*Table
        of Contents*







**SECURITIES
      AND EXCHANGE COMMISSION**


**Washington, D.C.
      20549**





**FORM
      10-Q**




(Mark
      One)


x
            **QUARTERLY
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**


**For
      the Quarterly Period Ended September 30, 2008**




**OR**


o
            **TRANSITION
                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
                ACT OF
                1934**




For
      the
      transition period from ______________ to ______________




Commission
      File No. 000-32429





**GOLDSPRING,
                INC**.(Exact
                name of small business issuer as specified in its
                charter)





FLORIDA
            1081
            65-0955118(State
                or other jurisdiction of
            (Primary
                Standard Industrial
            (I.R.S.
                Employerincorporation
                or organization)
            Classification
                Code Number)
            Identification
                No.)





P.O.
      Box
      1118


Virginia
      City, NV 89440


*(Address
      of principal executive offices)*


(775)
      847-5272


*(Registrant’s
      telephone number, including area code)*





Indicate
      by check mark whether the registrant is a large accelerated filer, an
      accelerated filer, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.
      (Check one):





Large
                accelerated fileroAccelerated
                filerxoNon-accelerated
                fileroSmaller reporting company





Indicate
      by check mark whether the registrant is a shell company (as defined in
      Rule 12b-2 of the Act). Yes o No o




The
      number of shares of Common Stock, $0.000666 par value, of the registrant
      outstanding at November 9, 2008 was 3,339,618,830.












*Table
        of Contents*




**TABLE
      OF CONTENTS**





PART
                I.
            3Item
                1. Financial Statements.
            3CONDENSED
                CONSOLIDATED BALANCE SHEETS
            3CONDENSED
                CONSOLIDATED STATEMENTS OF
                OPERATIONS
            4CONDENSED
                CONSOLIDATED STATEMENTS OF CASH
                FLOWS
            5CONDENSED
                CONSOLIDATED STATEMENT OF STOCKHOLDERS’
                EQUITY
            6NOTES
                TO CONDENSED CONSOLIDATED FINANCIAL
                STATEMENTS
            7Item
                2. Management’s Discussion and Analysis of Financial
                Condition and Results of Operations.
            18Item
                4. Controls and Procedures.
            25PART
                II.
            27Item
                1. Legal Proceedings.
            27Item
                1A. Risk Factors.
            27Item
                2. Unregistered Sales of Equity Securities and Use of
                Proceeds.
            33Item
                3. Defaults Upon Senior Securities.
            34Item
                4. Submission of Matter to Vote of Security
                Holders.
            34Item
                5. Other Information.
            34Item
                6. Exhibits.
            34SIGNATURES
            35EXHIBIT
                INDEXCertification
                of CEO Pursuant to Rule
                15d-14(a)Certification
                of CFO Pursuant to Rule
                15d-14(a)Certification
                of CEO Pursuant to Section
                1350Certification
                of CFO Pursuant to Section
                1350





**Statement
      Regarding Forward-Looking Statements**





*This
      Form 10-Q contains certain forward-looking statements within the meaning of
      Section 27A of the Securities Act of 1933, as amended Section 21E of the
      Securities Exchanged Act of 193, as amended, which are intended to be covered
      by
      the safe harbors created thereby. The statements contained in this report on
      Form 10-Q that are not purely historical are forward-looking statements within
      the meaning of applicable securities laws. Forward-looking statements include
      statements regarding our “expectations,” “anticipation,” “intentions,”
“beliefs,” or “strategies” regarding the future. Forward looking statements also
      include statements regarding fluctuations in the price of gold or certain other
      commodities, (such as silver, copper, diesel fuel, and electricity); changes
      in
      national and local government legislation, taxation, controls, regulations
      and
      political or economic changes in the United States or other countries in which
      we may carry on business in the future; business opportunities that may be
      presented to or pursued by us; our ability to integrate acquisitions
      successfully; operating or technical difficulties in connection with exploration
      or mining activities; the speculative nature of gold exploration, including
      risks of diminishing quantities or grades of reserves; and contests over our
      title to properties. All forward-looking statements included in this report
      are
      based on information available to us as of the filing date of this report,
      and
      we assume no obligation to update any such forward-looking statements. Our
      actual results could differ materially from the forward-looking statements.
      Among the factors that could cause actual results to differ materially are
      the
      factors discussed in Item 1A of Part II, “Risk Factors.”*




-
          2
          -
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          of Contents*





**PART I.**


**Item 1.***********Financial
      Statements.***





**GOLDSPRING,
      INC.**


**CONDENSED
      CONSOLIDATED BALANCE SHEETS**




**September 30,**
            
            **December 31,****2008**
            
            **2007****(Unaudited)****ASSETS**Current
                assets:Cash
                and cash equivalents
            
            $
            100,434
            
            $
            174,996Other
                assets
            
            
            89,583
            
            
            185,417Total
                current assets
            
            
            190,017
            
            
            360,413Property
                and equipment, net of accumulated depreciation and amortization of
                $1,343,984 and $1,473,340, respectivelyMineral
                properties
            
            
            1,530,547
            
            
            1,619,837Plant,
                equipment, mine development
            
            
            249,080
            
            
            411,040Total
                plant, equipment, mine development, net
            
            
            1,779,627
            
            
            2,030,877Reclamation
                deposit
            
            
            766,768
            
            
            377,169Other –
                embedded derivatives
            
            
            —
            
            
            906,989Total
                assets
            
            $
            2,736,412
            
            $
            3,675,448**LIABILITIES
                AND STOCKHOLDERS’ DEFICIENCY**Current
                liabilities:Accounts
                payable
            
            $
            434,154
            
            $
            305,638Accrued
                liabilities
            
            
            259,575
            
            
            2,429,326Accrued
                interest payable
            
            
            2,924,216
            
            
            3,205,813Lease
                obligations
            
            
            —
            
            
            42,459Convertible
                debentures
            
            
            8,247,966
            
            
            9,568,239Other
                notes, current portion of long-term debt
            
            
            2,661,015
            
            
            3,983,800Total
                current liabilities
            
            
            14,526,926
            
            
            19,535,275Long-term
                debt, less current portion
            
            
            4,285,459
            
            
            11,612Derivative
                liabilities
            
            
            —
            
            
            776,385Reclamation
                liabilities
            
            
            766,768
            
            
            553,190Total
                long-term liabilities
            
            
            5,052,227
            
            
            1,341,187Total
                Liabilities
            
            
            19,579,153
            
            
            20,876,462Stockholders’
                deficiency:Common
                stock, $0.000666 par value; 3,950,000,000 shares authorized;
                3,276,118,830 and 2,743,508,248 shares issued
                respectively
            
            
            2,181,895
            
            
            1,827,177Additional
                paid-in capital
            
            
            18,875,060
            
            
            12,969,210Accumulated
                deficit - prior years
            
            
            (31,997,401
            )
            
            (27,940,045
            )Accumulated
                deficit - current year
            
            
            (5,902,295
            )
            
            (4,057,356
            )Total
                stockholders’ deficiency
            
            
            (16,842,741
            )
            
            (17,201,014
            )Total
                liabilities and stockholders’ deficiency
            
            $
            2,736,412
            
            $
            3,675,448





See
      notes
      to the Condensed Consolidated Financial Statements.




-
          3
          -
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          of Contents*





**GOLDSPRING,
      INC.**


**CONDENSED
      CONSOLIDATED STATEMENTS OF OPERATIONS**


**(Unaudited)**




**Three
                Months Ended****September
                30,****2008**
            
            **2007**Operating
                revenues
            
            $
            —
            
            $
            804Costs
                and expenses:Depletion,
                depreciation and amortization
            
            
            60,000
            
            
            81,688Reclamation,
                exploration and test mining
            
            
            974,430
            
            
            127,882General
                and administrative
            
            
            429,767
            
            
            24,237Consulting
                and professional services
            
            
            83,026
            
            
            44,0211,547,223
            
            
            277,828Loss
                from operations
            
            
            (1,547,223
            )
            
            (277,024
            )Other
                income (expense):Interest
                expense
            
            
            (723,698
            )
            
            (775,082
            )Derivative
                change in fair value
            
            
            —
            
            
            75,103Other,
                net
            
            
            —
            
            
            —(723,698
            )
            
            (699,979
            )Net
                loss
            
            $
            (2,270,921
            )
            $
            (977,003
            )Basic
                loss per common share
            
            $
            (0.0007
            )
            $
            (0.0006
            )Basic
                weighted common shares outstanding
            
            
            3,245,163,591
            
            
            1,549,126,624




See
      notes
      to the Condensed Consolidated Financial Statements.




**Nine
                Months Ended****September
                30,****2008**
            
            **2007**Operating
                revenues
            
            $
            —
            
            $
            350,595Costs
                and expenses:Depletion,
                depreciation and amortization
            
            
            180,000
            
            
            225,578Reclamation,
                exploration and test mining
            
            
            2,415,831
            
            
            670,950General
                and administrative
            
            
            1,532,774
            
            
            304,366Consulting
                and professional services
            
            
            141,985
            
            
            180,6664,270,590
            
            
            1,381,560Loss
                from operations
            
            
            (4,270,590
            )
            
            (1,030,965
            )Other
                income (expense):Interest
                expense
            
            
            (2,053,008
            )
            
            (2,379,383
            )Derivative
                change in fair value
            
            
            (130,604
            )
            
            335,995Other,
                net
            
            
            551,907
            
            
            —(1,631,705
            )
            
            (2,043,388
            )Net
                loss
            
            $
            (5,902,295
            )
            $
            (3,074,353
            )Basic
                loss per common share
            
            $
            (0.0019
            )
            $
            (0.0024
            )Basic
                weighted common shares outstanding
            
            
            3,079,822,345
            
            
            1,302,253,229




See
      notes
      to the Condensed Consolidated Financial Statements




-
          4
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          of Contents*





**GOLDSPRING,
      INC.**


**CONDENSED
      CONSOLIDATED STATEMENT OF CASH FLOWS**


**(Unaudited)**




**Nine
                Months****Ended****September
                30,****2008**
            
            **2007****Cash
                flows from operating activities:**Net
                loss
            
            $
            (5,902,295
            )
            $
            (3,074,353
            )Adjustments
                to reconcile net loss to net cash used by operating activities:Depreciation,
                depletion and amortization
            
            
            485,833
            
            
            225,579Interest
                and payments through the issuance of common stock
            
            
            2,430,211
            
            
            716,637Payments
                through the issuance of company stock
            
            
            345,236
            
            
            —Stock
                warrants and grants issued
            
            
            735,290
            
            
            —Change
                in operating assets and liabilitiesPrepaid
                expenses
            
            
            95,834
            
            
            (41,441
            )Other
                current assets
            
            
            —
            
            
            (39,925
            )Accounts
                payable
            
            
            128,516
            
            
            (267,976
            )Accrued
                liabilities
            
            
            (2,169,751
            )
            
            71,560Accrued
                interest
            
            
            (281,597
            )
            
            1,227,804Interest
                capitalized with amended and restructured notes
            
            
            607,563
            
            
            —Derivative
                change fair value, net
            
            
            130,604
            
            
            104,261Other,
                net
            
            
            317,598
            
            
            15,203Net
                cash used in operating activities
            
            
            (3,076,958
            )
            
            (1,062,651
            )**Cash
                flows from investing activities:**Reclamation
                bond
            
            
            (389,599
            )
            
            —Acquisition
                of mineral claims
            
            
            (161,150
            )
            
            20,000Capital
                Expenditures
            
            
            (18,040
            )
            
            —Net
                cash used in investing activities
            
            
            (568,789
            )
            
            20,000**Cash
                flows from financing activities:**Bank
                overdraft
            
            
            —
            
            
            (9,987
            )New
                borrowings from the issuance of notes payable to related
                parties
            
            
            2,472,944
            
            
            1,085,000Debt
                repayments
            
            
            (51,759
            )
            
            (32,362
            )Sale
                of common stock
            
            
            1,150,000
            
            
            —Other
            
            
            —
            
            
            —Net
                cash provided by financing activities
            
            
            3,571,185
            
            
            1,042,651**Net
                increase in cash and cash equivalents**Increase
                in cash and cash equivalents
            
            
            (74,562
            )
            
            —Cash
                and cash equivalents at beginning of period
            
            
            174,996
            
            
            —Cash
                and cash equivalents at end of period
            
            $
            100,434
            
            $
            —**Supplemental
                disclosure of non-cash investing and financing
                activities**Conversion
                of debt into company’s common shares
            
            $
            1,520,273
            
            $
            660,676Issuance
                of company’s common stock for interest
            
            $
            1,420,366
            
            $
            716,637Issuance
                of company’s common stock for liquidated damages
            
            $
            1,009,845
            
            $
            154,346Issuance
                of company’s common stock for director fees
            
            $
            234,400
            
            $
            —Issuance
                of company’s common stock for employee grants and warrants
            
            $
            84,690
            
            
            —Issuance
                of company’s common stock for software
            
            $
            9,740
            
            $
            —Issuance
                of company’s common stock for mineral claims
            
            $
            79,558
            
            $
            —Issuance
                of company’s common stock for consulting
            
            $
            101,096
            
            $
            —




See
      notes
      to the Condensed Consolidated Financial Statements.




