# EDGAR Filing Document

**Accession Number:** 0001710350
**File Stem:** 0001213900-25-076608
**Filing Date:** 2025-8
**Character Count:** 390999
**Document Hash:** 14c8c976f0c58ef1f85fd10bbbae13de
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001213900-25-076608.hdr.sgml**: 20250814

**ACCESSION NUMBER**: 0001213900-25-076608

**CONFORMED SUBMISSION TYPE**: 10-Q

**PUBLIC DOCUMENT COUNT**: 110

**CONFORMED PERIOD OF REPORT**: 20250630

**FILED AS OF DATE**: 20250814

**DATE AS OF CHANGE**: 20250814

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Bit Digital, Inc
- **CENTRAL INDEX KEY:** 0001710350
- **STANDARD INDUSTRIAL CLASSIFICATION:** FINANCE SERVICES [6199]
- **ORGANIZATION NAME:** 09 Crypto Assets
- **EIN:** 000000000
- **STATE OF INCORPORATION:** E9
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 10-Q
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 001-38421
- **FILM NUMBER:** 251218633

**BUSINESS ADDRESS:**
- **STREET 1:** 31 HUDSON YARDS, FLOOR 11
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10001
- **BUSINESS PHONE:** 212-463-5121

**MAIL ADDRESS:**
- **STREET 1:** 31 HUDSON YARDS, FLOOR 11
- **CITY:** NEW YORK
- **STATE:** NY
- **ZIP:** 10001

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** Golden Bull Ltd
- **DATE OF NAME CHANGE:** 20170626

?xml version='1.0' encoding='ASCII'?

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM 10-Q**

**☒&nbsp;&nbsp;&nbsp;&nbsp; QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**

For the quarterly period ended **<u>June 30, 2025</u>**

**☐&nbsp;&nbsp;&nbsp;&nbsp; TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT**

For the transition period from __________ to __________

Commission file number: **<u>001-38421</u>**

---

| |
|:---|
| <br> **BIT DIGITAL, INC.** |
| (Exact name of registrant as specified in its charter) |

---

---

| | |
|:---|:---|
| **Cayman Islands** | **98-1606989** |
| (State or other jurisdiction of<br> Company or organization) | (I.R.S. Employer<br> Identification No.) |
| **31 Hudson Yards, Floor 11, New York, NY** | **10001** |
| (Address of principal executive offices) | (Zip Code) |

---

Registrant's telephone number: **<u>(212) 463-5121</u>**

Securities registered under Section 12(b) of the Exchange Act:

---

| | | |
|:---|:---|:---|
| Title of each class | Trading Symbol | Name of each exchange on which registered |
| **Ordinary Shares, $.01 par value** | **BTBT** | **Nasdaq Capital Market** |

---

Check whether the Issuer (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒&nbsp;&nbsp;&nbsp;&nbsp; No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒&nbsp;&nbsp;&nbsp;&nbsp; No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐ Accelerated filer ☐ <br> Non-accelerated Filer ☒ Smaller reporting company ☒ <br> Emerging growth company ☐

If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐&nbsp;&nbsp;&nbsp;&nbsp; No ☒

Applicable only to Corporate Issuers:

Indicate the number of shares outstanding of each of the issuers' classes of common stock, as of the latest practicable date: 321,432,722 Ordinary Shares as of August 13, 2025.

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| **PART I** | **PART I** |  |
| Item 1. | [Financial Statements.](#a_001) | 1 |
| Item 2. | [Management's Discussion and Analysis of Financial Condition and Results of Operations.](#a_002) | 43 |
| Item 3. | [Quantitative and Qualitative Disclosures about Market Risk.](#a_003) | 73 |
| Item 4. | [Controls and Procedures.](#a_004) | 73 |
| [**PART II**](#a_005) | [**PART II**](#a_005) |  |
| Item 1. | [Legal Proceedings.](#a_006) | 74 |
| Item 1A. | [Risk Factors.](#a_013) | 74 |
| Item 2. | [Unregistered Sales of Equity Securities and Use of Proceeds.](#a_007) | 74 |
| Item 3. | [Defaults Upon Senior Securities.](#a_008) | 74 |
| Item 4. | [Mine Safety Disclosures.](#a_009) | 74 |
| Item 5. | [Other Information.](#a_010) | 74 |
| Item 6. | [Exhibits.](#a_011) | 75 |
| [**SIGNATURES**](#a_012) | [**SIGNATURES**](#a_012) | 76 |

---

i

**Item 1. Financial Statements and Supplementary Data**

**BIT DIGITAL, INC.**

**UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS**

**As of June 30, 2025 and December 31, 2024**

**(Expressed in US dollars, except for the number of shares)**

---

| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,**<br>**2024** |
| **ASSETS** |  |  |
| **Current Assets** |  |  |
| Cash and cash equivalents | $181165847 | $95201335 |
| Restricted cash | 3732792 | 3732792 |
| Accounts receivable | 6491562 | 5267863 |
| USDC | 515242 | 411413 |
| Digital assets | 91214450 | 161377344 |
| Net investment in lease - current | 3517921 | 2546519 |
| Loans receivable | 400000 | 400000 |
| Other current assets | 26715156 | 28319669 |
| **Total Current Assets** | **313752970** | **297256935** |
| **Non-Current Assets** |  |  |
| Deposits for property, plant, and equipment | 21066026 | 39059707 |
| Property, plant, and equipment, net | 253920936 | 107302458 |
| Goodwill | 20190268 | 19383291 |
| Intangible assets | 13210056 | 13028730 |
| Operating lease right-of-use assets | 44799045 | 14967569 |
| Net investment in lease - non-current | 9367633 | 6782479 |
| Investment securities | 38953792 | 30797365 |
| Deferred tax asset | 92962 | 89246 |
| Other non-current assets | 8065349 | 9579884 |
| **Total Non-Current Assets** | **409666067** | **240990729** |
| **Total Assets** | $**723419037** | $**538247664** |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| **Current Liabilities** |  |  |
| Accounts payable | $2087887 | $3418172 |
| Current portion of deferred revenue | 11640667 | 30698458 |
| Current portion of operating lease liability | 5487628 | 4529291 |
| Dividend payable |  | 800000 |
| Income tax payable | 1936542 | 1595308 |
| Other payables and accrued liabilities | 18943717 | 13985375 |
| **Total Current Liabilities** | **40096441** | **55026604** |
| **Non-Current Liabilities** |  |  |
| Non-current portion of deferred revenue | 28046 | 73494 |
| Non-current portion of operating lease liability | 38257665 | 9276926 |
| Long-term income tax payable | 3196204 | 3196204 |
| Deferred tax liability | 8259351 | 6409915 |
| Other long-term liabilities | 392686 | 785372 |
| **Total Non-Current Liabilities** | **50133952** | **19741911** |
| **Total Liabilities** | **90230393** | **74768515** |
| **Commitments and Contingencies – Note 19** |  |  |
| **Shareholders' Equity** |  |  |
| Preferred shares, $0.01 par value, 10,000,000 and 10,000,000 shares authorized, 1,000,000 and 1,000,000 shares issued and outstanding as of June 30, 2025 and December 31, 2024, respectively | 9050000 | 9050000 |
| Ordinary shares, $0.01 par value, 340,000,000 and 340,000,000 shares authorized, 284,182,277 and 179,255,191 shares issued, 284,052,291 and 179,125,205 shares outstanding as of June 30, 2025 and December 31, 2024, respectively | 2841823 | 1792548 |
| Treasury stock, at cost, 129,986 and 129,986 shares as of June 30, 2025 and December 31, 2024, respectively | (1171679) | (1171679) |
| Additional paid-in capital | 762157571 | 553583437 |
| Accumulated deficit | (141047106) | (98209661) |
| Accumulated other comprehensive income (loss) | 1358035 | (1565496) |
| **Total Shareholders' Equity** | **633188644** | **463479149** |
| **Total Liabilities and Shareholders' Equity** | $**723419037** | $**538247664** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BIT DIGITAL, INC.**

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)**

**For the Three and Six Months Ended June 30, 2025 and 2024**

**(Expressed in US dollars, except for the number of shares)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Revenues** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | $6631838 | $16079893 | $14408801 | $37971653 |
| &nbsp;&nbsp;&nbsp;Cloud services | 16595315 | 12497197 | 31437601 | 20566781 |
| &nbsp;&nbsp;&nbsp;Colocation services | 1729004 | - | 3367413 | - |
| &nbsp;&nbsp;&nbsp;ETH staking | 365332 | 373812 | 925973 | 699558 |
| &nbsp;&nbsp;&nbsp;Other | 337930 | 92504 | 618497 | 192252 |
| **Total Revenues** | **25659419** | **29043406** | **50758285** | **59430244** |
| **Operating costs and expenses** |  |  |  |  |
| Cost of revenue (exclusive of depreciation and amortization shown below) |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | (6075585) | (10537841) | (12199474) | (23522773) |
| &nbsp;&nbsp;&nbsp;Cloud services | (6391120) | (4595301) | (12479120) | (7752628) |
| &nbsp;&nbsp;&nbsp;Colocation services | (687880) | - | (1199882) | - |
| &nbsp;&nbsp;&nbsp;ETH staking | (29633) | (24456) | (62201) | (40889) |
| Depreciation and amortization expenses | (8223538) | (8346633) | (15465527) | (15192582) |
| General and administrative expenses | (19667364) | (5480519) | (27937121) | (11436259) |
| Gains (losses) on digital assets | 27154706 | (11538949) | (22050521) | 34193628 |
| **Total operating expenses** | **(13920414)** | **(40523699)** | **(91393846)** | **(23751503)** |
| **Income (loss) from operations** | **11739005** | **(11480293)** | **(40635561)** | **35678741** |
| Net loss from disposal of property and equipment | - | - | (333620) | - |
| Other income, net | 4726754 | 68974 | 395011 | 4569147 |
| **Total other income, net** | **4726754** | **68974** | **61391** | **4569147** |
| &nbsp;&nbsp;&nbsp;**Income (loss) before income taxes** | **16465759** | **(11411319)** | **(40574170)** | **40247888** |
| Income tax expenses | (1591557) | (541781) | (2263273) | (2119131) |
| &nbsp;&nbsp;&nbsp;**Net income (loss)** | $**14874202** | $**(11953100)** | $**(42837443)** | $**38128757** |
| **Other comprehensive income (loss)** |  |  |  |  |
| Foreign currency translation adjustment | 3428201 | - | 2923531 | - |
| **Comprehensive income (loss)** | $**18302403** | $**(11953100)** | **(39913912)** | **38128757** |
| **Weighted average number of ordinary share outstanding** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 206889826 | 128053586 | 194355223 | 121362883 |
| &nbsp;&nbsp;&nbsp;Diluted | 208817806 | 128053586 | 194355223 | 122374103 |
| **Earnings (loss) per share** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | $0.07 | $(0.09) | $(0.22) | $0.31 |
| &nbsp;&nbsp;&nbsp;Diluted | $0.07 | $(0.09) | $(0.22) | $0.31 |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BIT DIGITAL, INC.** 

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF EQUITY**

**For the Three and Six Months Ended June 30, 2025 and 2024**

**(Expressed in U.S. dollars, except for the number of shares)**

---

| | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Preferred Shares** | **Preferred Shares** | **Common Shares** | **Common Shares** | **Treasury** | **Treasury** | **Treasury** | **Treasury** | | **Retained<br> Earnings<br> (Accumulated** | **Retained<br> Earnings<br> (Accumulated** | | |
|  | **Shares** | **Amount** | **Shares** | **Par Value** | **Shares** | **Shares** | **Par Value** | **Par Value** | **Additional<br> paid - in**<br>**capital** | **deficit)** | **deficit)** | **Accumulated<br> other<br> comprehensive**<br>**(loss) income** | **Total<br> Stockholders'**<br>**Equity** |
| **Balance, December 31, 2023** | **1000000** | **9050000** | **107291827** | **1074218** | **(129986** | **(129986)** | **(1171679** | **(1171679)** | **290660609** | **(146909292** | **(146909292)** | **-** | **152703856** |
| Share-based compensation expense |  | - |  | - |  |  |  | - | 106199 |  | - | - | 106199 |
| Issuance of common stock/At-the-market offering, net of offering costs | - | - | 12871934 | 128719 |  |  |  | - | 38523688 |  | - | - | 38652407 |
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | 100000 | 1000 |  |  |  | - | 275000 |  | - | - | 276000 |
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | 700000 | 7000 |  |  |  | - | 2058000 |  | - | - | 2065000 |
| Share-based compensation in connection with issuance of ordinary shares to director | - | - | 40000 | 400 |  |  |  | - | 110000 |  | - | - | 110400 |
| Cumulative effect upon adoption of ASU 2023-08 |  | - |  | - |  |  |  | - | - |  | 21193820 | - | 21193820 |
| Net income | - | - | - | - |  | - |  | - | - |  | 50081857 | - | 50081857 |
| **Balance, March 31, 2024** | **1000000** | **9050000** | **121003761** | **1211337** |  | **(129986)** |  | **(1171679)** | **331733496** |  | **(75633615)** | **-**  | **265189539** |
| Share-based compensation expense |  | - |  | - |  |  |  | - | **40661** |  | - |  | **40661** |
| Issuance of common stock/At-the-market offering, net of offering costs | - | - | **16237292** | **162373** |  |  |  | - | **41459137** |  | - |  | **41621510** |
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | **120000** | **1200** |  |  |  | - | **381875** |  | - |  | **383075** |
| Net loss | - | - | - | - |  | - |  | - | - |  | **(11953100)** | - | **(11953100)** |
| **Balance, June 30, 2024** | **1000000** | **9050000** | **137361053** | **1374910** |  | **(129986)** |  | **(1171679)** | **373615169** |  | **(87586715)** | **-**  | **295281685** |
| **Balance, December 31, 2024** | **1000000** | **9050000** | **179125205** | **1792548** |  | **(129986)** |  | **(1171679)** | **553583437** |  | **(98209661)** | **(1565496)** | **463479149** |
| Share-based compensation expense |  | - |  | - |  |  |  | - | 219255 |  | - | - | 219255 |
| Issuance of common stock/At-the-market offering, net of offering costs | - | - | 3149887 | 31499 |  |  |  | - | 10145739 |  | - | - | 10177238 |
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | 21250 | 216 |  |  |  | - | 48050 |  | - | - | 48266 |
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | 450000 | 4500 |  |  |  | - | 1638000 |  | - | - | 1642500 |
| Share-based compensation in connection with issuance of ordinary shares to director | - | - | 20000 | 200 |  |  |  | - | 67600 |  | - | - | 67800 |
| Other comprehensive loss |  | - |  | - |  |  |  | - | - |  | - | (504670) | (504670) |
| Net loss |  | - |  | - |  |  |  | - | - |  | (57711645) | - | (57711645) |
| **Balance, March 31, 2025** | **1000000** | **9050000** | **182766342** | **1828963** |  | **(129986)** |  | **(1171679)** | **565702081** |  | **(155921308)** | **(2070166)** | **417417891** |
| Share-based compensation expense |  | - |  | - |  |  |  | - | 5819232 |  | - | - | 5819232 |
| Issuance of common stock/At-the-market offering, net of offering costs | - | - | 25504699 | 255047 |  |  |  | - | 48056280 |  | - | - | 48311327 |
| Issuance of common stock/public offering, net of offering costs |  | - | 75000000 | 750000 |  |  |  | - | 140875128 |  | - |  | 141625128 |
| Share-based compensation in connection with issuance of ordinary shares to consultants | - | - | 250000 | 2500 |  |  |  | - | 545000 |  | - | - | 547500 |
| Share-based compensation in connection with issuance of ordinary shares to employees | - | - | 531250 | 5313 |  |  |  | - | 1159850 |  | - | - | 1165163 |
| Other comprehensive income |  | - |  | - |  |  |  | - | - |  | - | 3428201 | 3428201 |
| Net income | - | - | - | - |  | - |  | - | - |  | 14874202 | - | 14874202 |
| **Balance, June 30, 2025** | **1000000** | **9050000** | **284052291** | **2841823** |  | **(129986)** |  | **(1171679)** | **762157571** |  | **(141047106)** | **1358035** | **633188644** |

---

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

**BIT DIGITAL, INC.**

**UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**For the Six Months Ended June 30, 2025 and 2024**

**(Expressed in US dollars)**

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** |
| **Cash Flows from Operating Activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net (loss) income | $(42837443) | 38128757 |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization expenses | 15465527 | 15192582 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss from disposal of property, plant, and equipment | 333620 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Losses (gains) on digital assets | 22050521 | (34193628) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share-based compensation expenses | 7143021 | 916334 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Realized and unrealized gains on digital assets held within Investment Fund | - | (2676237) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Changes in fair value of investment security | 875572 | (537497) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Digital assets mined | (14408801) | (37971653) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Digital assets earned from staking | (925973) | (699558) |
| &nbsp;&nbsp;&nbsp;Changes in operating assets and liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Digital assets and stable coins | 53984537 | 369914 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease right-of-use assets | 2439539 | 932997 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenue | (19039677) | (13073449) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Lease liability | (2288198) | (932997) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other current assets | 3930493 | 8383844 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other non-current assets | 1575783 | 568694 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts receivable | (1186845) | (4127532) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | (258487) | 3819978 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other payables and accrued liabilities | 5264840 | (3706666) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net investment in lease | 1341770 | (2875439) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other long-term liabilities | (392687) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax payable | 341234 | 630210 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liability | 1686729 | 1480921 |
| &nbsp;&nbsp;&nbsp;**Net Cash Provided by (Used in) Operating Activities** | **35095075** | **(30370425)** |
| &nbsp;&nbsp;&nbsp;**Cash Flows from Investing Activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Purchases of and deposits made for property, plant and equipment | (147144795) | (5560262) |
| &nbsp;&nbsp;&nbsp;Investment in equity securities | (2001600) | (100000) |
| &nbsp;&nbsp;&nbsp;Investment in SAFE | - | (1000000) |
| &nbsp;&nbsp;&nbsp;Proceeds from disposal of property, plant and equipment | 906016 | - |
| &nbsp;&nbsp;&nbsp;**Net Cash Used in Investing Activities** | **(148240379)** | **(6660262)** |
| &nbsp;&nbsp;&nbsp;**Cash Flows from Financing Activities:** |  |  |
| &nbsp;&nbsp;&nbsp;Net proceeds from issuance of common stock for public offering | 141625128 | - |
| &nbsp;&nbsp;&nbsp;Net proceeds from issuance of common stock/At-the-market offering | 58488565 | 80273917 |
| &nbsp;&nbsp;&nbsp;Payment of dividends | (800000) | - |
| &nbsp;&nbsp;&nbsp;**Net Cash Provided by Financing Activities** | **199313693** | **80273917** |
| Net increase in cash, cash equivalents and restricted cash | 86168389 | 43243230 |
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (203877) | - |
| &nbsp;&nbsp;&nbsp;Cash, cash equivalents and restricted cash, beginning of period | 98934127 | 18180934 |
| &nbsp;&nbsp;&nbsp;**Cash, cash equivalents and restricted cash, end of period** | $**184898639** | $**61424164** |
| &nbsp;&nbsp;&nbsp;**Supplemental Cash Flow Information** |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid for income taxes, net of refunds | $225000 | $8000 |
| &nbsp;&nbsp;&nbsp;**Non-cash Transactions of Investing and Financing Activities** |  |  |
| &nbsp;&nbsp;&nbsp;Reclassification of deposits to property and equipment | $97296343 | $10141866 |
| &nbsp;&nbsp;&nbsp;Right of use assets exchanged for operating lease liability | $31193195 | $- |

---

**Reconciliation of cash, cash equivalents and restricted cash**

---

| | | |
|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,**<br>**2024** |
| Cash and cash equivalents | $181165847 | $95201335 |
| Restricted cash | 3732792 | 3732792 |
| **Cash, cash equivalents and restricted cash** | $**184898639** | $**98934127** |

---

The accompanying notes are an integral part of these unaudited consolidated financial statements.

**BIT DIGITAL, INC.**

**NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**1. ORGANIZATION AND PRINCIPAL ACTIVITIES**

Bit Digital, Inc. ("BTBT" or the "Company"), is a holding company incorporated on February 17, 2017, under the laws of the Cayman Islands. The Company is a digital asset platform focused on Ethereum (ETH)-native treasury, staking strategies and engaged in the digital asset mining business. Through its subsidiaries, the Company also engages in high performance computing ("HPC") business, including cloud services and HPC data center services.

On August 17, 2023, WhiteFiber Iceland ehf (f/k/a Bit Digital Iceland ehf) was incorporated to support the Company's cloud services in Iceland.

On June 27, 2024, WhiteFiber HPC, Inc. (f/k/a Bit Digital HPC, Inc.) ("WF HPC") was incorporated to support the Company's cloud services in the United States. WhiteFiber HPC, Inc. is 100% owned by WhiteFiber AI, Inc. which is 100% owned by the Company.

On August 15, 2024, WhiteFiber, Inc. (f/k/a Celer, Inc.) ("WhiteFiber") was incorporated to support the Company's generative artificial intelligence ("AI") workstreams. As of June 30, 2025, WhiteFiber was 100% owned by the Company.

On October 11, 2024, the Company completed the acquisition of Enovum Data Centers Corp ("Enovum"), a Montreal-based owner, operator, and developer of HPC data centers. Enovum Data Centers Corp is 100% owned by WhiteFiber which, as of June 30, 2025, was 100% owned by the Company.

On March 11, 2025, WhiteFiber Canada, Inc. ("WF Canada") was incorporated to support the Company's generative AI workstreams in Canada. WF Canada is 100% owned by WhiteFiber AI, Inc., which, as of June 30, 2025, was 100% owned by the Company.

On May 7, 2025, Enovum NC-1 BIDCO, LLC ("Enovum NC") was incorporated to support the HPC data centers workstreams in North Carolina. Enovum NC is 100% owned by WhiteFiber, which, as of June 30, 2025, was 100% owned by the Company.

On May 22, 2025, WhiteFiber Japan GK ("WF Japan") was incorporated to support the Company's generative AI workstreams in Japan. WF Japan is 100% owned by WhiteFiber AI, Inc., which, as of June 30, 2025, was 100% owned by the Company.

The accompanying unaudited condensed consolidated financial statements reflect the activities of the Company and each of the following entities:

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Background** | **Background** | **Ownership** |
| Bit Digital USA, Inc. ("BT USA") | ● | A United States company | 100% owned by Bit Digital, Inc. |
|  | ● | Incorporated on September 1, 2020 |  |
|  | ● | Engaged in digital asset mining business |  |
| Bit Digital Canada, Inc. ("BT Canada") | ● | A Canadian company | 100% owned by Bit Digital, Inc. |
|  | ● | Incorporated on February 23, 2021 |  |
|  | ● | Engaged in digital asset mining business |  |
|  | ● | Dormant and previously engaged in digital asset mining-related business |  |
| Bit Digital Hong Kong Limited ("BT HK") | ● | A Hong Kong company | 100% owned by Bit Digital, Inc. |
|  | ● | Acquired on April 8, 2020 |  |
|  | ● | Dormant and previously engaged in digital asset mining-related business |  |
| Bit Digital Strategies Limited | ● | A Hong Kong company | 100% owned by Bit Digital, Inc. |
| &nbsp;&nbsp;&nbsp;("BT Strategies") | ● | Incorporated on June 1, 2021 |  |
|  | ● | Engaged in treasury management activities |  |
| Bit Digital Singapore Pte. Ltd. | ● | A Singapore company | 100% owned by Bit Digital, Inc. |
| &nbsp;&nbsp;&nbsp;("BT Singapore") | ● | Incorporated on July 1, 2021 |  |
|  | ● | Engaged in digital asset staking activities |  |
| Bit Digital Investment Management | ● | A British Virgin Islands company | 100% owned by Bit Digital |
| &nbsp;&nbsp;&nbsp;Limited ("BT IM") | ● | Incorporated on April 17, 2023 | Strategies Limited. |
|  | ● | Engaged in fund and investment management activities |  |
|  | ● | Disposed on July 1, 2024 |  |
| Bit Digital Innovation Master Fund | ● | A British Virgin Islands company | 100% owned by Bit Digital |
| &nbsp;&nbsp;&nbsp;SPC Limited ("BT SPC") | ● | Incorporated on May 31, 2023 | Strategies Limited. |
|  | ● | A segregated portfolio company |  |
|  | ● | Disposed on July 1, 2024 |  |
| WhiteFiber AI, Inc. (f/k/a Bit Digital | ● | A United States company | 100% owned by Bit Digital, Inc.<sup>(1)</sup> |
| &nbsp;&nbsp;&nbsp;AI, Inc.) ("WF AI") | ● | Incorporated on October 19, 2023 |  |
|  | ● | Engaged in cloud services |  |
| WhiteFiber Iceland ehf (f/k/a Bit Digital | ● | An Icelandic company | 100% owned by WhiteFiber AI, Inc.<sup>(1)</sup> |
| &nbsp;&nbsp;&nbsp;Iceland ehf) ("WF Iceland") | ● | Incorporated on August 17, 2023 |  |
|  | ● | Engaged in cloud services |  |
| WhiteFiber HPC, Inc. (f/k/a Bit Digital | ● | A United States company | 100% owned by WhiteFiber AI, Inc.<sup>(1)</sup> |
| &nbsp;&nbsp;&nbsp;HPC, Inc.) ("WF HPC") | ● | Incorporated on June 27, 2024 |  |
|  | ● | Engaged in HPC business |  |
| WhiteFiber, Inc. (f/k/a Celer, Inc.) | ● | A United States company | 100% owned by Bit Digital, Inc.<sup>(1)</sup> |
| &nbsp;&nbsp;&nbsp; ("WhiteFiber") | ● | Incorporated on August 15, 2024 |  |
|  | ● | Engaged in HPC business |  |
| Enovum Data Centers Corp ("Enovum") | ● | A Canadian company | 100% owned by WhiteFiber, Inc.<sup>(1)</sup> |
|  | ● | Acquired on October 11, 2024 |  |
|  | ● | Engaged in HPC data center services |  |
| WhiteFiber Canada, Inc. ("WF Canada") | ● | A Canadian company | 100% owned by WhiteFiber AI, Inc.<sup>(1)</sup> |
|  | ● | Incorporated on March 11, 2025 |  |
|  | ● | Engaged in cloud services |  |
| Enovum NC-1 BIDCO, LLC | ● | A United States company | 100% owned by WhiteFiber, Inc.<sup>(1)</sup> |
| &nbsp;&nbsp;&nbsp;("Enovum NC") | ● | Incorporated on May 7, 2025 |  |
|  | ● | Engaged in HPC data center services |  |
| WhiteFiber Japan GK ("WF Japan") | ● | A Japanese company | 100% owned by WhiteFiber AI, Inc.<sup>(1)</sup> |
|  | ● | Incorporated on May 22, 2025 |  |
|  | ● | Engaged in cloud services |  |

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(1) Ownership percentages reflected as of June 30, 2025. On August
8, 2025, WhiteFiber completed its initial public offering of its ordinary shares. Prior to the consummation of the initial public offering,
the Company entered into a contribution agreement (the "Contribution Agreement") with WhiteFiber, pursuant to which the Company
contributed its HPC business through the transfer of 100% of the capital shares of its cloud services subsidiary, WhiteFiber AI, Inc.
and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to
WhiteFiber in exchange for 27,043,749 ordinary shares of WhiteFiber (see Note 18. *Related Parties*).

**2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

***Basis of presentation and principles of consolidation***

The interim unaudited condensed consolidated financial statements are prepared and presented in accordance with accounting principles generally accepted in the United States ("US GAAP").

The unaudited condensed consolidated financial information as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 has been prepared without audit, pursuant to the rules and regulations of the SEC and pursuant to Regulation S-X. Certain information and footnote disclosures, which are normally included in annual financial statements prepared in accordance with US GAAP, have been omitted pursuant to those rules and regulations. The unaudited interim financial information should be read in conjunction with the audited financial statements and the notes thereto, included in the Form 10-K for the fiscal year ended December 31, 2024, which was filed with the SEC on March 14, 2025.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements reflect all normal recurring adjustments, which are necessary for a fair presentation of financial results for the interim periods presented. The Company believes that the disclosures are adequate to make the information presented not misleading. The accompanying unaudited condensed consolidated financial statements have been prepared using the same accounting policies as used in the preparation of the Company's consolidated financial statements for the year ended December 31, 2024. The results of operations for the three and six months ended June 30, 2025, and 2024 are not necessarily indicative of the results for the full years.

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***Use of estimates***

In preparing the consolidated financial statements in conformity with U.S. GAAP, management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are based on information as of the date of the consolidated financial statements. Significant estimates required to be made by management include, but are not limited to, the valuation of digital assets and other current assets, useful lives of property, plant, and equipment, impairment of long-lived assets, intangible assets and goodwill, valuation of assets and liabilities acquired in business combinations, provision necessary for contingent liabilities and realization of deferred tax assets. Actual results could differ from those estimates.

We review the useful lives of equipment on an ongoing basis, and effective January 1, 2025 we changed our estimate of the useful lives for our cloud service equipment from three to five years. The change was made to better reflect the expected usage patterns and economic benefits of the assets. The effect of this change in estimate for the first quarter of 2025, based on cloud service equipment that were included in "Property, plant and equipment, net" as of December 31, 2024 and those acquired during the three months ended March 31, 2025, was a reduction in depreciation and amortization expense of $2.5 million and a benefit to net income of $2.0 million, or $0.01 per basic share and $0.01 per diluted share.

***Fair value of financial instruments***

ASC 825-10 requires certain disclosures regarding the fair value of financial instruments. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows:

● Level 1 - inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets.

● Level 2 - inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, quoted market prices for identical or similar assets in markets that are not active, inputs other than quoted prices that are observable and inputs derived from or corroborated by observable market data.

● Level 3 - inputs to the valuation methodology are unobservable.

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

***USDC***

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

 **

***Accounts Receivable***

 **

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

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

As of June 30, 2025, the allowance for credit loss has not been material to the consolidated financial statements.

***Digital assets***

Digital assets (primarily include bitcoin and ETH) are included in current assets in the accompanying consolidated balance sheets. Digital assets purchased are recorded at cost and digital assets awarded to the Company through its mining activities and staking activities are accounted for in accordance with the Company's revenue recognition policy disclosed below.

Effective January 1, 2024, the Company early adopted ASU 2023-08, which requires entities to measure certain cryptocurrencies at fair value, with changes in fair value recorded in net income in each reporting period. The Company's digital assets are within the scope of ASU 2023-08 and the transition guidance requires a cumulative-effect adjustment as of the beginning of the current fiscal year for any difference between the carrying amount of the Company's digital assets and fair value.

Prior to the adoption of ASU 2023-08, digital assets were accounted for as intangible assets with indefinite useful lives and are recorded at cost less impairment in accordance with ASC 350 - *Intangibles-Goodwill and Other*. An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Digital assets held are accounted for as intangible assets with indefinite useful lives and are subject to impairment losses if the fair value of digital assets decreases below the carrying value at any time during the period. The fair value is measured using the quoted price of the digital assets at the time its fair value is being measured. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted.

ASC 820 defines "principal market" as the market with the greatest volume and level of activity for the asset or liability. The determination of the principal market (and, as a result, the market participants in the principal market) is made from the perspective of the reporting entity. The digital assets held by the Company are traded on a number of active markets globally. The Company uses both exchanges and Amber Group's OTC desk to buy and sell digital assets, including transactions involving U.S. dollars or exchanges between different types of digital assets. Prior to April 1, 2025, the Company considered CoinMarketCap to be its principal market. Effective April 1, 2025, the Company determined that Coinbase is its principal market as it provides the most reliable and greatest volume and level of activity for bitcoin and ETH for which the Company can access.

The Company recognizes mining revenue by utilizing the spot price of Bitcoin determined using Coinbase at 0:00:00 UTC on the date of contract inception and staking revenue by utilizing the daily close prices obtained from Coinbase. In 2022, the Company also used hourly close price from CryptoCompare to recognize revenue from our digital asset mining activities. The Company believed the hourly close price can better reflect revenue recognized from our digital asset mining activities as compared to the daily close price from CoinMarketCap used at the time.

Purchases of digital assets by the Company and digital assets awarded to the Company through its mining activities and staking activities are included within operating activities on the accompanying consolidated statements of cash flows. The changes of digital assets are included within operating activities in the accompanying consolidated statements of cash flows. After adopting ASU 2023-08, changes in fair value and realized gains or losses are now reported as "gains (losses) on digital assets" in the consolidated statements of operations. Prior to this adoption, realized gains or losses were reported as "realized gains (losses) on exchange of digital assets" in the consolidated statements of operations. The Company accounts for its gains or losses in accordance with the first-in first-out method of accounting.

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***Deposits for property, plant, and equipment***

The deposits for property, plant, and equipment ("PP&E") represented advance payments for purchases of miner, high performance computing equipment and other equipment used in our colocation services. The Company initially recognizes deposits for PP&E when cash is advanced to our suppliers. Subsequently, the Company derecognizes and reclassifies deposits for PP&E to PP&E when control is transferred to and obtained by the Company.

Below is the roll forward of the balance of deposits for PP&E for the six months ended June 30, 2025 and 2024, respectively.

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| | | |
|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| **Opening balance** | $**39059707** | $**4227371** |
| Reclassification to PP&E | (97296343) | (10141867) |
| Addition of deposits for PP&E | 79302662 | 8263245 |
| **Ending balance** | $**21066026** | $**2348749** |

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***Property, plant, and equipment, net***

Property, plant, and equipment are recorded at cost and depreciated using the straight-line method over the estimated useful lives of the assets or declining-balance method. Direct costs related to developing or obtaining software for internal use are capitalized as property, plant, and equipment. Capitalized software costs are amortized over the software's useful life when the software is placed in service. The estimated useful lives by asset category are:

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| | |
|:---|:---|
|  | **Estimated <br> Useful <br> Life** |
| Digital asset miners | 3 years |
| Cloud service equipment | 5 years |
| Colocation service equipment | 10 to 15 years |
| Building | 30 years |
| Leasehold improvements | 15 years |
| Purchased and internally developed software | 1-5 years |
| Vehicle | 5 years |
| Other property and equipment | 20% to 30% |

---

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Effective January 1, 2025, we changed our estimate of the useful lives for our cloud service equipment from three to five years. The change was made to better reflect the expected usage patterns and economic benefits of the assets.

