirmed automatically on the bitcoin blockchain through mining is known as proof-of-work (or PoW). Proof-of-stake (or PoS) is an alternative
method in validating digital asset transactions, such as Ethereum. The shift from a proof-of-work validation method to a PoS method, mining
requires less energy and may render any company that maintains advantages in the current climate (for example, from lower priced electricity,
processing, real estate, or hosting) less competitive. We, as a result of our efforts to optimize and improve the efficiency of our bitcoin
mining operations, may be exposed to the risk in the future of losing the benefit of our capital investments and the competitive advantage
we hope to gain from this as a result, and may be negatively impacted by a switch to proof-of-stake validation. This may additionally
have an impact on other various investments of ours. Such events could have a material adverse effect on our ability to continue as a
going concern or to pursue our business strategy at all, which could have a material adverse effect on our business, prospects or operations
and potentially the value of any bitcoin or other digital assets we mine or otherwise acquire or hold for our own account.

To the extent that the profit margins of bitcoin mining operations are not high, operators of bitcoin mining operations are more likely to immediately sell bitcoin rewards earned by mining in the market, thereby constraining growth of the price of bitcoin that could adversely impact us, and similar actions could affect other digital assets.

Over the past several years, bitcoin mining operations
have evolved from individual users mining with computer processors, graphics processing units and first-generation ASIC servers. Currently,
new processing power is predominantly added by incorporated and unincorporated “professionalized” mining operations. Professionalized
mining operations may use proprietary hardware or sophisticated ASIC machines acquired from ASIC manufacturers. They require the investment