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          5
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          of Contents*





**GOLDSPRING,
      INC.**




**CONDENSED
      CONSOLIDATED STATEMENT OF STOCKHOLDERS’ DEFICIENTY**





**(Unaudited)**


**(Common
      Stock Par value, $.000666 per share; 3,950,000,000 shares authorized**


**Preferred
      Stock Par Value, per share; 50,000,000 shares authorized)**





Common
              Shares Issued
            
            Par value
              $.000666
              per share
            
            Additional
              Paid-in
              Capital
            
            Treasury
              Stock
              (at
              cost)
            
            Accumulated
              Deficit
            
            **Total**Balance
                - December 31, 2006,
            
            
            958,938,940
            
            $
            638,653
            
            $
            11,603,560
            
            
            —
            
            $
            (27,940,829
            )
            $
            (15,698,616
            )Liquidated
                damages
            
            
            50,000,000
            
            
            33,300
            
            
            121,047
            
            
            —
            
            
            —
            
            
            154,347Common
                stock issued for debenture principal
            
            
            898,776,970
            
            
            598,585
            
            
            846,362
            
            
            —
            
            
            —
            
            
            1,444,947Common
                stock issued for debenture interest
            
            
            835,792,338
            
            
            556,639
            
            
            398,241
            
            
            —
            
            
            —
            
            
            954,880Other
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            784
            
            
            784Net
                loss
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            (4,057,356
            )
            
            (4,057,356
            )Balance
                - December 31, 2007,
            
            
            2,743,508,248
            
            $
            1,827,177
            
            $
            12,969,210
            
            
            —
            
            $
            (31,997,401
            )
            $
            (17,201,014
            )Liquidated
                damages
            
            
            108,189,261
            
            
            72,054
            
            
            937,791
            
            
            —
            
            
            —
            
            
            1,009,845Common
                stock issued for debenture principal
            
            
            140,155,028
            
            
            93,343
            
            
            1,426,930
            
            
            —
            
            
            —
            
            
            1,520,273Common
                stock issued for debenture interest
            
            
            140,632,316
            
            
            93,661
            
            
            1,326,705
            
            
            —
            
            
            —
            
            
            1,420,366Sale
                of common stock
            
            
            100,000,000
            
            
            66,600
            
            
            1,083,400
            
            
            —
            
            
            —
            
            
            1,150,000Common
                stock issued for director fees
            
            
            20,000,000
            
            
            13,320
            
            
            221,080
            
            
            —
            
            
            —
            
            
            234,400Stock
                grants and warrants issued
            
            
            10,665,714
            
            
            7,103
            
            
            77,587
            
            
            
            
            
            
            
            
            84,690Common
                stock issued for mineral claims
            
            
            3,866,667
            
            
            2,575
            
            
            76,983
            
            
            —
            
            
            —
            
            
            79,558Common
                stock issued for consulting
            
            
            6,666,704
            
            
            4,440
            
            
            96,656
            
            
            —
            
            
            —
            
            
            101,096Stock
                warrants issued
            
            
            —
            
            
            —
            
            
            650,600
            
            
            
            
            
            
            
            
            650,600Common
                stock issued for software
            
            
            2,434,892
            
            
            1,622
            
            
            8,118
            
            
            
            
            
            
            
            
            9,740Net
                loss
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            (5,902,295
            )
            
            (5,902,295
            )Balance,
                September 30, 2008
            
            
            3,276,118,830
            
            $
            2,181,895
            
            $
            18,875,060
            
            $
            —
            
            $
            (37,899,696
            )
            $
            (16,842,741
            )





See
      notes
      to the Condensed Consolidated Financial Statements.


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          of Contents*





GOLDSPRING,
      INC.


NOTES
      TO CONSOLIDATED FINANCIAL STATEMENTS


September
      30, 2008 AND 2007




**Note
      1 - Basis of Presentation**




We
      were
      incorporated in the State of Florida effective October 19, 1999 under the name
      of Click and Call, Inc. On September 7, 2000, we filed an amendment to our
      Articles of Incorporation changing our name to STARTCALL.COM, INC. On March
      10,
      2003, we changed our name to GoldSpring, Inc. (“we” “Goldspring,” or the
“Company”). The primary nature of our business is the exploration and
      development of mineral producing properties. We originally became a mineral
      company through an acquisition of unpatented placer mineral claims and the
      Big
      Mike copper claims in March 2003 from Ecovery, Inc. This acquisition did not
      include any real property rights. In November 2003, we acquired the Plum mine
      facility as well as water rights that are usable at Plum Mine and the Gold
      Canyon and Spring Valley placer claims.




**Note
      2 — Interim Financial Statements**




The
      accompanying interim unaudited condensed financial statements have been prepared
      in accordance with generally accepted accounting principles for interim
      financial information and with the instructions to Form 10-Q and Article 8
      of
      Regulation S-X. Accordingly, they do not include all of the information and
      footnotes required by generally accepted accounting principles for complete
      financial statements. In our opinion, all adjustments (consisting of normal
      recurring accruals) considered necessary for a fair presentation have been
      included. Operating results for the three and nine month periods ended September
      30, 2008 are not necessarily indicative of the results that may be expected
      for
      the year ending December 31, 2008. For further information, refer to the
      financial statements and footnotes thereto included in our Annual Report on
      Form
      10-KSB for the fiscal year ended December 31, 2007.




**Note
      3 — Going Concern**




The
      accompanying consolidated condensed financial statements have been prepared
      in
      conformity with accounting principles generally accepted in the United States
      of
      America which contemplate continuation of the Company as a going concern.
      However, the Company has year end losses from operations and had no revenues
      from operations during the nine months ended September 30, 2008. During the
      nine
      months ended September 30, 2008, the Company incurred a net loss of $5,902,295.
      Further, the Company has inadequate working capital to maintain or develop
      its
      operations, and is dependent upon funds from private investors and the support
      of certain stockholders.





These
      factors raise substantial doubt about the ability of the Company to continue
      as
      a going concern. The financial statements do not include any adjustments that
      might result from the outcome of these uncertainties. In this regard, Management
      continues to raise any necessary additional funds through loans and additional
      sales of its common stock. There is no assurance that the Company will be
      successful in continuing to raise additional capital.





**Note
      4 — Management Plans**





Our
      plans
      for the continuation of our company as a going concern include developing our
      Comstock Lode Project into a profitable operation and supplementing financing
      of
      our operations through sales of our unregistered common stock and borrowings
      from affiliates and other shareholders and potentially third party investors.
      There are no assurances, however, with respect to the future success of these
      plans. The financial statements do not contain any adjustments, which might
      be
      necessary, if we are unable to continue as a going concern.




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          of Contents*




**Note
      5 — Summary of Significant Accounting Policies**





Summarized
      below are the significant accounting policies of GoldSpring, Inc. (“we,”
“GoldSpring,” or the “Company”). Unless otherwise indicated, amounts provided in
      these notes to the financial statements pertain to continuing
      operations.





*Recent
      Authoritative Pronouncements*




Recent
      accounting pronouncements that the Company has adopted or will be required
      to
      adopt in the future are summarized below.





*Determining
      Whether Instruments Granted in Share-Based Payment Transactions Are
      Participating Securities*





In
      June 2008, the FASB issued FSP Emerging Issues Task Force (“EITF”) Issue
      No. 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment
      Transactions Are Participating Securities.” The FSP addresses whether
      instruments granted in share-based payment transactions are participating
      securities prior to vesting and, therefore, need to be included in the earnings
      allocation in computing earnings per share under the two-class method. The
      FSP
      affects entities that accrue dividends on share-based payment awards during
      the
      awards’ service period when the dividends do not need to be returned if the
      employees forfeit the award. This FSP is effective for fiscal years beginning
      after December 15, 2008. The Company is currently assessing the impact of
      FSP EITF 03-6-1 on its consolidated financial position and results of
      operations.





*Determining
      Whether an Instrument (or an Embedded Feature) Is Indexed to an entity's Own
      Stock*





In
      June
      2008, the FASB ratified EITF Issue No. 07-5, "Determining Whether an Instrument
      (or an Embedded Feature) Is Indexed to an Entity's Own Stock" (EITF 07-5).
      EITF
      07-5 provides that an entity should use a two step approach to evaluate whether
      an equity-linked financial instrument (or embedded feature) is indexed to its
      own stock, including evaluating the instrument's contingent exercise and
      settlement provisions. It also clarifies on the impact of foreign currency
      denominated strike prices and market-based employee stock option valuation
      instruments on the evaluation. EITF 07-5 is effective for fiscal years beginning
      after December 15, 2008. The Company is currently assessing the impact of EITF
      07-5 on its consolidated financial position and results of
      operations.





*Accounting
      for Convertible Debt Instruments That May Be Settled in Cash upon Conversion
      (Including Partial Cash Settlement)*





In
      May 2008, the FASB issued FSP Accounting Principles Board (“APB”) Opinion
      No. 14-1, “Accounting for Convertible Debt Instruments That May Be
      Settled in Cash upon Conversion (Including Partial Cash Settlement).” The FSP
      clarifies the accounting for convertible debt instruments that may be settled
      in
      cash (including partial cash settlement) upon conversion. The FSP requires
      issuers to account separately for the liability and equity components of certain
      convertible debt instruments in a manner that reflects the issuer's
      nonconvertible debt (unsecured debt) borrowing rate when interest cost is
      recognized. The FSP requires bifurcation of a component of the debt,
      classification of that component in equity and the accretion of the resulting
      discount on the debt to be recognized as part of interest expense in our
      consolidated statement of operations. The FSP requires retrospective application
      to the terms of instruments as they existed for all periods presented. The
      Company is currently evaluating the potential impact of FSP APB 14-1 upon its
      consolidated financial statements.





*The
      Hierarchy of Generally Accepted Accounting Principles*




In
      May
      2008, the FASB issued SFAS No. 162, "The Hierarchy of Generally Accepted
      Accounting Principles" (FAS No.162). SFAS No. 162 identifies the sources of
      accounting principles and the framework for selecting the principles used in
      the
      preparation of financial statements. SFAS No. 162 is effective 60 days following
      the SEC's approval of the Public Company Accounting Oversight Board amendments
      to AU Section 411, "The Meaning of Present Fairly in Conformity with Generally
      Accepted Accounting Principles". The implementation of this standard will not
      have a material impact on the Company's consolidated financial position and
      results of operations.


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          8
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*Determination
      of the Useful Life of Intangible Assets*




In
      April
      2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff
      Position on Financial Accounting Standard (“FSP FAS”) No. 142-3, “Determination
      of the Useful Life of Intangible Assets”, which amends the factors that should
      be considered in developing renewal or extension assumptions used to determine
      the useful life of intangible assets under SFAS No. 142 “Goodwill and Other
      Intangible Assets”.  The intent of this FSP is to improve the consistency
      between the useful life of a recognized intangible asset under SFAS No. 142
      and
      the period of the expected cash flows used to measure the fair value of the
      asset under SFAS No. 141 (revised 2007) “Business Combinations” and other U.S.
      generally accepted accounting principles.    The Company is
      currently evaluating the potential impact of FSP FAS No. 142-3 on its
      consolidated financial statements.




*Disclosure
      about Derivative Instruments and Hedging Activities*




In
      March
      2008, the FASB issued SFAS No. 161, *“* Disclosure
      about Derivative Instruments and Hedging Activities *,* an
      amendment of SFAS No. 133”, (SFAS 161). This statement requires that objectives
      for using derivative instruments be disclosed in terms of underlying risk and
      accounting designation. The Company is required to adopt SFAS No. 161 on January
      1, 2009. The Company is currently evaluating the potential impact of SFAS No.
      161 on the Company’s consolidated financial statements.




*Delay
      in Effective Date*




In
      February 2008, the FASB issued FSP FAS No. 157-2, “Effective Date of FASB
      Statement No. 157”. This FSP delays the effective date of SFAS No. 157 for
      all nonfinancial assets and nonfinancial liabilities, except those that are
      recognized or disclosed at fair value on a recurring basis (at least annually)
      to fiscal years beginning after November 15, 2008, and interim periods
      within those fiscal years. The impact of adoption was not material to the
      Company’s consolidated financial condition or results of
      operations.




*Business
      Combinations*




In
      December 2007, the FASB issued SFAS No. 141(R) “Business Combinations” (SFAS
      141(R)). This Statement replaces the original SFAS No. 141. This Statement
      retains the fundamental requirements in SFAS No. 141 that the acquisition
      method of accounting (which SFAS No. 141 called the *purchase
      method* )
      be used
      for all business combinations and for an acquirer to be identified for each
      business combination. The objective of SFAS No. 141(R) is to improve the
      relevance, and comparability of the information that a reporting entity provides
      in its financial reports about a business combination and its effects. To
      accomplish that, SFAS No. 141(R) establishes principles and requirements for
      how
      the acquirer:




a.
            Recognizes
                and measures in its financial statements the identifiable assets
                acquired,
                the liabilities assumed, and any non-controlling interest in the
                acquiree.


b.
            Recognizes
                and measures the goodwill acquired in the business combination or
                a gain
                from a bargain purchase.


c.
            Determines
                what information to disclose to enable users of the financial statements
                to evaluate the nature and financial effects of the business
                combination.




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This
      Statement applies prospectively to business combinations for which the
      acquisition date is on or after the beginning of the first annual reporting
      period beginning on or after December 15, 2008 and may not be applied before
      that date. The Company is currently evaluating the effect, if any that the
      adoption of SFAS No. 141(R) will have on its consolidated results of operations
      and financial condition.




*Non-controlling
      Interests in Consolidated Financial Statements—an amendment of ARB No.
      51*




In
      December 2007, the FASB issued SFAS No. 160 “Non-controlling Interests in
      Consolidated Financial Statements – an amendment of ARB No. 51” (SFAS No.
      160). This Statement amends the original Accounting Review Board (ARB) No.
      51
“Consolidated Financial Statements” to establish accounting and reporting
      standards for the non-controlling interest in a subsidiary and for the
      deconsolidation of a subsidiary. It clarifies that a non-controlling interest
      in
      a subsidiary is an ownership interest in the consolidated entity that should
      be
      reported as equity in the consolidated financial statements. This Statement
      is
      effective for fiscal years and interim periods within those fiscal years,
      beginning on or after December 15, 2008 and may not be applied before that
      date.
      The Company is currently evaluating the effect that the adoption of SFAS No.
      160
      will have on its consolidated results of operations and financial
      condition.




*Fair
      Value Option for Financial Assets and Financial Liabilities*




In
      February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for
      Financial Assets and Financial Liabilities – Including an amendment of SFAS
      No. 115” (SFAS No. 159), which becomes effective for the Company on February 1,
      2008, permits companies to choose to measure many financial instruments and
      certain other items at fair value and report unrealized gains and losses in
      earnings. Such accounting is optional and is generally to be applied instrument
      by instrument. Although the Company adopted SFAS No. 159 as of January 1, 2008,
      the Company has not yet elected the fair value option for any items permitted
      under SFAS No. 159.