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***Impairment of long-lived assets***

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

 **

***Goodwill***

 **

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not subject to amortization, and instead, assessed for impairment annually at the end of each fiscal year, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount in accordance with ASC 350 - *Intangibles -Goodwill and Other.*

The impairment assessment involves an option to first assess qualitative factors to determine whether events or circumstances exist that lead to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If the qualitative assessment is not performed, or after assessing the totality of the events or circumstances, we determine it is more likely than not that the fair value of a reporting unit is less than its carrying amount, a quantitative assessment for potential impairment is performed.

The quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting unit.

***Finite-lived intangible Assets***

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Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition date.

Intangible assets with finite lives are comprised of customer relationships and are amortized on straight-line basis over their estimated useful lives. The Company assesses the appropriateness of finite-lived classification at least annually. Additionally, the carrying value and remaining useful lives of finite-lived assets are reviewed annually to identify any circumstances that may indicate potential impairment or the need for a revision to the amortization period. A finite-lived intangible asset is considered to be impaired if its carrying value exceeds the estimated future undiscounted cash flows expected to be generated from it. We apply judgment in selecting the assumptions used in the estimated future undiscounted cash flow analysis. Impairment is measured by the amount that the carrying value exceeds fair value. The useful lives of customer relationships is 19 years.

 **

***Business combinations***

 **

The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - *Business Combinations*, by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair value. The determination of fair value involves assumptions, estimates, and judgments. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date). Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets acquired.

Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred.

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***Investment securities***

As of June 30, 2025 and December 31, 2024, investment securities represent the Company's investments in three funds, a privately held company via a simple agreement for future equity ("SAFE"), and four privately held companies over which the Company neither has control nor significant influence through investments in ordinary shares or preferred shares.

*Investment in equity method investee*

In accordance with ASC 323, *Investments - Equity Method and Joint Ventures*, the Company accounts for the investment in one privately held company using equity method, because the Company has significant influence but does not own a majority equity interest or otherwise control over the equity investee.

Under the equity method, the Company initially records its investment at cost and prospectively recognizes its proportionate share of each equity investee's net income or loss into its consolidated statements of operations. When the Company's share of losses in the equity investee equals or exceeds its interest in the equity investee, the Company does not recognize further losses, unless the Company has incurred obligations or made payments or guarantees on behalf of the equity investee.

The Company continually reviews its investment in the equity investee to determine whether a decline in fair value below the carrying value is other-than-temporary. The primary factors the Company considers in its determination include the financial condition, operating performance and the prospects of the equity investee; other company specific information such as recent financing rounds; the geographic region, market and industry in which the equity investee operates; and the length of time that the fair value of the investment is below its carrying value. If the decline in fair value is deemed to be other-than-temporary, the carrying value of the equity investee is written down to fair value.

*Investment in funds*

Equity securities not accounted for using the equity method are carried at fair value with unrealized gains and losses recorded in the consolidated income statements, according to ASC 321, *Investments - Equity Securities*. As a practical expedient, the Company uses Net Asset Value ("NAV") or its equivalent to measure the fair value of the investment in the fund. NAV is primarily determined based on information provided by the fund administrator.

*Investment in privately held company*

Equity securities not accounted for using the equity method are carried at fair value with unrealized gains and losses recorded in the consolidated income statements, according to ASC 321, *Investments - Equity Securities*. The Company elected to record the equity investments in privately held companies using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

Equity investments in privately held companies accounted for using the measurement alternative are subject to periodic impairment reviews. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of these equity securities. In computing realized gains and losses on equity securities, the Company calculates cost based on amounts paid using the average cost method. Dividend income is recognized when the right to receive the payment is established.

*Investment in SAFE*

SAFE investments provide the Company with the right to participate in future equity financing of preferred stock. The Company accounted for this investment under ASC 320, *Investments - Debt Securities* and elected the fair value option for the SAFE investment under ASC 825, *Financial Instruments*, which requires financial instruments to be remeasured to fair value each reporting period, with changes in fair value recorded in the consolidated statements of operations. The fair value estimate includes significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy.

*Investment in Innovation Fund/Digital assets held in fund*

 

On October 1, 2023, the Company made an investment of 2,701 Ethereum, with a fair value of $4.7 million, into Bit Digital Innovation Master Fund SPC Ltd. (the "Fund"). The Fund was subsequently consolidated based on the Company's controlling financial interest. As a result, the assets held in the Fund were included in current assets in the consolidated balance sheets under the caption "Digital assets held in Fund" as of June 30, 2023 before the disposition.

The Fund qualified and operated as an investment company for accounting purposes pursuant to the accounting and reporting guidance under ASC 946, "*Financial Services – Investment Companies*" ("ASC 946"), which requires fair value measurement of the Fund. The Company retains the Fund's investment company specific accounting principles under ASC 946 upon consolidation. The digital assets held by the Fund were traded on a number of active markets globally. A fair value measurement under ASC 820, "*Fair Value Measurement*" ("ASC 820") for an asset assumes that the asset is exchanged in an orderly transaction between market participants either in the principal market for the asset or, in the absence of a principal market, the most advantageous market for the asset (ASC 820-10-35-5). The fair value of the assets within the Fund was primarily determined using the price from CoinMarketCap. Any changes in the fair value of the assets were recorded in Other income (expense), net in the consolidated statements of operations.

On July 1, 2024, the Company entered into a share purchase agreement with Pleasanton Ventures Limited ("Pleasanton Ventures") for the disposition of Bit Digital Innovation Master Fund SPC Ltd and Bit Digital Investment Management Limited. Refer to Note 20. *Disposition of Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund SPC Limited*, for more information. Upon the disposition, the Company no longer has a controlling financial interest in the Fund and therefore deconsolidated the Fund in accordance with ASC 810 – "*Consolidation*" ("ASC 810"). The Company did not record any gain or loss upon deconsolidation as the digital assets in the Fund were measured at fair value. Subsequently, the investment in the Fund is included under the caption "Investment securities" as Investment in Innovation Fund. Refer to Note 10. *Investment Securities* for more information.

***Leases***

The Company determines whether an arrangement contains a lease at the inception of the arrangement. If a lease is determined to exist, the term of such lease is assessed based on the date on which the underlying asset is made available for the Company's use by the lessor. The Company's assessment of the lease term reflects the non-cancelable term of the lease, inclusive of any rent-free periods and/or periods covered by early-termination options which the Company is reasonably certain of not exercising, as well as periods covered by renewal options which the Company is reasonably certain of exercising. The Company also determines lease classification as either operating or finance at lease commencement, which governs the pattern of expense recognition and the presentation reflected in the consolidated statements of operations over the lease term.

For leases with a term exceeding 12 months, an operating lease liability is recorded on the Company's consolidated balance sheet at lease commencement reflecting the present value of its fixed minimum payment obligations over the lease term. A corresponding operating lease right-of-use asset equal to the initial lease liability is also recorded, adjusted for any prepayment and/or initial direct costs incurred in connection with execution of the lease and reduced by any lease incentives received. For purposes of measuring the present value of its fixed payment obligations for a given lease, the Company uses its incremental borrowing rate, determined based on information available at lease commencement, as rates implicit in its leasing arrangements are typically not readily determinable. The Company's incremental borrowing rate reflects the rate it would pay to borrow on a secured basis and incorporates the term and economic environment of the associated lease. Variable lease costs are recognized in the period in which the obligation for those payments is incurred and not included in the measurement of right-of-use assets and operating lease liabilities.

For the Company's operating leases, fixed lease payments are recognized as lease expense on a straight-line basis over the lease term. For leases with a term of 12 months or less, any fixed lease payments are recognized on a straight-line basis over the lease term and are not recognized on the Company's consolidated balance sheet as an accounting policy election. Leases qualifying for the short-term lease exception were insignificant.

For sales-type leases where the Company is the lessor, the Company recognizes a net investment in lease, which comprises of the present value of the future lease payments and any unguaranteed residual value. Interest income is recognized over the lease term at a constant periodic discount rate on the remaining balance of the lease net investment using the rate implicit in the lease and is included in "Revenue – other". Sales-type leases result in the recognition of gain or loss at the commencement of the lease, which will be recorded in "Other income, net."

For operating sublease where the Company is the lessor, the Company recognizes lease payments in income over the lease term on a straight-line basis and is included in "Other income, net".

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***Revenue recognition***

The Company recognizes revenue in accordance with ASC 606, *Revenue from Contracts with Customers* ("ASC 606"). The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange. Refer to Note 3. *Revenue from Contracts with Customers* for further information.

***Contract costs***

Capitalized contract costs represent the costs directly related and incremental to the origination of new contracts, including commissions that are incurred directly related to obtaining customer contracts. We amortize the deferred contract costs on a straight-line basis over the expected period of benefit. These amounts are included in the accompanying consolidated balance sheets, with the capitalized costs to be amortized to commission expense over the expected period of benefit and commission expense payable included in Other current assets and Other long-term liabilities.

The Company capitalized lease expense incurred in December 2023 that are directly related to fulfilling its cloud services which commenced operations in January 2024. The lease expense is directly related to fulfill customer contracts and is expected to be recovered. The capitalized lease expense was reclassified as lease expense in January 2024.

***Deferred Revenue***

Deferred revenue primarily pertains to prepayments received from customers for services that have not yet commenced as of June 30, 2025. Deferred revenues are recognized as revenue recognition criteria have been met.

***Remaining performance obligation***

Remaining performance obligations represent the transaction price of contracts for work that have not yet been performed. The amount represents estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation.

***Cost of revenue***

The Company's cost of revenue consists primarily of (i) direct production costs related to mining operations, including electricity costs, profit-sharing fees/variable performance fees and/or other relevant costs paid to our hosting facilities, (ii) direct production costs related to our cloud services, including electricity costs, data center lease costs, and other relevant costs, (iii) direct production costs related to our colocation services, including electricity costs, lease costs, data center employees' wage expenses and other relevant costs, and (iv) direct cost related to ETH staking business, including service fees payable to the service provider.

Cost revenue excludes depreciation expenses, which are separately stated in the Company's consolidated statements of operations.

***Foreign currency***

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Accounts expressed in foreign currencies are translated into U.S. dollars. Functional currency assets and liabilities are translated into U.S. dollars generally using rates of exchange prevailing at the balance sheet date of each respective subsidiary and the related translation adjustments are recorded as a separate component of Accumulated other comprehensive income, net of any related taxes, in total shareholders' equity. Income statement accounts expressed in functional currencies are translated using average exchange rates during the period. Functional currencies are generally the currencies of the local operating environment. Financial statement accounts expressed in currencies other than the functional currency of a consolidated entity are remeasured into that entity's functional currency resulting in exchange gains or losses recorded in other income (expense), net.

***Operating segments***

 ****

Operating segments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker ("CODM") in deciding how to allocate resources to an individual segment and in assessing performance. Our CODM is composed of the Chief Executive Officer and Chief Financial Officer, who use segment gross profit (loss) to assess the performance of the business of our reportable operating segments.

***Income taxes***

 

We account for current and deferred income taxes in accordance with the authoritative guidance, which requires that the income tax impact is to be recognized in the period in which the law is enacted. Current income tax expense represents taxes paid or payable for the current period. Deferred tax assets and liabilities are recognized using enacted tax rates for the future tax impact of temporary differences between the financial statement and tax bases of recorded assets and liabilities. A valuation allowance is recorded to reduce deferred tax assets when it is more likely than not that a tax benefit will not be realized based on historical and projected future taxable income over the periods in which the temporary differences are expected to be recovered or settled on each jurisdiction.

In accordance with the authoritative guidance on accounting for uncertainty in income taxes, we recognize liabilities for uncertain tax positions based on the two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained in audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement.

***Earnings (loss) per shar****e*

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue ordinary shares were exercised or converted into ordinary shares or resulted in the issuance of ordinary share participating in the earnings of the entity.

 

***Commitments and contingencies***

In the normal course of business, the Company is subject to contingencies, such as legal proceedings and claims arising out of its business, which cover a wide range of matters. Liabilities for contingencies are recorded when it is probable that a liability has been incurred and the amount of the assessment can be reasonably estimated.

If the assessment of a contingency indicates that it is probable that a material loss is incurred and the amount of the liability can be estimated, then the estimated liability is accrued in the Company's financial statements. If the assessment indicates that a potentially material loss contingency is not probable, but is reasonably possible, or is probable but cannot be estimated, then the nature of the contingent liability, together with an estimate of the range of possible loss, if determinable and material, would be disclosed.

Loss contingencies considered remote are generally not disclosed unless they involve guarantees, in which case the nature of the guarantee would be disclosed.

The Company may also enter into contractual arrangements that result in commitments, including purchase obligations. In addition, the Company may be subject to contingent consideration obligations related to asset acquisitions, which involve potential future payments contingent upon the achievement of specified conditions or milestones.

***Share-based compensation***

 ****

The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant-date fair value of the awards. The Company estimates the fair value of stock option grants using the Black-Scholes option pricing model and the assumptions used in calculating the fair value of stock-based awards represent management's best estimates and involve inherent uncertainties and the application of management's judgment. These assumptions are the expected stock volatility, the risk-free interest rate, the expected life of the option, and the dividend yield on the underlying stock. Expected volatility is calculated based on the historical volatility of the Company's common stock over the expected term of the option. Risk-free interest rates are calculated based on risk–free rates for the appropriate term. The Company has elected to account for forfeitures of awards as they occur.

 

***Treasury stock***

 

The Company accounts for treasury stocks using the cost method. Under this method, the cost incurred to purchase the shares is recorded in the treasury stocks account on the consolidated balance sheets.

The Company treats shares withheld for tax purposes on behalf of employees in connection with the vesting of restricted share grants as ordinary share repurchases because they reduce the number of shares that would have been issued upon vesting.

***Reclassification***

Certain items in the financial statements of the comparative period have been reclassified to conform to the financial statements for the current period. The reclassification has no impact on the total assets and total liabilities as of June 30, 2025 or on the statements of operations for the three and six months ended June 30, 2025.

***Recent accounting pronouncements***

The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement affects the Company's financial reporting, the Company undertakes a study to determine the consequences of the change to its consolidated financial statements and assures that there are proper controls in place to ascertain that the Company's consolidated financial statements properly reflect the change.

In December 2023, the Financial Accounting Standards Board ("FASB") issued ASU No. 2023-09, *Income Taxes (Topic 740): Improvements to Income Tax Disclosures* ("ASU 2023-09"). ASU 2023-09 expands existing income tax disclosures for rate reconciliations by requiring disclosure of certain specific categories and additional reconciling items that meet quantitative thresholds and expands disclosures for income taxes paid by requiring disaggregation by certain jurisdictions. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is evaluating the impact the updated guidance will have on its disclosures for the year ended December 31, 2025.

In November 2024, the FASB issued ASU No. 2024-03*, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40)* ("ASU 2024-03"). ASU 2024-03 requires, in the notes to the annual and interim financial statements, disaggregated information about certain income statement expense line items in the notes to the financial statements. ASU2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is evaluating the impact the updated guidance will have on its disclosures.

In May 2025, the Financial Accounting Standards Board ("FASB") issued ASU 2025-03, *Business Combinations* (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, which amends the guidance for identifying the accounting acquirer in transactions involving the acquisition of a variable interest entity that meets the definition of a business. The new standard is effective for the Company for its annual periods beginning January 1, 2027, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.

**3. Revenue from Contracts with Customers**

The Company recognizes revenue in accordance with ASC 606, *Revenue from Contracts with Customers* ("ASC 606").

To determine revenue recognition for contracts with customers, the Company performs the following five steps: (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will *not* occur, (iv) allocate the transaction price to the respective performance obligations in the contract, and (v) recognize revenue when (or as) the Company satisfies the performance obligation.

The Company recognizes revenue when it transfers its goods and services to customers in an amount that reflects the consideration to which the Company expects to be entitled in such exchange.

The Company is currently engaged in digital asset mining business, high performance computing ("HPC") business, including cloud services and HPC data center services, and Ethereum staking activities.

In June 2025, the Company announced that it had initiated a strategic transition to become a pure play ETH staking and treasury company. In connection with the transition, the Company intends to convert its BTC holdings into ETH over time and has commenced a strategic alternatives process for its bitcoin mining operations, which is expected to result in a sale or wind-down, with any net proceeds to be re-deployed into ETH.

*<u>Disaggregation of revenues</u>*

Revenue disaggregated by reportable segment is presented in Note 17. *Segment Reporting*.

 

*Cloud services*

The Company provides cloud services to support customers' generative AI workstreams. We have determined that cloud services are a single continuous service comprised of a series of distinct services that are substantially the same and have the same pattern of transfer (i.e. distinct days of service).

These services are consumed as they are received, and the Company recognizes revenue over time using the variable allocation exception as it satisfies performance obligations. We apply this exception because we concluded that the nature of our obligations and the variability of the payment terms based on the number of GPUs providing HPC services are aligned and uncertainty related to the consideration is resolved on a daily basis as we satisfy our obligations. The Company recognizes revenue net of consideration payable to customers, such as service credits, and accounted for as a reduction of the transaction price in accordance with guidance in ASC 606-10-32-25.

During the three months ended March 31, 2024, the Company issued a service credit of $1.3 million to the customer as compensation for decreased utilization during the initial deployment period, which included testing and optimization phases.

The Company's cloud services revenue has been generated from Iceland.

 

*Colocation services*

Colocation services generate revenue by providing customers with physical space, power, and cooling within the data center facility.

Our revenue is primarily derived from recurring revenue streams, mainly (1) colocation, which is the leasing of cabinet space and power and (2) connectivity services, which includes cross-connects. Additionally, the remainder of our revenue is from non-recurring revenue, which primarily includes installation services related to a customer's initial deployment.

Revenues from recurring revenue streams are billed monthly and recognized ratably over the term of the contract, generally 1 to 5 years for data center colocation customers. Non-recurring installation fees, although generally paid upfront upon installation, are deferred and recognized ratably over the contract term.

We guarantee certain service levels, such as uptime, as outlined in individual customer contracts. If these service levels are not achieved due to any failure of the physical infrastructure or offerings, or in the event of certain instances of damage to customer infrastructure within our data center, we would reduce revenue for any credits or cash payments given to the customer.

The Company's colocation services revenue has been generated from Canada.

*Digital asset mining*

The Company enters in contracts with mining pool operators to provide computing power to digital asset mining pools. Providing computing power for digital asset transaction verification services is an output of the Company's ordinary activities. The provision of such computing power is the only performance obligation in the Company's contracts with mining pool operators.

Contract inception and the Company's enforceable right to consideration begin when the Company commences providing hash calculation services to the mining pool operators. Each party to the contract has the unilateral right to terminate the contract at any time without any compensation to the other party for such termination. As such, the duration of a contract is less than 24 hours (a day) and may be continuously renewed throughout the day. The implied renewal option is not a material right because there are no upfront or incremental fees in the initial contract, and the rate of payments remains the same upon each implied renewal, as the Full-Pay-Per-Share (FPPS) formula remains the same. The Company is entitled to compensation once it begins to perform hash calculations for the pool operator in accordance with the operator's specifications over a 24-hour period beginning 00:00:00 UTC and ending 23:59:59 on a daily basis. In exchange for providing computing power, the Company is entitled to a fractional share of the fixed digital assets award the mining pool operator receives, for successfully adding a block to the blockchain. The Company's fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. The Company is entitled to its relative share of consideration even if a block is not successfully placed.

The transaction consideration the Company receives, if any, is noncash consideration in the form of digital assets, net of pool fees charged by the mining pool operator. The Company estimates the fair value of noncash consideration at contract inception. This non-cash consideration is variable since the amount of block reward earned depends on the Company's hash rate provided and transaction fees depend on the actual Bitcoin Network transaction fees. While the non-cash consideration is variable, the payout is settled the next day on a daily basis and the Company has the ability to estimate the variable consideration with reasonable certainty, without the risk of significant revenue reversal because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved.

Revenue is recognized on the same day that control of the contracted service transfers to the mining pool operator, which is the same day as contract inception. Revenue is estimated and recognized based on the spot price of Bitcoin determined using the Company's Principal Market at 0:00:00 UTC on the date of contract inception.

Below table presents the Company's revenues generated from digital asset mining business from Foundry USA Pool by country:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| United States | $5216951 | $14185805 | $11619414 | $33497689 |
| Iceland | 1414887 | 1210510 | 2789387 | 2811550 |
| Canada | - | 683578 | - | 1662414 |
|  | $**6631838** | $**16079893** | $**14408801** | $**37971653** |

---

*ETH staking business* 

The Company generates revenue through ETH staking rewards. The Company commenced both native staking business and liquid staking business in 2022. In the first quarter of 2024, the Company terminated its liquid staking business. During the six months ended June 30, 2025, the Company only participated in native staking. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH.

With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain. As a result, we have terminated all liquid staking activities with StakeWise and Liquid Collection in the third quarter of 2023 and in the first quarter of 2024, respectively, reclaiming all staked Ethereum along with the accumulated rewards. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc.

*(a) Native staking*

The Company has entered into network-based smart contracts by staking ETH on nodes run by third-party operators or nodes maintained by us in 2022. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw the staked ETH which was previously locked-up in staking contracts since the Shanghai upgrade was successfully completed on April 12, 2023. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to the block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company's stake to the total ETH staked by all validators.

The provision of validating blockchain transactions is an output of the Company's ordinary activities. Each separate block creation or validation under a smart contract with a network represents a performance obligation. The transaction consideration the Company receives, the digital asset awards, is a non-cash consideration, which the Company measures at fair value on the date received. The fair value of the ETH reward received is determined using the quoted price of the ETH at the time of receipt. The satisfaction of the performance obligation for transaction verification services occurs at a point in time when confirmation is received from the network indicating that the validation is complete, and the awards are deposited to our address. At that point, revenue is recognized.

As of June 30, 2025 and December 31, 2024, the Company had native staked 21,568 ETH and 21,568 ETH, respectively, on the Ethereum blockchain. For the six months ended June 30, 2025 and 2024, the Company earned 377.8 ETH valued at $925,973 and 220.5 ETH valued at $695,055, respectively, from such staking activities and recognized the ETH staking rewards as revenues.

*(b) Liquid staking*

Liquid staking is similar to native staking in terms of performance obligations, determination of transaction price and revenue recognition. When we participated in liquid staking via Portara protocol, the Company received receipt tokens sETH-H to represent the staked ETH at 1:1 ratio. The liquid staking rewards were in the form of rETH-H which could be redeemed for ETH from the liquid staking provider or exchange for ETH via over-the-counter markets. When we participated in liquid staking via Liquid Collective protocol, the Company received receipt tokens Liquid Staked ETH ("LsETH") to represent the staked ETH. LsETH uses a floating conversion rate, or protocol conversion rate, between the receipt token and staked tokens, reflecting the value of accrued network rewards, penalties, and fees associated with the staked tokens.

For the six months ended June 30, 2024, the Company generated revenues of $4,503 from the liquid staking. We generated no revenue from liquid staking during the six months ended June 30, 2025.

*<u>Contract costs</u>*

The Company capitalizes commission expenses directly related to obtaining customer contracts, which would not have been incurred if the contract had not been obtained. As of June 30, 2025, capitalized costs to obtain a contract totaled $1.5 million, and the outstanding commission expense payable was $1.6 million. As of December 31, 2024, capitalized costs to obtain a contract totaled $2.0 million, and the outstanding commission expense payable was $1.6 million.

*<u>Contract Assets</u>*

 

Contract assets primarily consist of revenue allocated to complimentary services provided to customers as part of contractual arrangements. As of June 30, 2025 and December 31, 2024, contract assets were $1.3 million and $0, respectively.

*<u>Contract Liabilities</u>*

The Company's contract liabilities consist of deferred revenue and customer deposits. The following table presents changes in the total contract liabilities:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** |
| **Beginning balance** | $**30771952** | $**13073449** |
| Revenue earned | (22509221) | (13073449) |
| Prepayment received | 3405982 | - |
| **Ending balance** | $**11668713** | $**-**  |

---

*<u>Remaining performance obligation</u>*

The following table presents estimated revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligation as of June 30, 2025:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **2025** | **2026** | **2027** | **2028** | **2029** | **Total** |
| Colocation Services | $3103554 | $3489886 | $710751 | $82674 | $- | $7386865 |
| Other Revenue | 716336 | 1071272 | 696558 | 454618 | $3527025 | 6465809 |
| **Total contract liabilities** | $3819890 | $4561158 | $1407309 | $537292 | $3527025 | $13852674 |

---

The amounts presented in the table above exclude variable consideration allocated entirely to wholly unsatisfied performance obligations. Such amounts have been excluded from the disclosure of remaining performance obligations in accordance with ASC 606, as the consideration is not fixed and determinable.

**4. Acquisitions**

***Enovum Data Centers Acquisition***

On October 11, 2024, the Company acquired 100% of Enovum Data Centers Corp (the "Acquiree" or "Enovum"), an owner, operator, and developer of high-performance computing data centers, located in Montreal, Quebec, Canada. The acquisition of Enovum provides the Company with a strong diversity of existing and prospective colocation customers, delivers a strong pipeline of expansion site opportunities and an experienced management team to lead the development processes, and enables the Company to offer new service offerings. The acquisition creates the potential for significant synergies, as the Company may capture additional margin from HPC customers, versus hosting them with third party data centers. Additionally, Enovum enhances the Company's competitive positioning in the marketplace, enabling the Company to offer an integrated GPU cloud solution to customers. Finally, the Company will enjoy greater operating flexibility by collocating its owned GPU inventory in Enovum data centers, offering capacity to customers on a just-in-time basis.

The acquisition-date fair value of the consideration transferred totaled $43,834,313. The total consideration consists of $38,993,603 of cash consideration and $4,840,710 in equity-classified exchangeable shares. The acquisition-date fair value of the exchangeable shares was determined based on the opening market price of the Company's ordinary shares as of the acquisition date.

The following table summarizes the preliminary allocation of the purchase price based on the estimated fair value of the assets acquired and liabilities assumed at the acquisition date:

---

| | |
|:---|:---|
| Accounts receivable | $616153 |
| Other current assets | 2008566 |
| Property and equipment, net | 14201790 |
| Operating lease right-of-use assets | 4752501 |
| Intangible asset | 13486184 |
| Deferred tax asset | 91368 |
| Other non-current assets | 2493 |
| Accounts payable | (1866804) |
| Other payables and accrued liabilities | (1100095) |
| Current portion of deferred revenue | (465360) |
| Current portion of operating lease liability | (248301) |
| Non-current portion of deferred revenue | (123652) |
| Non-current portion of operating lease liability | (3273709) |
| Deferred tax liability | (4090683) |
| **Total identifiable assets and liabilities** | **23990451** |
| Goodwill | 19843862 |
| **Total Purchase Consideration** | $**43834313** |

---

The acquisition-date fair value of the acquired accounts receivable was $616,153, which equals the gross contractual amount. The Company does not expect a material amount of uncollectible contractual cash flows.

The Company recognized customer relationships as an intangible asset of $13,486,184 to be amortized over 19 years.

Of the total Goodwill recognized, $37,000 is attributable to the assembled workforce at Enovum and the rest is attributable to synergies expected to be achieved from the combined operations of the Company and Enovum. The goodwill recognized is not deductible for tax purposes. We assigned the goodwill to our colocation reportable segment.

Through June 30, 2025, the Company recognized $2.0 million of acquisition-related costs in the income statement line item "General and Administrative Expense".

The following unaudited pro forma financial information represents the consolidated results of operations as if the acquisition had occurred on January 1, 2024:

---

| | | |
|:---|:---|:---|
|  | **For the <br> Three Months <br> Ended <br> June 30,<br> 2024** | **For the <br> Six Months <br> Ended <br> June 30, <br> 2024** |
| Revenue | $30280259 | $61422697 |
| Net income | $(11867832) | $37785718 |

---

These pro forma results are presented for information purposes only and do not necessarily reflect the actual results that would have been achieved had the acquisition occurred on the date assumed, nor are they indicative of future consolidated results of operations.

These amounts have been calculated after applying the Company's accounting policies and adjusting the results of Enovum to reflect the additional depreciation and amortization that would have been charged assuming the fair value adjustments to property, plant and equipment, right-of-use asset and intangible assets had been applied on January 1, 2024, together with the consequential tax effects.

Enovum commenced its operations in October 2023. Therefore, is it impracticable to estimate and present proforma revenue and net income of the combined entity as though the business combination had occurred as of January 1, 2023.

***Real estate Acquisition – Montreal, Canada***

On December 27, 2024, the Company, through WhiteFiber, acquired the building and land, together with all the related improvements, located in Montreal, Canada, from an unrelated third party. The total consideration consisted of approximately $23.3 million in cash.

The acquired set of assets did not meet the definition of a business as defined in ASC 805, *Business Combinations*, as no substantive processes or employees were acquired. The assets acquired consisted primarily of land, building and related equipment, which are included in *Property and equipment, net* on the consolidated balance sheets. The fair value of the tangible assets acquired was estimated to be $23.3 million. No identifiable intangible assets were acquired, no goodwill was recognized, and no liabilities were assumed in connection with the transaction.

***Real estate Acquisition – Madison, North Carolina***

On May 20, 2025, the Company, through WhiteFiber, acquired the building and land, together with all the related improvements owned by Unifi Manufacturing, inc. ("Unifi Transaction") that were located in Madison, North Carolina. The total consideration consisted of $45.0 million in cash, including the initial deposit of $2.2 million.

The acquired set of assets did not meet the definition of a business as defined in ASC 805, *Business Combinations*, as no substantive processes or employees were acquired. The assets acquired consisted primarily of land, building and related equipment, which are included in *Property and equipment, net* on the consolidated balance sheets. The fair value of the tangible assets acquired was estimated to be $45.0 million. No identifiable intangible assets were acquired, no goodwill was recognized, and no liabilities were assumed in connection with the transaction.

In connection with the agreement, additional contingent consideration may become payable to the seller based on the timing and availability of power at the site (see Note 19. *Commitments and Contingencies*).

**5. USDC**

---

| | | |
|:---|:---|:---|
|  | **June 30,<br> 2025** | **December 31,<br> 2024** |
| USDC | $515242 | $411413 |

---

The following table presents additional information about USDC for the six months ended June 30, 2025 and 2024, respectively:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** |
| **Opening balance** | $**411413** | $**405596** |
| Receipt of USDC from sales of other digital assets | 1223250 | 1044600 |
| Payment of USDC for other expenses | (1159521) | (1110090) |
| Receipt of USDC from sales of property, plant, and equipment | 40100 | - |
| **Ending balance** | $**515242** | **340106** |

---

**6. DIGITAL ASSETS**

**Adoption of ASU 2023-08, Accounting for and Disclosure of Crypto Assets**

Effective January 1, 2024, the Company early adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in net income each reporting period. The Company's digital assets are within the scope of ASU 2023-08 and the transition guidance requires a cumulative-effect adjustment as of the beginning of the current fiscal year for any difference between the carrying amount of the Company's digital assets and fair value. As a result of the Company's early adoption of ASU 2023-08, the Company recorded a $21.2 million increase to digital assets and a $21.2 million decrease to accumulated deficit on the consolidated balance sheets as of the beginning of the quarter ended March 31, 2024.

The following table presents the Company's significant digital assets holdings as of June 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
|  | **Quantity** | **Cost Basis** | **Fair Value** |
| BTC | 280.4 | $15051528 | $30051600 |
| ETH | 24601.0 | 60282525 | 61162850 |
| Total digital assets held as of June 30, 2025 |  | $**75334053** | $**91214450** |

---

The cost basis is equal to the post-impairment value of all BTC and ETH held as of the adoption of ASU 2023-08 on January 1, 2024. For BTC and ETH earned subsequent to the adoption of ASU 2023-08, the cost basis of the BTC and ETH represents the valuation at the time the Company determined for revenue recognition purposes.

The following table presents a roll-forward of BTC for the six months ended June 30, 2025, based on the fair value model under ASU 2023-08:

---

| | |
|:---|:---|
|  | **Fair value** |
| BTC as of December 31, 2024 | $69319731 |
| Receipt of BTC from mining services | 14408801 |
| Sales of BTC in exchange of cash | (53963734) |
| Sales of BTC in exchange of USDC | (1223250) |
| Payment of BTC for service charges from mining facilities | (1166722) |
| Payment of BTC for other expenses | (73707) |
| Change in fair value of BTC | 2750481 |
| BTC fair value as of June 30, 2025 | $**30051600** |

---

For the additions of BTC generated by the Company's mining business, see Note 3. *Revenue from Contracts with Customers*.

Bitcoin is sold on a FIFO basis. For the six months ended June 30, 2025, gains from the sales of bitcoin are included in change in fair value of BTC which is included in the consolidated statements of operations under the caption "Gains (losses) on digital assets".

The following table presents a roll-forward of ETH for the six months ended June 30, 2025, based on the fair value model under ASU 2023-08:

---

| | |
|:---|:---|
|  | **Fair value** |
| ETH as of December 31, 2024 | $92057613 |
| Receipt of ETH from native staking business | 925973 |
| Investment of ETH in fund | (7030398) |
| Payment of ETH for other expenses | (780) |
| Change in fair value of ETH | (24789558) |
| ETH fair value at June 30, 2025 | $**61162850** |

---

For the additions of ETH generated by the Company's ETH staking business, see Note 3. *Revenue from Contracts with Customers*.

ETH is sold on a FIFO basis. For the six months ended June 30, 2025, gains from the sales of ETH are included in change in fair value of ETH which is included in the consolidated statements of operations under the caption "Gains (losses) on digital assets".

**7. OTHER CURRENT ASSETS**

Other current assets were comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30, <br> 2025** | **December 31,<br> 2024** |
| Deposits (a) | $4757685 | $1704785 |
| Prepayments to mining facilities (b) | - | 290475 |
| Prepaid director and officer insurance expenses | 611150 | 219471 |
| Prepaid consulting service expenses | 3495450 | 3016460 |
| Deposit for lease | 76906 | 63586 |
| Deferred contract costs | 982039 | 982039 |
| Contract assets | 807322 | - |
| Prepayment to third parties | 8263352 | 15526472 |
| Receivable from third parties | 5814496 | 6305652 |
| Others | 1906756 | 210729 |
| **Total** | $**26715156** | $**28319669** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) As of June 30, 2025 and December 31, 2024, the balance of deposits
represented the deposits made to our service providers, who paid utility charges in mining facilities on behalf of the Company. The deposits
are refundable upon expiration of the agreement.

