Company: BTBT
Filing Date: 2025-07-02
Form Type: S-8
Source: 0001213900-25-061020
Chunk: 75

Company: Bit Digital, Inc
Filing Date: 2025-07-02
Form: S-8
Chunk 75
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, process wire transfers to or from digital asset trading platforms, Ethereum-related
companies or service providers, or maintain accounts for persons or entities transacting in ETH. Conversely, a significant portion of
ETH demand is generated by speculators and investors seeking to profit from the short or long-term holding of ETH. The Company believes
that, like any commodity, ETH will fluctuate in value, but over time will gain a level of acceptance as a store of value, medium of exchange
or token of utility.

Smart Contract Risk

The Ethereum network is based upon the development
and deployment of smart contracts, which are self-executing contracts with the terms of the agreement written into software code. There
are thousands of smart contracts currently running on Ethereum network. Like any software code, smart contracts are exposed to risk that
the code contains a bug or other security vulnerability, which can lead to loss of assets that are held on or transacted through the contract.
The smart contract deployed on Ethereum and, as such, may contain a bug or other vulnerability that may lead to the loss of digital assets
held in the wallet. The Ethereum developer community audits widely used smart contracts frequently and publishes the results of such audits
on public forums. The Company currently relies on MarsLand for its native staking and Liquid Collective for its liquid staking solution.
The smart contract code via MarsLand was audited by CertiK. The smart contract code via Liquid Collective was audited by Halborn and Spearbit.
Nevertheless, there is no guaranty against a bug or other vulnerability leading to a loss of digital assets.

Risks Associated with the Ethereum Network

Dependence on Ethereum Network Developers

While many contributors to the Ethereum network’s
open-source software are employed by companies in the industry, most of them are not directly compensated for helping to maintain the
protocol. As a result, there are no contracts or guarantees that they will continue to contribute to the Ethereum network’s software
(https://github.com/ether and https://github.com/orgs/ether/people).

Issues with the Cryptography Underlying the Ethereum Network

Although the Ethereum network is one of the world’s
most established digital asset networks, the Ethereum network and other cryptographic and algorithmic protocols governing the issuance
of digital assets represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate.
In the past, flaws in the source code for digital assets have been exposed and exploited, including flaws that disabled some functionality
for users, exposed users’