**Note
      6 —Notes Payable Stockholders**




As
      of
      September 30, 2008, the Company is in default of the terms on several
      outstanding notes payable with two of its note holders with principal balance
      due of $8,757,737 and accrued interest of $2,477,979. Mr. Winfield and his
      affiliates account for $8,729,986 of principal and $2,462,183 of interest of
      the
      aforementioned amounts. Because we are in default, the entire note balances
      of
      the defaulted notes have been recorded as current liabilities.





The
      notes
      and related interest in default as of September 30, 2008 are as
      follows:





Issued date
            
            Principal
            
            InterestWinfield
                -*Convertible
                Debentures*
            
            
            10/30/04
            
            $
            687,928
            
            
            52,211Other
                -*Convertible
                Debentures*
            
            
            10/30/04
            
            
            27,751
            
            
            15,796Winfield
                -*Mandatory
                Redemption Payment*
            
            
            3/31/05
            
            
            4,972,058
            
            
            836,552Winfield
                –*Promissory
                Note*
            
            
            10/4/2003
            
            
            250,000
            
            
            46,875Winfield
                -*Convertible
                Debentures*
            
            
            ‘06
                – ‘07
            
            
            1,620,000
            
            
            664,864Winfield
                –*Promissory
                Note*
            
            
            7/15/2005
            
            
            1,200,000
            
            
            861,681Total
            
            
            
            
            $
            8,757,737
            
            
            2,477,979


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          10
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          of Contents*




**Note
      7 —Convertible Debentures and Notes Payable**




*Convertible
      Debentures-Investors*




We
      completed a private placement of securities transaction during March 2004
      (the “March Offering”). In connection with the offering, we received gross
      proceeds of $10 million from a group of accredited institutional and individual
      investors.





The
      8%
      convertible notes matured in November 2007. We must make monthly payments
      of 102% of 1/20 th of the
      initial principal amount, together with accrued interest. We have the option
      to
      repay such amounts in shares of our common stock at a conversion rate equal
      to
      85% of the average of the five lowest closing bid prices of our common stock
      during the 20 trading days preceding each payment date. We may prepay the
      outstanding principal amount by paying the holders of the notes 115% of the
      then-outstanding principal amount. Each holder of notes could have elected
      to
      convert the notes into shares of common stock at an initial conversion price
      of
      $0.20 per share, which is subject to anti-dilution adjustments. During the
      first
      20 days following the closing date, the conversion price may be reduced to
      a price equal to 70% of the average of the five lowest closing prices of our
      common stock during the 20 trading days preceding the closing date. None of
      the
      holders exercised their 20 day conversion right following the close date.




Pursuant
      to the terms of various financing instruments between Goldspring and some of
      its
      lenders have certain “favored nations” rights to either receive shares or have
      certain note conversion exercise prices reduced so that the overall equity
      issuance pricing is reduced to the same price as paid by any subsequent
      purchasers of equity and/or convertible note.  On February 20, 2008,
      Goldspring sold 50,000,000 shares of its Common Stock at $0.01 per share
      purchase price.  In lieu of triggering any and all “favored nations”
rights, the lenders have agreed to accept $.01 per share as the new maximum
      conversion price all convertible notes owned by them. At September 30, 2008
      the
      Company has principal and interest outstanding of $1,268,093 covered by this
      agreement.





*Convertible
      Debentures-Mandatory Redemption Payment*




The
      failure to deliver the shares by the Delivery Date resulted in liquidated
      damages of 1% of the note principal amount being converted per business day
      after the Delivery Date. We did not deliver the share certificates within the
      period required in the subscription agreement and as a result, in March of
      2005,
      John V. Winfield, a shareholder and note holder elected to demand payment of
      approximately $6.9 million pursuant to the mandatory redemption payment
      provisions of the subscription agreement and forfeit his right to receive the
      shares in favor of the payment.




On
      March
      31, 2005, we entered into a Settlement Agreement (“Settlement”) with the Mr.
      Winfield and agreed to convert the mandatory redemption payment into Nine
      Convertible Debentures (“the Debentures”). Accordingly, we accrued a liability
      for approximately $6.9 million and reduced our paid-in-capital account for
      approximately $3.5 million. The Debentures are subject to various covenants
      and
      conditions, including, but not limited to anti-dilution rights and protective
      rights.





*Conversion
      Rights*




The
      Debentures are convertible, in all or in part, into shares of our common stock
      (“Conversion Shares”) at any time. The conversion price shall is equal to the
      lesser of: (i) eighty-five percent (85%) of the average of the five (5) lowest
      closing bid prices of the common stock as reported by Bloomberg L.P. for the
      twenty (20) trading days preceding the date the Company was obligated to pay
      the
      mandatory redemption Payment; and (ii) eighty-five percent (85%) of the average
      of the five (5) lowest closing bid prices of the common stock as reported by
      Bloomberg L.P. for the twenty (20) trading days preceding the date of any such
      conversion; provided, however, until the effective date of the registration
      statement (see below), the conversion price shall be fifty-percent (50%) of
      the
      average of the five (5) lowest closing bid prices of the Common Stock as
      reported by Bloomberg L.P. for the twenty (20) trading days preceding the date
      of any such conversion. In no event shall the conversion price be higher than
      (i) $0.1131 and (ii) the conversion price of the convertible notes (See Note
      6),
      as adjusted from time to time, whichever is lower.




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          11
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          of Contents*





Pursuant
      to the terms of various financing instruments between Goldspring and some of
      its
      lenders have certain “favored nations” rights to either receive shares or have
      certain note conversion exercise prices reduced so that the overall equity
      issuance pricing is reduced to the same price as paid by any subsequent
      purchasers of equity and/or convertible note.  On February 20, 2008,
      Goldspring sold 50,000,000 shares of its Common Stock at $0.01 per share
      purchase price.  In lieu of triggering any and all “favored nations”
rights, the lenders have agreed to accept $.01 per share as the new maximum
      conversion price all convertible notes owned by them. At September 30, 2008
      Mr.
      Winfield and his affiliates principal and interest outstanding totaled
      $5,808,610.




*Security
      Agreement*




Pursuant
      to the terms of the Settlement Agreement, the Debentures are granted a priority
      collateralized position, second only to our note payable to the Brockbank Trust
      in substantially all of our assets. Winfield’s affiliates acquired the existing
      mortgage on the Plum Mine property from the Brockbank Trust.





*Convertible
      Notes Payable-Failure to Deliver Shares*




In
      March
      of 2005, and pursuant to our settlement with investors for our failure to
      deliver shares of our common stock upon their conversion of debentures during
      2004 (See above), we issued convertible notes payable that accrue interest
      at 8%
      and are payable in equal monthly installments including interest beginning
      April
      1, 2007. In the event of our default on the notes the interest rate increased
      to
      15%. In February 2008, we satisfied all obligations of these notes.




**$2,200,000
      Principal Amount Convertible Debenture Financing**





On
      August
      23 and 24, 2007, the Company formally entered into an agreement with several
      investors to loan $1,900,000 to the Company. In March 2008, the Company amended
      the agreement increasing the loan amount to $2,200,000. The notes evidencing
      the
      loan bear interest at the rate of 12% per annum, payable monthly on the first
      of
      each month commencing October 1, 2007, along with 1/24 of the principal amount
      of such notes on each repayment date and were issued between May 18, 2007 -
      August 24, 2007, with the second quarter notes being treated as “bridge debt”
until the loan agreement was formally signed.. The default interest is 18%
      per
      annum. The notes are also convertible into Common Stock at a 50% discount to
      market until a registration statement registering the Common Stock underlying
      the notes is effective and at a 15% discount to market thereafter. As additional
      consideration, the investors are to be issued a total of 20,000,000 warrants
      to
      purchase common stock at exercise prices based upon the same formulas as for
      conversion of the amounts due under the notes. The warrants have a term of
      five
      years from the date of the loan. The notes are secured by a lien on the assets
      of Goldspring, Inc. and a pledge of all of the interests in Plum Mine Special
      Purpose, LLC, which owns the Plum Mine operation. In connection with this loan,
      the lender has acquired the existing mortgage on the Plum Mine property from
      the
      Brockbank Trust. To date, $2,170,000 of the $2,200,000 has been funded by the
      investors. As of September 30, 2008, we had failed to make any monthly payments
      on the notes and are in default.




The
      notes
      issued as of September 30, 2008 are as follows:





Issued date
            
            Face amountWinfield
                Debenture Payable
            
            
            5/15/2007
            
            $
            300,000Winfield
                Debenture Payable
            
            
            6/21/2007
            
            
            300,000Winfield
                Debenture Payable
            
            
            8/23/2007
            
            
            300,000Longview
                Debenture Payable
            
            
            8/24/2007
            
            
            300,000Winfield
                Debenture Payable
            
            
            12/12/2007
            
            
            100,000Winfield/Longview
                Debenture Payable
            
            
            First
                Quarter 2008
            
            
            331,120Winfield/Longview
                Debenture Payable
            
            
            Second
                Quarter 2008
            
            
            538,880Total
            
            
            
            
            $
            2,170,000




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          12
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Accordingly,
      at September 30, 2008 and 2007, we classified the following convertible
      debentures as current liabilities as follows:




**September 30,****2008**
            
            **September 30,****2007**Convertible
                Debentures Payable-Investors
            
            $
            1,105,908
            
            $
            2,187,812Convertible
                Debentures Payable- Mandatory Redemption payment
            
            
            4,972,058
            
            
            5,835,688Convertible
                Debentures Payable- Failure to Deliver Shares
            
            
            —
            
            
            103,048Convertible
                Notes Payable - 2007 & 2008
            
            
            2,170,000
            
            
            2,170,000Total
            
            $
            8,247,966
            
            $
            10,296,548




Pursuant
      to the terms of various financing instruments between Goldspring and some of
      its
      lenders have certain “favored nations” rights to either receive shares or have
      certain note conversion exercise prices reduced so that the overall equity
      issuance pricing is reduced to the same price as paid by any subsequent
      purchasers of equity and/or convertible note.  On February 20, 2008,
      Goldspring sold 50,000,000 shares of its Common Stock at $0.01 per share
      purchase price.  In lieu of triggering any and all “favored nations”
rights, the lenders have agreed to accept $.01 per share as the new maximum
      conversion price all convertible notes owned by them.




**Note
      8 —Promissory Notes Payable**





*Notes
      Payable- Plum Mine*




We
      have
      note payable to a shareholder related to our purchase of the Plum Mining
      property. This note bears interest at 5% annually. The note is payable in ten
      quarterly payments through September 2007. As of September 30, 2008, we are
      in
      default on the outstanding principal of $250,000.




*Promissory
      Notes Payable—July 2005 Financing*




In
      July
      of 2005, we borrowed $1.2 million from companies controlled by John V. Winfield,
      a major investor. Proceeds from the notes were reduced by a 33.3% original
      issue
      discount and other origination fees. Net proceeds received by the Company from
      the borrowing were $740,000. The notes accrue interest at 15% per annum and
      are
      payable in monthly installments of principal and interest over a 24 month period
      with the remaining entire balance of unpaid principal and interest due on July
      15, 2008. The default interest rate is 17% per annum. The notes are
      collateralized by substantially all of the Company’s assets subject to the
      security interest of the Brockbank Trust (See Note 7). As of September 30,
      2008
      we had failed to make any monthly payments on the notes and are in default.
      Accordingly, the entire principal balance and all accrued and unpaid interest
      thereon are considered accelerated and classified as current liabilities.




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          13
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          of Contents*


*Promissory
      Notes Payable: 2007 Financing*





In
      December 2007, we completed a financing transaction with Mr. Winfield and his
      affiliates which provided us with $500,000 in funding. In consideration for
      the
      financing, we issued promissory notes with a face value of $600,000, reflecting
      an original discount of sixteen and seventeen hundreds (16.17%) percent. The
      notes evidencing the loan bear interest at the rate of 4.9% per annum, payable
      on or prior to the one year anniversary of the respective loan
      date.





*Promissory
      Notes Payable: 2008 Financing*





On
      January 31, 2008, we completed a financing transaction with Mr. Winfield and
      his
      affiliates which provided us with $500,000 in funding. In consideration for
      the
      financing, we issued promissory notes with a face value of $600,000, reflecting
      an original discount of sixteen and seventeen hundreds (16.17%) percent. The
      notes evidencing the loan bear interest at the rate of 4.9% per annum, payable
      on or prior to the one year anniversary of the respective loan
      date.





Accordingly,
      at September 30, 2008 and 2007, we classified the following notes payable as
      current liabilities as follows:





**September 30,****2008**
            
            **September 30,****2007**Promissory
                Notes Payable-July 2005 Financing
            
            $
            1,200,000
            
            $
            1,200,000Promissory
                Notes Payable-September 2005 Financing
            
            
            —
            
            
            300,000Promissory
                Notes Payable-December 2005 Financing
            
            
            —
            
            
            575,000Promissory
                Notes Payable-February 2006 Financing
            
            
            —
            
            
            250,000Promissory
                Notes Payable-March 2006 Financing
            
            
            —
            
            
            150,000Promissory
                Notes Payable-July 2007 Financing
            
            
            —
            
            
            300,000Promissory
                Notes Payable-December 2007 Financing
            
            
            600,000
            
            
            —Promissory
                Notes Payable-January 2008 Financing
            
            
            600,000
            
            
            —Total
            
            $
            2,400,000
            
            $
            2,775,000




**Note
      9 —Other Long Term Debt**




*$2,500,000
      Principal Amount Convertible Debenture Financing*





As
      of
      September 27, 2008, the Company entered into a Loan Agreement with John Winfield
      and affiliates (“Winfield”) pursuant to which Winfield has agreed to loan the
      Company $2,500,000 no later than December 31, 2008 through issuance of a series
      of secured notes (“Notes”). The Notes bear interest at the rate of 11% per
      annum, and interest is payable quarterly in either cash or Company common stock,
      at 85% of market price, at the Company’s option. The term of the Notes is five
      years from the date of issuance, and the Notes are convertible into Company
      common stock, at a conversion price of $.015 per share. The Notes are secured
      by
      a lien on all of the Company’s assets. On each of October 2008, September 2008,
      July 2008 and June 2008, Winfield lent the Company $500,000 pursuant to the
      Loan
      Agreement.