&nbsp;&nbsp;&nbsp;&nbsp;(b) As of June 30, 2025 and December 31, 2024, the balance of prepayments to mining facilities represented the prepayments for service charges from the mining facilities.

**8. LEASES**

***Lease as Lessee***

For the year ended December 31, 2023, the Company entered into a capacity lease agreement for its cloud services designed to support generative AI workstreams. The initial lease term is three years, with automatic renewals for successive twelve-month periods. The lease expense incurred in December 2023 is capitalized as deferred cost since it is directly related to fulfilling its cloud services which commenced operations in January 2024. The capitalized lease payment was expensed in January 2024.

On July 30, 2024, the Company entered into an office lease agreement for its headquarters office in New York. The initial lease term is three years with automatic renewals for successive terms equal in length to the initial term.

On August 1, 2024, the Company entered into an additional capacity lease agreement for its cloud services. The initial lease term is three years with automatic renewals for successive twelve-month periods.

On October 11, 2024, the Company acquired 100% of Enovum Data Centers Corp, including a data center lease agreement in Montreal for its data center services. The remaining lease term on the date of acquisition was twelve years with two five-year renewal options.

On December 3, 2024, the Company entered into a lease agreement in Singapore for general and administrative purposes. The initial lease term is two years with option to renew for one year.

On February 11, 2025, the Company, through WhiteFiber, entered into an additional office lease agreement for its headquarters office in New York. The initial lease term is twenty-seven months with automatic renewals on a month-to-month basis.

On March 1, 2025, the Company entered into an additional capacity lease agreement for its cloud services. The initial lease term is three years with automatic renewals for successive twelve-month periods.

On April 1, 2025, the Company entered into a lease agreement for general and administrative purposes. The lease term is two years.

On April 11, 2025, the Company, through WhiteFiber, entered into a data center lease agreement in Saint-Jérôme for its data center colocation services. The initial lease term is for twenty years with two 5-year extension options. The transaction also includes a fixed-price purchase option exercisable until December 31, 2025.

As of June 30, 2025 and December 31, 2024, operating right-of-use assets were $44.8 million and $15.0 million, respectively and operating lease liabilities were $43.7 million and $13.8 million, respectively. For the three months ended June 30, 2025 and 2024, the Company's amortization on the operating lease right-of-use assets totaled $1.3 million and $0.5 million, respectively. For the six months ended June 30, 2025 and 2024, the Company's amortization on the operating lease right-of-use assets totaled $2.4 million and $0.9 million, respectively.

The following table presents the components of the Company's lease expense. GPU lease expenses and data center lease expenses related to operational data centers are included in cost of revenue; data center lease expenses incurred during construction and office lease expenses are included in general and administrative expense:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Operating lease costs | $5564798 | $4430061 | $10686875 | $7112240 |
| Short-term lease costs | 68967 | 91573 | 138015 | 180073 |
| Sublease income | (6578) | - | (12765) | - |
| Total lease costs | **5627187** | **4521634** | **10812125** | **7292313** |

---

Additional information regarding the Company's leasing activities as a lessee is as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Operating cash outflows from operating leases | $1815328 | $600000 | $3190019 | $1200000 |
| Remaining lease term – operating lease | 21.3 | 2.5 | 21.3 | 2.5 |
| Discount rate – operating lease | 6.5% | 9.9% | 6.5% | 9.9% |

---

The following table represents our future minimum operating lease payments as of June 30, 2025:

 

---

| | |
|:---|:---|
| **Year** | **Amount** |
| 2025 | $3931558 |
| 2026 | 7794627 |
| 2027 | 4263598 |
| 2028 and thereafter | 61260476 |
| Total undiscounted lease payments | 77250259 |
| Less present value discount | (33504966) |
| Present value of lease liability | $**43745293** |

---

The Company entered into a GPU server lease agreement effective January 2024 for its cloud services designed to support generative AI workstreams. The lease payment depends on the usage of the GPU servers and the Company concludes that the lease payments are variable and will be recognized when they are incurred. For the three months ended June 30, 2025 and 2024, the GPU server lease expense amounted to $3.7 million and $3.8 million, respectively. For the six months ended June 30, 2025 and 2024, the GPU server lease expense amounted to $7.5 million and $5.9 million, respectively.

***Lease as Lessor***

During the quarter ended March 31, 2024, the Company entered into a sales-type lease agreement as a lessor for its data storage equipment. The term of the lease is scheduled to expire in December 2026.

During the quarter ended September 30, 2024, the Company entered into a sales-type lease agreement as a lessor for its data storage equipment. The term of the lease is scheduled to expire in December 2026.

During the quarter ended December 31, 2024, the Company entered into two sales-type lease agreements as a lessor for its cloud service equipment. The term of the lease is scheduled to expire in October 2029 and November 2029 respectively.

During the quarter ended December 31, 2024, the Company entered into an operating sublease agreement to partially lease out its leased data center to a third party. The term of the sublease is scheduled to expire on October 30, 2026 and includes two automatic renewal periods of three years each, unless subtenant provides at least 90 days' notice of non-renewal prior to the end of the then-current term.

During the quarter ended June 30, 2025, the Company entered into two sales-type lease agreements as a lessor for its cloud service equipment. The term of the lease is scheduled to expire in April 2030 and May 2030, respectively.

The components of lease income for the sales-type lease were as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Interest income related to net investment in lease | $337930 | $92504 | $618497 | $192252 |

---

Interest income is included in the consolidated statements of operations under the caption "Revenue – Other".

The components of net investment in sales-type leases were as follows:

---

| | | |
|:---|:---|:---|
|  | **June 30,<br> 2025** | **December 31,<br> 2024** |
| Net investment in lease - lease payment receivable | $12885554 | $9328998 |

---

The following table illustrates the Company's future minimum receipts for sales-type lease as of June 30, 2025:

---

| | |
|:---|:---|
| **Year** | **Sales-Type<br> Lease** |
| 2025 | $2413097 |
| 2026 | 4826194 |
| 2027 | 2844663 |
| 2028 | 2844663 |
| 2029 | 3088784 |
| Total future minimum receipts | 16017401 |
| Unearned interest income | (3131847) |
| Net investment in sales type lease | $12885554 |

---

The present value of minimum sales-type receipts of $12,885,554 is included in the consolidated balance sheets under the caption "Net investment in lease".

The following table illustrates the future lease payments from the Company's sublease tenant as of June 30, 2025 were as follows:

---

| | |
|:---|:---|
| **Year** | **Operating<br> Lease** |
| 2025 | $13021 |
| 2026 | 26042 |
| 2027 | 26042 |
| 2028 | 26042 |
| 2029 | 26042 |
| Thereafter | 73785 |
| Total future receipts | 190974 |

---

**9. PROPERTY, PLANT, AND EQUIPMENT, NET**

Property, plant and equipment, net was comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,<br> 2025** | **December 31,<br> 2024** |
| Miners for Bitcoin | $44862716 | $37484751 |
| Cloud service equipment | 99492846 | 63360624 |
| Colocation service equipment | 15133931 | 12509288 |
| Purchased and internal-use software development costs | 2493397 | 495285 |
| Land | 10773232 | 3502539 |
| Building | 56399860 | 19474743 |
| Leasehold Improvements | 2450025 | 2032691 |
| Vehicle | 235576 | 235576 |
| Other property and equipment | 30276 | 29066 |
| Less: Accumulated depreciation | (48005905) | (36946762) |
|  | 183865954 | 102177801 |
| Construction in progress | 70054982 | 5124657 |
| **Property, plant, and equipment, net** | $**253920936** | $**107302458** |

---

For the six months ended June 30, 2025 and 2024, depreciation expenses were $8,223,538 and $8,346,633, respectively. Construction in Progress represents assets received but not placed into service as of June 30, 2025 and December 31, 2024.

During the quarter ended March 31, 2024, we purchased data storage equipment totaling $5,315,202. Almost immediately thereafter, we entered into a sales-type lease agreement for a portion of these assets valued at $3,353,608 with a third party. As a result, the leased data storage equipment was derecognized from our property and equipment and recorded as a net investment in lease. Refer to Note 8. *Leases* for more information.

During the quarter ended September 30, 2024, we purchased data storage equipment totaling $1,254,248 and immediately thereafter, we entered into a sales-type lease agreement effective August 2024 for a portion of these assets valued at $1,184,937 with a third party. As a result, the leased data storage equipment was derecognized from our property and equipment and recorded as a net investment in lease. Refer to Note 8. *Leases* for more information.

During the quarter ended December 31, 2024, the Company purchased servers and network equipment totaling $6,056,700 and almost immediately thereafter, we entered into two sales-type lease agreements effective November 2024 and December 2024 with a third party. As a result, the leased cloud service equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 8. *Leases* for more information.

During the quarter ended June 30, 2025, the Company purchased servers and network equipment totaling $4,898,326 and almost immediately thereafter, we entered into two sales-type lease agreements effective May 2025 and June 2025, respectively, with a third party. As a result, the leased cloud service equipment was derecognized from our property, plant, and equipment and recorded as a net investment in lease. Refer to Note 8. *Leases* for more information.

*Sales of miners for the three months ended March 31, 2025*

For the three months ended March 31, 2025, the Company sold 4,828 bitcoin miners for a total consideration of $906,016. On the dates of the transaction, the total original cost and accumulated depreciation of these miners were $5,362,720 and $4,123,084, respectively. The Company recognized a loss of $333,620 from the sale of miners which was recorded in the account of "loss from disposal of property and equipment". As of the date of this report, the Company has collected cash consideration of $906,016.

**10. INVESTMENT SECURITIES**

Investment securities were comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30,<br> 2025** | **December 31,<br> 2024** |
| Investment in Digital Future Alliance Limited ("DFA") (a) | $94534 | $94534 |
| Investment in Nine Blocks Offshore Feeder Fund ("Nine Blocks") (b) | 2934308 | 3036403 |
| Investment in Auros Global Limited (c) | 1999987 | 1999987 |
| Investment in Ingonyama Ltd (d) | 100000 | 100000 |
| Investment in Cysic Inc. (e) | 100000 | 100000 |
| Investment in a SAFE (f) | 1000000 | 1000000 |
| Investment in AI Innovation Fund I ("AI fund") (g) | 17651600 | 15800000 |
| Investment in Innovation Fund I ("Innovation fund") (h) | 15073363 | 8666441 |
| **Total** | $**38953792** | $**30797365** |

---

*(a) Investment in Digital Future Alliance Limited ("DFA")*

DFA is a privately held company, over which the Company has neither control nor significant influence through investment in ordinary shares. The Company accounted for the investment in DFA using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

For the three and six months ended June 30, 2025 and 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of June 30, 2025 and December 31 2024, the Company did not recognize impairment against the investment security.

*(b) Investment in Nine Blocks Offshore Feeder Fund ("Nine Blocks")*

On August 1, 2022, the Company entered into a subscription agreement with Nine Blocks for investment of $2.0 million. The investment includes a direct investment into the Nine Blocks Master Fund, a digital assets market neutral fund using basis trading, relative value, and special situations strategies.

As a practical expedient, the Company uses Net Asset Value ("NAV") or its equivalent to measure the fair value of the investment in the fund. For the three months ended June 30, 2025 and 2024, the Company recorded cumulative downward adjustments of $26,095 and cumulative upward adjustments of $82,792, respectively, on the investment. For the six months ended June 30, 2025 and 2024, the Company recorded cumulative downward adjustments of $102,095 and cumulative upward adjustments of $537,497, respectively, on the investment.

*(c) Investment in Auros Global Limited ("Auros")*

On February 24, 2023, the Company closed an investment of $1,999,987 in Auros, which is a leading crypto-native algorithmic trading and market making firm that delivers best-in-class liquidity for exchanges and token projects. The Company neither has control nor significant influence through investment in ordinary shares. The Company accounted for the investment in Auros using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

For the three and six months ended June 30, 2025 and 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of June 30, 2025 and December 31, 2024, the Company did not recognize impairment against the investment security.

*(d) Investment in Ingonyama Ltd. ("Ingonyama")*

In September 2023, the Company closed an investment of $100,000 in Ingonyama, a semiconductor company focusing on Zero Knowledge Proof hardware acceleration. The Company neither has control nor significant influence through investment in preferred shares. The Company accounted for the investment in Ingonyama using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

For the three and six months ended June 30, 2025 and 2024, the Company did not record upward adjustments or downward adjustments on the investment. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of June 30, 2025 and December 31, 2024, the Company did not recognize impairment against the investment security.

*(e) Investment in Cysic Inc ("Cysic")*

On April 2, 2024, the Company closed an investment of $100,000 in Cysic, a ZK hardware acceleration company and ZK prover network to provide ZK Compute-as-a-Service. The Company has neither control nor significant influence through investment in preferred shares. The Company accounted for the investment in Cysic using the measurement alternative at cost, less impairment, with subsequent adjustments for observable price changes resulting from orderly transactions for identical or similar investments of the same issuer.

For the three and six months ended June 30, 2025, the Company did not record upward adjustments or downward adjustments on the investment. The Company's impairment analysis considers both qualitative and quantitative factors that may have a significant effect on the fair value of the equity security. As of June 30, 2025 and December 31, 2024, the Company did not recognize impairment against the investment security.

*(f) Investment in a SAFE* 

On June 30, 2024 (the "Effective Date"), the Company entered into a simple agreement for future equity ("SAFE") agreement for an initial investment amount of $1 million in exchange for a right to participate in a future equity financing of preferred stock to be issued by Canopy Wave Inc. ("Canopy"). Alternatively, upon a liquidity event such as a change in control, a direct listing or an initial public offering, the Company is entitled to receive the greater of (i) the SAFE investment amount plus 15% annual accrued interest (the "cash-out amount") or (ii) the SAFE investment amount divided by a discount to the price per share of Canopy's common stock. In a dissolution event, such as a bankruptcy, the Company is entitled to receive the cash-out amount. If the SAFE is outstanding on the three-year anniversary of the Effective Date, then the SAFE will expire and the Company will be entitled to receive the cash-out amount. In the event of a qualifying equity financing, the number of shares of preferred stock received by the Company would be determined by dividing the SAFE investment amount by a discounted price per share of the preferred stock issued in the respective equity financing. The Company recorded an investment of $1 million as an investment in the SAFE on the consolidated balance sheets. Additionally, per the terms of the SAFE arrangement, the Company may be obligated to invest up to an additional $2 million into the SAFE arrangement if Canopy satisfies certain milestones prior to the expiration of the SAFE, or if an equity financing event occurs.

The Company accounted for this investment under ASC 320, *Investments - Debt Securities* and elected the fair value option for the SAFE investment pursuant to ASC 825, *Financial Instruments*, which requires financial instruments to be remeasured to fair value each reporting period, with changes in fair value recorded in the consolidated statements of operations. The fair value estimate includes significant inputs not observable in the market, which represents a Level 3 measurement within the fair value hierarchy. The decision to elect the fair value option is determined on an instrument-by-instrument basis on the date the instrument is initially recognized, is applied to the entire instrument, and is irrevocable once elected. For instruments measured at fair value, embedded conversion or other features are not required to be separated from the host instrument. Issuance costs related to convertible securities carried at fair value are not deferred and are recognized as incurred on the consolidated statements of operations.

For the three and six months ended June 30, 2025, the Company did not record upward adjustments or downward adjustments on the investment.

*(g) Investment in AI Innovation Fund I ("AI fund")*

On July 15, 2024, the Company entered into a subscription agreement with Pleasanton Ventures Innovation Master Fund SPC Limited for investment of $15.9 million in its AI Innovation Fund I. The investment includes a direct investment into private equity and fund of fund opportunities within the AI industry. On May 20, 2025 the Company invested an additional $2.0 million into the fund.

As a practical expedient, the Company uses Net Asset Value ("NAV") or its equivalent to measure the fair value of the investment in the fund. For the three months ended June 30, 2025, the Company recorded cumulative downward adjustments of $75,000 on the investment. For the six months ended June 30, 2025, the Company recorded cumulative downward adjustments of $150,000 on the investment.

*(h) Investment in Innovation Fund I ("Innovation fund")*

 

After the Company disposed its BVI entities for its previous fund operation (See Note 20. *Disposition of Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund Spc Limited* for more information), the Company no longer consolidates the investment in the fund. As a practical expedient, the Company uses Net Asset Value ("NAV") or its equivalent to measure the fair value of the investment in the fund.

On March 25, 2025, the Company invested an additional 3,400 ETH, equivalent to approximately $7.0 million into the fund. For the three months ended June 30, 2025 and 2024, the Company recorded cumulative upward adjustments of $3,917,951 and $331,625, respectively, on the investment. For the six months ended June 30, 2025 and 2024, the Company recorded cumulative downward adjustments of $623,477 and downward adjustment of $2,676,237, respectively, on the investment.

**11. OTHER NON-CURRENT ASSETS**

Other non-current assets were comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **June 30, <br> 2025** | **December 31,<br> 2024** |
| Deposits (a) | $6249881 | $7103560 |
| Deferred contract costs | 491020 | 982039 |
| Contract assets | 538214 | - |
| Others | 786234 | 1494285 |
| **Total** | $**8065349** | $**9579884** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) As of June 30, 2025 and December 31, 2024, the balance of deposits
primarily consisted of the deposits made to utility company related to our colocation services and to our service providers who paid utility
charges in mining facilities on behalf of the Company. The deposits are refundable upon expiration of the agreement.

**12. SHARE-BASED COMPENSATION**

Share-based compensation such as restricted stock units ("RSUs"), incentive and non-statutory stock options, restricted shares, share appreciation rights and share payments may be granted to any directors, employees and consultants of the Company or affiliated companies under the 2021 Omnibus Equity Incentive Plan ("2021 Plan"), 2021 Second Omnibus Equity Incentive Plan ("2021 Second Plan"), 2023 Omnibus Equity Incentive Plan ("2023 Plan"), and 2025 Omnibus Equity Incentive Plan ("2025 Plan"). An aggregate of 2,415,293 RSUs were granted under the 2021 Plan and no ordinary shares remain reserved for issuance under the 2021 Plan. There are 5,000,000 ordinary shares reserved for issuance under the Company's 2021 Second Plan, under which 4,211,372 RSUs and 395,000 share options have been granted as of June 30, 2025. There are 5,000,000 ordinary shares reserved for issuance under the Company's 2023 Plan, under which 4,993,201 RSUs have been granted as of June 30, 2025. There are 8,000,000 ordinary shares reserved for issuance under the Company's 2025 Plan, under which 3,305,963 RSUs have been granted as of June 30, 2025.

*<u>Restricted Stock Units ("RSUs")</u>*

As of December 31, 2024, the Company had 1,025,968 awarded and unvested RSUs.

On January 14, 2025, the Company granted 20,000 RSUs to a non-executive director in accordance with his compensation arrangement. All of these RSUs were immediately vested.

On February 10, 2025, the Company granted 32,113 RSUs to an employee, which are subjected to an sixteen-quarter service vesting schedule.

On May 14, 2025, the Company granted 20,000 RSUs to an employee. All of these RSUs were immediately vested.

On June 17, 2025, the Company granted 2,599,198 RSUs to employees. All of these RSUs vested on July 2, 2025, the effective date of the S-8 registration statement filed July 2, 2025.

On June 30, 2025, the Company granted 255,000 RSUs to each of the Company's Chief Executive Officer and Chief Financial Officer in accordance with their compensation arrangements. All of these RSUs were immediately vested.

For the three months ended June 30, 2025 and 2024, the Company recognized share-based compensation expenses of $6,874,740 and $383,047. For the six months ended June 30, 2025 and 2024, the Company recognized share-based compensation expenses of $7,090,538 and $770,635. As of June 30, 2025, the Company had $3,607,864 unrecognized compensation costs related to the unvested RSUs.

As of June 30, 2025, the Company had 3,769,914 awarded and unvested RSUs.

*<u>Share Options</u>*

For the three months ended June 30, 2025 and 2024, the Company did not grant any options.

The Company recognizes compensation expenses related to options on a straight-line basis over the vesting periods. For the three months ended June 30, 2025 and 2024, the Company recognized share-based compensation expenses of $15,906 and $40,688, respectively. For the six months ended June 30, 2025 and 2024, the Company recognized share-based compensation expenses of $52,498 and $145,700, respectively. As of June 30, 2025, there were $1,923 of unrecognized compensation costs related to all outstanding share options.

*<u>Other share-based compensation</u>*

 

In January 2025, the Company entered into separate one-year service agreements with three consultants by granting each 150,000 RSUs, all of which vested immediately. Over the duration of the service agreement, the Company will recognize share-based compensation expenses aggregating $1.6 million based upon the closing price of the Company's ordinary shares on date of agreement.

In April 2025, the Company entered into a one-year service agreement with a consulting firm and granted 250,000 RSUs thereto, all of which vested immediately. Over the duration of the service agreement, the Company will recognize share-based compensation expenses aggregating $0.5 million based upon the closing price of the Company's ordinary shares on date of agreement.

In April 2025, WhiteFiber entered into a one-year director agreement with David Andre pursuant to which Mr. Andre would be appointed as a director of WhiteFiber upon the commencement of trading of our Ordinary Shares on the Nasdaq Capital Market. This agreement granted 135,135 RSUs of Bit Digital, which are subject to a four-quarter service vesting schedule. As the effective date of the Form S-1 was subsequent to June 30, 2025, this agreement was considered a consulting agreement until Mr. Andre was elected to the Board of Directors of WhiteFiber on August 7, 2025. Over the duration of the service agreement, the Company will recognize share-based compensation expenses aggregating $0.2 million based upon the closing price of the Company's ordinary shares on the date of the agreement.

**13. SHARE CAPITAL**

<u>Ordinary shares</u>

As of December 31, 2024, there were 179,255,191 ordinary shares issued and 179,125,205 ordinary shares outstanding.

In May 2022, the Company entered into an At-the-Market Offering Agreement with H.C. Wainwright & Co., LLC relating to the Company's ordinary shares. In accordance with the terms of the sales agreement, the Company may offer and sell ordinary shares having an aggregate offering price of up to $500,000,000. During the six months ended June 30, 2025, the Company sold 28,654,586 ordinary shares for an aggregate purchase price of $58.5 million net of offering costs pursuant to this at-the-market offering.

On April 29, 2025, the Company filed a registration statement on Form S-3 (No. 333-286841) to register up to $500 million of its ordinary shares, preference shares, debt securities, warrants, units and subscription rights (the "Registration Statement").

In June 2025, the Company completed an underwritten public offering of its ordinary shares registered under the Registration Statement. In accordance with the terms of the underwriting agreement entered into with B. Riley Securities, Inc., as representative of the several underwriters, the Company sold 75,000,000 ordinary shares at a price to the underwriters of $1.90 per share. The Company received net proceeds of approximately $141.6 million, after deducting the underwriting discount and offering expense. On July 1, 2025, the underwriters related to this public offering fully exercised their option to purchase an additional 11,250,000 ordinary shares, resulting in additional net proceeds to the Company of $21.3 million, after deducting the underwriting discount and offering expenses.

During the six months ended June 30, 2025, 1,272,500 ordinary shares were issued to the Company's employees, directors, and consultants in settlement of an equal number of fully vested restricted share units awarded to such individuals and companies by the Company pursuant to grants made under the Company's 2023 Plan and 2025 Plan.

As of June 30, 2025, there were 284,182,277 ordinary shares issued and 284,052,291 ordinary shares outstanding.

<u>Preferred shares</u>

As of June 30, 2025 and December 31, 2024, there were 1,000,000 preferred shares issued and outstanding.

The preference shares are entitled to the following preference features: 1) an annual dividend of 8% when, and if, declared by the Board of Directors; 2) a liquidation preference of $10.00 per share; 3) convert on a one for one basis for ordinary shares, subject to a 4.99% conversion limitation; 4) rank senior to ordinary shares in insolvency; and 5) solely for voting purposes vote 50 ordinary shares, for each preference share.

On December 20, 2024, the Board of Directors declared an 8% ($800,000) dividend on the preference shares to Geney Development Ltd. ("Geney"). Erke Huang, our Chief Financial Officer, is the President of Geney and the beneficial owner of 30% of the equity of Geney, with the remaining 70% held by Zhaohui Deng, the Company's Chairman of the Board. The Company fully paid the declared dividend in January 2025.

<u>Treasury stock</u>

The Company treats ordinary shares withheld for tax purposes on behalf of employees in connection with the vesting of restricted share grants as ordinary share repurchases because they reduce the number of ordinary shares that would have been issued upon vesting. For the six months ended June 30, 2025 and 2024, the Company withheld nil ordinary shares that were surrendered to the Company for withholding taxes related to restricted stock vesting valued at $nil, based on fair value of the withheld shares on the vesting date.

As of June 30, 2025 and December 31, 2024, the Company had treasury stock of $1,171,679 and $1,171,679, respectively.

<u>Warrants</u>

As of June 30, 2025 and December 31, 2024, the Company had outstanding 10,118,046 private placement warrants to purchase an aggregate of 10,118,046 ordinary shares at an exercise price of $7.91 per whole share. These warrants expired on July 25, 2025 and were not extended.

In accordance with ASC 815, the Company determined that the warrants meet the conditions necessary to be classified as equity because the consideration is indexed to the Company's own equity, there are no exercise contingencies based on an observable market not based on its stock or operations, settlement is consistent with a fixed-for-fixed equity instrument, the agreement contains an explicit number of ordinary shares and there are no cash payment provisions.

The fair value of the warrants was estimated at $33.3 million using the Black-Scholes model. Inherent in these valuations are assumptions related to expected stock-price volatility, expected life, risk-free interest rate and dividend yield. The Company estimates the volatility of its ordinary shares based on historical and implied volatilities of selected peer companies as well as its own that match the expected remaining life of the warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield curve on the grant date for a maturity similar to the expected remaining life of the warrants. The expected life of the warrants is assumed to be equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company anticipates it to remain at zero.

The following table provides quantitative information regarding Level 3 fair value measurements inputs for the Company's warrants at their measurement dates:

---

| | |
|:---|:---|
|  | **As of<br> October 4,<br> 2021** |
| Volatility | 192.85% |
| Stock price | 7.59 |
| Expected life of the warrants to convert | 3.81 |
| Risk free rate | 0.97% |
| Dividend yield | 0.0% |

---

**14. GOODWILL AND INTANGIBLE ASSETS**

<u>Goodwill</u>

The components of goodwill as of June 30, 2025 are as follows:

---

| | |
|:---|:---|
|  | **As of <br> June 30, <br> 2025** |
| Enovum Data Centers Corp. | $20190268 |
| Total goodwill | $20190268 |

---

The Company recorded goodwill in the amount of $20.2 million in connection with its acquisition of the Enovum Data Centers Corp. ("Enovum") on October 11, 2024. Refer to Note 4. *Acquisitions* for further information.

<u>Finite-lived intangible assets</u>

In addition to goodwill, in connection with the acquisition of Enovum, the Company recorded an identified intangible asset, customer relationships, with a definite useful life of 19 years in the amount of $13.5 million. Refer to Note 4. *Acquisitions* for further information.

The following table presents the Company's finite-lived intangible assets as of June 30, 2025:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of June 30, 2025** | **As of June 30, 2025** | **As of June 30, 2025** |
|  | **Cost** | **Accumulated<br> amortization** | **Net** |
| Customer relationships | $13721607 | $(511551) | $13210056 |
| Total | $13721607 | $(511551) | $13210056 |

---

The following table presents the Company's finite-lived intangible assets as of December 31, 2024:

---

| | | | |
|:---|:---|:---|:---|
|  | **As of December 31, 2024** | **As of December 31, 2024** | **As of December 31, 2024** |
|  | **Cost** | **Accumulated<br> amortization** | **Net** |
| Customer relationships | $13486184 | $(457454) | $13028730 |
| Total | $13486184 | $(457454) | $13028730 |

---

The following table presents the Company's estimated future amortization of finite-lived intangible assets as of June 30, 2025:

---

| | |
|:---|:---|
| 2025 | $346663 |
| 2026 | 693325 |
| 2027 | 693325 |
| Thereafter | 11476743 |
| **Total** | $13210056 |

---

The Company did not identify any impairment of its finite-lived intangible assets during the six months ended June 30, 2025.

**15. INCOME TAXES**

The following table provides details of income taxes:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| Income (loss) before income taxes | $16465759 | $(11411319) | $(40574170) | $40247888 |
| Provision for (benefit from) income taxes | $1591557 | $541781 | $2263273 | $2119131 |
| Effective tax rate | 9.7% | (4.7)% | (5.6)% | 5.3% |

---

Our income tax provision was $1.6 million and $0.5 million for the three months ended June 30, 2025 and 2024, respectively. The income tax provision was higher during the three months ended June 30, 2025 compared to the three months ended June 30, 2024 primarily due to increase of $0.9 million in Canada due to the unrealized gain resulted from increased bitcoin price during the three months ended June 30, 2025 as compared to the same period in 2024 and increase of $0.2 million in the United States due to higher taxable profits from digital assets sales during the three months ended June 30, 2025 compared to the same period in 2024.

Our income tax provision was $2.3 million and $2.1 million for the six months ended June 30, 2025 and 2024, respectively. The income tax provision did not change materially during the six months ended June 30, 2025 compared to the same period in 2024.

With the enactment of the One Big Beautiful Bill Act ("OBBBA") on July 4, 2025, the Company anticipates a reduction in our U.S. federal cash tax payments for the remainder of 2025 as the 100% bonus depreciation on qualified assets is permanently restored. There are several alternative ways of implementing the provisions of the OBBBA, which we are currently evaluating. At this time, we do not expect the OBBBA to have a material impact on our tax provision and expect to recognize its effects in our financial results for the period ending September 30, 2025.

We also continue to monitor the adoption of Pillar Two relating to the global minimum tax in each of our tax jurisdictions to evaluate its impact on our effective income tax rate. For the three months ended June 30, 2025, the Company is not subject to Pillar Two global minimum tax.

**16. EARNINGS (LOSS) PER SHARE**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Net income (loss)** | $**14874202** | $**(11953100)** | $**(42837443)** | $**38128757** |
| **Weighted average number of ordinary share outstanding** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | 206889826 | 128053586 | 194355223 | 121362883 |
| &nbsp;&nbsp;&nbsp;Diluted | 208817806 | 128053586 | 194355223 | 122374103 |
| **Earnings (loss) per share** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Basic | $0.07 | $(0.09) | $(0.22) | $0.31 |
| &nbsp;&nbsp;&nbsp;Diluted | $0.07 | $(0.09) | $(0.22) | $0.31 |

---

Basic earnings (loss) per share is computed by dividing net income (loss) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the period. The computation of diluted net loss per share does not include dilutive ordinary share equivalents in the weighted average shares outstanding, as they would be anti-dilutive.

For the three months ended June 30, 2025, the dilutive effect of preferred shares and unvested RSUs were included in the calculation of diluted earnings per share. The warrants and options were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the six months ended June 30, 2025, the unvested RSUs, warrants, options and convertible preferred shares were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the three months ended June 30, 2024, the unvested RSUs, warrants, options and convertible preferred shares were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

For the six months ended June 30, 2024, the dilutive effect of preferred shares and unvested RSUs were included in the calculation of diluted earnings per share. The warrants and options were excluded from the calculation of diluted earnings per share because they were anti-dilutive.

**17. SEGMENT REPORTING**

The Company has four reportable segments digital asset mining, cloud services, colocation services, and ETH Staking. The reportable segments are identified based on the types of service performed.

Gross profit (loss) is the segment performance measure the chief operating decision maker ("CODM") uses to assess the Company's reportable segments.

The digital asset mining segment generates revenue from the bitcoin the Company earns through its mining activities. Cost of revenue consists primarily of direct production costs of mining operations, including electricity, management fee and maintenance cost but excluding depreciation and amortization.

The cloud services segment generates revenue from providing high performance computing services to support generative AI workstreams. Cost of revenue consists of direct production costs, including electricity costs, data center lease expense, GPU servers lease expense, and other relevant costs, but excluding depreciation and amortization.

Colocation services generate revenue by providing customers with physical space, power and cooling within the data center facility. Cost of revenue consists of direct production costs related to our HPC data center services, including electricity costs, lease costs, data center employees' wage expenses and other relevant costs.

The Ethereum staking segment generates revenue from both native staking and liquid staking. Cost of revenue consists of direct cost related to ETH staking business including service fee and reward-sharing fees to the service providers.

The CODM analyzes the performance of the segments based on reportable segment revenue and reportable segment cost of revenue. No operating segments have been aggregated to form the reportable segments.

Other than the $20.2 million of goodwill from the Enovum Acquisition allocated to the Colocation Services segment, the Company does not allocate all assets to the reporting segments as these are managed on an entity-wide basis. Therefore, the Company does not separately disclose the total assets of its reportable operating segments.

All *Other revenue* is generated from equipment leases with external customers.

 

The following table presents segment revenue and segment gross profit reviewed by the CODM:

**Three Months Ended June 30, 2025**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Digital asset<br> mining** | **Cloud<br> services** | **Colocation<br> services** | **ETH<br> staking** | **Total** |
| Revenue from external customers | $6631838 | $16595315 | $1729004 | $365332 | $25321489 |
| *Reconciliation of revenue* |  |  |  |  |  |
| Other revenue (a) |  |  |  |  | 337930 |
| &nbsp;&nbsp;&nbsp;Total consolidated revenue |  |  |  |  | 25659419 |
| Less: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Electricity costs | 4334282 | 601655 | 270003 | - | 5205940 |
| &nbsp;&nbsp;&nbsp;Profit sharing fees | 1051811 | - | - | - | 1051811 |
| &nbsp;&nbsp;&nbsp;Datacenter lease expense | - | 1365599 | 156740 | - | 1522339 |
| &nbsp;&nbsp;&nbsp;GPU lease expense | - | 3749470 | - | - | 3749470 |
| &nbsp;&nbsp;&nbsp;Wage expense | - | - | 169543 | - | 169543 |
| &nbsp;&nbsp;&nbsp;Service costs - ETH staking | - | - | - | 29633 | 29633 |
| &nbsp;&nbsp;&nbsp;Other segment items (b) | 689492 | 674396 | 91594 | - | 1455482 |
| **Segment gross profit** | $556253 | $10204195 | $1041124 | $335699 | $12137271 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) Other revenue is primarily attributable to Equipment Leasing revenue and is therefore not included in the total for segment gross profit.

&nbsp;&nbsp;&nbsp;&nbsp;(b) All amounts included within Other segment items are individually insignificant.

**Three Months Ended June 30, 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Digital asset<br> mining** | **Cloud<br> services** | **ETH<br> staking** | **Total** |
| Revenue from external customers | $16079893 | $12497197 | $373812 | $28950902 |
| *Reconciliation of revenue* |  |  |  |  |
| Other revenue (a) |  |  |  | 92504 |
| &nbsp;&nbsp;&nbsp;Total consolidated revenue |  |  |  | 29043406 |
| Less: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Electricity costs | 7177302 | 143043 | - | 7320345 |
| &nbsp;&nbsp;&nbsp;Profit sharing fees | 2714035 | - | - | 2714035 |
| &nbsp;&nbsp;&nbsp;Datacenter lease expense | - | 605220 | - | 605220 |
| &nbsp;&nbsp;&nbsp;GPU lease expense | - | 3830061 | - | 3830061 |
| &nbsp;&nbsp;&nbsp;Service costs - ETH staking | - | - | 20458 | 20458 |
| &nbsp;&nbsp;&nbsp;Other segment items (b) | 646504 | 16977 | 3998 | 667479 |
| **Segment gross profit** | $5542052 | $7901896 | $349356 | $13793304 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) Other revenue is primarily attributable to Equipment Leasing and is therefore not included in the total for segment gross profit.

&nbsp;&nbsp;&nbsp;&nbsp;(b) All amounts included within Other segment items are individually insignificant.

**Six Months Ended June 30, 2025**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Digital asset<br> mining** | **Cloud<br> services** | **Colocation<br> services** | **ETH<br> staking** | **Total** |
| Revenue from external customers | $14408801 | $31437601 | $3367413 | $925973 | $50139788 |
| *Reconciliation of revenue* |  |  |  |  |  |
| Other revenue (a) |  |  |  |  | 618497 |
| &nbsp;&nbsp;&nbsp;Total consolidated revenue |  |  |  |  | 50758285 |
| Less: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Electricity costs | 8567364 | 1171592 | 493061 | - | 10232017 |
| &nbsp;&nbsp;&nbsp;Profit sharing fees | 2242111 | - | - | - | 2242111 |
| &nbsp;&nbsp;&nbsp;Datacenter lease expense | - | 2639653 | 307277 | - | 2946930 |
| &nbsp;&nbsp;&nbsp;GPU lease expense | - | 7496856 | - | - | 7496856 |
| &nbsp;&nbsp;&nbsp;Wage expense |  |  | 169543 |  | 169543 |
| &nbsp;&nbsp;&nbsp;Service costs - ETH staking | - | - | - | 62201 | 62201 |
| &nbsp;&nbsp;&nbsp;Other segment items (b) | 1389999 | 1171019 | 230001 | - | 2791019 |
| **Segment gross profit** | $2209327 | $18958481 | $2167531 | $863772 | $24199111 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) Other revenue is primarily attributable to Equipment Leasing and is therefore not included in the total for segment gross profit.

&nbsp;&nbsp;&nbsp;&nbsp;(b) All amounts included within Other segment items are individually insignificant.

**Six Months Ended June 30, 2024**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Digital asset<br> mining** | **Cloud<br> services** | **ETH<br> staking** | **Total** |
| Revenue from external customers | $37971653 | $20566781 | $699558 | $59237992 |
| *Reconciliation of revenue* |  |  |  |  |
| Other revenue (a) |  |  |  | 192252 |
| &nbsp;&nbsp;&nbsp;Total consolidated revenue |  |  |  | 59430244 |
| Less: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Electricity costs | 15264702 | 226421 |  | 15491123 |
| &nbsp;&nbsp;&nbsp;Profit sharing fees | 6977443 |  |  | 6977443 |
| &nbsp;&nbsp;&nbsp;Datacenter lease expense |  | 1306110 |  | 1306110 |
| &nbsp;&nbsp;&nbsp;GPU lease expense |  | 5912240 |  | 5912240 |
| &nbsp;&nbsp;&nbsp;Service costs - ETH staking |  |  | 28218 | 28218 |
| &nbsp;&nbsp;&nbsp;Other segment items (b) | 1280628 | 307857 | 12671 | 1601156 |
| **Segment gross profit** | $14448880 | $12814153 | $658669 | $27921702 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(a) Other revenue is primarily attributable to Equipment Leasing and is therefore not included in the total for segment gross profit.

&nbsp;&nbsp;&nbsp;&nbsp;(b) All amounts included within Other segment items are individually insignificant.

The following table presents the reconciliation of segment gross profit to net (loss) income before taxes:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br> June 30,** | **For the Three Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** | **For the Six Months Ended <br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Segment gross profit** | $**12137271** | $**13793304** | $**24199111** | $**27921702** |
| **Reconciling Items:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Other profit (a) | 337930 | 92504 | 618497 | 192252 |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization expenses | (8223538) | (8346633) | (15465527) | (15192582) |
| &nbsp;&nbsp;&nbsp;General and administrative expenses | (19667364) | (5480519) | (27937121) | (11436259) |
| &nbsp;&nbsp;&nbsp;Gains (losses) on digital assets | 27154706 | (11538949) | (22050521) | 34193628 |
| &nbsp;&nbsp;&nbsp;Net loss from disposal of property and equipment | - | - | (333620) | - |
| &nbsp;&nbsp;&nbsp;Other income, net | 4726754 | 68974 | 395011 | 4569147 |
| &nbsp;&nbsp;&nbsp;**Net income (loss) before taxes** | 16465759 | (11411319) | (40574170) | 40247888 |

---

(a) Other profit is primarily attributable to Equipment Leasing
and is therefore not included in the total for segment gross profit.

**18. RELATED PARTIES**

On December 20, 2024, the Board of Directors declared an eight (8%) percent ($800,000) dividend on the preference shares to Geney Development Ltd. ("Geney"). Erke Huang, our Chief Financial Officer, is the President of Geney and the beneficial owner of 30% of the equity of Geney, with the remaining 70% held by Zhaohui Deng, the Company's Chairman of the Board. The Company fully paid the declared dividend in January 2025.

Bit Digital Iceland ehf appointed Daniel Jonsson as its part-time Chief Executive Officer starting November 7, 2023, for a six-month term with a three-month probation. His compensation includes a monthly salary of $8,334, a $6,440 signing bonus, and eligibility for performance-based RSU. Concurrently, Daniel Jonsson is part of the management team at GreenBlocks ehf which not only provides bitcoin mining hosting services but also benefits from a facility loan agreement extended by Bit Digital USA Inc., an affiliate of Bit Digital Iceland ehf. Additionally, Bit Digital Iceland ehf has contracted GreenBlocks ehf for consulting services pertaining to our high performance computing services in Iceland. As of December 31, 2023, the Company owed $21,592 to Daniel Jonsson for salary and bonus, and $160,000 to GreenBlocks ehf for services rendered. By the end of the first quarter of 2024, we had settled these outstanding amounts with both Daniel Jonsson and GreenBlocks ehf.

On August 8, 2025, WhiteFiber, a subsidiary of the Company, completed its initial public offering (the "Offering") of 9,375,000 ordinary shares, at a public offering price of $17.00 per share. All ordinary shares in the Offering were sold by WhiteFiber. The gross proceeds to WhiteFiber from the Offering were $159,375,000, before deducting underwriting discounts and commissions and offering expenses payable by WhiteFiber. Prior to the consummation of the Offering, the Company held all of the issued and outstanding ordinary shares of WhiteFiber. After giving effect to the Offering, the Company holds approximately 74.3% of the issued and outstanding ordinary shares of WhiteFiber.

Prior to the consummation of the Offering, the Company entered into a contribution agreement (the "Contribution Agreement") with WhiteFiber, pursuant to which the Company contributed its HPC business through the transfer of 100% of the capital shares of its cloud services subsidiary, WhiteFiber AI, Inc. and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to WhiteFiber in exchange for 27,043,749 ordinary shares of WhiteFiber (the "Contribution"). The Contribution became effective on August 6, 2025, when the registration statement on Form S-1, as amended (File No. No. 333-288650) (the "Registration Statement"), of WhiteFiber was declared effective by the Securities and Exchange Commission.

In addition, prior to the consummation of the Offering, the Company entered into a transition services agreement (the "Transition Services Agreement") with WhiteFiber, pursuant to which the Company will provide certain services to WhiteFiber, on a transitional basis. The Transition Services Agreement provides for the performance of certain services by the Company for the benefit of WhiteFiber, or in some cases certain services provided by WhiteFiber for the benefit of the Company, for a limited period of time after the Offering, including certain services provided by Sam Tabar, our Chief Executive Officer, and Erke Huang, our Chief Financial Officer and a Director. During such transition period, Messrs. Tabar and Huang will continue to hold the same position with the Company as well as WhiteFiber. Messrs. Tabar and Huang have committed to provide the requisite time and effort to fulfill their responsibilities as a full-time officer of WhiteFiber, supervising a full staff and are expected to provide certain services, representing not more than approximately 30% of their working time, in respect of the Company's operations. The services to be provided will include financial reporting, tax, legal, human resources, information technology, insurance and other general and administrative functions. All services are to be provided at cost, except if otherwise agreed to. WhiteFiber estimates that the average fees payable by WhiteFiber to the Company will be approximately $155,000 per month, exclusive of shared based compensation expense.

**19. COMMITMENTS AND CONTINGENCIES** 

***Legal Proceedings***

The Company from time to time may become involved in legal proceedings in the ordinary course of our business. The Company may also pursue litigation to assert its legal rights and assets, and such litigation may be costly and divert the efforts and attention of its management and technical personnel which could adversely affect its business. Due to the uncertainty of litigation and depending on the amount and the timing, an unfavorable resolution of some or all of such matters may materially affect our business, results of operations, financial position, or cash flows.

Although we cannot predict the outcome of legal or other proceedings with certainty, where there is at least a reasonable possibility that a loss may have been incurred, U.S. GAAP requires us to disclose an estimate of the reasonably possible loss or range of loss or make a statement that such an estimate cannot be made. We follow a thorough process in which we seek to estimate the reasonably possible loss or range of loss, and only if we are unable to make such an estimate do we conclude and disclose that an estimate cannot be made. Accordingly, unless otherwise indicated below in our discussion of legal proceedings, a reasonably possible loss or range of loss associated with any individual legal proceeding cannot be estimated.

*Bit Digital USA, Inc. v. Blockfusion USA, Inc., C.A. No. N24C-05-306 PRW (CCLD)*

On June 3, 2024, the Company filed suit in the Superior Court of the State of Delaware, Complex Commercial Litigation Division, against Blockfusion USA, Inc. ("Blockfusion") alleging claims for breach of contract and related causes of action arising out of a terminated mining services relationship. The Company initially sought in excess of $4.3 million, including: (i) the return of a $3.75 million investment made under the parties' Mining Services Agreement; (ii) approximately $576,000 in payments made in reliance on invoices the Company later determined to be fraudulent; and (iii) unpaid late development fees accruing at $9,375 per week. On October 22, 2024, Blockfusion denied the Company's claims and filed counterclaims forreciprocal breach of contract and related relief. Bit Digital denied Blockfusion's claims.

 

Following limited discovery, the Court entered a stipulation and order on June 18, 2025, amending the Case Management Order to extend multiple discovery deadlines and vacate the previously scheduled trial date. On August 1, 2025, the Company moved for leave to file a Second Amended Complaint, which adds claims for fraud and related causes of action arising out of Blockfusion's conduct both at the inception of and during the parties' relationship. The Second Amended Complaint also names Blockfusion's CEO, Alexander Martini-Lomanto, as an additional defendant. The Company continues to seek the recovery of its original investment, invoice payments, and unpaid late development fees, and now seeks additional damages for the tort and equitable claims contained in the Second Amended Complaint pending Court approval, including punitive damages. If the Company's Second Amended Complaint is ultimately accepted by the Court, the total amount of damages sought will be in excess of $5 million.

The litigation remains ongoing, and the Company cannot yet estimate a reasonably possible range of loss or recovery.

***Contingent Consideration Liabilities***

 ****

As part of the Unifi Transaction (See Note 4. *Acquisitions*), the Company may be required to make additional contingent payments to the seller based on the timing and availability of electric service to the property, as follows:

● A contingent payment of $8 million may become payable if, within two years of the acquisition date, the Company uses commercially reasonable efforts and obtains from the local energy provider an Electric Service Agreement for at least 99 megawatts (MW), or if the property otherwise receives 99MW of power within that timeframe.

● If an Electric Service Agreement for at least 99MW is provided, or the property receives 99MW of power within three years, the Company may instead be required to make a contingent payment of $5 million.

● If an Electric Service Agreement is provided, or the property receives more than 99MW of power within four years, the Company may be required to make an additional payment of $200,000 per MW in excess of 99MW, up to a maximum of $5 million.

***Royal Bank of Canada Facility Agreement***

 ****

On June 18, 2025, the Company entered into a definitive credit agreement with the Royal Bank of Canada ("RBC"), to finance its data centers business. The credit agreement provides for an aggregate amount of up to approximately USD $43.8 million of financing. The agreement is non-recourse and comprised of three separate facilities:

● Non-revolving three year lease facility in the amount of USD $18.5 million. The lease facility provides for straight-line amortization of six years and capital moratorium of six months after disbursement is complete.

● Non-revolving term loan facility in the amount of USD $19.6 million to refinance the Company's purchase of MTL-2. Payment of principal and interest is due 30 days after drawdown and is repayable in full on the last day of the three-year term.

● Revolver by way of letters of credit and letters of guaranty with fees to be determined on a transaction-by-transaction basis. This facility will be available for the 36-month term in the amount of USD $5.8 million.

The Company agreed to certain financial covenants that are not yet in effect. The facilities have not yet been authorized for use by the lender, as certain conditions precedent have not yet been satisfied. Accordingly, no amounts were drawn, and no borrowings were available under the facility as of the reporting date.

**20. DISPOSITION OF BIT DIGITAL INVESTMENT MANAGEMENT LIMITED AND BIT DIGITAL INNOVATION MASTER FUND SPC LIMITED**

On July 1, 2024, the Company entered into a share purchase agreement (the "Disposition SPA") with Pleasanton Ventures Limited ("Pleasanton Ventures"), an unrelated Hong Kong entity (the "Purchaser"). Pursuant to the Disposition SPA, the Purchaser purchased Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund SPC Limited in exchange for a consideration of $176,000 and $100, respectively. The disposition was closed on the same date.

On the same date, the parties completed all of the share transfer registration procedures as required by the laws of the British Virgin Islands and all other closing conditions had been satisfied. As a result, the disposition contemplated by the Disposition SPA was completed. Upon completion of the disposition, the Purchaser became the sole shareholder of Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund SPC Limited. Upon the closing of the transactions, the Company does not bear any contractual commitment or obligation to the business of Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund SPC Limited, nor to the Purchaser.

Bit Digital Investment Management Limited was incorporated on April 17, 2023 and engaged in fund and investment management activities. Bit Digital Investment Management Limited had total assets of $1,155,038 and total liabilities of $0, with net assets of $1,155,038 which is accounted for approximately 0.4% of the unaudited consolidated net assets of the Company as of September 30, 2024. The Company recorded a loss of $979,038 from the disposal under "other income (loss), net" in the consolidated statements of operations.

Bit Digital Innovation Master Fund SPC Limited was incorporated on May 31, 2023 and is a segregated portfolios company. Bit Digital Innovation Master Fund SPC Limited did not have any net assets as of September 30, 2024. The Company recorded a gain of $100 from the disposal under "other income (loss), net" in the consolidated statements of operations.

Management believes that the disposition of Bit Digital Investment Management Limited and Bit Digital Innovation Master Fund SPC Limited does not represent a strategic shift that has (or will have) a major effect on the Company's operations and financial results. The disposition is not accounted for discontinued operations in accordance with ASC 205-20.

**21. SUBSEQUENT EVENTS**

On July 14, 2025, the Company entered into a placement agency agreement (the "Placement Agent Agreement") with B. Riley Securities, Inc. (the "Placement Agent"), pursuant to which the Placement Agent agreed to serve as the sole placement agent for the Company in connection with a registered direct offering (the "Registered Direct Offering") of an aggregate of 22,000,000 ordinary shares (the "Shares") of the Company at an offering price of $3.06 per share. The Registered Direct Offering was made pursuant to the Registration Statement (including the base prospectus therein) and a prospectus supplement, dated July 14, 2025, filed with the SEC on July 15, 2025, pursuant to Rule 424(b)(5) under the Securities Act of 1933, as amended. The gross proceeds to the Company from the Registered Direct Offering were approximately $67.3 million before deducting placement agent fees and other estimated offering expenses. The Company agreed to pay the Placement Agent an aggregate cash fee equal to $0.1648 per Share sold in the Registered Direct Offering. The Registered Direct Offering closed on July 15, 2025. The Company intends to use the net proceeds from the Registered Direct Offering to purchase Ethereum.

On August 5, 2025, the Company filed a definitive proxy statement on Schedule 14A to provide notice of a general meeting of shareholders, pursuant to which shareholders will consider and vote upon a resolution to approve an increase to the Company's authorized share capital from $3,500,000 divided into 340,000,000 Ordinary Shares of $0.01 each and 10,000,000 Preference Shares of $0.01 each to $10,100,000 divided into 1,000,000,000 Ordinary Shares of $0.01 each and 10,000,000 Preference Shares of $0.01 each. The shareholder meeting will be held on September 10, 2025.

On August 8, 2025, WhiteFiber, a subsidiary of the Company, completed its initial public offering of ordinary shares. In connection with the offering, the Company also completed a series of related transactions, including a contribution of the cloud services business to WhiteFiber and the execution of a transition services agreement. These transactions occurred after the balance sheet date and are more fully described in Note 18. *Related Parties*.

**Forward Looking Statements**

*The discussion and analysis of our financial condition and results of operations should be read in conjunction with our financial statements and the related notes included elsewhere in this report. Except for the statements of historical fact, this report contains "forward-looking information" and "forward-looking statements reflecting our current expectations that involve risks and uncertainties (collectively, "forward-looking information") that is based on expectations, estimates and projections as at the date of this report. All statements, other than statements of historical fact, included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "intends," "expects," or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looing statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. Investing in our securities involves a high degree of risk. Before making an investment decision, you should carefully consider the risks, uncertainties and forward-looking statements described under "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 (Annual Report) and any subsequently filed quarterly reports on Form 10-Q and any Current Reports on Form 8-K. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this report.*

*The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. If any material risk was to occur, our business, financial condition or results of operations would likely suffer. In that event, the value of our securities could decline and you could lose part of all of your investment. Additional risks not presently know to us or that we currently deem immaterial may also impair our business operations. In addition, our past financial performance may not be a reliable indicate of future performance, and historical trends should not be used to anticipate results in the future. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the company does not assume a duty to update these forward-looking statements.*

**Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations.**

The following discussion should be read in conjunction with our interim Condensed Consolidated Financial Statements and the related notes and other financial information appearing elsewhere in this Quarterly Report on Form 10-Q for the period ended June 30, 2025 as well as Management's Discussion and Analysis of Financial Condition and Results of Operations included in our Form 10-K for the year ended December 31, 2024 ("Form 10-K").

**Overview**

Bit Digital, Inc. or the "Company", is a global platform for high performance computing ("HPC") business including cloud services and HPC data center services and digital asset business, including Etherum (ETH) staking business, with headquarters in New York City. On June 25, 2025, the Company announced that it has initiated a strategic transition to become a pure play Ethereum staking and treasury company. The Company began accumulating ETH and operating staking infrastructure in 2022 and has steadily increased its holdings since that time.

**HPC Business**

We believe we are a leading provider of artificial intelligence ("AI") infrastructure solutions. We own high-performance computing ("HPC") data centers and provide cloud-based HPC graphics processing units ("GPU") services, which we term cloud services, for customers such as AI application and machine learning ("ML") developers (the "HPC Business"). Our Tier-3 data centers provide hosting and colocation services. Our cloud services support generative AI workstreams, especially training and inference.

*Data centers*

We design, develop, and operate data centers, through which we offer our hosting and colocation services. Our operational data centers meet the requirements of the Tier-3 standard, including N+1 redundancy architecture, concurrent maintainability, uninterruptible power supply, advanced and highly reliable cooling systems, strict monitoring and management systems, SOC 2 Type 2, differentiated software supporting AI workloads, high density and robust bandwidth, and infrastructure to support AI workloads.

On July 30, 2025, we entered into a Contribution Agreement with WhiteFiber, pursuant to which we agreed to contribute our HPC business through the transfer of 100% of the capital shares of our cloud services subsidiary, WhiteFiber AI, Inc. and its wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, to WhiteFiber, upon the effectiveness of WhiteFiber's registration statement on Form S-1 in connection with WhiteFiber's initial public offering. For more information, see Note 21. *Subsequent Events* in our Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere herein.

We acquired Enovum Data Centers Corp ("Enovum") on October 11, 2024. The transaction included the lease to MTL-1, a fully operational and fully leased to customers 4 MW (gross) Tier-3 datacenter headquartered in Montreal, Canada.

On December 27, 2024, we acquired the real estate and building for a build-to-suit 5 MW (gross) Tier-3 data center ("MTL-2") expansion project near Montreal, Canada which we refer to as MTL-2. MTL-2 is a 160,000 square foot site that was previously used as an encapsulation manufacturing facility, is located in Pointe-Claire, Quebec. We initially funded the purchase of CAD $33.5 million (approximately USD $23.3) million with cash on hand. We expect to invest approximately USD $23.6 million to develop the site to Tier-3 standards with an initial load of 5 MW (gross). MTL-2 is expected to be completed and operational in the fourth quarter of 2025, with a one-month delay before it begins to generate revenue.

On April 11, 2025, we entered into a lease for a new data center site in Saint-Jerome, Quebec, a suburb of Montreal, MTL-3. The MTL-3 facility spans approximately 202,000 square feet on 7.7 acres and is being developed to as a 7 MW (gross) Tier-3 data center. It will support current contracted capacity, with Cerebras (5 MW IT Load), with future expansion potential subject to utility approvals. The transaction was executed under a lease-to-own structure, which includes a fixed-price purchase option of CAD $24.2 million (approximately USD $17.3 million) exercisable by December 2025. The lease term is 20 years, with two 5-year extensions at the Company's option. Subject to our receipt of all required permits, the facility is being retrofitted to Tier-3 standards, with development costs expected to total approximately USD $41 million, and is expected to be completed and operational in the fourth quarter of 2025, with a one-month delay before we expect to begin to generate revenue.

On May 20, 2025 (the "Closing Date"), we completed the purchase of a former industrial/manufacturing building from Unifi Manufacturing, Inc. ("UMI"). Pursuant to the Purchase Agreement we agreed to purchase from UMI, an industrial/manufacturing building together with the underlying land ("NC-1") located in Madison, North Carolina, as well as certain machinery and equipment located thereon for a cash purchase price of $45 million. The purchase price will increase by (i) $8 million, if Duke Energy actually provides, or provides an Electric Services Agreement providing for, at least 99 MW (gross) within two years of the Closing Date or (ii) $5 million, if Duke Energy actually provides, or provides an Electric Services Agreement providing for, at least 99 MW (gross) more than two years but less than three years after the Closing Date. Additionally, the purchase price will increase by an additional $200,000 per MW over 99 MW (gross) up to a maximum of $5 million if at least 99 MW (gross) are actually delivered, or Duke Energy provides an Electric Services Agreement for the provision of at least 99 MW (gross), within four years of the Closing Date. Separately, the Company entered into a Capacity Agreement with Duke Energy pursuant to which Duke Energy agreed to use commercially reasonable efforts to achieve 24 MW (gross) of service to the Property by September 1, 2025, 40 MW (gross) by April 1, 2026 and 99 MW (gross) within four years of May 16, 2025. Management believes based upon its review of the site and a Duke Energy preliminary transmission study, that the Property may receive and support up to 200 MW (gross) of total electrical supply over an extended period of time, subject to infrastructure upgrades, such as developing new substations and other conditions.

On June 18, 2025, the Company entered into a definitive credit agreement (the "Facility") with the Royal Bank of Canada ("RBC"). The Facility provides for an aggregate of up to approximately CAD $60 million (approximately USD $43.8 million) of financing. The proceeds are to be used primarily to refinance the buildout of Tier-3 AI data center at 7300 Trans Canada Highway, Pointe-Claire, Quebec ("MTL-2") as well as USD $5.8 million of revolving term financing (the "Revolver"). The Facility is non-recourse to the Company. The Company entered into a three-year USD $18.5 million non-revolving lease facility to finance equipment costs and building improvements to build out the site. The lease facility provides for straight-line amortization of six years and capital moratorium of six months after disbursement is complete. RBC may cancel any unutilized portion of the facility after March 31, 2026. The interest rate is fixed based on the rental rate determined by RBC for the three-year term of the lease.

As part of the Facility, the Company entered into a three-year USD $19.6 million non-revolving real estate term loan facility. The purpose of this facility is to refinance the Company's purchase of MTL-2. The interest rate of the real estate term loan facility will be determined at the time of borrowing, or a floating interest rate ranging from RBP plus 0.75% to CORRA ("Canadian Overnight Repo Rate Average") plus 250 bps. Payment of principal and interest is due 30 days after drawdown and is repayable in full on the last day of the three-year term.

The Revolver is being provided by RBC by way of Letters of Credit and Letters of Guaranty with fees to be determined on a transaction by transaction basis. This facility will be available for the 36 month term subject to the issuance of the EDC (Export and Development Canada) Performance Security Guaranty in the amount of USD $5.8 million and other related supporting documents. The Company agreed to certain financial covenants included maintaining on a combined basis between MTL-1 and MTL-2: fixed charge coverage of not less than 1.20:1 and a ratio of Net Funded Debt to EBITDA of not greater than 4.25:1 and decreasing to 3.50:1 from December 31, 2027.

*Cloud Services* 

We provide specialized cloud services to support generative AI workstreams, especially training and inference, emphasizing cost-effective utility and tailor-made solutions for each client. We are an authorized NVIDIA Preferred Partner through the NVIDIA Partner Network ("NPN"), an authorized partner with SuperMicro Computer Inc.®, an authorized Communications Service Provider ("CSP") with Dell (through Dell's exclusive distributor in Iceland, Advania), an official partnership with Hewlett Packard Enterprise and a commercial relationship with Quanta Computer Inc. ("QCT"). Based on Management's knowledge of the industry, we are proud to be among the first service providers to offer H200, B200, and GB200 servers. We provide a high-standard service lease with an Uptime percentage > 99.5%.

We expect to leverage a global network of data centers for hosting capacity for our GPU business, in many instances, by negotiating with third-party providers to seamlessly integrate our cloud services at data centers across key regions in Europe, North America and Asia. Our initial data center partnership through which we lease capacity is at Blönduós Campus, Iceland, offering a world-class operations team with certified technicians and reliable engineers. The facility has 45kW rack density and 6 MW (gross) total capacity. We have executed contracts for 5.5 MW at the data center. The center's energy source is 100% renewable energy, mainly from Blanda Hydro PowerStation, the winner of an IHA Blue Planet Award in 2017.

The following summaries reflect selected GPU cloud service agreements that we consider to be material or representative. We have entered into additional agreements that are not individually material and are not included below.

On October 23, 2023, Bit Digital announced that it had commenced AI operations by signing a binding term sheet with a customer (the "Initial Customer") to support the customer's GPU workloads. On December 12, 2023, we finalized a Master Services and Lease Agreement ("MSA"), as amended, with our Initial Customer for the provision of cloud services from a total of 2,048 GPUs over a three-year period. To finance this operation, we entered into a sale-leaseback agreement with a third party, selling 96 AI servers (equivalent to 768 GPUs) and leasing them back for three years. The total contract value with the Initial Customer for the aggregated 2,048 GPUs was estimated to be worth more than $50 million of annualized revenue. On January 22, 2024, approximately 192 servers (equivalent to 1,536 GPUs) were deployed at a specialized data center and began generating revenue, and subsequently on February 2, 2024, approximately an additional 64 servers (equivalent to 512 GPUs) also started to generate revenue.

In the second quarter of 2024, we finalized an agreement to supply our Initial Customer with an additional 2,048 GPUs over a three-year period. To finance this operation, we entered into a sale-leaseback agreement with a third party, agreeing to sell 128 AI servers (equivalent to 1,024 GPUs) and leasing them back for three years. In late July, at the customer's request, we agreed with the customer to temporarily delay the purchase order so the customer could evaluate an upgrade to newer generation Nvidia GPUs. Consequently, the Company and manufacturer postponed the purchase order. In early August, the customer made a non-refundable prepayment of $30.0 million for the services to be rendered under this agreement.

In January 2025, the Company entered into a new agreement to supply its Initial Customer with an additional 464 GPUs for a period of eighteen months. This new agreement replaces the prior agreement whereby the Company was to provide the customer with an incremental 2,048 H100 GPUs. The contract represents approximately $15 million of annualized revenue and features a two-month prepayment from the customer. The customer has elected to defer the commencement date until August 20, 2025, which is the latest allowable date under the agreement.

In August 2024, we executed a binding term sheet with Boosteroid Inc. ("Boosteroid"), a global cloud gaming provider pursuant to which, we finalized initial orders of 489 GPUs, projected to generate approximately $7.9 million in contracted value in the aggregate through November 2029. The GPUs were delivered to respective data centers across the U.S. and Europe and began earning fees in November 2024. On October 9, 2024, we executed a Master Services and Lease Agreement (the "MSA") with Boosteroid, pursuant to which Boosteroid may, from time to time, lease certain equipment, including GPUs, from the Company upon delivery of a purchase order. The MSA provides the general terms and conditions for such equipment leases. Pursuant to the MSA, we are granted a right of first refusal with respect to the next 5,000 servers that Boosteroid leases during the term of the MSA. The MSA provides Boosteroid with the option to expand in increments of 100 servers, up to 50,000 servers, representing a potential contract value of approximately $700 million over the five-year term assuming Boosteroid utilizes the GPUs and services at full capacity for the duration of the contract. Expansion depends upon the internal development roadmap of Boosteroid, Boosteroid has full discretion to decide when and the quantity to pursue separate source orders (for GPU servers) under the MSA. In the third quarter of 2025, the Company finalized additional purchase orders for 302, 120, and 279 GPUs, totaling approximately $10.4 million in contracted value over a five-year term.

On November 6, 2024, we entered into a Master Services Agreement ("MSA") with a minimum purchase commitment of 16 GPUs, along with an associated purchase order, from a new customer. The purchase order provides for services utilizing a total of 16 H200 GPUs over a minimum of a six month period, representing total contracted value of approximately $160,000 for the term. The deployment commenced on November 7, 2024, using the Company's existing inventory of H200 GPUs. The service under the purchase order concluded in May 2025. Between May and August 2025, the Company signed four additional agreements on a month-to-month basis for a total of 64 H200 GPUs.

On November 14, 2024, we entered into a Terms of Supply and Service Level Agreement (together, the "Agreement") and an Order Form with a new customer. The order form provides for services utilizing a total of 64 H200 GPUs on a month-to-month basis, which either party may terminate upon at least 14 days' written notice prior to any renewal date. It represents annual revenue of approximately $1.2 million. The deployment commenced and revenue generation began on November 15, 2024, using the Company's existing inventory of H200 GPUs. The service under the purchase order concluded in December 2024.

On December 30, 2024, we entered into a Master Services Agreement ("MSA") with a minimum purchase commitment of 32 GPUs, along with an associated purchase order, from a new customer, an AI Compute Fund managed by DNA Holdings Venture Inc. ("DNA Fund"). The purchase order provides for services utilizing a total of 576 H200 GPUs over a twenty-five month period and terminable by either party upon at least 90 days' written notice prior to any renewal date. It represents an aggregate revenue opportunity of approximately $20.2 million. Concurrently, we placed a purchase order for 130 H200 servers for approximately $30 million. The deployment commenced in February 2025.

In April 2025, the Company signed two additional cloud services agreements with DNA Fund. The first agreement includes 104 NVIDIA H200 GPUs under a 23-month term and was deployed in May 2025. The second agreement includes 512 H200 GPUs under a 24-month term and was deployed in July 2025. With these additions, DNA Fund's total contracted deployment increased to 1,192 GPUs. Combined, the agreements represent approximately $20.8 million of annualized revenue.

On January 6, 2025, we entered into a Master Services Agreement ("MSA") with a minimum purchase commitment of 32 GPUs, along with an associated purchase order, from a new customer. The purchase order provided for services utilizing a total of 32 H200 GPUs over a minimum of six month period, representing total revenue of approximately $300,000 for the term. The deployment commenced and revenue generation began on January 8, 2025, using the Company's existing inventory of H200 GPUs. The service under the purchase order concluded in April 2025 following a change in the customer's ownership, and the customer paid the remaining contract value as an early termination penalty.

In January 2025, we entered into a Master Services Agreement ("MSA"), along with two associated purchase orders, from a new customer. The purchase orders provide for services utilizing a total of 24 H200 GPUs over a minimum twelve (12) month period, representing total revenue of approximately $450,000 for the term. The deployment commenced and revenue generation began on January 27, 2025, using the Company's existing inventory of H200 GPUs. The service under the purchase order concluded in March 2025 after the customer ceased operations.

On January 30, 2025, we entered into a Master Services Agreement ("MSA") with a minimum purchase commitment of 40 GPUs, along with an associated purchase order, from a new customer. The purchase orders provide for services utilizing a total of 40 H200 GPUs over a minimum of 12 month period, representing total revenue of approximately $750,000 for the term. The deployment commenced and revenue generation began on January 24, 2025, using the Company's existing inventory of H200 GPUs. Between April and July 2025, the Company signed four additional agreements on a month-to-month basis for a total of 184 H200 GPUs including one purchase order for 32 GPUs that was terminated in August 2025.

In March 2025, we entered a strategic partnership with Shadeform, Inc., the premier multi-cloud GPU marketplaces, to bring on-demand NVIDIA B200 GPUs to customers beginning in May 2025.

In April 2025, we received our first shipment of NVIDIA GB200 Grace Blackwell Superchip powered NVIDIA GB200 NVL72 system chips, from Quanta Cloud Technology, a leading provider of data center solutions. We believe that support with proof of concept (POC) access from Quanta will enable us to meet and exceed expectations around delivery and timeline, performance and reliability.  ****

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**Digital Asset Business**

The digital asset business is comprised primarily of two distinct but highly complementary operations: (i) digital asset mining (the "Digital Asset Mining Operations"); and (ii) ETH staking (the "ETH Staking Operations").