*$2,782,563
      Amended and Revised Longview LP Note on July 10, 2008*





On
      July
      10, 2008, the Company amended $2,175,000 principal amount of unsecured
      promissory notes issued to Longview Fund, L.P. through the issuance of an
      Amended and Restated Promissory Note issued by the Company in favor of Longview
      Fund, L.P. The amended terms are as follows:


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          14
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          of Contents*





Expiration
                Date:
            July
                10, 2011Accrued
                Interest
            Accrued
                interest at July 10, 2008 capitalized into the amended and revised
                note.Interest
                Rate:
            11%,
                payable in arrears in cash or stock (at a 15% discount to market
                price,
                calculated as a 5 day trailing VWAP)Conversion:
            The
                principal amount of the Note and interest thereon is convertible
                into
                Goldspring Common Stock at a price of $.0175 per share.Term
            July
                10, 2011Anti
                Dilution:
            Full
                ratchet





**Principal**
            
            **Interest**Promissory
                Notes Payable-September 2005 Financing
            
            
            300,000
            
            
            172,870Promissory
                Notes Payable-December 2005 Financing
            
            
            375,000
            
            
            211,966Promissory
                Notes Payable-February 2006 Financing
            
            
            250,000
            
            
            98,164Promissory
                Notes Payable-March 2006 Financing
            
            
            150,000
            
            
            56,237Promissory
                Notes Payable-July 2007 Financing
            
            
            300,000
            
            
            58,526Promissory
                Notes Payable-October 2007 Financing
            
            
            200,000
            
            
            —Promissory
                Notes Payable-February 2008 Financing
            
            
            600,000
            
            
            9,800Total
            
            $
            2,175,000
            
            $
            607,563





On
      February 29, 2008, we received the $500,000 balance of the financing from the
      December 11, 2007 financing agreement. In consideration for the financing,
      we
      issued promissory notes with a face value of $600,000, reflecting an original
      discount of sixteen and seventeen hundreds (16.17%) percent. The notes
      evidencing the loan bear interest at the rate of 4.9% per annum, payable on
      or
      prior to the one year anniversary of the respective loan date. On July 10,
      2008,
      the Company amended this promissory note and related outstanding interest with
      Longview Fund, L.P. through the issuance of an Amended and Restated Promissory
      Note issued by the Company in favor of Longview Fund, L.P as summarized above.





The
      aggregate total of the first nine months of 2008 financing transactions totaled
      $2,500,000.





*Notes
      Payable / Lease Obligations - Equipment Financing*




During
      2004, we purchased certain equipment and financed our purchases through GMAC,
      Ford Motor and Caterpillar Company credit agencies. Aggregated principal and
      interest due pursuant to the financings is due monthly in equal installments
      of
      $3,952, at an averaged interest rate of 7.2%. The equipment purchased is pledged
      as collateral for the debt. At September 30, 2008 and 2007, we had the following
      amounts due under the financings as follows:




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          of Contents*





**September 30,****2008**
            
            **September 30,****2007**Long-term
                Debt-Current Plum Mine
            
            $
            11,015
            
            $
            10,278Long-term
                Debt-Current Seller Note
            
            
            250,000
            
            
            397,200Long-term
                Winfield Debenture Current
            
            
            —
            
            
            —Other
                Long-term Debt-Current
            
            
            —
            
            
            33,675Total
            
            $
            261,015
            
            $
            441,153





**September 30,****2008**
            
            **September 30,****2007**Long-term
                Debt-non current Plum Mine
            
            $
            2,896
            
            $
            14,881Long-term
                Debt-non current Longview amended and restructured note
            
            $
            2,782,563
            
            
            —Long-term
                Winfield Debenture
            
            $
            1,500,000
            
            
            —Other
                Long-term Debt -Non-current
            
            $
            —
            
            
            17,082Total
            
            $
            4,285,459
            
            $
            31,963




Principal
      payments on other long-term debt related to equipment financing for the next
      four years are as follows:




2008
                (Oct – Dec)
            
            $
            3,1642009
            
            $
            10,7872009
            
            $
            —2011
                and thereafter
            
            $
            —Total
            
            $
            13,951





At
      September 30, 2008 and 2007 we classified the following notes payable as current
      liabilities as follows:




**September 30,****2008**
            
            **September 30,****2007**Convertible
                Notes Payable
            
            $
            8,247,966
            
            $
            10,296,548Promissory
                notes
            
            
            2,400,000
            
            
            2,775,000Other
                notes, current portion long-term debt
            
            
            261,015
            
            
            441,153Total
            
            $
            10,908,981
            
            $
            13,512,701




**Note
      10. Unregistered Sales of Securities**





On
      February 20, 2008, Goldspring raised $500,000 through a private placement to
      accredited investors. In consideration we issued 50,000,000 shares of our
      unregistered Common Stock at $0.01 per share purchase price.  The proceeds
      from this private placement were used to fund exploratory drilling and for
      general working capital.





In
      January 2008, our two outside directors were issued, in aggregate, twenty
      million shares of our unregistered common stock as director compensation. The
      value of the common shares at the time of issuance was $234,400, averaging
      $0.012 per share.


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          16
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Pursuant
      to the November 27, 2006 Executive Employment Agreement with Robert T. Faber,
      its CEO, Mr. Faber was issued 80,000,000 stock options at an exercise price
      of
      $.01119 on January 9, 2008. The stock options have an expiration date of January
      8, 2018.





In
      March
      2008, a consultant was issued a total of one million shares, valued at $10,000
      or $0.01 per share, for services performed.





In
      March
      2008, Dennis Anderson, the Company’s senior engineer, was issued a total of one
      million of our unregistered shares, valued at $18,690 or $0.01869 per share,
      for
      services performed. In August 2008, Mr. Anderson, pursuant his employee
      agreement, was awarded 1.5 million unregistered shares valued at $66,000 or
      $0.044 per share for achieving various milestones.





Pursuant
      to an agreement in late 2007, a vendor in March 2008 was issued 2,434,892 shares
      valued at $9,740 or $0.004 per share, for computer modeling software.





During
      the second quarter 2008, Goldspring raised $500,000 through a private placement
      to accredited investors. In consideration we issued 40,000,000 shares of our
      unregistered Common Stock at $0.015 per share purchase price and 40,000.000
      warrants.  The warrants have an exercise price of $.02 and a term of six
      years. The proceeds from this private placement were used to fund exploratory
      drilling and for general working capital.





On
      July
      18, 2008, Goldspring raised $150,000 through a private placement to accredited
      investors. In consideration we issued 10,000,000 shares of our unregistered
      Common Stock at $0.015 per share purchase price.  The proceeds from this
      private placement were used to fund exploratory drilling and for general working
      capital.





During
      the nine month period ended September 30, 2008, 3,866,667 unregistered common
      shares, valued at $79,558 or an average of $0.021 per share, were issued for
      the
      acquisition of mining claims in the Comstock Lode District.





In
      May
      2008, a vendor was issued 5.53 million shares valued at $88,480 or $0.016 per
      share, for services.





In
      August
      2008, Mr. James Golden, the Chief Operating Officer, exercised 10,000,000 stock
      options at a price of $0.0525. Mr. Golden elected the cashless exercise method
      and thus received a total of 8,165,714 unregistered shares of our common stock.
      As of the date of this report, Mr. Golden has not sold any of these
      shares.





In
      August
      2008, a vendor was issued 136,704 shares valued at $2,616 or $0.019 per share,
      for services.





**Note
      11. Subsequent Events**





On
      October 1, 2008, our four independent directors were each awarded 3 million
      stock options with an exercise price of $0.02. These options will vest equally
      over the next 8 quarters. The stock options have an expiration date of September
      30, 2018.





In
      October 2008, a vendor was issued 500,000 shares valued at $10,000 or $0.02
      per
      share, for services.


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          17
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**Item
      2.****Management’s
      Discussion and Analysis or Plan of Operations**





The
      following discussion provides information that we believe is relevant to an
      assessment and understanding of the consolidated results of operations and
      financial condition of our company. It should be read in conjunction with the
      Consolidated Financial Statements and accompanying Notes.





*Overview*




GoldSpring,
      Inc. is a North American precious metals mining company, focused in Nevada,
      with
      extensive, contiguous property in the Comstock Lode District. Our Company was
      formed in mid-2003, and we acquired two properties in the Comstock Lode before
      the end of the year. We secured permits, built an infrastructure and brought
      the
      exploration project into test mining production within a year of its
      acquisition. The Company, in 2005, began consolidating the Comstock Lode by
      acquiring additional properties in the district, expanding our footprint and
      creating opportunities for exploration and mining. We are an emerging company,
      looking to build on our success through the acquisition of other mineral
      properties in the Comstock Lode District with reserves or exploration potential.
      The Company's objectives are to increase reserves through exploration, expand
      its footprint in the Comstock, resume mining, optimize its production, and
      maximize shareholder value






In
      the
      first quarter of 2007, we temporarily ceased mining activity while we focus
      on
      delineating the ore body and exploratory drilling that should lead to a
      comprehensive mine plan and, ultimately, to more efficient mining in the
      future.




The
      Company turned a corner during 2007 with the final settlement of the Parent
      litigation and settlement of the Degerstrom litigation, both of which had caused
      a drain of financial and human resources that severely drained Company
      resources. Given the end of this litigation and continued challenges in capital
      raising efforts, the Company’s management determined that there was a need to
      reevaluate the Company’s business plan with a view toward the best way to
      maximize shareholder value and protection of our secured creditors.




In
      2008,
      the Company began to execute its new business plan with all activities focused
      on resumption of mine production in Fiscal Year 2009. The most relevant steps
      taken are as follows:





o  Expanding
      our footprint in the Comstock Region and other acquisition opportunities through
      the entry into of two letters of intent to purchase rights, which upon
      consummation, will have allowed the Company to amass one of the largest land
      positions in the Comstock District.





o  Further
      exploration in the Comstock Region to accomplish the above, including a decision
      to review the geology of the Hartford complex in a more detailed
      manner





o  Completion
      of the Plum Mine reserve report through a focus on infill drilling to allow
      completion of the Report





o  Expanding
      the permitted drilling area and updating of the mine reclamation
      bond





o  Consummation
      of loan agreement with major shareholder to borrow up to $2.5 million for
      completion of the drilling program, of which $1,500,0000 has been funded as
      of
      September 30, 2008 and efforts to secure further funding to enable
      recommencement of mine production





Adjustments
      to this analysis have been made over the past few months, all with the goal
      to
      best utilize the Company’s limited financial resources to increase shareholder
      value and to focus on raising additional capital to reinstate mining production
      operations.


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          18
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          of Contents*





Post
      the
      mine shutdown in January 2007, the Company focused its attention on ore body
      delineation, metallurgic testing and exploration. In December 2007 the Company
      commenced developmental drilling in the Hartford Complex of the Comstock Lode
      District to delineate the ore body in this area. This developmental drilling
      program is scheduled to be completed in three phases of 100 holes per phase.
      The
      goal is to define and map the ore body, complete the reserve report and related
      feasibility study and create a comprehensive mine plan.




There
      is
      also ongoing exhaustive metallurgic testing to attempt to maximize recovery
      of
      the high grade fraction of the ore and to determine optimum size to continue
      heap leaching. The Company, through this testing determined that a mill should
      be increase overall metal recovery.





The
      exploration drilling program, which is heavily dependent on funds availability,
      commenced in December 2007. The Company is scheduled to continue with the
      exploration drilling program throughout 2008 and plans to complete the first
      one
      hundred hole drilling phase by the end of December 2008. . To date, 89 holes
      have been drilled.




Assuming
      sufficient funds are raised in a timely manner, the Company’s goal would be to
      reopen the Mine during the first half of 2009. In order to resume production,
      the Company must complete a reserve report certified by a qualified third party;
      complete a comprehensive mine plan; and complete a mining schedule, all of
      which
      are dependent upon ability to secure sufficient funds to procure the mining
      fleet and related assets.





There
      are
      also risks involved in the fact that one individual and his affiliates, as
      of
      September 30, 2008, beneficially own in excess of 22% of our voting stock.
      Pursuant to financing agreements, this convertible debt holder and his
      affiliates with a 61 day notice can waive the 4.9% ownership restriction,
      allowing him to convert 100% of his convertible debt and related interest,
      which
      totals $8,833,614 at September 30, 2008, into our common shares. This group,
      if
      they waive the ownership restriction and convert all convertible debt and
      related interest into our voting common stock *,* may
      take
      actions that could conflict with your interests *.* This
      includes the election of Company directors, approval of actions generally
      requiring the approval of the holders of our voting stock, including adopting
      amendments to our articles of incorporation and bylaws and approving mergers,
      certain acquisitions or sales of all or substantially all of our assets, which
      could delay or prevent someone from acquiring or merging with us or limit the
      ability of our other stockholders to approve transactions that they may deem
      to
      be in their best interests.




***Results
      of Operations and Operational Plan***




Our
      Comstock Lode Mine, which is located in Storey County, Nevada, went into test
      mining production in late third quarter 2004. We have not established reserves
      on this exploration project. Therefore, all of our activities on this property
      are considered test mining or exploratory in nature. In November 2005, we
      retained mining engineer Jim Golden, who became our COO in 2006, to conduct
      a
      comprehensive review of all aspects of the Comstock Lode Mine operation,
      including the overall mine plan, with the objective of further improving
      efficiency, increasing production, and reducing costs. Furthermore, TechBase
      of
      Colorado, with the help of our consultants, is expected to complete a detailed
      mine plan and a reserve report for the Comstock Lode Project in the fourth
      quarter 2008 or first quarter 2009. We believe that these steps coupled with
      our
      exploratory drilling of the Hartford Complex will improve our overall
      performance at the Comstock Lode Mine.