In June of 2025, the Company announced that it had initiated a strategic transition to become a pure play ETH staking and treasury company. In connection with the transition, the Company intends to convert its BTC holdings into ETH over time and has commenced a strategic alternatives process for its bitcoin mining operations, which is expected to result in a sale or wind-down, with any net proceeds to be re-deployed into ETH.

*Digital Asset Mining Business*

We commenced our bitcoin ("BTC") mining business in February 2020. We initiated limited Ethereum mining operations in January 2022, however discontinued the operations by September 2022 due to Ethereum blockchain switching from proof-of-work ("PoW") consensus mechanism to proof-of-stake ("PoS") validation. Our mining operations, hosted by third-party providers, use specialized computers, known as miners, to generate digital assets. Our miners use application specific integrated circuit ("ASIC") chips. These chips enable the miners to apply high computational power, expressed as "hash rate", to provide transaction verification services (generally known as "solving a block") which helps support the blockchain. For every block added, the blockchain provides an award equal to a set number of digital assets per block. Miners with a greater hash rate generally have a higher chance of solving a block and receiving an award.

We operate our mining assets with the primary intent of accumulating digital assets which we may sell for fiat currency from time to time depending on market conditions and management's determination of our cash flow needs, and/or exchange into ETH or USD Coin ("USDC"). Our mining strategy has been to mine bitcoins as quickly and as many as possible given the fixed supply of bitcoins. In view of historically long delivery lead times to purchase miners from manufacturers like Bitmain Technologies Limited ("Bitmain") and MicroBT Electronics Technology Co., Ltd ("MicroBT"), and other considerations, we have chosen to acquire miners on the spot market, which can typically result in delivery within a relatively short time.

We have signed service agreements with third-party hosting partners in North America and Iceland. These partners operate specialized mining data centers, where they install and operate the miners and provide IT consulting, maintenance, and repair work on site for us. Our mining facilities in New York are maintained by Digihost Technologies Inc. ("Digihost"). Our mining facilities in Texas are maintained by Dory Creek, LLC, a subsidiary of Bitdeer Technologies Group ("Bitdeer") and A.R.T. Digital Holdings Corp ("KaboomRacks"). Soluna Computing, Inc and DVSL ComputeCo, LLC (collectively "Soluna") maintained our mining facilities in Kentucky and Texas. Our mining facility in Iceland is maintained by GreenBlocks ehf, an Icelandic private limited company ("GreenBlocks"). We have relocated our miners from our mining facility in Canada maintained by Blockbreakers Inc. ("Blockbreakers") to Soluna and Coinmint after our service agreement expired in November 2024.

From time to time, the Company may change partnerships with hosting facilities to recalibrate its bitcoin mining operations. These terminations are strategic, targeting reduced operational costs, enhanced energy efficiency for a smaller carbon footprint, increased flexibility in operational control, and minimized geopolitical risks. While a short-term decrease in mining output might occur, we expect these changes to yield long-term operational improvements.

We are a sustainability-focused digital asset mining company. On June 24, 2021, we signed the Crypto Climate Accord, a private sector-led initiative that aims to decarbonize the crypto and blockchain sectors. On December 7, 2021, we became a member of the Bitcoin Mining Council ("BMC"), joining MicroStrategy and other founding members to promote transparency, share best practices, and educate the public on the benefits of bitcoin and bitcoin mining.

<u>Miner Deployments</u>

During the three months ended June 30, 2025, we continued to work with our hosting partners to deploy our miners in North America and Iceland.

During the first quarter of 2025, the Company deployed an additional 1,441 miners at one of Soluna's hosting facilities.

During the second quarter of 2025, the Company received an additional 1,720 miners, which were deployed in July 2025.

As of June 30, 2025, the Company's active hash rate totals approximately 1.2 EH/s, with operations in North America and Iceland.

<u>Power and Hosting Overview</u>

During the three and six months ended June 30, 2025, our hosting partners continued to prepare sites to deliver our contracted hosting capacity, bringing additional power online for our miners.

The Company's subsidiary, Bit Digital Canada, Inc., entered into a Mining Services Agreement effective September 1, 2022, for Blockbreakers, Inc. to provide five MW of incremental hosting capacity at its facility in Canada. The facility utilizes an energy source that is primarily hydroelectric.

On May 8, 2023, the Company entered into a Master Mining Services Agreement with Blockbreakers, pursuant to which Blockbreakers agreed to provide the Company with four (4) MW of additional mining capacity at its hosting facility in Canada. The agreement is for two (2) years automatically renewable for additional one (1) year terms unless either party gives at least 60 days' advance written notice. The performance fee is 15% of the net profit. Additionally, Bit Digital has secured a side letter agreement with Blockbreakers, granting the Company the right of first refusal for any future mining hosting services offered by Blockbreakers in Canada. This agreement brought the Company's total contracted hosting capacity with Blockbreakers to approximately 9 MW. Our service agreement with Blockbreakers expired in November 2024. A portion of the miners were transferred to other hosting facilities, and the inefficient units were sold.

On June 7, 2022, we entered into a Master Mining Services Agreement (the "MMSA") with Coinmint LLC, pursuant to which Coinmint will provide the required mining colocation services for a one-year period automatically renewing for three-month periods unless earlier terminated. The Company paid Coinmint electricity costs, plus operating costs required to operate the Company's mining equipment, as well as a performance fee equal to 27.5% of the net profit, subject to a 10% reduction if Coinmint fails to provide uptime of 98% or better for any period. We were not privy to the emissions rate at the Coinmint facility or at any other hosting facility. However, the Coinmint facility operated in an upstate New York region that reportedly utilized power that is 99% emissions-free, as determined based on the 2023 Load & Capacity Data Report published by the New York Independent System Operator, Inc. ("NYISO").

On April 5, 2023, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to ten (10) MW of additional mining capacity to energize the Company's mining equipment at Coinmint's hosting facility in Plattsburgh, New York. The agreement was for two years automatically renewing for three (3) months unless terminated by either party on at least ninety (90) days prior written notice. The performance fees under this letter agreement range from 30% to 33% of the net profit. This agreement brought the Company's total contracted hosting capacity with Coinmint to approximately 30 MW at this facility.

On April 27, 2023, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to 10 MW of additional mining capacity to energize the Company's mining equipment at Coinmint's hosting facility in Massena, New York. The agreement was for one year automatically renewing for three (3) months unless terminated by either party on at least 90 days prior written notice. The performance fees under this letter agreement are 33% of the net profit. This new agreement brought the Company's total contracted hosting capacity with Coinmint to approximately 40 MW.

On January 26, 2024, the Company entered into a letter agreement and MMSA Amendment with Coinmint pursuant to which Coinmint agreed to provide the Company with up to six MW of additional mining capacity to energize the Company's mining equipment at Coinmint's hosting facility in Massena, New York. The agreement was for one year automatically renewing for three months unless terminated by either party on at least 90 days prior written notice. The performance fees under this letter agreement are 28% of the net profit. This agreement brought the Company's total contracted hosting capacity with Coinmint to approximately 46 MW.

On September 5, 2024, the Company received a 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent not to renew 27 MW of the 36 MW total contracted capacity at its Massena, New York site, effective December 7, 2024. Subsequently, on October 29, 2024, the Company received an additional 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent to not renew the remaining 9 MW of the 36 MW total contracted capacity at its Massena, New York site, effective January 28, 2024. On January 3, 2025, the Company received an additional 90-days notice of non-renewal of colocation mining services agreement from Coinmint, which informed the Company of its intent not to renew the 10 MW total contracted capacity at its Plattsburgh, New York site, effective April 5, 2025. After the contracts with Coinmint expired, a portion of the miners were transferred to other hosting facilities, and the inefficient units were sold.

In June 2021, we entered into a strategic co-mining agreement with Digihost Technologies in North America. Pursuant to the terms of the agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of a 20 MW bitcoin mining system to be delivered by Bit Digital. Digihost provides services to maintain the premises for a term of two years. Digihost shall also be entitled to 20% of the net profit generated by the miners.

In April 2023, we renewed the co-mining agreement with Digihost, previously executed in June 2021. Pursuant to the terms of the new agreement, Digihost provides certain premises to Bit Digital for the purpose of the operation and storage of an up to 20 MW bitcoin mining system to be delivered by Bit Digital. Digihost also provides services to maintain the premises for a term of two years, automatically renewing for a period of one (1) year. Digihost shall also be entitled to 30% of the net profit generated by the miners. As of June 30, 2025, Digihost provided approximately 6.0 MW of capacity for our miners at their facility.

On May 9, 2023 ("Effective Date"), the Company entered into a Term Loan Facility and Security Agreement (the "Loan Agreement") with GreenBlocks. Pursuant to the Loan Agreement, GreenBlocks has requested the Company to extend one or more loans ("Advances") under a senior secured term loan facility in an aggregate outstanding principal amount not to exceed $5 million. The interest rate of the Loan Agreement is 0% and Advances are to be repaid on the maturity date, which is the thirty-nine-month anniversary of the Effective Date. GreenBlocks will exclusively use the Advances to buy miners that will be operated for the benefit of the Company at a facility in Iceland, with an overall capacity of 8.25 MW. To secure the prompt payment of Advances, the Company has been granted a continuing first priority lien and security interest in all of GreenBlocks's rights, title and interest to the financed miners. The miners are the sole property of GreenBlocks, of which they are responsible for the purchase, installation, operation, and maintenance.

On May 9, 2023, the Company entered into a Computation Capacity Services Agreement (the "Services Agreement") with GreenBlocks. Pursuant to the Agreement, GreenBlocks will provide computational capacity services and other necessary ancillary services, such as operation, management, and maintenance, at the facility in Iceland for a term of two years. GreenBlocks will own and operate the miners financed through the Loan Agreement for the purpose of providing computational capacity of up to 8.25 MW. The Company will pay power costs of $0.05 per kilowatt hour, a pod fee of $22,000 per pod per month, and a depreciation fee equal to 1/36 of the facility size per month. The performance fees under this agreement are 20% of the net profit. The Company submitted to Greenblocks a deposit in the amount of $1,052,100, which was exclusively for the purpose of paying the landlord of the facility for hosting space.

On June 1, 2023, the Company and GreenBlocks entered the Omnibus Amendment to Loan Documents and Other Agreements ("Omnibus Amendment"). This amendment revised both the Loan Agreement and the Services Agreement previously entered on May 9, 2023. While the core terms remained consistent, notable modifications pertained to the facility size and contracted capacity. Specifically, the facility size was increased from $5 million to $6.7 million. Moreover, GreenBlocks agreed to expand the computation capacity to approximately 10.7 MW. Advances of $6.4 million have been financed by the Company to GreenBlocks.

In May 2025, we amended the Services Agreement with Greenblocks, originally executed in May 2023 and previously amended in June 2023. Pursuant to the terms of the amended agreement, Greenblocks shall provide services to support 8.9 MW of power capacity from March 1, 2025 through April 30, 2025 and 5 MW of computational capacity starting May 1, 2025 through December 31, 2025. The Company will pay power costs of $0.067 per kilowatt hour and a pod fee of $10,000 per pod per month, subject to pro rata adjustment if usage falls below 2 MW. All other provisions of the original agreement and previous appendices remain in effect. The amended terms may be modified by mutual agreement, and either party may terminate with one month's notice. As of June 30, 2025, GreenBlocks provided approximately 5.0 MW of capacity for our miners at their facility.

In October 2023, we entered into a strategic co-location agreement with Soluna Computing, Inc. for a term of one year automatically renewing on a month-to-month basis unless terminated by either party. Pursuant to the terms of the agreement, Soluna provided certain required mining colocation services at their hosting facility in Murray, Kentucky to the Company for the purpose of the operation and storage of up to 4.4 MW bitcoin mining system to be delivered by Bit Digital. Soluna was also entitled to 42.5% of the net profit generated by the miners. This agreement expired at the end of October 2024.

In October 2024, we entered into a co-location agreement with Soluna SW, Inc. to continue our business relationship. Under this agreement, Soluna provides certain required mining colocation services to the Company at their hosting facility in Murray, Kentucky for the purpose of the operation and storage of bitcoin mining system to be delivered by the Company up to 6.6 MW (3.3 MW for terms of nine months and 3.3 MW for terms of one (1) year), automatically renewing on a month-to-month basis unless terminated by either party. Soluna shall also be entitled to 35% of the net profit generated by the miners.

In December 2024, we entered into two additional co-location agreements with Soluna DVSL ComputerCo, LLC. pursuant to which Soluna agreed to provide the Company with up to 11 MW (5.5 MW and 5.5 MW, respectively) at their hosting facility in Silverton, Texas. Both agreements are for one (1) year automatically renewing on a month-to-month basis unless terminated by either party on at least 60 days prior written notice. Soluna shall also be entitled to 35% and 27.5%, respectively, of the net profit generated by the miners. These new agreements bring the Company's total contracted hosting capacity with Soluna to approximately 17.6 MW. As of June 30, 2025, Soluna provided approximately 15.8 MW of capacity for our miners at their facility.

In November 2023, we entered into a hosting services agreement, which was amended on March 7, 2024, with Dory Creek, LLC, a subsidiary of Bitdeer Technologies Group ("Bitdeer"), for a term of one year automatically renewing on an annual basis unless terminated by either party by giving a 30-day prior notice to the other Party in writing. Pursuant to the terms of the agreement, Bitdeer provides maintenance and operation services to the Company to support 17.5 MW of capacity. Bitdeer shall also be entitled to 30% of the net profit generated by the miners. the Company shall have the first right, but not obligation, to accept services for any extra capacity under the terms of this Agreement. As of June 30, 2025, Bitdeer provided approximately 15.5 MW of capacity for our miners at their facility.

In February 2025, we entered into two hosting services agreements with A.R.T. Digital Holdings Corp ("KaboomRacks") for terms of nine (9) months and three years automatically renewing on an annual basis unless terminated by either party. Pursuant to the terms of the agreements, KaboomRacks provides maintenance and operation services to Bit Digital to support 6 MW and 13 MW of capacity. On July 1, 2025, we entered into the first amendment to the hosting service agreement for 13 MW of capacity. The amendment modified the existing agreement, identifying the two facilities that will provide maintenance and operations service to Bit Digital to support 5 MW and 8 MW of capacity. KaboomRacks shall also be entitled to respective 40%, 14.75% and 22.5% of the net profit generated by the miners. As of June 30, 2025, KaboomRacks provided approximately 4.5 MW of capacity for our miners at their facility.

In May 2022, our hosting partner Blockfusion advised us that the substation at its Niagara Falls, New York facility was damaged by an explosion and fire, and power was cut off to approximately 2,515 of the Company's bitcoin miners and approximately 710 ETH miners that had been operating at the site immediately prior to the incident. The explosion and fire are believed to have been caused by faulty equipment owned by the power utility. Blockfusion and the Company have entered into a common interest agreement to jointly pursue any claims evolving from the explosion and fire. Prior to the incident, our facility with Blockfusion in Niagara Falls, provided approximately 9.4 MW to power our miners. Power was restored to the facility in September 2022. However, we received a notice dated October 4, 2022 (the "Notice"), from the City of Niagara Falls, which ordered the cease and desist from any cryptocurrency mining or related operations at the facility until such time as Blockfusion complies with Section 1303.2.8 of the City of Niagara Falls Zoning Ordinance (the "Ordinance"), in addition to all other City ordinances and codes. Blockfusion has advised us that the Ordinance came into effect on October 1, 2022, following the expiration of a related moratorium on September 30, 2022. Blockfusion has further advised that it has submitted applications for new permits based on the Ordinance's new standards and that the permits may take several months to process. Pursuant to the Mining Services Agreement between Bit Digital and Blockfusion dated August 25, 2021, Blockfusion represents, warrants and covenants that it "possesses, and will maintain, all licenses, registrations, authorizations and approvals required by any governmental agency, regulatory authority or other party necessary for it to operate its business and engage in the business relating to its provision of the Services." On October 5, 2022, Bit Digital further advised Blockfusion that it expects it to comply with the directives of the Notice. Our service agreement with Blockfusion ended in September 2023. On June 3, 2024, the Company filed suit in Delaware Superior Court against Blockfusion alleging claims for breach of contract, conversion, and related claims in connection with, among other things, certain deposits and advances paid to Blockfusion, the return of which is owed to the Company. The Company is seeking in excess of $4.3 million. On October 22, 2024, Blockfusion denied the Company's claims and brought reciprocal breach of contract and related counterclaims. Following limited discovery, the court entered a stipulation and order on June 18, 2025, amending the Case Management Order to extend multiple discovery deadlines and vacate the previously scheduled trial date. On August 1, 2025, the Company moved for leave to file a Second Amended Complaint, which adds claims for fraud and related causes of action arising out of Blockfusion's, conduct both at the inception of and during the parties' relationship. The second Amended Complaint also names Blockfusion's CEO, Alexander Martini-Lomanto, as an additional defendant. The Company continues to seek the recovery of its original investment, invoices payments, and unpaid late development fees and now seeks additional damages for the tort and equitable claims contained in the Second Amended Complaint pending Court approval, including punitive damages. If the Company's Second Amended Complaint is ultimately accepted by the Court, the total amount of damages sought will be in excess of $5 million. Refer to Note 19. *Commitments and Contingencies* for further details.

<u>Miner Fleet Update and Overview</u> 

As of December 31, 2024, we had 24,239 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 2.6 EH/s.

On December 10, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 191 S21 miners. As of the date of this report, all of the miners were delivered.

On December 15, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 750 S21 miners. As of the date of this report, all of the miners were delivered.

On December 23, 2024, we entered into an agreement with an unaffiliated seller of bitcoin mining computers, from whom we acquired 4,300 S21+ miners. As of the date of this report, 2,630 miners were delivered.

For the three and six months ended June 30, 2025, the Company disposed of nil and 4,828 bitcoin miners. In July 2025, the Company disposed of 2,972 bitcoin miners.

As of June 30, 2025, we had 22,574 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 2.7 EH/s.

<u>Bitcoin Production</u>

From the inception of our bitcoin mining business in February 2020 to June 30, 2025, we earned an aggregate of 7,431.6 bitcoins.

The following table presents our bitcoin mining activities for the six months ended June 30, 2025:

---

| | | |
|:---|:---|:---|
|  | **Number of<br> bitcoins** | **Amount <sup>(1)</sup>** |
| **Balance at December 31, 2024** | **741.9** | $**69319731** |
| Receipt of BTC from mining services | 151.5 | 14408801 |
| Exchange of BTC into USDC | (15.0) | (1223250) |
| Sales of and payments made in BTC | (598.0) | (55204163) |
| Change in fair value of BTC | - | 2750481 |
| **Balance at June 30, 2025** | **280.4** | $**30051600** |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Receipt of digital assets from mining services are the product of the number of bitcoins received multiplied by the bitcoin price obtained from Coinbase, calculated on a daily basis. Sales of bitcoin represent the carrying value of bitcoin at the time of sale.

*ETH Staking Business*

In the fourth quarter of 2022, we formally commenced Ethereum staking operations. We delegate or stake our ETH holdings to an Ethereum validator node to help secure and strengthen the blockchain network. Stakers are compensated for this commitment in the form of a reward of the native network token.

Our native staking operations are enhanced by a partnership with Blockdaemon, the leading institutional-grade blockchain infrastructure company for node management and staking. In the fourth quarter of 2022, following a similar mechanism to native Ethereum staking, we also participated in liquid staking via Portara protocol (formerly known as Harbour), the liquid staking protocol developed by Blockdaemon and StakeWise and the first of its kind tailored to institutions. With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain. As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon.

Our native staking operations with MarsProtocol Technologies Pte. Ltd. ("Marsprotocol") commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking with MarsLand Global Limited ("MarsLand") in August 2023. Subsequently, we have ceased our native staking with MarsLand in the first quarter of 2024 and initiated our native staking with Figment Inc.

We started participating in liquid staking via Liquid Collective protocol on the Coinbase platform in the first quarter of 2023. Liquid staking allows participants to achieve greater capital efficiency by utilizing their staked ETH as collateral and trading their staked ETH tokens on the secondary market. In the first quarter of 2024, we have reclaimed all the liquid staked ETH from Liquid Collective protocol. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. This approach provides flexibility to engage in both staking and restaking through a broader range of strategies and platforms.

**Results of operations**

The following table summarizes the results of our operations during the three months ended June 30, 2025 and 2024, respectively, and provides information regarding the dollar increase or (decrease) during the period.

 

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30,** | **For the Three Months Ended<br> June 30,** | |
|  | **2025** | **2024** | **Variance in**<br>**Amount** |
| **Revenues** |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | $6631838 | $16079893 | $(9448055) |
| &nbsp;&nbsp;&nbsp;Cloud services | 16595315 | 12497197 | 4098118 |
| &nbsp;&nbsp;&nbsp;Colocation services | 1729004 |  | 1729004 |
| &nbsp;&nbsp;&nbsp;ETH staking | 365332 | 373812 | (8480) |
| &nbsp;&nbsp;&nbsp;Other | 337930 | 92504 | 245426 |
| **Total revenues** | **25659419** | **29043406** | **(3383987)** |
| **Operating costs and expenses** |  |  |  |
| **Cost of revenue (exclusive of depreciation shown below)** |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | (6075585) | (10537841) | 4462256 |
| &nbsp;&nbsp;&nbsp;Cloud services | (6391120) | (4595301) | (1795819) |
| &nbsp;&nbsp;&nbsp;Colocation services | (687880) |  | (687880) |
| &nbsp;&nbsp;&nbsp;ETH staking | (29633) | (24456) | (5177) |
| Depreciation and amortization expenses | (8223538) | (8346633) | 123095 |
| General and administrative expenses | (19667364) | (5480519) | (14186845) |
| Gains (losses) on digital assets | 27154706 | (11538949) | 38693655 |
| **Total operating expenses** | **(13920414)** | **(40523699)** | **26603285** |
| **Income (loss) from operations** | **11739005** | **(11480293)** | **23219298** |
| Other income, net | 4726754 | 68974 | 4657780 |
| **Total other income, net** | **4726754** | **68974** | **4657780** |
| **Income (loss) before income taxes** | **16465759** | **(11411319)** | **27877078** |
| Income tax expenses | (1591557) | (541781) | (1049776) |
| **Net income (loss)** | $**14874202** | $**(11953100)** | $**26827302** |

---

*Revenue*

We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses.

*Revenue from cloud services*

In the fourth quarter of 2023, we initiated WhiteFiber, a new business line to provide cloud services to support generative AI workstreams. The Company commenced the cloud services in January 2024.

Our revenues from cloud services increased by $4.1 million, or 32.8%, to $16.6 million for the three months ended June 30, 2025 from $12.5 million for the three months ended June 30, 2024. The increase was primarily due to an increase in deployed GPU servers in the first quarter of 2025 and the $1.3 million service credit issued to the customer as compensation for decreased utilization during the initial deployment period, which included testing and optimization phases, in the first quarter of 2024.

*Revenue from colocation services*

 

In the fourth quarter of 2024, we acquired Enovum which provides customers with physical space, power, and cooling within the data center facility.

Our revenue from colocation services was $1.7 million and $nil for the three months ended June 30, 2025. We had no revenue from colocation services for the three months ended June 30, 2024.

*Revenue from digital asset mining*

We provide computing power to digital asset mining pools, and receive consideration in the form of digital assets, the value of which is determined using the market price of the related digital asset at the time of receipt. By providing computing power to successfully add a block to the blockchain, the Company is entitled to a fractional share of the digital assets award from the mining pool operator, which is based on the proportion of computing power the Company contributed to the mining pool to the total computing power contributed by all mining pool participants in solving the current algorithm.

For the three months ended June 30, 2025, we received 68.2 bitcoins from the Foundry mining pool. As of June 30, 2025, our maximum hash rate was at an aggregate of 2.7 EH/s for our bitcoin miners. For the three months ended June 30, 2025, we recognized revenue of $6.6 million from bitcoin mining services.

For the three months ended June 30, 2024, we received 244.2 bitcoins from the Foundry mining pool. As of June 30, 2024, our maximum hash rate was at an aggregate of 4.2 EH/s for our bitcoin miners. For the three months ended June 30, 2024, we recognized revenue of $16.1 million from bitcoin mining services.

Our revenues from digital asset mining services decreased by $9.4 million, or 58.8%, to $6.6 million for the three months ended June 30, 2025 from $16.1 million for the three months ended June 30, 2024. The decrease was primarily due to a decrease of 176.0 bitcoins generated from our mining business and partially offset by a higher average BTC price in the second quarter of 2025, compared to the same period in 2024.

*Revenue from ETH staking*

 

During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking.

For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand. Currently, we stake ETH with Figment, using network-based smart contracts, on a node for the purpose of validating transactions and adding blocks to the network. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking since April 12, 2023 when the announced Shanghai upgrade was completed. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company's stake to the total ETH staked by all validators.

In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. Our native staking operations with Marsprotocol commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking operations with MarsLand in August 2023. In the first quarter of 2024, we concluded our operations with MarsLand and initiated our native staking operations with Figment. As of December 31, 2024, all of our native staking operations are with Figment.

For the liquid staking business, the Company has deployed ETH into Portara protocol (formerly known as Harbour) supported by liquid staking solution provider under the consortium of Blockdaemon and Stakewise, and Liquid Collective protocol supported by Coinbase. By staking, we receive receipt tokens for the ETH staked which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In addition, we receive rETH-h for rewards earned from Portara protocol. With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain. As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH.

In the first quarter of 2024, the Company has restaked 3,008 ETH into EigenLayer, a protocol built on Ethereum that enables restaking of the already-staked ETH, through Figment. To mitigate potential risks, we restake our ETH without delegating to any operator and the Company received 33,568 EigenLayer in the fourth quarter of 2024 from this restaking activity. As of the date of this report, the reward earned in 2025 from this restaking activity is not significant.

For the three months ended June 30, 2025, we earned 166.8 ETH in native staking. For the three months ended June 30, 2025, we recognized revenues of $365,332 from native staking.

For the three months ended June 30, 2024, we earned 109.4 ETH in native staking. For the three months ended June 30, 2024, we recognized revenues of $373,812 from native staking.

Our revenues from ETH native staking decreased by $8,480, or 2.3%, to $365,332 for the three months ended June 30, 2025 from $373,812 for the three months ended June 30, 2024. The decrease was primarily due to an increase of 57.4 ETH earned from staking services partially offset by a decrease in the average price of ETH for the three months ended June 30, 2025 compared to the three months ended June 30, 2024.

*Cost of revenue*

 

We incur cost of revenue from digital asset mining, cloud services, colocation services, and ETH staking businesses.

The Company's cost of revenue consists primarily of direct production costs associated with its core operations, excluding depreciation and amortization, which are separately stated in the Company's consolidated statements of operations. Specifically, these costs consist of:

&nbsp;&nbsp;&nbsp;&nbsp;i. cloud services operations - electricity costs, datacenter lease expense, GPU servers lease expense, and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;ii. colocation services - electricity costs, lease costs, data center employees' wage expenses, and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;iii. mining operations - electricity costs, profit-sharing fees and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;iv. ETH staking business - service fee and reward-sharing fees to the service providers.

*Cost of revenue - cloud services*

 

For the three months ended June 30, 2025 and 2024, the cost of revenue from cloud services was comprised of the following:

 

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30,** | **For the Three Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $601655 | $143043 |
| Datacenter lease expenses | 1365599 | 605220 |
| GPU servers lease expenses | 3749470 | 3830061 |
| Other costs | 674396 | 16977 |
| &nbsp;&nbsp;&nbsp;**Total** | $**6391120** | $**4595301** |

---

***Electricity costs***. These expenses were incurred by the data center for the high performance computing equipment and were closely correlated with the number of deployed GPU servers.

For the three months ended June 30, 2025, electricity costs increased by $0.5 million, or 321%, compared to the electricity costs incurred for the three months ended June 30, 2024. The increase primarily resulted from an increase in the number of deployed GPU servers.

***Datacenter lease expenses***. We entered into datacenter lease agreements for fixed monthly recurring costs.

For the three months ended June 30, 2025, datacenter lease expenses increased by $0.8 million, or 126%, compared to the datacenter lease expenses incurred for the three months ended June 30, 2024. The increase primarily resulted from two additional datacenter leases entered into after the second quarter of 2024.

***GPU servers lease expenses***. We entered into a GPU servers lease agreement to support our cloud services. The lease payment depends on the usage of the GPU servers.

For the three months ended June 30, 2025, GPU servers lease expenses were relatively consistent with the same period in 2024, with a slight decrease of $0.1 million, or 2%.

*Cost of revenue - Colocation Services*

 

In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the three months ended June 30, 2025 and 2024, the cost of revenue from colocation services was comprised of the following:

 

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30,** | **For the Three Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $270003 | $- |
| Lease expenses | 156740 |  |
| Wage expenses | 169543 |  |
| Other costs | 91594 | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;**Total** | $**687880** | $**-** |

---

 

***Electricity costs****.* These expenses were closely correlated with the number of deployed servers hosted by the data center.

For the three months ended June 30, 2025, electricity costs totaled $0.3 million. We had no electricity costs for the three months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

***Lease expenses***. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.

For the three months ended June 30, 2025 , data center lease expenses totaled $0.2 million. We had no data center lease expenses for the three months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

***Wage expenses***. These expenses represent the salaries and benefits of data center employees involved in the operation of our facilities.

For the three months ended June 30, 2025, wage expenses totaled $0.2 million. We had no wage expenses for the three months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

*Cost of revenue - digital asset mining*

For the three months ended June 30, 2025 and 2024, the cost of revenue from digital asset mining was comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30,** | **For the Three Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $4334282 | $7177302 |
| Profit-sharing fees | 1051811 | 2714035 |
| Other costs | 689492 | 646504 |
| &nbsp;&nbsp;&nbsp;**Total** | $**6075585** | $**10537841** |

---

***Electricity costs.*** These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners.

For the three months ended June 30, 2025, electricity costs decreased by $2.8 million, or 40%, compared to the electricity costs incurred for the three months ended June 30, 2024. The decrease primarily resulted from a decrease in the number of deployed miners.

***Profit-sharing fees.*** We enter into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.

For the three months ended June 30, 2025, profit-sharing fees decreased by $1.7 million, or 61%, compared to profit-sharing fees incurred in the three months ended June 30, 2024. The decrease in profit-sharing fees was primarily due to a lower bitcoin production and partially offset by the higher average BTC price for three months ended June 30, 2025.

*Cost of revenue - ETH staking* 

 

For the three months ended June 30, 2025, cost of revenue from ETH staking business increased by $5,177, or 21%, compared to the cost of revenue incurred for the three months ended June 30, 2024. The increase was primarily driven by an increased number of staked ETH from 17,184 ETH in the three months ended June 30, 2024 to 21,568 ETH in the three months ended June 30, 2025.

*Depreciation and amortization expenses*

 

For the three months ended June 30, 2025 and 2024, depreciation and amortization expenses were $8.2 million and $8.3 million, respectively, based on an estimated useful life of property, plant, and equipment.

Effective January 1, 2025, we changed our estimate of the useful lives for our cloud service equipment from three to five years. The change was made to better reflect the expected usage patterns and economic benefits of the assets. Refer to Note 2. *Summary of Significant Accounting Policies*.

*General and administrative expenses*

For the three months ended June 30, 2025, our general and administrative expenses, totaling $19.7 million, were primarily comprised of professional and consulting expenses of $7.9 million, shared-based compensation expenses of $6.9 million, salary and bonus expenses of $1.8 million, marketing expenses of $0.6 million, travel expenses of $0.3 million, and directors and officers insurance expenses of $0.2 million.

For the three months ended June 30, 2024, our general and administrative expenses, totaling $5.5 million, were primarily comprised of shared-based compensation expenses of $0.4 million, salary and bonus expenses of $1.0 million, professional and consulting expenses of $2.3 million, directors and officers insurance expenses of $0.2 million, marketing expenses of $0.4 million, and travel expenses of $0.3 million.

 

 

*Gains (losses) on digital assets*

 

For the three months ended June 30, 2025, a gain of $27.2 million was recognized, primarily attributable to the increase in the prices of bitcoin and ETH as of June 30, 2025.

For the three months ended June 30, 2024, a loss of $11.5 million was recognized, primarily attributable to the decreases in the prices of bitcoin and ETH as of June 30, 2024.

*Income tax provisions*

 

Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the three months ended June 30, 2025 is primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, and the valuation allowance applied to the Company's deferred tax assets in the United States, Singapore and Hong Kong. We continue to maintain a valuation allowance against the deferred tax assets in United States, Singapore and Hong Kong as the Company does not expect those deferred tax assets are "more likely than not" to be realized in the near future, particularly due to the uncertainty on macroeconomy, politics and profitability of the business.

Our income tax provision was $1.6 million and $0.5 million for the three months ended June 30, 2025 and 2024, respectively. The income tax provision was higher during the three months ended June 30, 2025 compared to the three months ended June 30, 2024 primarily due to increase of $0.9 million in Canada due to the higher unrealized gain resulted from increased Bitcoin price and increase of $0.2 million in the United States due to higher taxable profits from digital assets sales.

 

*Net income (loss) and earnings (loss) per share*

For the three months ended June 30, 2025, our net income was $14.9 million, representing a change of $26.8 million from a net loss of $12.0 million for the three months ended June 30, 2024.

Basic and diluted earning per share was $0.07 and $0.07 for the three months ended June 30, 2025, respectively. Basic and diluted loss per share was $0.09 and $0.09 for the three months ended June 30, 2024, respectively.

Basic and diluted weighted average number of shares was 206,889,826 and 208,817,806 for the three months ended June 30, 2025, respectively. Basic and diluted weighted average number of shares was 128,053,586 and 128,053,586 for the three months ended June 30, 2024, respectively.

The following table summarizes the results of our operations during the six months ended June 30, 2025 and 2024, respectively, and provides information regarding the dollar increase or (decrease) during the period.

 

---

| | | | |
|:---|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** | |
|  | **2025** | **2024** | **Variance in**<br>**Amount** |
| **Revenues** |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | $14408801 | $37971653 | $(23562852) |
| &nbsp;&nbsp;&nbsp;Cloud services | 31437601 | 20566781 | 10870820 |
| &nbsp;&nbsp;&nbsp;Colocation services | 3367413 |  | 3367413 |
| &nbsp;&nbsp;&nbsp;ETH staking | 925973 | 699558 | 226415 |
| &nbsp;&nbsp;&nbsp;Other | 618497 | 192252 | 426245 |
| **Total revenues** | **50758285** | **59430244** | **(8671959)** |
| **Operating costs and expenses** |  |  |  |
| **Cost of revenue (exclusive of depreciation shown below)** |  |  |  |
| &nbsp;&nbsp;&nbsp;Digital asset mining | (12199474) | (23522773) | 11323299 |
| &nbsp;&nbsp;&nbsp;Cloud services | (12479120) | (7752628) | (4726492) |
| &nbsp;&nbsp;&nbsp;Colocation services | (1199882) |  | (1199882) |
| &nbsp;&nbsp;&nbsp;ETH staking | (62201) | (40889) | (21312) |
| Depreciation and amortization expenses | (15465527) | (15192582) | (272945) |
| General and administrative expenses | (27937121) | (11436259) | (16500862) |
| (Losses) gains on digital assets | (22050521) | 34193628 | (56244149) |
| **Total operating expenses** | **(91393846)** | **(23751503)** | **(67642343)** |
| **(Loss) income from operations** | **(40635561)** | **35678741** | **(76314302)** |
| Net loss from disposal of property and equipment | (333620) |  | (333620) |
| Other income, net | 395011 | 4569147 | (4174136) |
| **Total other income, net** | **61391** | **4569147** | **(4507756)** |
| **(Loss) income before income taxes** | **(40574170)** | **40247888** | **(80822058)** |
| Income tax expenses | (2263273) | (2119131) | (144142) |
| **Net (loss) income** | $**(42837443)** | $**38128757** | $**(80966200)** |

---

*Revenue*

We generate revenues from cloud services, colocation services, digital asset mining, and ETH staking businesses.

*Revenue from cloud services*

In the fourth quarter of 2023, we initiated WhiteFiber, a new business line to provide cloud services to support generative AI workstreams. The Company commenced the cloud services in January 2024.

Our revenues from cloud services increased by $10.9 million, or 52.9%, to $31.4 million for the six months ended June 30, 2025 from $20.6 million for the six months ended June 30, 2024. The increase was primarily due to an increase in deployed GPU servers for the six months ended June 30, 2025 and the $1.3 million service credit issued to the customer as compensation for decreased utilization during the initial deployment period, which included testing and optimization phases, in the first quarter of 2024.

*Revenue from colocation services*

 

Our revenue from colocation services was $3.4 million for the six months ended June 30, 2025. We had no revenue from colocation services for the six months ended June 30, 2024. In the fourth quarter of 2024, we acquired Enovum which provides customers with physical space, power, and cooling within the data center facility.

*Revenue from digital asset mining*

The Company enters in contracts with mining pool operators to provide computing power to digital asset mining pools. Providing computing power for digital asset transaction verification services is an output of the Company's ordinary activities. The provision of such computing power is the only performance obligation in the Company's contracts with mining pool operators.

For the six months ended June 30, 2025, we received 151.5 bitcoins from the Foundry USA Pool ("Foundry") mining pool. As of June 30, 2025, our maximum hash rate was at an aggregate of 2.7 EH/s for our bitcoin miners. For the six months ended June 30, 2025, we recognized revenue of $14.4 million from bitcoin mining services.

For the six months ended June 30, 2024, we received 654.9 bitcoins from the Foundry mining pool. As of June 30, 2024, our maximum hash rate was at an aggregate of 4.3 EH/s for our bitcoin miners. For the six months ended June 30, 2024, we recognized revenue of $38.0 million from bitcoin mining services.

Our revenues from digital asset mining services decreased by $23.6 million, or 62.1%, to $14.4 million for the six months ended June 30, 2025 from $38.0 million for the six months ended June 30, 2024. The decrease was primarily due to a decrease of 503.4 bitcoins generated from our mining business and partially offset by a higher average BTC price for the six months ended June 30, 2025, compared to the same period in 2024.

*Revenue from ETH staking*

 

During the fourth quarter of 2022, we commenced ETH staking business, in both native staking and liquid staking.

For the ETH native staking business, we previously partnered with Blockdaemon, Marsprotocol and MarsLand. Currently, we stake ETH with Figment, using network-based smart contracts, on a node for the purpose of validating transactions and adding blocks to the network. Through these contracts, the Company stakes ETH on nodes for the purpose of validating transactions and adding blocks to the Ethereum blockchain network. The Company is able to withdraw staked ETH under contracted staking since April 12, 2023 when the announced Shanghai upgrade was completed. In exchange for staking the ETH and validating transactions on blockchain networks, the Company is entitled to block rewards and transaction fees for successfully validating or adding a block to the blockchain. These rewards are received by the Company directly from the Ethereum network and are calculated approximately based on the proportion of the Company's stake to the total ETH staked by all validators.

In the fourth quarter of 2023, the Company terminated the native staking activities and reclaimed all staked Ethereum with Blockdaemon. Our native staking operations with Marsprotocol commenced in the first quarter of 2023 and concluded in July 2023. After ceasing operations with Marsprotocol, we initiated our native staking operations with MarsLand in August 2023. In the first quarter of 2024, we concluded our operations with MarsLand and initiated our native staking operations with Figment. As of December 31, 2024, all of our native staking operations are with Figment.

For the liquid staking business, the Company has deployed ETH into Portara protocol (formerly known as Harbour) supported by liquid staking solution provider under the consortium of Blockdaemon and Stakewise, and Liquid Collective protocol supported by Coinbase. By staking, we receive receipt tokens for the ETH staked which could be redeemed to ETH or can be traded or collateralized elsewhere, at any time. In addition, we receive rETH-h for rewards earned from Portara protocol. With the introduction of staked ETH withdrawals in April 2023, we have reassessed our Ethereum network staking approaches, weighing the advantages of traditional staking against liquid staking solutions. The withdrawal feature in native staking, coupled with yields that are on par with those of liquid staking, has encouraged us to expand our collaborations with other service providers in this domain. As a result, we terminated all liquid staking activities with StakeWise in the third quarter of 2023, reclaiming all staked Ethereum along with the accumulated rewards. In the first quarter of 2024, we ceased our liquid staking activities with Liquid Collective protocol and reclaimed all our staked Ethereum. Since the first quarter of 2024, the Company has no liquid staking activities. In July 2025, we resumed liquid staking through the Liquid Collective protocol with 5,120 ETH. This approach provides flexibility to engage in both staking and restaking through a broader range of strategies and platforms.

In the first quarter of 2024, the Company has restaked 3,008 ETH into EigenLayer, a protocol built on Ethereum that enables restaking of the already-staked ETH, through Figment. To mitigate potential risks, we restake our ETH without delegating to any operator and the Company received 33,568 EigenLayer in the fourth quarter of 2024 from this restaking activity. As of the date of this report, the reward earned in 2025 from this restaking activity is not significant.

For the six months ended June 30, 2025, we earned 377.8 ETH in native staking and nil ETH in liquid staking, respectively. For the six months ended June 30, 2025, we recognized revenues of $925,973 and $0 from native staking and liquid staking, respectively.

For the six months ended June 30, 2024, we earned 220.5 ETH in native staking and 1.3 ETH in liquid staking, respectively. For the six months ended June 30, 2024, we recognized revenues of $695,055 and $4,503 from native staking and liquid staking, respectively.

Our revenues from ETH native staking increased by $230,918, or 33.2%, to $925,973 for the six months ended June 30, 2025 from $695,055 for the six months ended June 30, 2024. The increase was primarily due to an increase of 157.3 ETH earned from staking services partially offset by a decrease in the average price of ETH for the six months ended June 30, 2025 compared to the six months ended June 30, 2024.

Our revenues from ETH liquid staking decreased by $4,503, or 100%, to $0 for the six months ended June 30, 2025 from $4,503 for the six months ended June 30, 2024. The decrease was due to the termination of liquid staking activities in the first quarter of 2024.

*Cost of revenue*

 

We incur cost of revenue from digital asset mining, cloud services, colocation services, and ETH staking businesses.

The Company's cost of revenue consists primarily of direct production costs associated with its core operations, excluding depreciation and amortization, which are separately stated in the Company's consolidated statements of operations. Specifically, these costs consist of:

&nbsp;&nbsp;&nbsp;&nbsp;i. cloud services operations - electricity costs, datacenter lease expense, GPU servers lease expense, and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;ii. colocation services - electricity costs, lease costs, data center employees' wage expenses, and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;iii. mining operations - electricity costs, profit-sharing fees and other relevant costs

&nbsp;&nbsp;&nbsp;&nbsp;iv. ETH staking business - service fee and reward-sharing fees to the service providers.

*Cost of revenue - cloud services*

 

For the six months ended June 30, 2025 and 2024, the cost of revenue from cloud services was comprised of the following:

 

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $1171592 | $226421 |
| Datacenter lease expenses | 2639653 | 1306110 |
| GPU servers lease expenses | 7496856 | 5912240 |
| Other costs | 1171019 | 307857 |
| &nbsp;&nbsp;&nbsp;**Total** | $**12479120** | $**7752628** |

---

***Electricity costs***. These expenses were incurred by the data center for the high performance computing equipment and were closely correlated with the number of deployed GPU servers.

For the six months ended June 30, 2025, electricity costs increased by $0.9 million, or 417%, compared to the electricity costs incurred for the six months ended June 30, 2024. The increase primarily resulted from an increase in the number of deployed GPU servers.

***Datacenter lease expenses***. We entered into datacenter lease agreements for fixed monthly recurring costs.

For the six months ended June 30, 2025, datacenter lease expenses increased by $1.3 million, or 102%, compared to the datacenter lease expenses incurred for the six months ended June 30, 2024. The increase primarily resulted from two additional datacenter leases entered into after the second quarter of 2024.

***GPU servers lease expenses***. We entered into a GPU servers lease agreement to support our cloud services. The lease payment depends on the usage of the GPU servers.

For the six months ended June 30, 2025, GPU servers lease expenses increased by $1.6 million, or 27%, compared to the GPU servers lease expenses incurred for the six months ended June 30, 2024. The increase primarily resulted from a higher average number of GPU servers leased.

*Cost of revenue - Colocation Services*

 

In the fourth quarter of 2024, we acquired Enovum which provides colocation services. For the six months ended June 30, 2025 and 2024, the cost of revenue from colocation services was comprised of the following:

 

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $493061 | $- |
| Lease expenses | 307277 |  |
| Wage expenses | 169543 |  |
| Other costs | 230001 | - |
| &nbsp;&nbsp;&nbsp;**Total** | $**1199882** | $**-** |

---

 

***Electricity costs****.* These expenses were closely correlated with the number of deployed servers hosted by the data center.

For the six months ended June 30, 2025, electricity costs totaled $0.5 million. We had no electricity costs for the six months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

***Lease expenses***. These expenses were incurred by the data center for lease agreement for a fixed monthly recurring cost.

For the six months ended June 30, 2025, data center lease expenses totaled $0.3 million. We had no data center lease expenses for the six months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

***Wage expenses***. These expenses represent the salaries and benefits of data center employees involved in the operation of our facilities.

For the six months ended June 30, 2025, wage expenses totaled $0.2 million. We had no wage expenses for the six months ended June 30, 2024 as we acquired Enovum in the fourth quarter of 2024, which provides colocation services.

*Cost of revenue - digital asset mining*

For the six months ended June 30, 2025 and 2024, the cost of revenue from digital asset mining was comprised of the following:

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Electricity costs | $8567364 | $15264702 |
| Profit-sharing fees | 2242111 | 6977443 |
| Other costs | 1389999 | 1280628 |
| &nbsp;&nbsp;&nbsp;**Total** | $**12199474** | $**23522773** |

---

***Electricity costs.*** These expenses were incurred by mining facilities for the miners in operation and were closely correlated with the number of deployed miners.

For the six months ended June 30, 2025, electricity costs decreased by $6.7 million, or 44%, compared to the electricity costs incurred for the six months ended June 30, 2024. The decrease primarily resulted from a decrease in the number of deployed miners.

***Profit-sharing fees.*** We enter into hosting agreements with certain mining facilities, which included performance fees calculated as a fixed percentage of net profit generated by the miners. We refer to these fees as profit-sharing fees.

For the six months ended June 30, 2025, profit-sharing fees decreased by $4.7 million, or 68%, compared to profit-sharing fees incurred in the six months ended June 30, 2024. The decrease in profit-sharing fees was primarily due to a lower bitcoin production and partially offset by the higher average BTC price for six months ended June 30, 2025.

*Cost of revenue - ETH staking*

 

For the six months ended June 30, 2025, cost of revenue from ETH staking business increased by $21,312, or 52%, compared to the cost of revenue incurred for the six months ended June 30, 2024. The increase was primarily driven by an increased number of staked ETH from 17,184 ETH in the six months ended June 30, 2024 to 21,568 ETH in the six months ended June 30, 2025.

*Depreciation and amortization expenses*

 

For the six months ended June 30, 2025 and 2024, depreciation and amortization expenses were $15.5 million and $15.2 million, respectively based on an estimated useful life of property, plant, and equipment.

Effective January 1, 2025, we changed our estimate of the useful lives for our cloud service equipment from three to five years. The change was made to better reflect the expected usage patterns and economic benefits of the assets. Refer to Note 2. *Summary of Significant Accounting Policies*.

*General and administrative expenses*

For the six months ended June 30, 2025, our general and administrative expenses, totaling $27.9 million, were primarily comprised of professional and consulting expenses of $12.2 million, shared-based compensation expenses of $7.1 million, salary and bonus expenses of $3.2 million, marketing expenses of $1.0 million, travel expenses of $0.5 million, and directors and officers insurance expenses of $0.4 million.

For the six months ended June 30, 2024, our general and administrative expenses, totaling $11.4 million, were primarily comprised of shared-based compensation expenses of $0.9 million, salary and bonus expenses of $2.0 million, professional and consulting expenses of $4.9 million, directors and officers insurance expenses of $0.4 million, marketing expenses of $0.7 million, and travel expenses of $0.5 million.

 

*Gains (losses) on digital assets*

 

For the six months ended June 30, 2025, a loss of $22.1 million was recognized, primarily attributable to the decreases in the price of ETH as of June 30, 2025, partially offset by an increase in the price of bitcoin as of June 30, 2025.

For the six months ended June 30, 2024, a gain of $34.2 million was recognized, primarily attributable to the increases in the prices of bitcoin and ETH as of June 30, 2024.

*Income tax provisions*

 

Provision for income taxes consists of federal, state and foreign income taxes. Our income tax provision for the six months ended June 30, 2025 is primarily attributable to the mix of earnings and losses in countries with differing statutory tax rates, and the valuation allowance applied to the Company's deferred tax assets in the United States, Singapore and Hong Kong. We continue to maintain a valuation allowance against the deferred tax assets in United States, Singapore and Hong Kong as the Company does not expect those deferred tax assets are "more likely than not" to be realized in the near future, particularly due to the uncertainty on macroeconomy, politics and profitability of the business.

Our income tax provision was $2.3 million and $2.1 million for the six months ended June 30, 2025 and 2024, respectively. The income tax provision did not change materially during the six months ended June 30, 2025 compared to the same period in 2024.

*Net income (loss) and earnings (loss) per share*

For the six months ended June 30, 2025, our net loss was $42.8 million, representing a change of $81.0 million from a net income of $38.1 million for the six months ended June 30, 2024.

Basic and diluted loss per share was $0.22 and $0.22 for the six months ended June 30, 2025, respectively. Basic and diluted earnings per share was $0.31 and $0.31 for the six months ended June 30, 2024, respectively.

Basic and diluted weighted average number of shares was 194,355,223 and 194,355,223 for the six months ended June 30, 2025, respectively. Basic and diluted weighted average number of shares was 121,362,883 and 122,374,103 for the six months ended June 30, 2024, respectively.

**Discussion of Certain Balance Sheet Items**

The following table sets forth selected information from our consolidated balance sheets as of June 30, 2025 and December 31, 2024. This information should be read together with our consolidated financial statements and related notes included elsewhere in this report.

---

| | | | |
|:---|:---|:---|:---|
|  | **June 30,**<br>**2025** | **December 31,**<br>**2024** | **Variance in**<br>**Amount** |
| **ASSETS** |  |  |  |
| **Current Assets** |  |  |  |
| Cash and cash equivalents | $181165847 | $95201335 | $85964512 |
| Restricted cash | 3732792 | 3732792 |  |
| Accounts receivable | 6491562 | 5267863 | 1223699 |
| USDC | 515242 | 411413 | 103829 |
| Digital assets | 91214450 | 161377344 | (70162894) |
| Net investment in lease - current | 3517921 | 2546519 | 971402 |
| Loans receivable | 400000 | 400000 |  |
| Other current assets | 26715156 | 28319669 | (1604513) |
| **Total Current Assets** | **313752970** | **297256935** | **16496035** |
| **Non-Current Assets** |  |  |  |
| Deposits for property, plant, and equipment | 21066026 | 39059707 | (17993681) |
| Property, plant, and equipment, net | 253920936 | 107302458 | 146618478 |
| Goodwill | 20190268 | 19383291 | 806977 |
| Intangible Assets | 13210056 | 13028730 | 181326 |
| Operating lease right-of-use assets | 44799045 | 14967569 | 29831476 |
| Net investment in lease - non-current | 9367633 | 6782479 | 2585154 |
| Investment securities | 38953792 | 30797365 | 8156427 |
| Deferred tax asset | 92962 | 89246 | 3716 |
| Other non-current assets | 8065349 | 9579884 | (1514535) |
| **Total Non-Current Assets** | **409666067** | **240990729** | **168675338** |
| **Total Assets** | $**723419037** | $**538247664** | $**185171373** |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |  |
| **Current Liabilities** |  |  |  |
| Accounts payable | $2087887 | $3418172 | $(1330285) |
| Current portion of deferred revenue | 11640667 | 30698458 | (19057791) |
| Current portion of operating lease liability | 5487628 | 4529291 | 958337 |
| Income tax payable | 1936542 | 1595308 | 341234 |
| Dividend payable |  | 800000 | (800000) |
| Other payables and accrued liabilities | 18943717 | 13985375 | 4958342 |
| **Total Current Liabilities** | **40096441** | **55026604** | **(14930163)** |
| **Non-Current Liabilities** |  |  |  |
| Other long-term liabilities | 392686 | 785372 | (392686) |
| Non-current portion of deferred revenue | 28046 | 73494 | (45448) |
| Non-current portion of operating lease liability | 38257665 | 9276926 | 28980739 |
| Long-term income tax payable | 3196204 | 3196204 |  |
| Deferred tax liability | 8259351 | 6409915 | 1849436 |
| **Total Non-Current Liabilities** | **50133952** | **19741911** | **30392041** |
| **Total Liabilities** | $**90230393** | $**74768515** | $**15461878** |

---

*Cash and cash equivalents*

Cash and cash equivalents primarily consist of funds deposited with banks, which are highly liquid and are unrestricted to withdrawal or use. The total balance of cash and cash equivalents were $181.2 million and $95.2 million as of June 30, 2025 and December 31, 2024, respectively. The increase in the balance of cash and cash equivalents was a result of net cash of $35.1 million provided by operating activities and net cash of $199.3 million provided by financing activities, partially offset by net cash of $148.2 million used in investing activities.

*Accounts receivable, net*

Accounts receivable consists of amounts due from our customers. The total balance of accounts receivable was $6.5 million and $5.3 million as of June 30, 2025 and December 31, 2024, respectively. The increase in the balance of accounts receivable is attributable to unpaid invoices from our customers.

*USDC*

USD Coin ("USDC") is accounted for as a financial instrument; one USDC can be redeemed for one U.S. dollar on demand from the issuer. The balance of USDC was $0.5 million and $0.4 million as of June 30, 2025 and December 31, 2024, respectively. The increase in the balance of USDC was primarily due to the receipt of USDC from sales of other digital assets of $1.2 million and receipt of USDC from other income of $40,100, partially offset by the payment of other expenses of $1.2 million.

*Digital assets*

Digital assets primarily consist of BTC and ETH. For the three months ended June 30, 2025, we earned digital assets from mining services and ETH staking services. We exchanged BTC into ETH or USDC, exchanged BTC and ETH into cash, or used BTC and ETH to pay certain operating costs and other expenses. Digital assets held are accounted for as intangible assets measured at fair value, with changes in fair value recorded in net income in each reporting period.

As compared with the balance as of December 31, 2024, the balance of digital assets as of June 30, 2025 decreased by $70.2 million, which was primarily attributable to exchange of bitcoins of $54.0 million into cash, exchange of bitcoins of $1.2 million into USDC, payment of ETH to investment fund of $7.0 million, and change in fair value of $22.0 million, partially offset by the generation of bitcoins of $14.4 million from our mining business.

*Loans Receivable*

Loans receivable consist of a loan issued by the Company to a third party. The total balance of loans receivable was $0.4 million and $0.4 million as of June 30, 2025 and December 31, 2024, respectively.

*Net investment in lease*

Net investment in lease represents the present value of the lease payments not yet received from lessee. The current and non-current balance of net investment in lease was $3.5 million and $9.4 million, respectively as of June 30, 2025. The current and non-current balance of net investment in lease was $2.5 million and $6.8 million, respectively as of December 31, 2024.

*Deposits for property, plant, and equipment*

The deposits for property, plant, and equipment consists of advance payments for property, plant, and equipment. The balance was derecognized once the control of the property, plant, and equipment was transferred to and obtained by us.

Compared with December 31, 2024, the balance as of June 30, 2025 decreased $18.0 million, mainly due to the receipt of property and equipment of $97.3 million, offset by prepayment of $79.3 million for property, plant and equipment.

*Property, plant, and equipment, net*

Property, plant, and equipment primarily consisted of equipment used in our HPC business and digital asset business as well as construction in progress representing assets received but not yet put into service.

As of June 30, 2025, we had 22,574 bitcoin miners with net book value of $22.9 million, cloud service computing equipment with a net book value of $75.4 million, property, plant, and equipment for colocation service with a net book value of $82.9 million, and construction in progress of $70.0 million.

As of December 31, 2024, we had 24,239 bitcoin miners with net book value of $17.9 million, cloud service computing equipment with a net book value of $47.2 million, property, plant, and equipment acquired as part of the acquisition of Enovum with a net book value of $36.4 million for colocation service, and construction in progress of $5.1 million.

*Operating lease right-of-use assets and operating lease liability*

As of June 30, 2025, the Company's operating lease right-of-use assets and total operating lease liability were $44.8 million and $43.7 million respectively. As of December 31, 2024, the Company's operating lease right-of-use assets and total operating lease liability were $15.0 million and $13.8 million respectively

The increase in operating lease right-of-use assets and total operating lease liability of $29.8 million and $29.9 million respectively, were due to one additional data center lease entered in 2025, one additional capacity lease entered in 2025, one additional office lease entered in 2025, and one additional lease entered in 2025 for general and administrative purposes totaling $32.1 million, partially offset by the amortization of the operating lease right-of-use assets totaling $2.4 million for the six months ended June 30, 2025.

*Investment Securities*

As of June 30, 2025, our portfolio consists of investments in three funds, a privately held company via a simple agreement for future equity ("SAFE"), and four privately held companies over which the Company neither has control nor significant influence. The total balance of investment securities was $39.0 million and $30.8 million as of June 30, 2025, and December 31, 2024, respectively. The increase of $8.2 million in the value of our investment securities was mainly driven by an additional investment of $7.0 million in Innovation Fund I and an additional investment of $2.0 million in AI Innovation Fund I, which partially offset by downward fair value adjustments of $0.8 million.

*Accounts payable*

Accounts payable primarily consists of amounts due for costs related to our digital asset mining, cloud services, colocation services and ETH staking. Compared with December 31, 2024, the balance of accounts payable decreased by $1.3 million in the three months ended June 30, 2025, largely due to a higher volume of payments made.

*Deferred revenue*

Deferred revenue pertains to prepayments received from customers for HPC business.

As of June 30, 2025, the Company's current and non-current portion of deferred revenue was $11.6 million and $28 thousand, respectively, compared to $30.7 million and $0.1 million, respectively, as of December 31, 2024. The decrease in deferred revenue of $19.1 million reflects the recognition of $22.5 million in revenue related to the successful fulfillment of performance obligations from our HPC services, partially offset by $3.4 million prepayments from customers for HPC services to be rendered in the future.

*Long-term income tax payable*

Compared with December 31, 2024, the balance as of June 30, 2025 did not change as no incremental penalty was accrued on the existing unrecognized tax benefits for the three months ended June 30, 2024. Refer to Note 15. *Income Taxes*, for more information.

**Non-GAAP Financial Measures**

In addition to consolidated U.S. GAAP financial measures, we consistently evaluate our use of and calculation of the non-GAAP financial measures, such as "Adjusted EBITDA".

EBITDA is computed as net income before interest, taxes, depreciation, and amortization. Adjusted EBITDA is a financial measure defined as our EBITDA adjusted to eliminate the effects of certain non-cash and / or non-recurring items that do not reflect our ongoing strategic business operations, which management believes results in a performance measurement that represents a key indicator of the Company's core business operations. The adjustments currently include fair value adjustments such as investment securities value changes and non-cash share-based compensation expenses, in addition to other income and expense items.

We believe Adjusted EBITDA can be an important financial measure because it allows management, investors, and our board of directors to evaluate and compare our operating results, including our return on capital and operating efficiencies, from period-to-period by making such adjustments.

Adjusted EBITDA is provided in addition to and should not be considered to be a substitute for, or superior to net income, the comparable measures under U.S. GAAP. Further, Adjusted EBITDA should not be considered as an alternative to revenue growth, net income, diluted earnings per share or any other performance measure derived in accordance with U.S. GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity. Adjusted EBITDA has limitations as an analytical tool, and you should not consider such measures either in isolation or as substitutes for analyzing our results as reported under U.S. GAAP.

Reconciliations of Adjusted EBITDA to the most comparable U.S. GAAP financial metric for historical periods are presented in the table below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> June 30,** | **For the Three Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** | **2025** | **2024** |
| **Reconciliation of non-GAAP income (loss) from operations:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**Net income (loss)** | $**14874202** | $**(11953100)** | $**(42837443)** | $**38128757** |
| &nbsp;&nbsp;&nbsp;Depreciation and amortization expenses | 8223538 | 8346633 | 15465527 | 15192582 |
| &nbsp;&nbsp;&nbsp;Income tax expenses | 1591557 | 541781 | 2263273 | 2119131 |
| &nbsp;&nbsp;&nbsp;**EBITDA** | **24689297** | **(3064686)** | **(25108643)** | **55440470** |
| &nbsp;&nbsp;&nbsp;**Adjustments:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net loss from disposal of property and equipment |  |  | 333620 |  |
| &nbsp;&nbsp;&nbsp;Share based compensation expenses | 6890646 | 423736 | 7143036 | 916335 |
| &nbsp;&nbsp;&nbsp;Changes in fair value of long-term investments | (3816856) | (1182792) | 875572 | (1637497) |
| &nbsp;&nbsp;&nbsp;**Adjusted EBITDA** | $**27763087** | $**(3823742)** | $**(16756415)** | $**54719308** |

---

**Liquidity and capital resources**

As of June 30, 2025, we had working capital of $273.7 million which includes USDC of $0.5 million and digital assets of $91.2 million as compared with working capital of $242.2 million as of December 31, 2024. Working capital is the difference between the Company's current assets and current liabilities.

To date, we have financed our operations primarily through cash flows from operations, and equity financing through public and private offerings of our securities. We plan to support our future operations primarily from cash generated from our operations and equity financings. We may also consider debt, preferred and convertible financing on favorable terms.

We believe our existing cash will be sufficient to fund our anticipated operating cash requirements for at least twelve months following the date of this filing.

We have sold from time to time in one or more offerings at the market (ATM) at prices and on terms which the Company will then determine for an initial aggregate offering price of $500 million pursuant to a registration statement on Form F-3 declared effective by the SEC on May 4, 2022.

Between May and August 2023, the Company issued an aggregate of 6,747,663 ordinary shares to Ionic Ventures LLC for gross proceeds of $22.0 million. The Company received net proceeds of approximately $21.0 million after deducting commissions payable to the placement agent.

In 2023, the Company sold an aggregate of 14,744,026 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $45.3 million, net of offering costs.

In 2024, the Company sold an aggregate of 67,246,628 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $242.9 million, net of offering costs.

In the first quarter of 2025, the Company sold an aggregate of 3,149,887 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $10.2 million, net of offering costs.

In the second quarter of 2025, the Company sold an aggregate of 25,504,699 ordinary shares in connection with the at-the-market offering. The Company received net proceeds of $48.3 million, net of offering costs.

On October 11, 2024, the Company acquired all of the issued and outstanding capital stock of Enovum Data Centers Corp. in a transaction valued at approximately CAD 62.8 million (approximately 46.0 million).

On April 29, 2025, the Company filed a registration statement on Form S-3 (No. 333-286841) to register up to $500 million of its Ordinary Shares, preference shares, debt securities, warrants, units and subscription rights (the "Registration Statement").

In June 2025, the Company completed an underwritten public offering of its ordinary shares registered under the Registration Statement. In accordance with the terms of the underwriting agreement entered into with B. Riley Securities, Inc., as representative of the several underwriters, the Company sold 75,000,000 ordinary shares at a price to the underwriters of $1.90 per share. The Company received net proceeds of approximately $141.6 million, after deducting the underwriting discount and offering expenses. On July 1, 2025, the underwriters related to this public offering fully exercised their option to purchase an additional 11,250,000 ordinary shares, resulting in additional net proceeds to the Company of $21.3 million, after deducting the underwriting discount and offering expenses.

On July 15, 2025, the Company entered into a registered direct offering with B. Riley Securities, Inc. relating to its ordinary shares. In accordance with the terms of the sales agreement, the Company agreed to issue and sell 22,000,000 ordinary shares having an aggregate purchase price of $63.6 million, net of offering costs. The registered direct offering closed on July 15, 2025. The Company intends to use the net proceeds from the registered direct offering to purchase Ethereum.

***Revenue from Operations***

Funding our operations on a going-forward basis will rely significantly on the revenue earned from our high performance computing business, as well as our ability to earn ETH rewards from ETH staking business and the spot or market price of ETH.

On October 23, 2023, Bit Digital announced that it had commenced AI operations by signing a binding term sheet with a customer (the "Initial Customer") to support the customer's GPU workloads. On December 12, 2023, we finalized a Master Services and Lease Agreement ("MSA"), as amended, with our Initial Customer for the provision of cloud services from a total of 2,048 GPUs over a three-year period. To finance this operation, we entered into a sale-leaseback agreement with a third party, selling 96 AI servers (equivalent to 768 GPUs) and leasing them back for three years. The total contract value with the Initial Customer for the aggregated 2,048 GPUs was estimated to be worth more than $50 million of annualized revenue. On January 22, 2024, approximately 192 servers (equivalent to 1,536 GPUs) were deployed at a specialized data center and began generating revenue, and subsequently on February 2, 2024, approximately an additional 64 servers (equivalent to 512 GPUs) also started to generate revenue.

In the second quarter of 2024, we finalized an agreement to supply our Initial Customer with an additional 2,048 GPUs over a three-year period. To finance this operation, we entered into a sale-leaseback agreement with a third party, agreeing to sell 128 AI servers (equivalent to 1,024 GPUs) and leasing them back for three years. In late July, at the customer's request, we agreed with the customer to temporarily delay the purchase order so the customer could evaluate an upgrade to newer generation Nvidia GPUs. Consequently, the Company and manufacturer postponed the purchase order. In early August, the customer made a non-refundable prepayment of $30.0 million for the services to be rendered under this agreement.

In January 2025, the Company entered into a new agreement to supply its Initial Customer with an additional 464 GPUs for a period of eighteen months. This new agreement replaces the prior agreement whereby the Company was to provide the customer with an incremental 2,048 H100 GPUs. The contract represents approximately $15 million of annualized revenue and features a two-month prepayment from the customer. The customer has elected to defer the commencement date until August 20th, 2025, which is the latest allowable date under the agreement.

On October 9, 2024, we executed a Master Service Agreement (the "MSA") with Boosteroid Inc. ("Boosteroid"), a global cloud gaming provider. Following execution of a binding term sheet with Boosteroid on August 19, 2024, we finalized initial orders of 489 GPUs, projected to generate approximately $7.9 million in contracted value in the aggregate through November 2029. The GPUs have been delivered to respective data centers across the U.S. and Europe and began earning fees in November 2024. The MSA provides Boosteroid with the option to expand in increments of 100 servers, up to 50,000 servers, representing a potential contract value of approximately $700 million over the five-year term assuming Boosteroid utilizes the GPUs and services at full capacity for the duration of the contract. Expansion depends upon the internal development roadmap of Boosteroid, Boosteroid has full discretion to decide when and the quantity to pursue separate source orders (for GPU servers) under the MSA. In the third quarter of 2025, the Company finalized additional purchase orders for 302, 120, and 279 GPUs, totaling approximately $10.4 million in contracted value over a five-year term.

On December 30, 2024, we entered into a Master Services Agreement ("MSA") with a minimum purchase commitment of 32 GPUs, along with an associated purchase order, from a new customer, an AI Compute Fund managed by DNA Holdings Venture Inc. ("DNA Fund"). The purchase order provides for services utilizing a total of 576 H200 GPUs over a twenty-five month period, terminable by either party upon at least 90 days' written notice prior to any renewal date. It represents an aggregate revenue opportunity of approximately $20.2 million. Concurrently, we placed a purchase order for 130 H200 servers for approximately $30 million. The deployment commenced in February 2025. In April 2025, the Company signed two additional cloud services agreements with DNA Fund. The first agreement, commencing in early May, includes 104 NVIDIA H200 GPUs under a 23-month term. The second, commencing mid-May, includes 512 H200 GPUs under a 24-month term. With these additions, DNA Fund's total contracted deployment increased to 1,192 GPUs. Combined, the agreements represent approximately $20.9 million of annualized revenue.

Regardless of our ability to generate revenue from our high performance computing business, or our Ethereum staking business, we may need to raise additional capital in the form of equity or debt to fund our operations and pursue our business strategy. The ability to raise funds such as equity, debt or conversion of digital assets to maintain our operations is subject to many risks and uncertainties and, even if we are successful, future equity issuances would result in dilution to our existing stockholders and any future debt or debt securities may contain covenants that limit our operations or ability to enter into certain transactions. Our ability to realize revenue through conversion of digital assets into cash or fund overhead with digital assets is subject to a number of risks, including regulatory, financial and business risks, many of which are beyond our control. Additionally, the value of digital asset rewards has historically been extremely volatile, and future prices cannot be predicted.