We
      had
      planned to commence our exploratory drilling program in mid 2007 if capital
      resources allowed; however, due to insufficient funds, this was delayed until
      the December 2007. In late 2007, we retained Dwight Juras, Ph. D. geologist,
      to
      assist in overseeing our exploration program at the Comstock Lode Mine and
      in
      the Comstock Lode district. Mr. Juras has over thirty years of diverse
      geological and exploration experience in the mining industry. He has worked
      for
      several major mining companies. We have allocated a budget of $2,000,000 to
      explore and develop our claims at the Comstock Lode Project. Exploratory
      drilling started in late 2007 and is scheduled to continue throughout 2008.
      Initial drilling has been in the Hartford Complex, and drilling consists of
      surface mine drilling down to a depth of 400 feet and covers approximately
      40
      acres. We intend to target our exploration toward expanding our mineralized
      material inventory at our Hartford Complex property in the Comstock Lode
      District and toward developing new mineral properties in the Comstock. The
      successful location of additional mineralized material on the existing property
      would allow us to expand the size and the lifespan of the Comstock Lode mining
      project, exclusive of new property acquisitions. It is our belief that we
      possess an advantage with our status as likely the only heap leach gold mining
      permit holder in the area. This permit is relatively difficult to obtain, and
      it
      is one that we can expand to include new areas in the event we locate and wish
      to process new deposits.




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          19
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          of Contents*





Among
      the
      exploration and business development activities that are in
      process:





·
            Ore
                body delineation





·
            Reserve
                definition





·
            Completion
                of drilling and reserve report





·
            Development
                of comprehensive mine plan from exploration
                results





·
            Increase
                of ore reserves





·
            Augment
                ability to mine and operate at more efficient
                levels





·
            Intent
                to resume mine operations after completion of the reserve report
                and the
                comprehensive mine plan.





·
            Expansion
                of existing footprint in the Comstock region (which was largely
                accomplished through the in process DWC and Sutro Tunnel
                transactions)




Expansion
                of team of experts to study geology and metallurgy, as well as develop
                mine plan, define reserves and complete initial reserve
                report




Secure
                funds to complete drilling





The
      Company hired Orbit Garant Drilling to perform exploration and developmental
      drilling at the Comstock project, and four holes were drilled by the end of
      December, with third party laboratory testing yielding encouraging ore grades
      from samples tested from the first four holes. The Company also hired two mining
      engineers and a Ph. D. geologist as consultants to its team to further augment
      its expertise in all facets of mining, including metallurgy. In order to fund
      its exploration efforts, the Company, since early December 2007, has raised
      in
      excess of $4,650,000 (of which $4,150,000 has been funded as of September 30,
      2008) in capital to finance the exploratory drilling.





**First
      Nine Months of 2008 Developments**





The
      Company has drilled a total of 89 holes in its 100 hole Phase 1exploratory
      program through October 2008 at the Hartford Complex. The purpose of this
      program is to define the boundaries of the ore bodies and to produce a
      comprehensive reserve report and mine plan by the end of the 2008 calendar
      year.
      The total estimated cost of this plan is $2,000,000 of which $1,357,000 has
      been
      expended to date. As of September 30, 2008, $1,500,000 has already been received
      of the total $2.5 million committed by a related party in new loans to us
      through the end of 2008.  Initial
      report results are encouraging. The initial resource report released in
      September after obtaining 3 rd party
      assays on 38 drill holes completed to date plus assay results from 450 holes
      from prior drill campaigns indicated a resource of 4,926,000 tons grading 0.080
      ounces per ton gold containing 392,000 ounces at a cutoff grade of 0.030 ounces
      per ton. The resource is highlighted by 930,000 tons grading 0.209 ounces per
      ton gold containing 194,000 ounces of gold using 0.10 ounces per ton gold cutoff
      grade. A reserve report is expected to be completed during the fourth quarter
      of
      2008 or first quarter 2009. The Company intends to expand the exploration
      program beyond the Hartford Complex in the fourth quarter of 2008.


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          20
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All
      of
      the assays referenced herein and the data derived there from have been performed
      and analyzed by American Assay of Reno, Nevada, a laboratory independent of
      GoldSpring, utilizing industry standard analytical methods.




In
      addition to the drilling program, the Company is continuing to work on the
      completion of a comprehensive mine plan. The results of the drilling program,
      combined with the mine plan, will form the basis for a reserve report. The
      Company completed its initial resource report in the third quarter 2008.
      Completing the mine plan and the initial reserve report and obtaining the
      required funding are the key elements in the Company’s plan to return to
      production in 2009. In determining the optimum time to resume production, the
      Company will seek advice from its team of mining industry experts.





The
      Company continued to expand its footprint in the Comstock Lode in the first
      nine
      months of 2008. During the nine month period, the company acquired or staked
      approximately 71 new claims, bringing its total claims in the area to
      approximately 250. The average claim covers an area of 20 acres. In addition,
      the Company acquired mineral leases on 16 unpatented mineral claims, 6 patented
      mineral claims and 84 acres of mineral rights on private land. The Company
      intends to acquire additional properties and claims in the Comstock Lode region
      through the remainder of 2008 if suitable financing can be
      arranged.





*DWC
      Resources Acquisition*




On
      August
      13, 2008, Goldspring, Inc. (the “Company”) entered into a binding letter of
      intent to purchase certain property owned by DWC Resources, Inc. in Storey
      County, Nevada. The purchase price is $7,500,000, but is subject to adjustment
      pursuant to the results of a fairness opinion and/or appraisal to be obtained
      by
      the Company. The purchase price will be paid through issuance of a $7,500,000
      promissory note which shall bear interest at the rate of 9% per year with
      quarterly interest payments due throughout the term of the note which is 5
      years. The purchased assets include patented and unpatented lode mining claims
      owned by DWC Resources, Inc. in the Comstock Lode district. The letter of intent
      also provides for the payment of royalties ranging from 2% - 6% of “net smelter
      returns” based upon the price of gold per ounce and a 1% royalty to be paid to
      the party which sold the subject property to DWC Resources in 2007. There is
      also a commitment to expend a minimum of $250,000 per year on exploration by
      the
      Company for five years.


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          21
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*Sutro
      Tunnel Sublease*




The
      Company simultaneously entered into a binding letter of intent to sublease
      the
      Sutro Tunnel Lease dated January 1, 2008 between Sutro Tunnel Co. and John
      Winfield or his nominee. The purchase price for the sublease is $2,000,000
      (which is subject to adjustment upon receipt of a third party fairness
      opinion/appraisal) payable pursuant to the issuance of a $2,000,000 promissory
      note which shall bear interest at the rate of 9%per year with quarterly interest
      payments due throughout the term of the note which is 5 years. The letter of
      intent also provides for the payment of royalties ranging from 6% - 8% of “net
      smelter returns” based upon the price of gold per ounce and a 1% royalty to be
      paid to Winfield if Winfield provides an acceptable buyout of the Sutro
      property. The Company is also required to fulfill lessee’s obligations under the
      Sutro Tunnel Lease with regard to payment of royalties and exploration
      expenditures.




With
      the
      appointment of two new directors in the first quarter of 2008 (Rob Faber, the
      Company’s CEO, and Scott Jolcover, a former Company employee with significant
      mining experience in the region), the Company commenced the task of rebuilding
      its Board, which lost several independent Directors in early 2007. The Company
      further complemented its Board by the third quarter appointments of independent
      directors, Jonathan Jaffrey and Robert Reseigh. Mr. Jaffrey’s strong financial
      background and Mr. Reseigh’s strong mining background greatly augment the
      expansion in depth of expertise on the Board and with their appointments; the
      Board is now comprised of a majority of independent directors.





In
      early
      March 2008, the Company appointed a new metallurgical team with resources and
      expertise geared toward efficiency maximization in anticipation of
      recommencement of production, which was scheduled for the second half of 2008
      and due to funding delays, which have been remedied, is scheduled to commence
      in
      2009. The Company secured $4,500,000 in half of 2008 for further drilling and
      general corporate expenses and $150,000 in the third quarter of which $4,150,000
      has been funded as of September 30, 2008 with the balance being funded by the
      end of calendar year 2008.





The
      Company was also successful in extending several notes with Longview Fund,
      LP.
      On September 30, 2008, Longview extended the maturity date on three promissory
      notes issued to it by either the Company or its subsidiary, Plum Mine Special
      Purpose, LLC (“Plum Mine”), to September 30, 2010, with a principal amount
      totaling approximately $1.0 million.




***Comparative
      Financial Information***





Below
      we
      set forth a summary of comparative financial information the three months and
      nine months ended September 30, 2008 and 2007.




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          22
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          of Contents*




***Comparative
      Financial Information***





*Three
      Months Ended September 30, 2008*





**Quarter****ended****September****30, 2008**
            
            **Quarter****ended****September****30, 2007**
            
            **Difference**Revenue
            
            $
            —
            
            $
            804
            
            $
            (804
            )Depletion
                and amortization
            
            
            60,000
            
            
            81,688
            
            
            (21,688
            )Reclamation,
                Exploration and Test Mining Expense
            
            
            974,430
            
            
            127,882
            
            
            846,548General
                and Administration
            
            
            429,767
            
            
            24,237
            
            
            405,530Consulting
                and Professional Service
            
            
            83,026
            
            
            44,021
            
            
            39,005Derivative
                Change in fair value
            
            
            —
            
            
            (75,103
            )
            
            (75,103
            )Interest
                Expense
            
            
            723,698
            
            
            775,082
            
            
            (51,384
            )Other,
                net
            
            
            —
            
            
            —
            
            
            —Net
                Loss
            
            $
            (2,270,921
            )
            
            (977,003
            )
            $
            1,292,310




During
      the first quarter 2007, we decided to temporarily cease mining operation
      allowing us to focus on delineating the ore body and exploratory drilling.
      Mining activities continue to be suspended and thus there were no precious
      metals sold during the third quarter 2008.





Test
      Mining Expenses in the three months ended September 30, 2008 were $846,548
      more
      than in the three months ended September 30, 2007. The expense increase reflects
      our exploratory drilling program which commenced in December 2007.




General
      and administrative expenses for the three months ended September 30, 2008 were
      $405,530 more than for the three months ended September 30, 2007. The increase
      in G&A reflects the impact of the implementation of SFAS (Statement of
      Financial Accounting Standards) No. 123R Share Based Compensation, specifically
      the stock options granted to the directors and a stock grant to an employee
      of
      the Company.




Consulting
      and professional service fees were $39,005 more for the three months ended
      September 30, 2008 than for the three months ended September 30, 2007. The
      increase is mainly due to an increase in accounting and legal fees.





Derivative
      Change in fair value for the three months ended September 30, 2008 was $75,103
      less than for the three months ended September 30, 2007. This decrease is due
      to
      quarterly adjustment of embedded derivatives.




Interest
      expense for the three months ended September 30, 2008 was $51,384 less than
      for
      the three months ended September 30, 2007. This variance reflects the issuance
      of additional lower interest bearing notes and the Longview July 2006 amended
      and restructured note bears interest at a lower rate. At September 30, 2008,
      our
      Company had approximately $15,194,440 of outstanding debt bearing an average
      interest rate of 19%, and at September 30, 2007, our Company had approximately
      $13,573,211 of outstanding debt bearing an average interest rate of 23%.


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          23
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          of Contents*





*Nine
      Months Ended September 30, 2008*




**Nine months****ended****September****30,2008**
            
            **Nine months****ended****September****30, 2007**
            
            **Difference**Revenue
            
            $
            —
            
            $
            350,595
            
            $
            (350,595
            )Depletion
                and amortization
            
            
            180,000
            
            
            225,578
            
            
            (45,578
            )Reclamation,
                Exploration and Test Mining Expense
            
            
            2,415,831
            
            
            670,950
            
            
            1,744,881General
                and Administration
            
            
            1,532,774
            
            
            304,366
            
            
            1,228,408Consulting
                and Professional Service
            
            
            141,985
            
            
            180,666
            
            
            (38,681
            )Derivative
                Change in fair value
            
            
            130,604
            
            
            (335,995
            )
            
            466,599Interest
                Expense
            
            
            2,053,008
            
            
            2,379,383
            
            
            (326,375
            )Other,
                net
            
            
            (551,907
            )
            
            —
            
            
            (551,907
            )Net
                Loss
            
            $
            (5,902,295
            )
            
            (3,074,353
            )
            $
            2,827,942




During
      the nine months ended September 30, 2008, we did not sell any precious metals
      compared to 536 ounces of gold, at an average price $650, that was sold during
      the nine months ended September 30, 2007. During the January 2007, we decided
      to
      temporarily cease mining operation allowing us to focus on delineating the
      ore
      body and exploratory drilling. Mining activities continue to be suspended,
      until
      we complete our exploratory drill program at the Hartford Complex and we
      complete our resource report and our mine plan. We anticipate mine production
      to
      begin during 2009.




Test
      Mining Expenses in the nine months ended September 30, 2008 were $898,333 more
      than in the nine months ended September 30, 2007. The expense increase reflects
      our exploratory drilling program which commenced in December 2007.





General
      and administrative expenses for the nine months ended September 30, 2008 were
      $1,228,408more than for the nine months ended September 30, 2007. The increase
      in G&A reflects the impact of the implementation of SFAS (Statement of
      Financial Accounting Standards) No. 123R Share Based Compensation, specifically
      the stock options granted to the officers and directors of the Company and
      the
      stock grant given to the Company’s outside directors and a Company employee.




Consulting
      and professional service fees were $38,681 less for the nine months ended
      September 30, 2008 than for the nine months ended September 30, 2007. The
      decrease is mainly due to the settlement of the N.A. Degerstrom litigation
      in
      December 2007.





Derivative
      Change in fair value for the nine months ended September 30, 2008 was $466,599
      more than for the nine months ended September 30, 2007. This increase is due
      to
      our quarterly review of embedded derivatives.