If we are unable to generate sufficient revenue when needed or secure additional funding, it may become necessary to significantly reduce our current rate of expansion or to explore other strategic alternatives.

***Cash flows***

---

| | | |
|:---|:---|:---|
|  | **For the Six Months Ended<br> June 30,** | **For the Six Months Ended<br> June 30,** |
|  | **2025** | **2024** |
| Net Cash Provided by (Used in) Operating Activities | $35095075 | $(30370425) |
| Net Cash Used in Investing Activities | (148240379) | (6660262) |
| Net Cash Provided by Financing Activities | 199313693 | 80273917 |
| Net (decrease) increase in cash, cash equivalents and restricted cash | 86168389 | 43243230 |
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (203877) |  |
| Cash, cash equivalents and restricted cash, beginning of period | 98934127 | 18180934 |
| Cash, cash equivalents and restricted cash, end of period | $**184898639** | $**61424164** |

---

 ****

 ****

*Operating Activities*

Net cash provided by operating activities was $35.1 million for the six months ended June 30, 2025, derived mainly from (i) a net loss of $42.8 million for the six months ended June 30, 2025 adjusted for digital assets mined of $14.4 million from our mining services, depreciation expenses and amortization expense of $15.5 million, losses on digital assets of $22.1 million, share based compensation expenses of $7.1 million, loss from disposal of property, plant, and equipment of $0.3 million, and changes in fair value of investment security of $0.9 million, and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in digital assets and stable coins of $54.0 million, decrease in deferred revenue of $19.0 million, an increase in accounts receivable of $1.2 million, an increase in other payable and accrued liabilities of $5.3 million, a decrease in net investment in lease of $1.3 million, a decrease in accounts payable of $0.3 million, a decrease in other current assets of $3.9 million, and a decrease in other non-current assets of $1.6 million.

Net cash used in operating activities was $30.4 million for the six months ended June 30, 2024, derived mainly from (i) a net income of $38.1 million for the six months ended June 30, 2024 adjusted for digital assets of $38.0 million from our mining services, depreciation expenses of property and equipment of $15.2 million, unrealized gain on digital assets held in fund of $2.7 million, and gains on digital assets of $34.2 million, and (ii) net changes in our operating assets and liabilities, principally comprising of a decrease in deferred revenue of $13.1 million, decrease in other payable and accrued liabilities of $3.7 million, and a decrease in net investment in lease of $2.9 million, offset by and an increase in accounts payable of $3.8 million and other current assets of $8.4 million.

*Investing Activities*

Net cash used in investing activities was $148.2 million for the six months ended June 30, 2025, primarily attributable to purchases of and deposits made for property, plant, and equipment of $147.1 million, investment in equity securities of $2.0 million, and proceeds from disposal of property, plant and equipment of $0.9 million.

Net cash used in investing activities was $6.7 million for the six months ended June 30, 2024, primarily attributable to purchases of and deposits made for property and equipment of $5.6 million, investment in a SAFE of $1.0 million and investment in one equity investee of $0.1 million.

*Financing Activities*

Net cash provided by financing activities was $199.3 million for the six months ended June 30, 2025, attributable to net proceeds of $58.5 million from the at-the-market offering, net proceeds of $141.6 million from the public offering, and offset by the payment of dividends of $0.8 million.

Net cash provided by financing activities was $80.3 million for the six months ended June 30, 2024, attributable to net proceeds of $80.3 million from the at-the-market offering.

***Royal Bank of Canada Credit Facility***

On June 18, 2025, the Company entered into a definitive credit agreement with the Royal Bank of Canada ("RBC"), the largest bank in Canada, to finance its data centers business. The facility provides up to CAD $60 million (approximately USD $43.8) in aggregate financing. Proceeds will be used to support the continued buildout of the Company's HPC data center portfolio. Refer to Data Centers section above for further details.

**Critical Accounting Policies and Estimates**

Our discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements. These financial statements are prepared in accordance with U.S. GAAP, which requires the Company to make estimates and assumptions that affect the reported amounts of our assets, liabilities, revenues, and expenses, to disclose contingent assets and liabilities on the dates of the unaudited condensed consolidated financial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods. The most significant estimates and assumptions include, but are not limited to, the valuation of current assets, useful lives of property, plant, and equipment, impairment of long-lived assets, intangible assets and goodwill, valuation of assets and liabilities acquired in business combinations, provision necessary for contingent liabilities and realization of deferred tax assets. We continue to evaluate these estimates and assumptions that we believe to be reasonable under the circumstances. We rely on these evaluations as the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Since the use of estimates is an integral component of the financial reporting process, actual results could differ from those estimates as a result of changes in our estimates. Some of our accounting policies require higher degrees of judgment than others in their application. We believe critical accounting policies as disclosed in this release reflect the more significant judgments and estimates used in preparation of our unaudited condensed consolidated financial statements. For a summary of significant accounting policies, refer to Note 2. *Summary of Significant Accounting Policies* in our Notes to Unaudited Condensed Consolidated Financial Statements included elsewhere herein.

**Item 3. Quantitative and Qualitative Disclosures about Market Risk.**

Not applicable. A smaller reporting company is not required to provide the information required by this Item.

**Item 4. Controls and Procedures.**

***Evaluation of Disclosure Controls and Procedures***

Our management, with the participation of our Chief Executive Officer and our Principal Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report to ensure that the information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and that information required to be disclosed in the reports we file or submit under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Principal Financial Officer, to allow timely decisions regarding required disclosures.

Based on this evaluation, our management, with the participation of our Chief Executive Officer and our Principal Financial Officer, concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of the end of the period covered by this report.

Management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily applies its judgment in conducting a cost-benefit analysis of possible controls and procedures.

***Changes in Internal Control over Financial Reporting***

In October 2024, we acquired 100% of the equity interests of Enovum Data Centers Corp ("Enovum"). We are currently in the process of integrating Enovum's operations, control processes, and information systems into our systems and control environment and expect to include them in scope of design and operation of our internal control over financial reporting for the year ending December 31, 2025. We believe that we have taken the necessary steps to monitor and maintain appropriate internal control over financial reporting during this integration. Other than changes made in connection with the acquisitions, there were no changes in our internal control over financial reporting during the three months ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

**PART II - OTHER INFORMATION**

**Item 1. Legal Proceedings.**

Except as set forth herein, there have been no changes since the filing of the Company's Form 10-K for the year ended December 31, 2024 and the Company's Form 10-Q for the period ended March 31, 2025.

On June 3, 2024, the Company filed suit in Delaware Superior Court against Blockfusion, Inc. ("Blockfusion") alleging claims for breach of contract, conversion, and related claims in connection with, among other things, certain deposits and advances paid to Blockfusion, the return of which is owed to Bit Digital. Bit Digital is seeking in excess of $4.3 million. On October 22, 2024, Blockfusion denied the Company's claims and brought reciprocal breach of contract and related counterclaims. Following limited discovery, the Court entered a stipulation and order on June 18, 2025, amending the Case Management Order to extend multiple discovery deadlines and vacate the previously scheduled trial date. On August 1, 2025, the Company moved for leave to file a Second Amended Complaint, which adds claims for fraud and related causes of action arising out of Blockfusion's conduct both at the inception of and during the parties' relationship. The Second Amended Complaint also names Blockfusion's CEO, Alexander Martini-Lomanto, as an additional defendant. The Company continues to seek the recovery of its original investment, invoice payments, and unpaid late development fees, and now seeks additional damages for the tort and equitable claims contained in the Second Amended Complaint pending Court approval, including punitive damages. If the Company's Second Amended Complaint is ultimately accepted by the Court, the total amount of damages sought will be in excess of $5 million.

**Item 1A. Risk Factors**

The Company is not required to provide the information called for in this item due to its status as a Smaller Reporting Company. You should refer to the other information set forth in this report, including the information set forth in "Management's Discussion and Analysis of Financial Condition and Results of Operations" as well as in our consolidated financial statements and the related notes. Our business prospects, financial condition or results of operations could be adversely affected by any of these risks.

Please note in considering the "Risk Factors" in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2024 (Annual Report) that, notwithstanding the fact that Bit Digital, Inc. has not conducted operations in the PRC since September 30, 2021, we have previously disclosed under Risk Factors in our Annual Report. "We may be subject to fines and penalties for any noncompliance with or any liabilities in our former business in China in a certain period from now on." Although the statute of limitations for non-compliance by our former business in the PRC is generally two years and the Company has been out of the PRC, for more than two years, the Authority may still find its prior bitcoin mining operations involved a threat to financial security. In such event, the two-year period would be extended to five years.

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

None. Previously reported on Form 8-K.

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

None.

**Item 4. Mine Safety Disclosures.**

Not applicable.

**Item 5. Other Information.**

During the three months ended June 30, 2025, no director or officer of the Company adopted or terminated a "Rule 10b5-1 trading arrangement" or "non-Rule 10b5-1 trading arrangement," as each term is defined in Item 408(a) of Regulation S-K.

**Item 6. Exhibits.**

(a) Exhibits.

---

| | |
|:---|:---|
| **Exhibit No.** | **Document Description** |
| 2.1\* | [Section 351 Contribution Agreement, dated July 30, 2025, between WhiteFiber, Inc. and Bit Digital, Inc.](ea025144801ex2-1_bitdigital.htm) |
| 10.1 | [MTL-3 Lease Agreement dated April 10, 2025 (Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on April 15, 2025).](http://www.sec.gov/Archives/edgar/data/1710350/000121390025032132/ea023804201ex10-1_bitdigital.htm) |
| 10.2 | [Purchase Agreement, dated as of April 10, 2025, by and between Enovum Data Centers Corp. and Unifi Manufacturing, Inc. Certain portions of the exhibit that include immaterial and confidential information have been omitted and are available upon request of the SEC (Incorporated by reference to Exhibit 10.1 to the Registrant's Current Report on Form 8-K filed on April 16, 2025).](http://www.sec.gov/Archives/edgar/data/1710350/000121390025032598/ea023841901ex10-1_bitdigi.htm) |
| 10.3+ | [Amendment to Real Estate Purchase and Sale Agreement dated as of May 19, 2025, by and between Enovum NC-1 Bidco, LLC and Unifi Manufacturing, Inc (Incorporated by reference to Exhibit 10.2 to the Registrant's Current Report on Form 8-K filed on May 23, 2025).](http://www.sec.gov/Archives/edgar/data/1710350/000121390025047369/ea024300201ex10-2_bitdigit.htm) |
| 10.4\* | [Transition Services Agreement, dated July 30, 2025, between WhiteFiber, Inc. and Bit Digital, Inc.](ea025144801ex10-4_bitdigital.htm) |
| 31.1\* | [Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ea025144801ex31-1_bitdigital.htm) |
| 31.2\* | [Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.](ea025144801ex31-2_bitdigital.htm) |
| 32.1\* | [Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).](ea025144801ex32-1_bitdigital.htm) |
| 32.2\* | [Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).](ea025144801ex32-2_bitdigital.htm) |
| 101.INS\*\* | Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).\*\* |
| 101.SCH\*\* | Inline XBRL Taxonomy Extension Schema Document. |
| 101.CAL\*\* | Inline XBRL Taxonomy Extension Calculation Linkbase Document. |
| 101.DEF\*\* | Inline XBRL Taxonomy Extension Definition Linkbase Document. |
| 101.LAB\*\* | Inline XBRL Taxonomy Extension Labels Linkbase Document. |
| 101.PRE\*\* | Inline XBRL Taxonomy Extension Presentation Linkbase Document. |
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). |

---

---

| | |
|:---|:---|
| \* | Filed herewith (unless otherwise noted as being furnished herewith). |
| \*\* | XBRL (Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections. |
| + | Certain portions of this exhibit have been redacted in accordance with Item 601(b)(10) of Regulation S-K. |

---

**SIGNATURES**

In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

---

| | | |
|:---|:---|:---|
|  | **Bit Digital, Inc.** | **Bit Digital, Inc.** |
| Date: August 14, 2025 | By: | */s/ Sam Tabar* |
|  |  | Sam Tabar |
|  |  | Chief Executive Officer |
|  |  | (Principal Executive Officer) |

---

---

| | | |
|:---|:---|:---|
| Date: August 14, 2025 | By: | */s/ Erke Huang* |
|  |  | Erke Huang |
|  |  | Chief Financial Officer |
|  |  | (Principal Accounting Officer) |

---

---

| | | |
|:---|:---|:---|
| Date: August 14, 2025 | By: | */s/ Justin Zhu* |
|  |  | Justin Zhu |
|  |  | Chief Accounting Officer and Senior<br> Vice President of Finance |
|  |  | (Principal Financial Officer) |

---

## Exhibit 2.1

**Exhibit 2.1**

**SECTION 351 CONTRIBUTION AGREEMENT**

**THIS SECTION 351 CONTRIBUTION AGREEMENT**, made as of the 30th day of July 2025, to be effective as of the Effective Date (as defined below), by and between:

**WHITEFIBER, INC.** a Cayman Island exempted company (hereinafter "Company"); and **BIT DIGITAL, INC.,** a Cayman Island exempted company (hereinafter referred to as the "Contributing Party")

**WITNESSETH:**

WHEREAS, the Contributing Party, which has formed the Company and taken part in the development of the Company's business, having an interest in the assets, business, liabilities and capital stock of its subsidiaries listed on <u>Schedule A</u> attached hereto (the "Subsidiaries");

WHEREAS, the Company and the Contributing Party believe that it is in their best interests to separate the Subsidiaries from the Contributing Party;

WHEREAS the Company and the Contributing Party have negotiated and reached certain understandings, herein delineated and in a Transition Services Agreement, which have been memorialized hereinafter; and

WHEREAS, effective as of the date on which the Company's Registration Statement on Form S-1, as amended (Reg. No. 333-288650), relating to the Company's initial public offering of ordinary shares of par value US$0.01 each ("Ordinary Shares), is declared effective by the U.S. Securities and Exchange Commission (the "Effective Date"), each of the Company and the Contributing Party desire this Contribution Agreement to formalize and evidence such understandings.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, and intending to be legally bound, the parties have agreed as follows:

1. As of the date of this Contribution Agreement, the Company currently has one Ordinary Share issued and outstanding, all of which is held by the Contributing Party. There are no preferred shares issued and outstanding.

2. The Contributing Party hereby contributes to the Company and hereby transfers, sells, conveys, assigns and quitclaims to the Company all of its rights, title and interest in and to the capital shares, business and associated assets and liabilities of the Subsidiaries (the "Contribution").

3. The Company shall issue to the Contributing Party 27,043,749 Ordinary Shares as consideration for the Contributing Party's Contribution, on the terms and subject to the conditions set out in this Contribution Agreement. The Ordinary Shares shall be issued and allotted to the Contributing Party on the Effective Date and the Company shall take all necessary actions to ensure that the Ordinary Shares are duly and validly issued, credited as fully paid, and entered into the register of members in the name of the Contributing Party.

4. The Company and the Contributing Party acknowledge that they have negotiated at arms length over a period of time regarding this transaction prior to reaching this agreement. This Contribution Agreement memorializes the understandings reached and sets forth the complete agreement of the parties. This Contribution Agreement supersedes any and all prior discussion and all oral and/or written understandings. There are no representations or warranties made by any of the parties as an inducement to this Contribution Agreement except for those set forth in this Contribution Agreement, if any.

4. This Contribution Agreement is intended to provide for a tax-free exchange between the Contributing Party and the Company under Section 351 of the Internal Revenue Code and shall be construed to accomplish that result.

5. This Contribution Agreement may not be terminated, amended, or otherwise modified except by a written agreement signed by all of the Parties to this Contribution Agreement and all parties so required by the Company's Amended and Restated Memorandum of Association at the time of such termination, amendment or modification, if any.

6. If any provision of this Agreement is held to be illegal, invalid or unenforceable under the present or future laws effected during the terms of this Agreement in the state of New York, such provision shall be fully severable from the remaining provisions of this Contribution Agreement, and it shall not affect the validity of the remaining provisions, which provisions shall be given full force and effect as if the illegal, unenforceable, or invalid provision had not been included in this Contribution Agreement. In lieu of an illegal, unenforceable, or invalid provision, there shall be substituted a provision as similar in terms to the illegal, invalid, or unenforceable provision as may be possible and still be legal, valid and enforceable.

7. This Contribution Agreement shall be construed and enforced in accordance with and governed by New York law in existence on the date of this Contribution Agreement.

8. The parties will execute and deliver such further instruments and do such further acts and things as may be required to carry out the intent and purpose of this Contribution Agreement.

9. This Contribution Agreement shall be binding upon, and shall inure to the benefit of, the heirs, administrators, personal representatives, successors and assigns of the respective parties hereto.

10. Any notice required or permitted to be given under this Contribution Agreement shall be sufficient if in writing, and if sent by certified mail to the address shown at the head of the Contribution Agreement or such alternative address as a party may provide in writing and delivered to the above listed address of the other parties hereto.

11. The waiver by either party of a breach of any provision of this Contribution Agreement by the other party shall not operate or be construed as a waiver of any subsequent breach by such other party.

IN CONSIDERATION THEREOF, intending to be legally bound, the parties have executed the Agreement on the date first written above.

---

| | |
|:---|:---|
| ATTEST: | ATTEST: |
|  | The Company |
|  | WHITEFIBER, INC. |
| By: | /s/ Sam Tabar |
|  | Sam Tabar |
|  | Chief Executive Officer |
|  | Contributing Party |
|  | BIT DIGITAL, INC. |
| By: | /s/ Erke Huang |
|  | Erke Huang |
|  | Chief Financial Officer |

---

**<u>SCHEDULE A</u>**

---

| | |
|:---|:---|
| &nbsp;&nbsp;WhiteFiber AI, Inc. | &nbsp;&nbsp;(Delaware) |
| &nbsp;&nbsp;WhiteFiber HPC, Inc. | &nbsp;&nbsp;(Delaware) |
| &nbsp;&nbsp;WhiteFiber Iceland ehf | &nbsp;&nbsp;(Iceland) |
| &nbsp;&nbsp;WhiteFiber Canada, Inc. | &nbsp;&nbsp;(Canada) |
| &nbsp;&nbsp;WhiteFiber Japan G.K. | &nbsp;&nbsp;(Japan) |

---

## Exhibit 10.4

**<u>Exhibit 10.4</u>**

TRANSITION SERVICES AGREEMENT<br>BETWEEN<br>BIT DIGITAL, INC.,<br>AND<br>WHITEFIBER, INC.<br>Dated July 30, 2025

**TABLE OF CONTENTS**

---

| | | |
|:---|:---|:---|
| ARTICLE I | DEFINITIONS | 1 |
| Section 1.1 | Definitions | 1 |
| ARTICLE II | PERFORMANCE AND SERVICES | 5 |
| Section 2.1 | General | 5 |
| Section 2.2 | Additional Services | 5 |
| Section 2.3 | Service Requests | 6 |
| Section 2.4 | Access | 6 |
| Section 2.5 | Local Agreements | 7 |
| Section 2.6 | System Shutdown | 7 |
| ARTICLE III | SERVICE QUALITY; INDEPENDENT CONTRACTOR | 7 |
| Section 3.1 | Service Quality | 7 |
| Section 3.2 | Independent Contractor; Assets; Subcontractors | 8 |
| Section 3.3 | Uses of Services | 9 |
| Section 3.4 | Modification of Services. | 9 |
| Section 3.5 | Transition of Responsibilities | 9 |
| Section 3.6 | Substantive Business Decisions Prohibited | 9 |
| Section 3.7 | Disclaimer of Warranties | 9 |
| ARTICLE IV | FEES; PAYMENT | 10 |
| Section 4.1 | Fees | 10 |
| Section 4.2 | Taxes | 10 |
| Section 4.3 | Invoices and Payment | 10 |
| Section 4.4 | Payment Disputes | 10 |
| ARTICLE V | CONFIDENTIALITY; SECURITY. | 11 |
| Section 5.1 | Bit Digital and WhiteFiber Obligations | 11 |
| Section 5.2 | No Release; Return or Destruction | 11 |
| Section 5.3 | Protective Arrangements | 12 |
| Section 5.4 | Security | 12 |
| ARTICLE VI | TERMINATION | 13 |
| Section 6.1 | Term | 13 |
| Section 6.2 | Partial Termination | 14 |
| Section 6.3 | Termination of Entire Agreement | 14 |
| Section 6.4 | Procedures on Termination | 15 |
| Section 6.5 | Effect of Termination | 15 |
| Section 6.6 | Exit | 15 |
| Section 6.7 | Responsibility for Salary and Other Benefits on Exit | 15 |
| Section 6.8 | Indemnities on Exit | 15 |
| Section 6.9 | Procedure and Indemnity for Claims by Non-Transferring Employees | 16 |

---

i

---

| | | |
|:---|:---|:---|
| ARTICLE VII | INDEMNIFICATION AND DISPUTE RESOLUTION | 16.0 |
| Section 7.1 | Limitation of Liability | 16.0 |
| Section 7.2 | Indemnification by WhiteFiber | 17.0 |
| Section 7.3 | Indemnification by Bit Digital | 17.0 |
| Section 7.4 | Exclusive Remedy | 18.0 |
| Section 7.5 | Risk Allocation | 18.0 |
| Section 7.6 | Indemnification Procedures | 18.0 |
| Section 7.7 | Project Managers | 19.0 |
| Section 7.8 | Mediation | 19.0 |
| ARTICLE VIII | MISCELLANEOUS | 19.0 |
| Section 8.1 | Amendments and Waivers | 19.0 |
| Section 8.2 | Notices | 20.0 |
| Section 8.3 | Entire Agreement | 20.0 |
| Section 8.4 | No Third-Party Beneficiaries | 20.0 |
| Section 8.5 | Governing Law | 21.0 |
| Section 8.6 | Assignability | 21.0 |
| Section 8.7 | Severability | 21.0 |
| Section 8.8 | Counterparts | 21.0 |
| Section 8.9 | Rules of Construction | 21.0 |
| Section 8.10 | Specific Performance | 22.0 |
| Section 8.11 | Precedence of Schedules | 22.0 |
| Section 8.12 | Force Majeure | 22.0 |

---

ii

TRANSITION SERVICES AGREEMENT

THIS TRANSITION SERVICES AGREEMENT, dated July 30, 2025, to be effective as of the Effective Date (as defined below) (this "<u>Agreement</u>"), is between Bit Digital, Inc., a Cayman Islands exempted company ("<u>Bit Digital</u>") and WhiteFiber Inc., a Cayman Islands exempted company ("WhiteFiber"). Bit Digital and WhiteFiber are sometimes referred to herein individually as a "<u>Party</u>", and collectively as the "<u>Parties</u>".

RECITALS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; A. Bit Digital and WhiteFiber are parties to that certain Section 351 Contribution Agreement dated as of even date herewith (the "<u>Contribution Agreement</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; B. Pursuant to the Contribution Agreement, Bit Digital agreed to transfer to WhiteFiber, on the Effective Date, its subsidiary WhiteFiber AI, Inc. and its subsidiaries, WhiteFiber HPC, Inc. a Delaware company and WhiteFiber ehf, an Icelandic company (collectively, the "HPC Services Business Segment") and for WhiteFiber to acquire the HPC Services Business Segment, which will include WhiteFiber's existing subsidiary, Enovum Data Centers Corp. ("Enovum"). Accordingly, (1) WhiteFiber will own and conduct, directly and indirectly, the HPC Services Business Segment and (2) Bit Digital will continue to own and conduct, directly and indirectly, its Digital Assets Business (the "Reorganization") with effect from the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; C. In connection with the transactions contemplated by the Reorganization and in order to ensure a smooth transition following the Reorganization, each Party desires that the other Party provide, or cause its Affiliates or contractors to provide, the Services specified pursuant to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; D. It is the intent of the Parties that, except as otherwise provided in this Agreement, the Services be provided at cost, and therefore, the Fees set forth on <u>Annex A</u> or <u>Annex B</u> were calculated to reflect costs only.

In consideration of the forgoing and the mutual covenants and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree, effective as of the Effective Date, as follows:

ARTICLE I<br> DEFINITIONS

Section 1.1 <u>Definitions</u>. Unless otherwise defined herein, each capitalized term will have the meaning specified for such term in the Separation Agreement. As used in this Agreement:

"<u>Additional Bit Digital Service</u>" has the meaning set forth in <u>Section 2.2(a)</u>.

"<u>Additional WhiteFiber Service</u>" has the meaning set forth in <u>Section 2.2(b)</u>.

"<u>Affiliate</u>" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with such other Person as of the date on which, or at any time during the period for which, the determination of affiliation is being made. For purposes of this definition, the term "control" (including, with correlative meanings, the terms "controlled by" and "under common control with"), as used with respect to any Person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by Contract or otherwise. For the avoidance of doubt, (a) Affiliates of Bit Digital will include subsidiaries of the HPC Services Business Segment Group prior to the Reorganization, and (b) Affiliates of HPC Services Business Segment will include the HPC Services Business Segment after the Reorganization.

"<u>Agreement</u>" has the meaning set forth in the Preamble.

"<u>Availed Party</u>" has the meaning set forth in <u>Section 5.4(a)</u>.

"<u>Bit Digital</u>" has the meaning set forth in the Preamble.

"<u>Bit Digital Group</u>" means Bit Digital and each Person that is a Subsidiary of Bit Digital (other than WhiteFiber and any of its Subsidiaries).

"<u>Bit Digital Indemnified Parties</u>" has the meaning set forth in <u>Section 7.2</u>.

"<u>Bit Digital Services</u>" means the Services generally described on <u>Annex A</u> and any other Service provided by Bit Digital or any member of the Bit Digital Group pursuant to this Agreement.

"<u>Business</u>" means the HPC Services Business Segment or the Digital Assets Business, as the case may be.

"<u>Commercially Reasonable Efforts</u>" means, with respect to the efforts to be expended by a Party with respect to any objective under this Agreement, reasonable, diligent good faith efforts to accomplish such objective as such Party would normally use to accomplish a similar objective as expeditiously as reasonably possible under similar circumstances exercising reasonable business judgment, it being understood and agreed that such efforts will include the exertion of efforts and utilization of resources that would be used by such Party in support of one of its own wholly owned businesses. "Commercially Reasonable Efforts" will not require a Party (a) to make payments to unaffiliated Third Parties (except as set forth in this Agreement), to incur non-de minimis Liabilities to unaffiliated Third Parties or to grant any non-de minimis concessions or accommodations unless the other Party agrees to reimburse and make whole such Party to its reasonable satisfaction for such Liabilities, concessions or accommodations requested to be made by the other Party (such reimbursement and make whole to be made promptly after the determination thereof following the Distribution or, with respect to items incurred after the Distribution, promptly thereafter), (b) to violate any Law, or (c) to initiate any litigation or arbitration.

"<u>Confidential Information</u>" shall mean all Information that is either confidential or proprietary.

"<u>Digital Assets Business</u>" means the businesses of the Bit Digital Group following the Reorganization.

"<u>Effective Date</u>" means the date on which WhiteFiber's Registration Statement on Form S-1, as amended (Reg. No. 333-288650), relating to WhiteFiber's initial public offering of its ordinary shares, is declared effective by the U.S. Securities and Exchange Commission.

"<u>Eligible Services</u>" has the meaning set forth in <u>Section 6.2(a)</u>.

"<u>Extendable Service</u>" has the meaning set forth in <u>Section 6.1(b)</u>.

"<u>Fees</u>" means the fees for a particular Service as set forth on <u>Annex A</u> or <u>Annex B</u>, as the case may be.

"<u>Force Majeure</u>" shall mean, with respect to a Party, an event beyond the reasonable control of such Party (or any Person acting on its behalf), which event (a) does not arise or result from the fault or negligence of such Party (or any Person acting on its behalf) and (b) by its nature would not reasonably have been foreseen by such Party (or such Person), or, if it would reasonably have been foreseen, was unavoidable, and includes acts of God, acts of civil or military authority, acts of terrorism, cyberattacks, embargoes, epidemics, pandemics (including COVID-19 and Pandemic Measures), war, riots, insurrections, fires, explosions, earthquakes, floods, unusually severe weather conditions, labor problems, or unavailability of parts, or, in the case of computer systems, any significant and prolonged failure in electrical or air conditioning equipment.

"<u>Governmental Authority</u>" means any federal, state, local, provincial, foreign or international court, tribunal, judicial or arbitral body, government, department, commission, board, bureau, agency, official or other regulatory, administrative or governmental authority or any national securities exchange.

"<u>HPC Services Business Segment</u>" has the meaning set forth in the Recitals.

"<u>Information</u>" means information in written, oral, electronic or other tangible or intangible forms, stored in any medium, including studies, forecasts, budgets, reports, records, books, Contracts, instruments, surveys, discoveries, ideas, concepts, know-how, recipes, techniques, designs, specifications, processes, procedures, policies, drawings, blueprints, diagrams, models, prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes, computer programs, or other Software, marketing plans, customer names, communications by or to attorneys (including attorney-client privileged communications), memos, manuals and other materials prepared by attorneys or under their direction (including attorney work product), and other technical, financial, employee or business information or data, but in any case excluding back-up tapes.

"<u>Invoice</u>" has the meaning set forth in <u>Section 4.3(a)</u>.

"<u>Law</u>" means any statute, law, ordinance, regulation, rule, code, or other requirement of, or order or governmental permit issued by, a Governmental Authority.

"<u>Level of Service</u>" has the meaning set forth in <u>Section 3.1(a)</u>.

"<u>Liabilities</u>" has the meaning set forth in the Separation Agreement.

"<u>Local Agreement</u>" has the meaning set forth in <u>Section 2.5</u>.

"<u>Notification</u>" has the meaning set forth in <u>Section 6.9(i)</u>.

"<u>Objection Notice</u>" has the meaning set forth in <u>Section 4.4</u>.

"<u>Pandemic Measures</u>" shall mean any quarantine, "shelter in place," "stay at home," workforce reduction, social distancing, shut down, closure, sequester, immunization requirements, safety or similar Law, directive, guidelines or recommendations promulgated by any Governmental Authority, including the Centers for Disease Control and Prevention and the World Health Organization, in each case, in connection with or in response to a pandemic, including COVID-19.

"<u>Partial Termination</u>" has the meaning set forth in <u>Section 6.2(a)</u>.

"<u>Party</u>" has the meaning set forth in the Preamble.

"<u>Payment Due Date</u>" has the meaning set forth in <u>Section 4.3(b)</u>.

"<u>Person</u>" means an individual, a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, or other entity or organization or a Governmental Authority.

"<u>Project Managers</u>" has the meaning set forth in <u>Section 7.7</u>.

"<u>Safety and Security Policies</u>" has the meaning set forth in <u>Section 5.4(a)</u>.

"<u>Service Provider</u>" means (a) in the case of Bit Digital, or any of its Subsidiaries providing a Service hereunder and, or (b) in the case of WhiteFiber or any of its Subsidiaries providing a Service hereunder.

"<u>Service Recipient</u>" means (a) in the case of Bit Digital, or any of its Subsidiaries receiving a Service hereunder and, or (b) in the case of WhiteFiber, or any of its Subsidiaries receiving a Service hereunder.

"<u>Service Term</u>" means the term for a particular Service as set forth on <u>Annex</u> A or <u>Annex B</u>.

"<u>Services</u>" means the Bit Digital Services or the WhiteFiber Services, individually, or the Bit Digital Services and the WhiteFiber Services, collectively, as the context may indicate.

"<u>Subsidiary</u>" has the meaning set forth in the Separation Agreement.

"<u>Systems</u>" has the meaning set forth in <u>Section 5.4(a)</u>.

"<u>Term</u>" has the meaning set forth in <u>Section 6.1(a)</u>.

"<u>Third Party</u>" shall mean any Person other than the Parties or any of their respective Affiliates.

"<u>Transferring Employees</u>" means those employees or former employees of the Service Provider wholly or mainly assigned to the provision of a particular Service immediately before the Termination Date.

"<u>Transfer Regulations</u>" means any legislation in any jurisdiction where the Services are provided (as amended or replaced from time to time).

"<u>Termination Date</u>" means the date on which the Service Provider ceases to provide a particular Service for the Service Recipient

"<u>WhiteFiber</u>" has the meaning set forth in the Preamble.

"<u>WhiteFiber Indemnified Parties</u>" has the meaning set forth in Section 7.3 of this Agreement.

"<u>WhiteFiber Services</u>" means the Services generally described on <u>Annex B</u> and any other Service provided by WhiteFiber pursuant to this Agreement.

ARTICLE II<br> PERFORMANCE AND SERVICES

Section 2.1 <u>General</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) During the Term, and subject to the terms and conditions of this Agreement, Bit Digital will provide, or cause to be provided, the Bit Digital Services to WhiteFiber and its Subsidiaries. The applicable Fee for each Bit Digital Service will be the specified Fee for such Service set forth on <u>Annex A</u>, and the applicable Service Term for each Bit Digital Service will be the specified Service Term for such Bit Digital Service set forth on <u>Annex A</u>. Notwithstanding anything to the contrary contained herein or on any Annex, Bit Digital will have no obligation under this Agreement to: (i) operate the HPC Services Business Segment or any portion thereof (it being acknowledged and agreed by Bit Digital and WhiteFiber that providing the Bit Digital Services will not be deemed to be operating the HPC Business Services Segment or any portion thereof); (ii) advance funds or extend credit to WhiteFiber; (iii) hire new employees for the purpose of providing the Bit Digital Services; (iv) provide Bit Digital Services to any Person other than WhiteFiber or any of its Subsidiaries; or (v) implement, develop or acquire systems, processes, technologies, plans or initiatives not already implemented or utilized by Bit Digital or members of the Bit Digital Group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) During the Term, and subject to the terms and conditions of this Agreement, WhiteFiber will provide, or cause to be provided, the WhiteFiber Services to Bit Digital and its Subsidiaries. The applicable Fee for each WhiteFiber Service will be the specified Fee for such WhiteFiber Service set forth on <u>Annex B</u>, and the applicable Service Term for each WhiteFiber Service will be the specified Service Term for such WhiteFiber Service set forth on <u>Annex B</u>. Notwithstanding anything to the contrary contained herein or on any Annex, WhiteFiber will have no obligation under this Agreement to: (i) operate the Digital Assets Business or any portion thereof (it being acknowledged and agreed by Bit Digital and WhiteFiber that providing the WhiteFiber Services will not be deemed to be operating the Digital Assets Business or any portion thereof); (ii) advance funds or extend credit to Bit Digital; (iii) hire new employees for the purpose of providing the WhiteFiber Services; (iv) provide WhiteFiber Services to any Person other than Bit Digital or any of its Subsidiaries; or (v) implement, develop or acquire systems, processes, technologies, plans or initiatives not already implemented or utilized by WhiteFiber or members of the HPC Services Business Segment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding anything to the contrary in this Agreement, neither Bit Digital nor WhiteFiber (nor any of their respective Subsidiaries) will be required to perform Services hereunder or take any actions relating thereto that conflict with or violate any applicable Law, contract, license, sublicense, authorization, certification, permit or would amount to Bit Digital or WhiteFiber performing a "relevant activity" under the International Tax Co-Operation (Economic Substance) Act (Revised) of the Cayman Islands.