Interest
      expense for the nine months ended September 30, 2008 was $326,375 less than
      for
      the nine months ended September 30, 2007. This variance reflects the issuance
      of
      additional lower interest bearing notes and the Longview July 2006 amended
      and
      restructured note bears interest at a lower rate. At September 30, 2008, our
      Company had approximately $15,194,440 of outstanding debt bearing an average
      interest rate of 18%, and at September 30, 2007, our Company had approximately
      $13,573,211 of outstanding debt bearing an average interest rate of
      23%.





Other,
      net for the nine months ended September 30, 2008 was $655,907 less than in
      the
      nine months ended September 30, 2007. This amount primarily reflects adjustments
      to debt obligations.


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          24
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          of Contents*




***Liquidity
      and Capital Resources***




We
      are
      actively seeking additional capital to meet our working capital needs and to
      grow our business. We recognize that our cash resources are limited. Our
      continued existence and plans for future growth depend on our ability to obtain
      the capital necessary to operate, through the generation of revenue or the
      issuance of additional debt or equity. In 2007, we raised an aggregate of
      $1,700,000 through three financing transactions. In the first nine months of
      2008, we completed additional financing transactions, which provided us with
      $4,150,000 in net funding. We have also have commitments $500,000 of additional
      net funding for the fourth quarter of 2008. While this additional funding may
      meet our immediate working capital needs, if we are not able to generate
      sufficient revenues and cash flows or obtain additional or alternative funding,
      we will be unable to continue as a going concern. We have yet to realize an
      operating profit at our Plum Mine location at which there is currently no
      production. We do not anticipate recommencing mining activities until the first
      or second quarter of 2009, so we will be dependent upon third party and related
      party financings for working capital until at least the third quarter of 2009.
      As disclosed in the report of our independent registered public accounting
      firm
      in our financial statements included in this Form 10-KSB for the year ended
      December 31, 2007, our recurring losses and negative cash flow from operations
      raise substantial doubt about our ability to continue as a going concern.





At
      the
      date of filing, we have specific commitments for additional financing for up
      to
      $500,000 from a related party; however, we have no further financing commitments
      above the $500,000, and additional capital will be necessary to implement our
      revised business plan. We are diligently seeking additional sources of funding.
      Additionally, without additional funding, it is unlikely that we will be able
      to
      remain in operation long enough to have the time necessary to fully implement
      the business plan.




Once
      we
      recommence production our operations will be significantly affected by changes
      in the market price of gold. Gold prices can fluctuate widely and may be
      affected by numerous factors, such as expectations for inflation, levels of
      interest rates, currency exchange rates, central bank sales, forward selling
      or
      other hedging activities, demand for precious metals, global or regional
      political and economic crises, and production costs in major gold-producing
      regions. The aggregate effect of these factors, all of which are beyond our
      control, is impossible for us to predict. The demand for and supply of gold
      affect gold prices, but not necessarily in the same manner as supply and demand
      affect the prices of other commodities. The supply of gold consists of a
      combination of new mineral production and existing stocks of bullion and
      fabricated gold held by governments, public and private financial institutions,
      industrial organizations, and private individuals. As the amount produced in
      any
      single year constitutes a small portion of the total potential supply of gold,
      normal variations in current production do not have a significant impact on
      the
      supply of gold or on its price. If gold prices decline substantially, it could
      adversely affect the realizable value of our assets and potential future results
      of operations and cash flow.




**Item
      3.****Quantitative
      and Qualitative Disclosures About Market Risks**





An
      investment in our common stock involves risk. You should carefully consider
      the
      following risk factors.





Our
      exposure to market risk for changes in interest rates relates primarily to
      the
      market-driven increase or decrease in interest rates, and the impact of those
      changes on the Company’s ability to realize a return on invested or available
      funds. We ensure the safety and preservation of our invested principal funds
      by
      limiting default risk, market risk and reinvestment risk. We mitigate default
      risk by investing in short term high-credit investment grade securities and/or
      commercial checking and savings accounts.





**ITEM
      4. CONTROLS AND PROCEDURES**




**A. 
      Disclosure**




As
      of the
      end of the period covered by this Quarterly Report on Form 10-Q, management
      performed, with the participation of our Chief Executive Officer and Chief
      Financial Officer, an evaluation of the effectiveness of our disclosure controls
      and procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange
      Act.
      Our disclosure controls and procedures are designed to ensure that information
      required to be disclosed in the report we file or submit under the Exchange
      Act
      is recorded, processed, summarized, and reported within the time periods
      specified in the SEC’s forms, and that such information is accumulated and
      communicated to our management including our Chief Executive Officer and our
      Chief Financial Officer, to allow timely decisions regarding required
      disclosures. Based on the evaluation and the identification of the significant
      deficiencies in our internal control over financial reporting described below,
      which we do not believe to be material weaknesses, our Chief Executive Officer
      and our Chief Financial Officer concluded that, as of June 30, 2008, our
      disclosure controls and procedures were effective.




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**B.
       Internal Control over Financial Reporting**




Our
      certifying officers (principal executive and accounting officers) are
      responsible for establishing and maintaining disclosure controls and procedures
      (as defined in Exchange Act Rules 13a-14 and 15d-14). Our Chief Executive
      Officer and Chief Financial Officer have:




a)
            designed
                a framework to evaluate the effectiveness of our internal control
                over our
                financial reporting as required by paragraph (c) of Rule 13a-15 or
                Rule
                15d-15 through the use of ongoing review and checks and balances
                for all
                transactions and decisions; we have designed disclosure controls
                and
                procedures to ensure that material information relating to our affairs,
                including our consolidated subsidiaries, is made known to us by others
                within those entities, particularly during the period in which this
                quarterly report is being prepared;





b)
            evaluated
                the effectiveness of our disclosure controls and procedures as of
                the
                filing date of this quarterly report (the "Evaluation Date");
                and




c)
            presented
                in this quarterly report our conclusions about the effectiveness
                of the
                disclosure controls and procedures based on our evaluation as of
                the
                Evaluation Date.





Management's
      assessment of the effectiveness of our internal control over financial reporting
      is for the year ended December 31, 2007. In making this assessment, our
      management used the criteria set forth by the Committee of Sponsoring
      Organizations of the Treadway Commission (COSO) in *Internal
      Control - Integrated Framework* and *Internal
      Control over Financial Reporting-Guidance for Smaller Public
      Companies* *.*





There
      have been no changes in our internal controls or in other factors that could
      affect these controls including any corrective actions with regard to
      deficiencies and material weaknesses. As there has been no change in our
      internal controls since disclosure in our Form 10-KSB for the year ending
      December 31, 2007, filed with the Securities and Exchange Commission, on April
      15, 2008, we reiterate the following significant deficiencies which also existed
      as of December 31, 2007.




We
      have
      identified conditions as of September 30, 2008 that we believe are significant
      deficiencies in internal controls that include: 1) a lack of segregation of
      duties in accounting and financial reporting activities; and 2) the lack of
      a
      sufficient number of qualified accounting personnel. We previously had added
      a
      clerk to assist with duties; however, we do not believe this is sufficient
      to
      remedy the deficiencies. We are currently seeking to add an outside consultant
      to assist with CFO and controller - level duties, and intend to retain such
      a
      consultant by December 31, 2008. We believe that the presence this additional
      qualified accounting personnel will allow us to effectively correct the lack
      of
      segregation of duties in accounting and financial reporting
      activities.




Our
      former Chief Financial Officer became our Chief Executive Officer in September
      2004. Our Company has not hired another individual to act as Chief Financial
      Officer. We believe the absence of a full-time Chief Financial Officer or Chief
      Accounting Officer has resulted in a significant deficiency with respect to
      the
      lack of qualified accounting personnel. We have been able to mitigate this
      deficiency by engaging outside consultants to assist the Company in its
      accounting activities, but believe that the only effective long-term solution
      to
      our accounting needs is to hire a qualified CFO. Due to our budgetary
      constraints and the small size of our company we are uncertain as to when we
      will be able to accomplish this; hence, our endeavor to hire a consultant is
      critical.




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We
      do not
      believe that these deficiencies constitute material weaknesses because of (i)
      additional accounting support through the office consolidation with Plum Mine
      and (ii) the use of outside consultants.




We
      are
      also in the process of taking additional corrective measures to further remedy
      the deficiencies in future periods.




There
      have been no changes during the quarter ended September 30, 2008 in our
      Company's internal control over financial reporting identified in connection
      with the evaluation required by Exchange Act Rules 13a-15(d) and 15d-15(d)
      that
      have material affected, or are reasonably likely to materially affect, our
      internal controls over our financial reporting.




**PART
      II - OTHER INFORMATION**





**Item
      1.****Legal
      Proceedings**





From
      time
      to time, we are involved in lawsuits, claims, investigations and proceedings
      that arise in the ordinary course of business. There are no matters pending
      that
      we expect to have a material adverse impact on our business, results of
      operations, financial condition or cash flows.




**Item
      1A.****Risk
      Factors**





An
      investment in our common stock involves risk. You should carefully consider
      the
      following risk factors, in addition to those discussed elsewhere in this report,
      in evaluating our company, its business, and prospects. The following risks
      could cause our business, financial condition, and operating results to be
      materially and adversely affected.




***We
      have limited resources and our inability to obtain additional financing could
      negatively affect our growth and success.***




We
      have
      incurred substantial losses since our inception, and we are currently
      experiencing a cash flow deficiency from operations. Our current cash flow
      and
      capital resources are limited, and we may require additional funds to pursue
      our
      business. We may not be able to secure further financing in the future. If
      we
      are not able to obtain additional financing on reasonable terms, we may not
      be
      able to execute our business strategy, conduct our operations at the level
      desired, or even to continue business.




***We
      have received a qualified report from our independent
      auditors***




The
      report by the independent auditors on our financial statements indicates that
      our financial statements have been prepared assuming that we will continue
      as a
      going concern. The report indicates that our recurring losses from operations
      and working capital deficit raise substantial doubt about our ability to
      continue as a going concern.





***Inability
      to raise sufficient funds to increase growth***





Our
      recent financings have only provided capital to continue existing operations
      but
      not to continue significant exploration and growth. Without the ability to
      attract sufficient amounts of capital at any one time, it is unlikely that
      we
      can achieve profitability in the foreseeable future.




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***We
      have invested capital in high-risk mineral projects where we have not conducted
      sufficient exploration and engineering studies*** *.*




We
      have
      invested capital in various mineral properties and projects in North America
      where we may not have conducted sufficient exploration and engineering studies
      to minimize the risk of project failure to the extent that is typical in the
      mining industry. Our mineral projects involve high risks because we have not
      invested substantial sums in the characterization of mineralized material,
      geologic analysis, metallurgical testing, mine planning, and economic analysis
      to the same extent that other mining companies might deem reasonable. Standard
      industry practice calls for a mining company to prepare a formal mine plan
      and
      mining schedule and have these documents reviewed by a third party specialist.
      We do not have a formal mine plan that has been reviewed by a third party
      specialist. Because we have not established proven or probable reserves, there
      can be no assurance that we will be able to produce sufficient gold to recover
      our investment and operating costs.




***Our
      corporate officers lack sufficient technical training and mining
      experience.***




Our
      corporate officers lack technical training and experience in operating a mine.
      Although Jim Golden, our COO, is a licensed mining engineer, with substantial
      mining experience, we may lack sufficient qualified support personnel to
      effectively manage our mining operation. Without sufficient training or
      experience in all areas, our corporate officers may not be fully aware of all
      of
      the specific requirements related to working within the mining industry. The
      decisions of our corporate officers may not take into account standard
      engineering or managerial approaches that operating mining companies commonly
      use. Consequently, our operations, earnings, and ultimate financial success
      could suffer irreparable harm due to corporate officers’ lack of experience in
      the mining industry.




***We
      will not be successful unless we recover precious metals and sell them for
      a
      profit.***




Our
      success depends on our ability to recover precious metals, process them, and
      successfully sell them for more than the cost of production. The success of
      this
      process depends on the market prices of metals in relation to our costs of
      production. We may not always be able to generate a profit on the sale of gold
      or other minerals because we can only maintain a level of control over our
      costs
      and have no ability to control the market prices. The total cash costs of
      production at any location are frequently subject to great variation from year
      to year as a result of a number of factors, such as the changing composition
      of
      ore grade or mineralized material production, and metallurgy and exploration
      activities in response to the physical shape and location of the ore body or
      deposit. In addition costs are affected by the price of commodities, such as
      fuel and electricity. Such commodities are at times subject to volatile price
      movements, including increases that could make production at certain operations
      less profitable. A material increase in production costs or a decrease in the
      price of gold or other minerals could adversely affect our ability to earn
      a
      profit on the sale of gold or other minerals.




***We
      do not have proven or probable reserves, and there is no assurance that the
      quantities of precious metals we produce will be sufficient to recover our
      investment and operating costs.***




Our
      success depends on our ability to produce sufficient quantities of precious
      metals to recover our investment and operating costs. We do not have proven
      or
      probable reserves. There can be no assurance that our exploration activities
      will result in the discovery of sufficient quantities of mineralized material
      to
      lead to a commercially successful operation.




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***The
      costs of our exploration and acquisition activities are substantial, and there
      is no assurance that the quantities of minerals we discover or acquire will
      justify commercial operations or replace reserves established in the
      future.***




Mineral
      exploration, particularly for gold and other precious metals, is highly
      speculative in nature, involves many risks, and frequently is nonproductive.
      There can be no assurance that our exploration and acquisition activities will
      be commercially successful. Once gold mineralization is discovered, it may
      take
      a number of years from the initial phases of drilling until production is
      possible, during which time the economic feasibility of production may change.
      Substantial expenditures are required to acquire existing gold properties,
      to
      establish ore reserves through drilling and analysis, to develop metallurgical
      processes to extract metal from the ore, and in the case of new properties,
      to
      develop the processing facilities and infrastructure at any site chosen for
      mineral exploration. There can be no assurance that any gold reserves or
      mineralized material that may be discovered or acquired in the future will
      be in
      sufficient quantities or of adequate grade to justify commercial operations
      or
      that the funds required for mineral production operation can be obtained on
      a
      timely or reasonable basis. Mineral exploration companies must continually
      replace mineralized material or reserves depleted by production. As a result,
      there can be no assurance that we will be successful in replacing any reserves
      or mineralized material acquired or established in the future.




***The
      price of gold fluctuates on a regular basis and a downturn in price could
      negatively impact our operations and cash flow.***




Our
      operations are significantly affected by changes in the market price of gold.
      Gold prices can fluctuate widely and may be affected by numerous factors, such
      as expectations for inflation, levels of interest rates, currency exchange
      rates, central bank sales, forward selling or other hedging activities, demand
      for precious metals, global or regional political and economic crises, and
      production costs in major gold-producing regions, such as South Africa and
      the
      former Soviet Union. The aggregate effect of these factors, all of which are
      beyond our control, is impossible for us to predict. The demand for and supply
      of gold affect gold prices, but not necessarily in the same manner as supply
      and
      demand affect the prices of other commodities. The supply of gold consists
      of a
      combination of new mineral production and existing stocks of bullion and
      fabricated gold held by governments, public and private financial institutions,
      industrial organizations, and private individuals. As the amount produced in
      any
      single year constitutes a small portion of the total potential supply of gold,
      normal variations in current production do not have a significant impact on
      the
      supply of gold or on its price. If gold prices decline substantially, it could
      adversely affect the realizable value of our assets and potential future results
      of operations and cash flow.




***The
      use of hedging instruments may not prevent losses being realized on subsequent
      price decreases or may prevent gains being realized from subsequent price
      increases.*** ****




We
      may
      from time to time sell some future production of gold pursuant to hedge
      positions. If the gold price rises above the price at which future production
      has been committed under these hedge instruments, we will have an opportunity
      loss. However, if the gold price falls below that committed price, our revenues
      will be protected to the extent of such committed production. In addition,
      we
      may experience losses if a hedge counterparty defaults under a contract when
      the
      contract price exceeds the gold price. As of the date of filing of this report,
      we have no open hedge positions.




***Since
      our business consists of exploring for or acquiring gold prospects, the drop
      in
      the price of gold will negatively affect our asset values, cash flows, potential
      revenues and profits.***




We
      plan
      to pursue opportunities to acquire properties with gold mineralized material
      or
      reserves with exploration potential. The price that we pay to acquire these
      properties will be influenced, in large part, by the price of gold at the time
      of the acquisition. Our potential future revenues are expected to be derived
      from the production and sale of gold from these properties or from the sale
      of
      some of these properties. The value of any gold reserves and other mineralized
      material, and the value of any potential mineral production therefrom, will
      vary
      in direct proportion to variations in those mineral prices. The price of gold
      has fluctuated widely as a result of numerous factors beyond our control. The
      effect of these factors on the price of gold, and therefore the economic
      viability of any of our projects, cannot accurately be predicted. Any drop
      in
      the price of gold would negatively affect our asset values, cash flows,
      potential revenues, and profits.




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***We
      compete with other mineral exploration and mining
      companies***




We
      compete with other mineral exploration and mining companies or individuals,
      including large, established mining companies with substantial capabilities
      and
      financial resources, to acquire rights to mineral properties containing gold
      and
      other minerals. There is a limited supply of desirable mineral lands available
      for claim staking, lease, or other acquisition. There can be no assurance that
      we will be able to acquire mineral properties against competitors with
      substantially greater financial resources than we have.




***Our
      activities are inherently hazardous and any exposure may exceed our insurance
      limits or may not be insurable.***




Mineral
      exploration and operating activities are inherently hazardous. Operations in
      which we have direct or indirect interests will be subject to all the hazards
      and risks normally incidental to exploration and production of gold and other
      metals, any of which could result in work stoppages, damage to property, and
      possible environmental damage. The nature of these risks is such that
      liabilities might exceed any liability insurance policy limits. It is also
      possible that the liabilities and hazards might not be insurable, or we could
      elect not to insure ourselves against such liabilities because of the high
      premium costs, in which event, we could incur significant costs that could
      have
      a material adverse effect on our financial condition.




***We
      do not have proven or probable reserves, and our mineral calculations are only
      estimates; any material change may negatively affect the economic viability
      of
      our properties.***




Substantial
      expenditures are required to acquire existing gold properties with established
      reserves or to establish proven or probable reserves through drilling and
      analysis. We do not anticipate expending sums for additional drilling and
      analysis to establish proven or probable reserves on our properties. We drill
      in
      connection with our mineral exploration activities and not with the purpose
      of
      establishing proven and probable reserves. Therefore, our activity must be
      called exploration or test mining. While we estimate the amount of mineralized
      material we believe exists on our properties, our calculations are estimates
      only, subject to uncertainty due to factors, including the quantity and grade
      of
      ore, metal prices, and recoverability of minerals in the mineral recovery
      process. There is a great degree of uncertainty attributable to the calculation
      of any mineralized material, particularly where there has not been significant
      drilling, mining, and processing. Until the mineralized material located on
      our
      properties is actually mined and processed, the quantity and quality of the
      mineralized material must be considered as an estimate only. In addition, the
      quantity of mineralized material may vary depending on metal prices. Any
      material change in the quantity of mineralized material may negatively affect
      the economic viability of our properties. In addition, there can be no assurance
      that we will achieve the same recoveries of metals contained in the mineralized
      material as in small-scale laboratory tests or that we will be able to duplicate
      such results in larger scale tests under on-site conditions or during
      production.




***Our
      operations are subject to strict environmental regulations, which result in
      added costs of operations and operational delays.***




Our
      operations are subject to environmental regulations, which could result in
      additional costs and operational delays. All phases of our operations are
      subject to environmental regulation. Environmental legislation is evolving
      in
      some countries and jurisdictions in a manner that may require stricter standards
      and enforcement, increased fines and penalties for non-compliance, more
      stringent environmental assessments of proposed projects, and a heightened
      degree of responsibility for companies and their officers, directors, and
      employees. There is no assurance that any future changes in environmental
      regulation will not negatively affect our projects.




***We
      have no insurance for environmental problems.***




Insurance
      against environmental risks, including potential liability for pollution or
      other hazards as a result of the disposal of waste products occurring from
      exploration and production, has not been available generally in the mining
      industry. We have no insurance coverage for most environmental risks. In the
      event of a problem, the payment of environmental liabilities and costs would
      reduce the funds available to us for future operations. If we are unable to
      fund
      fully the cost of remedying an environmental problem, we might be required
      to
      enter into an interim compliance measure pending completion of the required
      remedy.




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***We
      are subject to federal laws that require environmental assessments and the
      posting of bonds, which add significant costs to our operations and delays
      in
      our projects.***




The
      Bureau of Land Management requires that mining operations on lands subject
      to
      its regulation obtain an approved plan of operations subject to environmental
      impact evaluation under the National Environmental Policy Act. Any significant
      modifications to the plan of operations may require the completion of an
      environmental assessment or Environmental Impact Statement prior to approval.
      Mining companies must post a bond or other surety to guarantee the cost of
      post-mining reclamation. These requirements could add significant additional
      cost and delays to any mining project undertaken by us. Our mineral exploration
      operations are required to be covered by reclamation bonds deemed adequate
      by
      regulators to cover these risks. We believe we currently maintain adequate
      reclamation bonds for our operations.




***Changes
      in state laws, which are already strict and costly, can negatively affect our
      operations by becoming stricter and costlier.***




At
      the
      state level, mining operations in Nevada are regulated by the Nevada Division
      of
      Environmental Protection, or NDEP. Nevada state law requires our Nevada projects
      to hold Nevada Water Pollution Control Permits, which dictate operating controls
      and closure and post-closure requirements directed at protecting surface and
      ground water. In addition, we are required to hold Nevada Reclamation Permits
      required under Nevada law. These permits mandate concurrent and post-mining
      reclamation of mines and require the posting of reclamation bonds sufficient
      to
      guarantee the cost of mine reclamation. Other Nevada regulations govern
      operating and design standards for the construction and operation of any source
      of air contamination and landfill operations. Any changes to these laws and
      regulations could have a negative impact on our financial performance and
      results of operations by, for example, requiring changes to operating
      constraints, technical criteria, fees or surety requirements.




***Title
      claims against our properties could require us to compensate parties, if
      successful, and divert management’s time from
      operations.***




There
      may
      be challenges to our title in the properties in which we hold material
      interests. If there are title defects with respect to any of our properties,
      we
      might be required to compensate other persons or perhaps reduce our interest
      in
      the effected property. The validity of unpatented mineral claims, which
      constitute most of our holdings in the United States, is often uncertain and
      may
      be contested by the federal government and other parties. The validity of an
      unpatented mineral claim, in terms of both its location and its maintenance,
      depends on strict compliance with a complex body of federal and state statutory
      and decisional law. Although we have attempted to acquire satisfactory title
      to
      our properties, we have not obtained title opinions or title insurance with
      respect to the acquisition of the unpatented mineral claims. While we have
      no
      pending claims or litigation pending contesting title to any of our properties,
      there is nothing to prevent parties from challenging our title to any of our
      properties. While we believe we have satisfactory title to our properties,
      some
      risk exists that some titles may be defective or subject to challenge. Also,
      in
      any such case, the investigation and resolution of title issues would divert
      management’s time from ongoing exploration programs.




***We
      have never paid a cash dividend on our common stock and do not expect to pay
      cash dividends in the foreseeable future.***




We
      have
      never paid cash dividends, and we do not plan to pay cash dividends in the
      foreseeable future. Consequently, your only opportunity to achieve a return
      on
      your investment in us will be if the market price of our common stock
      appreciates and you sell your shares at a profit. There is no assurance that
      the
      price of our common stock that will prevail in the market after this offering
      will ever exceed the price that you pay.




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***Our
      business depends on a limited number of key personnel, the loss of whom could
      negatively affect us.*** ****




Robert
      Faber, Chief Executive Officer, President and acting-Chief Financial Officer
      is
      important to our success. If he becomes unable or unwilling to continue in
      his
      present position, our business and financial results could be materially
      negatively affected.




***If
      we fail to adequately manage our growth, we may not be successful in growing
      our
      business and becoming profitable*** **.**




We
      plan
      to expand our business and the number of employees over the next 12 months.
      In
      particular, we intend to hire additional operational personnel. Our inability
      to
      hire and retain additional qualified employees could have a negative impact
      on
      our chances of success.




***The
      issuance of securities by us may not have complied with or violated federal
      and
      state securities laws and, as a result, the holders of these shares and warrants
      may have rescission rights.*** ****




Securities
      issued by us may not have complied with applicable federal and state securities
      laws, the result of which is that the holders of these securities may have
      rescission rights that could require us to reacquire the
      securities.




***Outstanding
      convertible securities and warrants may result in substantial
      dilution.***




At
      September 30, 2008, we had outstanding 3,276,118,830 shares of common stock.
      In
      addition, we had outstanding convertible notes and various common stock purchase
      warrants. At September 30, 2008, these notes and warrants were convertible
      into
      or exercisable for a total of approximately 1.3 billion additional shares of
      our
      common stock, subject to further anti-dilution provisions.




***Our
      stock is a penny stock and trading of our stock may be restricted by the SEC’s
      penny stock regulations, which may limit a stockholder’s ability to buy and sell
      our stock.***




Our
      stock
      is a penny stock. The Securities and Exchange Commission has adopted Rule 15g-9,
      which generally defines “penny stock” to be any equity security that has a
      market price (as defined) less than $5.00 per share or an exercise price of
      less
      than $5.00 per share, subject to certain exceptions. Our securities are covered
      by the penny stock rules, which impose additional sales practice requirements
      on
      broker-dealers that sell to persons other than established customers and
“accredited investors.” The term “accredited investor” refers generally to
      institutions with assets in excess of $5,000,000 or individuals with a net
      worth
      in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly
      with their spouse. The penny stock rules require a broker-dealer, prior to
      a
      transaction in a penny stock not otherwise exempt from the rules, to deliver
      a
      standardized risk disclosure document in a form prepared by the SEC, which
      provides information about penny stocks and the nature and level of risks in
      the
      penny stock market. The broker-dealer also must provide the customer with
      current bid and offer quotations for the penny stock, the compensation of the
      broker-dealer and its salesperson in the transaction, and monthly account
      statements showing the market value of each penny stock held in the customer’s
      account. The bid and offer quotations, and the broker-dealer and salesperson
      compensation information, must be given to the customer orally or in writing
      prior to effecting the transaction and must be given to the customer in writing
      before or with the customer’s confirmation. In addition, the penny stock rules
      require that, prior to a transaction in a penny stock not otherwise exempt
      from
      these rules; the broker-dealer must make a special written determination that
      the penny stock is a suitable investment for the purchaser and receive the
      purchaser’s written agreement to the transaction. These disclosure requirements
      may have the effect of reducing the level of trading activity in the secondary
      market for the stock that is subject to these penny stock rules. Consequently,
      these penny stock rules may affect the ability of broker-dealers to trade our
      securities. We believe that the penny stock rules discourage investor interest
      in and limit the marketability of our common stock. NASD sales practice
      requirements may also limit a stockbroker’s ability to buy or sell our
      stock.




-
          32
          -
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          of Contents*


In
      addition to the “penny stock” rules promulgated by the Securities and Exchange
      Commission, the NASD has adopted rules that require that in recommending an
      investment to a customer, a broker-dealer must have reasonable grounds for
      believing that the investment is suitable for that customer. Prior to
      recommending speculative low priced securities to their non-institutional
      customers, broker-dealers must make reasonable efforts to obtain information
      about the customer’s financial status, tax status, investment objectives, and
      other information. Under interpretation of these rules, the NASD believes that
      there is a high probability that speculative low priced securities will not
      be
      suitable for at least some customers. The NASD requirements make it more
      difficult for broker-dealers to recommend that their customers buy our common
      stock, which may limit your ability to buy or sell our stock and have an adverse
      effect on the market for our shares.




**Item
      2.****Unregistered
      Sales of Equity Securities and Use of Proceeds**





On
      February 20, 2008, Goldspring raised $500,000 through a private placement to
      accredited investors. In consideration we issued 50,000,000 shares of our
      unregistered Common Stock at $0.01 per share purchase price.  The proceeds
      from this private placement were used to fund exploratory drilling and for
      general working capital.





In
      January 2008, our two outside directors were issued, in aggregate, twenty
      million shares of our unregistered common stock as director compensation. The
      value of the common shares at the time of issuance was $234,400, averaging
      $0.012 per share.





Pursuant
      to the November 27, 2006 Executive Employment Agreement with Robert T. Faber,
      its CEO, and Mr. Faber was issued 80,000,000 stock options at an exercise price
      of $.01119 on January 9, 2008. The stock options have an expiration date of
      January 8, 2018.





In
      March
      2008, a consultant was issued a total of one million shares, valued at $10,000
      or $0.01 per share, for services performed.





In
      March
      2008, Dennis Anderson, the Company’s senior engineer, was issued a total of one
      million of our unregistered shares, valued at $18,690 or $0.01869 per share,
      for
      services performed. In August 2008, Mr. Anderson, pursuant his employee
      agreement, was awarded 1.5 million unregistered shares valued at $66,000 or
      $0.044 per share for achieving various milestones.





Pursuant
      to an agreement in late 2007, a vendor in March 2008 was issued 2,434,892 shares
      valued at $9,740 or $0.004 per share, for computer modeling software.





During
      the second quarter 2008, Goldspring raised $500,000 through a private placement
      to accredited investors. In consideration we issued 40,000,000 shares of our
      unregistered Common Stock at $0.015 per share purchase price and 40,000.000
      warrants.  The warrants have an exercise price of $.02 and a term of six
      years. The proceeds from this private placement were used to fund exploratory
      drilling and for general working capital.





On
      July
      18, 2008, Goldspring raised $150,000 through a private placement to accredited
      investors. In consideration we issued 10,000,000 shares of our unregistered
      Common Stock at $0.015 per share purchase price.  The proceeds from this
      private placement were used to fund exploratory drilling and for general working
      capital.




-
          33
          -
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          of Contents*


During
      the nine month period ended September 30, 2008, 3,866,667 unregistered common
      shares, valued at $79,558 or an average of $0.021 per share, were issued for
      the
      acquisition of mining claims in the Comstock Lode District.





In
      May
      2008, a vendor was issued 5.53 million shares valued at $88,480 or $0.016 per
      share, for services.





In
      August
      2008, Mr. James Golden, the Chief Operating Officer, exercised 10,000,000 stock
      options at a price of $0.0525. Mr. Golden elected the cashless exercise method
      and thus received a total of 8,165,714 unregistered shares of our common stock.
      As of the date of this report, Mr. Golden has not sold any of these
      shares.





In
      August
      2008, a vendor was issued 136,704 shares valued at $2,616 or $0.019 per share,
      for services.





On
      October 1, 2008, our four independent directors were each awarded 3 million
      stock options with an exercise price of $0.02. These options will vest equally
      over the next 8 quarters. The stock options have an expiration date of September
      30, 2018.





In
      October 2008, a vendor was issued 500,000 shares valued at $10,000 or $0.02
      per
      share, for services.





**Item
      3.****Defaults
      Upon Senior Securities**





As
      of
      September 30, 2008, the Company is in default of the terms on several
      outstanding notes payable with two its note holders with principal balance
      due
      of $8,729,987 and accrued interest of $2,477,979. Mr. Winfield and his
      affiliates account for $8,729,987 of principal and $2,462,183 of interest of
      the
      aforementioned amounts. Because we are in default, the entire note balances
      of
      the defaulted notes have been recorded as current liabilities.




**Item
      4.****Submission
      of Matters to a Vote of Security Holders**





Not
      applicable.





**Item
      5.****Other
      Information**




None.




**Item
      6.****Exhibits
      and Reports on Form 8-K**





(a)
            The
                following documents are filed as part of this
                Report:




(1)
            Financial
                statements filed as part of this
                Report:




Consolidated
                Balance Sheet as of September 30,
                2008(Unaudited)Consolidated
                Statement of Operations for the three-month
                periods ended September 30, 2008 and 2007 (Unaudited)Consolidated
                Statement of Cash Flows for the three-month
                periods ended September 30, 2008 and 2007 (Unaudited)Notes
                to Financial Statements




-
          34
          -
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          of Contents*




(2) Exhibits
      filed as part of this Report:





Exhibit
              Number
            
            Exhibit31.1
            
            Certification
                of Chief Executive Officer and Chief Financial Officer pursuant to
                Rule
                13a-14(a) and Rule 15d-14(a), promulgated under the Securities Exchange
                Act of 1934, as amended.32.1
            
            Certification
                pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
                906 of
                the Sarbanes-Oxley Act of 2002




(b) 
      Reports filed on Form 8-K during the quarter ended September 30,
      2008:




Current
      Report of Form 8-K filed on August 15, 2008


Current
      Report of Form 8-K filed on September 9, 2008


Current
      Report of Form 8-K filed on September 9, 2008





**SIGNATURES**





Pursuant
      to the requirements of the Securities Exchange Act of 1934, the registrant
      has
      duly caused this report to be signed on its behalf by the undersigned, thereunto
      duly authorized.





GOLDSPRING,
                INC.
              (Registrant)Date:
                November 10, 2008
            By:
            /s/
                Robert T. FaberName:
            Robert
                T. FaberTitle:
            President
                and Chief Executive OfficerBy:
            /s/
                Robert T. FaberName:
            Robert
                T. FaberTitle:
            Chief
                Financial Officer




-
          35
          -
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          of
          Contents*






APPENDIX
      A




**Summary
      Exploratory Drilling Results Table**


The
        chart
        below details the results of the assay testing, which was conducted by an
        independent third-party laboratory. The encouraging assay results received
        from
        the drilling program have expanded the surface area and the depth of the
        identified body of mineralized material in the Hartford Complex. To date,
        the
        Company’s drilling program results at the Hartford Complex since December 2007
        are summarized in the table below.
  Gold GradeDrill Hole
              
              
              
              (ounces per ton
              
              Silver GradeNumber
              
              Intercept in Feet
              
              Au)
              
              (ounces per ton Ag)56
              
              90’-105’
                135’-155’
                270’-425’
              
              .018
                .023
                .017
              
              .43
                .06
                .1855
              
              435’-445’
                750’-765’
              
              .191
                .070
              
              .1
                .0454
              
              345’-355’
                385’-410’
                450’-605’
              
              .104
                .016
                .026
              
              .17
                .05
                .0253
              
              315’-355’
                450’-470’
                505’-520’
                635’-675’
              
              .043
                .033
                .048
                .022
              
              .93
                .08
                .23
                .0952
              
              0’-25’
                225-260’
              
              .018
                .033
              
              .69
                .1351
              
              70’-90’
                120’-170’
                190’-255’
                290’-325’
              
              .046
                .120
                .022
                .015
              
              .16
                .52
                .35
                1.1350
              
              55’-120’
                175’-295’
              
              .041
                .024
              
              .23
                .4649
              
              0’-50’
                155’-275’
                Bottom
                  in ore @ 275’
              
              .128
                .068
              
              .43
                .8348
              
              0’-50’
                165’-290’
                310’-355
              
              .018
                .025
                .119
              
              .73
                .15
                .3747
              
              0’-90’
              
              0.041
              
              0.8646
              
              0’-85’
              
              0.040
              
              0.8145
              
              0’-15’
                105’-115’
                220’-305’
                325’-350
              
              0.012
                0.019
                0.058
                0.031
              
              0.50
                0.06
                0.46
                0.0744
              
              90’-95’
                165’-255’
                255’-345’
              
              0.257
                0.012
                0.077
              
              1.64
                0.08
                0.8243
              
              215’-275’
                230’-235’
                345’-430’
                355’-370’
              
              0.172
                1.559
                0.064
                0.242
              
              1.19
                6.35
                0.06
                0.20
   A-1
 *Table
            of
            Contents*
   42
                
                335’-410’
                
                0.010
                
                0.4341
                
                615’-715
                
                Low grade ore
                
                Low grade ore40
                
                10’-25’
                  135’-155’
                  185’-270’
                  295’-405’
                  540’-560’
                
                0.030
                  0.137
                  0.015
                  0.037
                  0.025
                
                0.17
                  0.61
                  0.04
                  0.61
                  0.3139
                
                210’-260’
                  235’-240’
                  325’-340’
                
                0.238
                  1.937
                  0.043
                
                0.16
                  0.70
                  0.6838
                
                0’-120’
                  120’-170’
                  170’-210’
                
                0.031
                  0.009
                  0.04
                
                0.43
                  0.37
                  1.0037
                
                0’-20’
                  60’-170’
                  190’-235’
                  400’-425’
                
                0.087
                  0.025
                  0.031
                  0.021
                
                0.83
                  0.38
                  0.73
                  0.3536
                
                0’-155’
                
                0.032
                
                0.5335
                
                95’-110’
                  175’-195’
                  205’-255
                  285’-315’
                  330’-400’
                  410’-520’
                  585’-625’
                
                0.191
                  0.019
                  0.044
                  0.025
                  0.025
                  0.173
                  0.010
                
                0.18
                  0.20
                  0.31
                  0.08
                  0.09
                  1.08
                  0.0434
                
                0’-15’
                  170’-190’
                  320’-380’
                  400’-420’
                  465’-560’
                
                0.030
                  0.033
                  0.026
                  0.016
                  0.014
                
                0.63
                  0.16
                  0.16
                  0.35
                  0.5233
                
                0’-10’
                  195’-205’
                  305’-335’
                  365’-420’
                  540’-550’
                
                0.055
                  0.025
                  0.021
                  0.029
                  0.020
                
                0.95
                  0.12
                  0.41
                  0.58
                  0.4432
                
                0’-15’
                  30’-40’
                  160’-170’
                  240’-250’
                  310’-325’
                  365’-380’
                  395’-420’
                
                0.019
                  0.05
                  0.025
                  0.045
                  0.015
                  0.025
                  0.025
                
                0.16
                  0.21
                  0.72
                  0.08
                  0.50
                  0.02
                  0.0231
                
                0’-60’
                  195’-265’
                  295’-315’
                  420’-460’
                  555’-585’
                
                0.039
                  0.026
                  0.019
                  0.020
                  0.017
                
                0.27
                  0.33
                  0.25
                  0.15
                  0.7430
                
                0’-15’
                  225’-370’
                  390’-420’
                  575’-635’
                
                0.053
                  0.041
                  0.014
                  0.080
                
                1.67
                  0.12
                  0.06
                  0.52
   A-2
 *Table
            of
            Contents*
   29
              
              0’-55’
                280’-350’
                375’-410’
                570’-630’
              
              0.037
                0.017
                0.060
                0.020
              
              0.63
                0.31
                0.22
                0.8928
              
              0’-15’
                405’-485’
                495’-570’
                600’-640’
              
              0.040
                0.113
                0.017
                0.078
              
              0.63
                2.09
                0.19
                0.3227
              
              0’-15’
                65’-210’
                255’-290’
                310’-410
              
              0.023
                0.083
                0.051
                0.020
              
              0.78
                0.63
                0.60
                0.6526
              
              0’-20’
                140’-150’
                175’-255’
                315’-495’
              
              0.044
                0.063
                0.044
                0.040
              
              0.94
                0.56
                0.38
                1.1325
              
              0’-25’
                240’-375’
                395’-435’
              
              0.025
                0.065
                0.029
              
              0.88
                0.41
                0.6924
              
              0’-60’
                135’-150’
                165’-230’
                315’-330’
                525’-595’
              
              0.033
                0.034
                0.029
                0.014
                0.015
              
              0.80
                0.06
                0.50
                0.09
                0.1423
              
              0’-25’
                150’-235’
                285’-420’
              
              0.052
                0.103
                0.022
              
              0.64
                0.54
                1.0322
              
              75’-235’
                260’-300’
              
              0.058
                0.030
              
              0.78
                1.0421
              
              0’-20’
                30’-40’
                70’-140
              
              0.012
                0.134
                0.040
              
              0.24
                1.57
                0.4320
              
              210’-305’
              
              0.046
              
              0.6119
              
              70’-75’
                390’-395’
              
              0.013
                0.015
              
              0.04
                0.0418
              
              0’-45’
                140’-180’
                205’-230’
              
              0.010
                0.045
                0.013
              
              0.13
                0.63
                0.5617
              
              0’-40’
                260’-265’
              
              0.010
                0.022
              
              0.29
                1.6316
              
              60’-130’
              
              0.031
              
              0.5015
              
              290’-300’
              
              0.088
              
              0.07385’-535
              
              0.047
              
              0.07555’-755’
              
              0.032
              
              0.2514
              
              10’-25’
              
              0.054
              
              1.74115’-320’
              
              0.118
              
              1.32325’-365’
              
              0.029
              
              3.5313
              
              10’-
                  40’
              
              0.034
              
              0.7255’-80’
              
              0.109
              
              0.75210’-225’
              
              0.082
              
              0.08290’-330
              
              0.091
              
              0.2312
              
              0’-70’
              
              0.025
              
              0.34
   A-3
 *Table
            of
            Contents*
   11
              
              0’-60’
              
              0.012
              
              0.18445’-460’
              
              0.062
              
              0.1410
              
              175’-265’
              
              0.043
              
              0.47285’-350’
              
              0.076
              
              1.2809
              
              20’-400’
              
              0.109
              
              0.6608
              
              40’-55’
              
              0.037
              
              0.1785’-150’
              
              0.060
              
              1.0407
              
              15’
                  - 185’
              
              0.068
              
              1.506
              
              35’-55’
              
              0.029
              
              1.27120’-130’
              
              0.164
              
              1.19135’-215’
              
              0.033
              
              0.29245’-275’
              
              0.037
              
              1.29275’-325’
              
              0.003
              
              1.7105
              
              30’-65’
              
              0.038
              
              0.90120’-265’
              
              0.045
              
              1.2704
              
              50’-60’
              
              0.006
              
              0.0903
              
              55’-90’
              
              0.031
              
              0.8102
              
              160’
                  - 275’
              
              0.074
              
              0.6901
              
              65’
                  - 135’
              
              0.052
              
              0.64
 A-4