Section 2.2 <u>Additional Services</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If WhiteFiber reasonably determines in good faith after the date hereof that additional transition services (not listed on <u>Annex A</u>) of the type previously provided by members of the Bit Digital Group to the HPC Services Business Segment are necessary to conduct the HPC Services Business Segment, and WhiteFiber or its Subsidiaries are not able to provide such services to the HPC Services Business Segment or such services are not commercially available from Third Party providers, then WhiteFiber may provide written notice thereof to Bit Digital. Upon receipt of such notice by Bit Digital, if Bit Digital is willing, in its sole discretion, to provide such additional service during the Term, the Parties will negotiate in good faith an amendment to <u>Annex A</u> setting forth the additional service (each such service an "<u>Additional Bit Digital Service</u>"), the terms and conditions for the provision of such Additional Bit Digital Service and the Fees to be payable by WhiteFiber for such Additional Bit Digital Service, such Fees to be determined on an arm's-length basis with the intent that they reflect costs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) If Bit Digital reasonably determines in good faith after the date hereof that additional transition services (not listed on <u>Annex B</u>) of the type previously provided by WhiteFiber or any of its Subsidiaries to the Digital Assets Business are necessary to conduct the Digital Assets Business, and Bit Digital or members of the Bit Digital Group are not able to provide such services to the Digital Assets Business or such services are not commercially available from Third Party providers, then Bit Digital may provide written notice thereof to WhiteFiber. Upon receipt of such notice by WhiteFiber, if WhiteFiber is willing, in its sole discretion, to provide such additional service during the Term, the Parties will negotiate in good faith an amendment to <u>Annex B</u> setting forth the additional service (each such service an "<u>Additional WhiteFiber Service</u>"), the terms and conditions for the provision of such Additional WhiteFiber Service and the Fees to be payable by Bit Digital for such Additional WhiteFiber Service, such Fees to be determined on an arm's-length basis with the intent that they reflect costs.

Section 2.3 <u>Service Requests</u>. Any requests by a Party to the other Party regarding the Services or any modification or alteration to the provision of the Services must be made by a Project Manager (it being understood that the receiving Party will not be obligated to agree to any modification or alteration requested thereby). Notwithstanding anything to the contrary hereunder, each Party may avail itself of the remedies set forth in <u>Section 6.3</u> without fulfilling the notice requirements of this <u>Section 2.3</u>.

Section 2.4 <u>Access</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Subject to <u>ARTICLE V</u>, WhiteFiber, at the reasonable request of Bit Digital, will make available on a timely basis to Bit Digital all information reasonably requested by Bit Digital to enable it to provide the Bit Digital Services. WhiteFiber will give Bit Digital and its Affiliates, employees, agents, and representatives, as reasonably requested by Bit Digital, reasonable access, during regular business hours and at such other times as are reasonably required, to the systems, premises, equipment, facilities, and data of the HPC Services Business Segment for the purposes of providing the Bit Digital Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Subject to <u>ARTICLE V</u>, Bit Digital, at the reasonable request of WhiteFiber, will make available on a timely basis to WhiteFiber all information reasonably requested by WhiteFiber to enable it to provide the WhiteFiber Services. Bit Digital will give WhiteFiber and its Affiliates, employees, agents, and representatives, as reasonably requested by WhiteFiber, reasonable access, during regular business hours and at such other times as are reasonably required, to the systems, premises, equipment, facilities, and data of the Digital Assets Business for the purposes of providing the WhiteFiber Services.

Section 2.5 <u>Local Agreements</u>. Each Party recognizes and agrees that it may be necessary or desirable to separately document certain matters relating to the Services provided hereunder in various jurisdictions from time to time or to otherwise modify the scope or nature of such Services, in each case to the extent necessary to comply with applicable Law. If such an agreement or modification of any of the Services is required by applicable Law, or if the applicable Parties mutually determine entry into such an agreement or modification of Services would be desirable, in each case in order for Service Provider or its Subsidiaries to provide any of the Services in a particular jurisdiction, Service Provider and Service Recipient shall, or shall cause their applicable Subsidiaries to, enter into local implementing agreements (as each may be amended and in effect from time to time, each a "<u>Local Agreement</u>") in form and content reasonably acceptable to the applicable Parties; <u>provided</u> that the execution or performance of any such Local Agreement shall in no way alter or modify any term or condition of this Agreement or the effect of any such term or condition, except to the extent expressly specified in such Local Agreement. Each Party agrees that any Local Agreement shall be subject to <u>Section 5.3</u> of this Agreement. Except as used in this <u>Section 2.5</u>, any references herein to this Agreement and the Services to be provided hereunder, shall include any Local Agreement and any local services to be provided thereunder. Except as expressly set forth in any Local Agreement, in the event of a conflict between the terms contained in a Local Agreement and the terms contained in this Agreement (including the applicable Schedules), the terms in this Agreement shall take precedence.

Section 2.6 <u>System Shutdown</u>. Service Provider shall have the right to shut down temporarily for maintenance or similar purposes the operation of any facilities or systems providing any Service whenever in Service Provider's reasonable judgment such action is necessary or advisable for general maintenance or emergency purposes; <u>provided</u> that without limiting the immediately following sentence, Service Provider will schedule non-emergency general maintenance impacting the Services so as not to materially disrupt the operation of the HPC Services Business Segment or the Digital Assets Business, as applicable, by Service Recipient. To the extent possible, such shutdowns shall occur during non-business hours. Service Provider will use Commercially Reasonable Efforts to provide Service Recipient advance notice of any shut down for general maintenance purposes or other planned shutdown.

ARTICLE III<br> SERVICE QUALITY; INDEPENDENT CONTRACTOR

Section 3.1 <u>Service Quality</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise provided with respect to a specific Service on the Applicable Annex, the Service Provider will perform the Services in a manner and quality that is substantially consistent with the manner (including as to quantity) and quality that such Services were performed by such Party (or its applicable Affiliate) in the twelve (12) months prior to the Reorganization for the Digital Assets Business or the HPC Services Business Segment, as applicable, and in any event in compliance with any terms or service levels set forth on the applicable Annex (collectively referred to as the "<u>Level of Service</u>"). The Service Recipient will use the Services in substantially the same manner and on substantially the same scale as they were used by such Party and its Affiliates in the past practice of the Digital Assets Business or the HPC Services Business Segment, as applicable, prior to the Reorganization.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Party acknowledges and agrees that certain of the Services to be provided under this Agreement have been, and will continue to be, provided (in accordance with this Agreement and the Annexes hereto) to the Digital Assets Business or the WhiteFiber Business, as applicable, by Third Parties designated by the Service Provider. To the extent so provided, the Party responsible for providing such Services will use Commercially Reasonable Efforts to (i) cause such Third Parties to provide such Services under this Agreement and/or (ii) enable the Party seeking the benefit of such Services and its Subsidiaries to avail itself of such Services; <u>provided</u>, <u>however</u>, that if any such Third Party is unable or unwilling to provide any such Services, the Parties agree to use their Commercially Reasonable Efforts to determine the manner, if any, in which such Services can best be provided (it being acknowledged and agreed that any costs or expenses to be incurred in connection with obtaining a Third Party to provide any such Services will be paid by the Party to which such Services are provided; <u>provided</u> that the Service Provider will use Commercially Reasonable Efforts to communicate the costs or expenses expected to be incurred in advance of incurring such costs or expenses).

Section 3.2 <u>Independent Contractor; Assets; Subcontractors</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Service Provider is an independent contractor. All employees and representatives of the Service Provider and any of its Subsidiaries involved in providing Services will be under the exclusive direction, control and supervision of the Service Provider or its Subsidiaries (or their subcontractors) providing such Services, and not of the Service Recipient. The Service Provider or its Subsidiaries (or their subcontractors) providing the Services will be solely responsible for compensation of its employees, and for all withholding, employment or payroll taxes, unemployment insurance, workers' compensation, and any other insurance and fringe benefits with respect to such employees. The Service Provider or its Subsidiaries (or their subcontractors) providing the Services will have the exclusive right to hire and fire any of its employees in accordance with applicable Law. The Service Recipient will have no right to direct and control any of the employees or representatives of the Party or its Subsidiaries (or their subcontractors) providing such Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) All procedures, methods, systems, strategies, tools, equipment, facilities, software, data and other resources used by a Party, any of its Subsidiaries or any Third Party service provider in connection with the provision of the Services hereunder will remain the property of such Party, its Subsidiaries or such service providers and, except as otherwise provided herein, will at all times be under the sole direction and control of such Party, its Subsidiaries or such Third Party service provider. No license under any patents, know-how, trade secrets, copyrights, or other rights is granted by this Agreement or any disclosure in connection with this Agreement by either Party. Service Recipient shall not attempt to decompile, translate, reverse engineer, or make excessive copies of any intellectual property owned or licensed by Service Provider, and Service Recipient shall promptly notify Service Provider of any such attempt, regardless of whether by Service Recipient or any Third Party, of which Service Recipient becomes aware.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Service Provider may hire or engage one or more subcontractors to perform any or all of its obligations under this Agreement; <u>provided</u> that (a) the Service Provider will use the same degree of care in selecting any such subcontractor as it would if such contractor was being retained to provide similar services to the Service Provider; and (b) the Service Provider will in all cases remain primarily responsible for all of its obligations hereunder with respect to the scope of the Services, the standard for services as set forth in <u>ARTICLE III</u> and the content of the Services provided to the Service Recipient. The Service Provider may replace a subcontractor providing Services under this Agreement, provided that the costs of the replacement subcontractor are not materially higher than the costs for such previous subcontractor. The Service Provider will provide notice to the Service Recipient prior to replacing or hiring new subcontractors whenever reasonably possible.

Section 3.3 <u>Uses of Services</u>. The Service Provider will be required to provide the Services only to the Service Recipient and the Service Recipient's Subsidiaries in connection with the Service Recipient's operation of the Business. The Service Recipient may not resell any Services to any Person whatsoever or permit the use of such Services by any Person other than in connection with the operation of the Business in the ordinary course of business.

Section 3.4 <u>Modification of Services</u>. The Parties agree that each Service Provider may make changes from time to time in the manner of performing the applicable Service if such Service Provider is making similar changes in performing similar services for itself, its Affiliates or other Third Parties, if any, <u>provided</u> that such Service Provider furnishes to the Service Recipient substantially the same notice (in content) as such Service Provider provides to its Affiliates or Third Parties, if any, respecting such changes; <u>provided</u> <u>further</u> that each Service Provider may make any of the following changes without obtaining the prior consent of, and without prior notice to, the Service Recipient: (a) changes to the process of performing a particular Service that do not adversely affect the benefits to the Service Recipient in any material respect or materially increase the charge for such Service; (b) emergency changes on a temporary and short-term basis; and (c) changes to a particular Service in order to comply with applicable Law.

Section 3.5 <u>Transition of Responsibilities</u>. Each Party agrees to use Commercially Reasonable Efforts to reduce or eliminate its and its Subsidiaries' dependence on each Service as soon as is reasonably practicable. Each Party agrees to cooperate with the other Party to facilitate the smooth transition of the Services being provided to the Service Recipient by the Service Provider.

Section 3.6 <u>Substantive Business Decisions Prohibited</u>. Notwithstanding anything to the contrary contained in this Agreement or the accompanying schedules, none of the Service Provider or its Subsidiaries, authorized agents, and subcontractors (if any) shall make any substantive business decisions with respect to Service Recipient in performing Services. Each provision of this Agreement and the schedules shall be interpreted in a manner consistent with this <u>Section 3.6</u>.

Section 3.7 <u>Disclaimer of Warranties</u>. Except as expressly set forth in this Agreement: (i) each Party acknowledges and agrees (on behalf of itself and any other Service Recipient) that Service Provider makes no warranties of any kind with respect to the Services to be provided hereunder; and (ii) Service Provider hereby expressly disclaims all warranties with respect to the Services to be provided hereunder, as further set forth immediately below.

EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE SERVICES OR ACCESS TO SYSTEMS, FACILITIES AND DATA TO BE PROVIDED UNDER THIS AGREEMENT WILL BE PROVIDED AS-IS, WHERE-IS, WITH ALL FAULTS, AND WITHOUT WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING ANY WARRANTY OF NON-INFRINGEMENT, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, CONFORMITY TO ANY REPRESENTATION OR DESCRIPTION, TITLE OR ANY OTHER WARRANTY WHATSOEVER.

ARTICLE IV<br> FEES; PAYMENT

Section 4.1 <u>Fees</u>. The Service Recipient will pay the Service Provider the Fees for the Services provided by such Service Provider under this Agreement. The Fees for the Services are set forth on <u>Annex A</u> and <u>Annex B</u>. During the Term, the amount of a Fee for any Service may be modified to the extent of (a) any adjustments mutually agreed to by the Parties, (b) any adjustments due to a change in Level of Service requested by Service Recipient and agreed upon by Service Provider, and (c) any adjustment in the rates or charges imposed by any Third Party provider that is providing Services; <u>provided</u> that Service Provider will notify Service Recipient in writing of any such change in rates at least thirty (30) days prior to the effective date of such rate change.

Section 4.2 <u>Taxes</u>. To the extent required or permitted by applicable Law, there will be added to any Fees due under this Agreement, and Service Recipient agrees to pay to the Service Provider, amounts equal to any Taxes paid or payable by the Service Provider, however designated or levied, based upon such Fees, or upon this Agreement or the Services provided under this Agreement, or their use. In the event Taxes are not added to an invoice from the Service Provider hereunder, the Service Recipient is responsible to remit to the appropriate jurisdiction any additional amounts due, including Taxes, interest, and penalties. The Parties will reasonably cooperate with each other to minimize any of these Taxes and to obtain and provide each other with reasonable documentation related to these Taxes. If additional amounts are determined to be due on the Services provided hereunder as a result of an audit by a tax jurisdiction, Service Recipient agrees to reimburse the Service Provider for the additional amounts due including Taxes, interest, and penalties. The Parties further agree that, notwithstanding the foregoing, neither Party will be required to pay any income, franchise, or employment Taxes of the other Party. All payments and reimbursements due under this <u>Section 4.2</u> will be calculated in a manner that ensures that the Service Provider receives the same net amounts under this Agreement that it would have received in the absence of Taxes.

Section 4.3 <u>Invoices and Payment</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless otherwise specified in <u>Annex A</u> or <u>Annex B</u>, within thirty (30) days following the end of each fiscal month of Service Provider, the Service Provider will submit to the Service Recipient for payment a written statement of amounts due under this Agreement for such month (an "<u>Invoice</u>"). The Invoice will set forth the Fees and any Third Party costs or charges that are required to be reimbursed by Service Recipient in connection with the provision of any Services, in the aggregate and itemized, based on the descriptions set forth on <u>Annex A</u> or <u>Annex B</u>, as the case may be. Each statement will specify the nature of any amounts due for any Fees as set forth on <u>Annex A</u> or <u>Annex B</u> and will contain reasonably satisfactory documentation in support of such amounts as specified therein and such other supporting detail as the Service Recipient may reasonably require to validate such amounts due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless otherwise specified in <u>Annex A</u> or <u>Annex B</u>, the Service Recipient will pay all amounts due pursuant to an Invoice no later than sixty (60) days after the date of the Invoice (the "<u>Payment Due Date</u>"). All timely payments under this Agreement will be made without early payment discount.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Subject to <u>Section 4.4</u>, if the Service Recipient fails to pay the full amount of any invoice by the Payment Due Date, such failure will be considered a material default under this Agreement. The remedies provided to each Party by this <u>Section 4.3(c)</u> and by <u>Section 6.3</u> will be cumulative with respect to any other applicable provisions of this Agreement. Payments made after the Payment Due Date will bear interest at the rates set forth in <u>Annex A</u> or <u>Annex B</u> for the applicable Services.

Section 4.4 <u>Payment Disputes</u>. The Service Recipient may object to any amounts for any Service invoiced to it at any time before, at the time of, or after payment is made, provided such objection is made in writing ("<u>Objection Notice</u>") to the Service Provider prior to the Payment Due Date. Any dispute under this <u>Section 4.4</u> will be resolved in accordance with the provisions of <u>Section 7.8</u> of this Agreement. The Service Recipient will pay interest, which will begin to accrue beginning on the date that is sixty (60) days following receipt of the Service Recipient's Objection Notice, at an annual rate equal to the Prime Rate plus 2.0% (compounded monthly) on any amounts it is required to pay to the Service Provider upon resolution of the dispute if the dispute is resolved in the Service Provider's favor.

ARTICLE V<br> CONFIDENTIALITY; SECURITY

Section 5.1 <u>Bit Digital and WhiteFiber Obligations</u>. Subject to <u>Section 5.4</u>, until the six (6) year anniversary of the date of the termination of this Agreement in its entirety, each of Bit Digital and WhiteFiber, on behalf of itself and each of its Subsidiaries, agrees to hold, and to cause its respective Representatives to hold, in strict confidence, with at least the same degree of care that applies to Bit Digital's Confidential Information pursuant to policies in effect as of the Effective Time, all Confidential Information concerning the other Party or its Subsidiaries or their respective businesses that is either in its possession (including Confidential Information in its possession prior to the date hereof) or furnished by such other Party or such other Party's Subsidiaries or their respective Representatives at any time pursuant to this Agreement, and shall not use any such Confidential Information other than for such purposes as may be expressly permitted hereunder, <u>except</u>, in each case, to the extent that such Confidential Information (a) is in the public domain or is generally available to the public, other than as a result of a disclosure by such Party or any of its Subsidiaries or any of their respective Representatives in violation of this Agreement; (b) is lawfully acquired from other sources by such Party or any of its Subsidiaries, which sources are not themselves known by such Party or any of its Subsidiaries to be bound by a confidentiality obligation or other contractual, legal or fiduciary obligation of confidentiality with respect to such Confidential Information; (c) is independently developed or generated without reference to or use of the Confidential Information of the other Party or any of its Subsidiaries; or (d) was in such Party's or its Subsidiaries' possession on a non-confidential basis prior to the time of disclosure to such Party and at the time of such disclosure was not known by such Party or any of its Subsidiaries to be prohibited from being disclosed by a confidentiality obligation or other contractual, legal or fiduciary obligation of confidentiality with respect to such Confidential Information. If any Confidential Information of a Party or any of its Subsidiaries is disclosed to the other Party or any of its Subsidiaries in connection with providing the Services, then such disclosed Confidential Information shall be used only as required to perform such Services.

Section 5.2 <u>No Release; Return or Destruction</u>. Each Party agrees (a) not to release or disclose, or permit to be released or disclosed, any Confidential Information of the other Party addressed in <u>Section 5.1</u> to any other Person, except its Representatives who need to know such Confidential Information in their capacities as such (who shall be advised of their obligations hereunder with respect to such Confidential Information) and except in compliance with <u>Section 5.4</u>, and (b) to use Commercially Reasonable Efforts to maintain such Confidential Information. Without limiting the foregoing, when any such Confidential Information is no longer needed for the purposes contemplated by the Separation Agreement, this Agreement or any other Transaction Documents, each Party will promptly after request of the other Party either return to the other Party all such Confidential Information in a tangible form (including all copies thereof and all notes, extracts or summaries based thereon) or notify the other Party in writing that it has destroyed such information (and such copies thereof and such notes, extracts or summaries based thereon); <u>provided</u> that the Parties may retain electronic back-up versions of such Confidential Information maintained on routine computer system backup tapes, disks or other backup storage devices; and <u>provided</u>, <u>further</u>, that any such retained back-up information shall remain subject to the confidentiality provisions of this Agreement.

Section 5.3 <u>Protective Arrangements</u>. In the event that a Party or any of its Subsidiaries either determines on the advice of its counsel that it is required to disclose any information pursuant to applicable Law or receives any request or demand under lawful process or from any Governmental Authority to disclose or provide information of the other Party (or any of its Subsidiaries) that is subject to the confidentiality provisions hereof, such Party shall notify the other Party (to the extent legally permitted) as promptly as practicable under the circumstances prior to disclosing or providing such information and shall cooperate, at the expense of the other Party, in seeking any appropriate protective order requested by the other Party. In the event that such other Party fails to receive such appropriate protective order in a timely manner and the Party receiving the request or demand reasonably determines that its failure to disclose or provide such information shall actually prejudice the Party receiving the request or demand, then the Party that received such request or demand may thereafter disclose or provide information to the extent required by such Law (as so advised by its counsel) or by lawful process or such Governmental Authority and will exercise reasonable efforts to obtain assurance that confidential treatment will be accorded to such Confidential Information, and the disclosing Party shall promptly provide the other Party with a copy of the information so disclosed, in the same form and format so disclosed, together with a list of all Persons to whom such information was disclosed, in each case to the extent legally permitted. The obligations in this <u>ARTICLE V</u> shall survive any expiration or termination of this Agreement for six (6) years after the date of expiration or termination of this Agreement; <u>provided</u>, <u>however</u>, that, with respect to each trade secret of a Party or its Affiliates, such obligations shall continue as long as such trade secret remains otherwise protectable as a trade secret.

Section 5.4 <u>Security</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If either Party (including its Affiliates and their employees, authorized agents and subcontractors) is given access to the other Party's computer systems or software (collectively, "<u>Systems</u>"), premises, equipment, facilities, or data in connection with the Services, the Party given access (the "<u>Availed Party</u>") will each comply with (and will cause its Affiliates, and their employees, authorized agents and subcontractors to comply with) their respective policies and procedures in relation to the use and access of the other Party's Systems, premises, equipment, facilities or data (collectively, "<u>Safety and Security Policies</u>"), and will not compromise or circumvent any safety, security or audit measures employed by such other Party. The Availed Party will access and use only those Systems, premises, equipment, facilities, and data of the other Party for which it has been granted the right to access and use.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each Party will use Commercially Reasonable Efforts to ensure that only those of its personnel who are specifically authorized to have access to the Systems, premises, equipment, facilities, and data of the other Party gain such access, and use Commercially Reasonable Efforts to prevent unauthorized access, use, destruction, alteration, or loss of such Systems, premises, equipment, facilities, or data (including, in each case, any information contained therein), including notifying its personnel of the restrictions set forth in this Agreement and of the Safety and Security Policies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If, at any time, the Availed Party determines that any of its personnel has sought to circumvent, or has circumvented, the Safety and Security Policies, that any unauthorized Availed Party personnel has accessed the Systems, premises, equipment, facilities, or data, or that any of its personnel has engaged in activities that may lead to the unauthorized access, use, destruction, alteration, or loss of, or damage to, premises, facilities, equipment, data, information, or software of the other Party, the Availed Party will promptly terminate any such person's access to the Systems, premises, equipment, facilities, or data and promptly notify the other Party. In addition, such other Party will have the right to deny personnel of the Availed Party access to its Systems, premises, equipment, facilities, or data upon notice to the Availed Party in the event that the other Party reasonably believes that such personnel have engaged in any of the activities set forth above in this <u>Section 5.4(c)</u> or otherwise pose a security concern. The Availed Party will use Commercially Reasonable Efforts to cooperate with the other Party in investigating any apparent unauthorized access to such other Party's Systems, premises, equipment, facilities, or data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) If any Systems, premises, equipment, or facilities of a Party are damaged (ordinary wear and tear excepted) due to the conduct of the Availed Party or any of its Affiliates, or their employees, authorized agents, or subcontractors, the Availed Party will be liable to the other Party for all costs associated with such damage, to the extent such costs exceed any available insurance proceeds.

ARTICLE VI<br> TERMINATION

Section 6.1 <u>Term</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The term of this Agreement (the "<u>Term</u>") will commence upon the Effective Date and end on the earliest to occur of (i) the date on which the provision of all Services have terminated pursuant to <u>Annex A</u> or <u>Annex B</u> (inclusive of any term extension agreed to by the Parties for any Extendable Service pursuant to <u>Section 6.1(b)</u>), (ii) the date on which the provision of all Services has been terminated by the Parties pursuant to <u>Section 6.2</u>, (iii) the date this Agreement is terminated pursuant to <u>Section 6.3</u>, and (iv) the date that is twenty-four (24) months after the Effective Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Unless identified on <u>Annex A</u> and <u>Annex B</u> as ineligible for extension, all Services are eligible for an extension of their respective Service Term as provided in this <u>Section 6.1(b)</u> (each such Service, an "<u>Extendable Service</u>"). To the extent reasonably necessary to (i) continue the transition of any Extendable Service from Service Provider or its Affiliates to Service Recipients, its Affiliates or other providers, and (ii) the continued operation of Service Recipient's business in connection therewith, in each case, as reasonably agreed by Service Provider and Service Recipient, Service Recipient may elect, by delivering written notice to Service Provider no later than sixty (60) days prior to the end of the then in effect term for such Extendable Service, to extend any such Extendable Service (and, as necessary, the term of this Agreement with respect to such Service) for a maximum period of six (6) months beyond the scheduled termination of such Service (which period shall in no event end later than the date that is the thirty-six (36) month anniversary of the Distribution Date); <u>provided</u>, <u>however</u>, that Service Recipient may only extend each such Extendable Service one time; <u>provided further</u>, <u>however</u>, that any extension of the Service Term for such Extendable Service is subject to receiving any necessary consents from Third Party vendors to such extension. To the extent the Service Term of any Extendable Service is extended hereunder, Service Recipient will be responsible for any incremental costs related to enabling such extension. If Service Provider agrees to provide such Extendable Service during the requested period, then (i) the Parties shall in good faith negotiate the terms of an amendment to the Annexes hereto, which amendment shall be consistent with the terms of the applicable Service, and (ii) the Fee for such Service during the extension of the Service Term shall be equal to 105% of the original Fee for such Service.

Section 6.2 <u>Partial Termination</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Unless identified on <u>Annex A</u> or <u>Annex B</u> as ineligible for termination prior to the expiration of the Service Term, all Services are eligible for termination prior to the expiration of the Service Term ("<u>Eligible Services</u>"). The Service Recipient may, upon providing sixty (60) days written notice to the Service Provider and satisfying any such other requirements specified in <u>Annex A</u> or <u>Annex B</u> with respect to any such Eligible Service, terminate any Eligible Services that, prior to the expiration of the Service Term, are no longer needed from the Service Provider, in which case this Agreement will terminate as to such Eligible Services (a "<u>Partial Termination</u>"); <u>provided</u>, that such termination shall not relieve the Service Recipient from any obligations arising under this Agreement prior to the termination of such Service(s) or its obligations with regard to those Services it continues to receive. The Parties will mutually agree as to the effective date of any Partial Termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of any termination prior to the scheduled expiration of the Service Term or of any Partial Termination hereunder, with respect to any terminated Services in which the Fee for such terminated Services is charged as a flat monthly rate, if termination occurs other than the end of the month, there will be no proration of the monthly rate. To the extent any amounts due or advances made hereunder related to costs or expenses that have been or will be incurred and that cannot be recovered by the Service Provider, such amounts due or advances made will not be prorated or reduced and the Service Provider will not be required to refund to the Service Recipient any prorated amount for such costs or expenses; and the Service Recipient will reimburse the Service Provider for (i) Service Recipient's proportional share of any Third Party costs or charges that are required to be paid in connection with the provision of any Services and that cannot be terminated and (ii) any Third Party cancellation or similar charges incurred as a result of the Service Recipient's early termination.

Section 6.3 <u>Termination of Entire Agreement</u>. Subject to the provisions of <u>Section 6.5</u>, a Party will have the right to terminate this Agreement or effect a Partial Termination effective upon delivery of written notice to the other Party if the other Party:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) makes an assignment for the benefit of creditors, or becomes bankrupt or insolvent, or is petitioned into bankruptcy, or takes advantage (with respect to its own property and business) of any state, federal or foreign bankruptcy or insolvency act, or if a receiver or receiver/manager is appointed for all or any substantial part of its property and business and such receiver or receiver/manager remains undischarged for a period of thirty (30) days; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) materially defaults in the performance of any of its covenants or obligations contained in this Agreement (or, in the case of a Partial Termination, with respect to the Services being terminated) and such default is not remedied to the non-defaulting Party's reasonable satisfaction within thirty (30) days after receipt of written notice by the defaulting Party informing such Party of such default, or if such default is not capable of being cured within thirty (30) days, if the defaulting Party has not promptly begun to cure the default within such thirty (30) day period and thereafter proceeded with all diligence to cure the same.

Section 6.4 <u>Procedures on Termination</u>. Following any termination of this Agreement or Partial Termination, each Party will cooperate with the other Party as reasonably necessary to avoid disruption of the ordinary course of the other Party's and its Subsidiaries' businesses. Termination will not affect any right to payment for Services provided prior to termination.

Section 6.5 <u>Effect of Termination</u>. <u>Section 4.1</u> and <u>Section 4.2</u> (in each case, with respect to Fees and Taxes attributable to periods prior to termination), <u>Section 3.2</u>, <u>Section 4.3</u>, <u>Section 4.4</u>, <u>Section 6.4</u>, this <u>Section 6.5</u>, <u>ARTICLE I</u>, <u>ARTICLE V</u>, <u>ARTICLE VII</u> and <u>ARTICLE VIII</u> will survive any termination of this Agreement. In the event of a Partial Termination, this Agreement will remain in full force and effect with respect to the Services which have not been terminated by the Parties as provided herein. For the avoidance of doubt, the termination of this Agreement with respect to the Services provided under one Annex, but not the other Annex, will not be a termination of this Agreement.

Section 6.6 <u>Exit</u>. The Parties acknowledge that Transfer Regulations may apply on termination of the whole or part of this Agreement such that the contracts of employment between the Service Provider and the Transferring Employees may have effect as if originally made between the Service Recipient and the Transferring Employees and that any collective agreements applicable to such Transferring Employees may have effect between the Service Recipient and the relevant trade union.

Section 6.7 <u>Responsibility for Salary and Other Benefits on Exit</u>. All emoluments and outgoings in relation to the Transferring Employees (including without limitation all wages, bonuses, holiday pay, social insurance contributions, pension contributions and otherwise) shall be borne by the Service Provider up to and including the Termination Date and by the Service Recipient with effect from the Termination Date.

Section 6.8 <u>Indemnities on Exit</u>. In connection with a transfer under <u>Section 6.6</u>, the Parties agree that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the Service Provider will indemnify, keep indemnified, and hold harmless the Service Recipient against all Liabilities in respect of the Transferring Employees, arising from, in respect of or as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any act or omission by the Service Provider (including any failure to comply with an applicable obligation under <u>Section 6.7</u>) relating to any Transferring Employees occurring prior to the Termination Date; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any failure by the Service Provider to comply with any requirement of any Transfer Regulations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the Service Recipient will indemnify, keep indemnified, and hold harmless, the Service Provider against all Liabilities in respect of the Transferring Employees arising from, in respect of or as a result of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any act or omission by the Service Recipient (including any failure to comply with an applicable obligation under <u>Section 6.7</u>) relating to any Transferring Employees occurring on or after the Termination Date;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) any claim arising out of the provision of or proposal by the Service Recipient to offer or effect any variation to any benefit, term or condition or working condition of any Transferring Employees which is intended to take effect on or after the Termination Date; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) any failure by the Service Recipient to comply with any Transfer Regulations in respect of the Transferring Employees.

Section 6.9 <u>Procedure and Indemnity for Claims by Non-Transferring Employees</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) If any person other than any Transferring Employee claims or alleges as a result of the termination of this Agreement that his contract of employment has transferred to the Service Recipient pursuant to any Transfer Regulations, the following process shall apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the Service Recipient shall notify the Service Provider in writing within thirty-five (35) days of the Termination Date and in any event seven (7) days of becoming aware of that allegation or claim ("<u>Notification</u>");

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) within twenty-eight (28) days of Notification, the Service Provider may offer employment to such person on their existing terms and conditions of employment. If such offer of employment is accepted, the Service Recipient shall immediately release the person from its employment; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) if an offer of employment has not been made or accepted then the Service Recipient may terminate the employment of such person within seven (7) days of the expiry of the twenty-eight (28) day period referred to in <u>Section 6.9(a)(ii)</u>.

Subject to the provisions of <u>Section 6.9</u> being followed by the Service Recipient, the Service Provider will indemnify, keep indemnified, and hold harmless, the Service Recipient against all Liabilities arising out of such allegation or claim up to the date of and in respect of such termination. If the Service Recipient fails to take the action outlined in <u>Section 6.9(a)(iii)</u> within the appropriate time period then such person will be deemed a Transferring Employee.

ARTICLE VII<br> INDEMNIFICATION AND DISPUTE RESOLUTION

Section 7.1 <u>Limitation of Liability</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Party nor any of such Party's Affiliates will be liable, whether in contract, tort (including negligence and strict liability) or otherwise, for any special, indirect, punitive, incidental or consequential damages whatsoever that in any way arise out of, relate to, or are a consequence of, its performance or nonperformance hereunder, or the provision of or failure to provide any Service hereunder, including loss of profits, loss of data, diminution in value, business interruptions and claims of customers, whether or not such damages are foreseeable or any Party has been advised of the possibility or likelihood of such damages.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Except for Liabilities arising out of or related to the gross negligence, willful misconduct, or bad faith of the Service Provider, in no event will the Service Provider's aggregate liability arising under or in connection with this Agreement (or the provision of Services hereunder) exceed the Fees paid or payable to the Service Provider from the Service Recipient pursuant to this Agreement in respect of the Service from which such Liabilities flows.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Each Party will use Commercially Reasonable Efforts to mitigate the Liabilities for which the other is responsible hereunder. In the event of any breach of this Agreement by any Service Provider with respect to the provision of any Services (with respect to which the Service Provider can reasonably be expected to re-perform in a commercially reasonable manner), the Service Provider shall promptly correct in all material respects such error, defect or breach or to perform again in all material respects such Services at the request of the Service Recipient and at the sole cost and expense of the Service Provider. Any request for re-performance in accordance with this <u>Section 7.1(c)</u> by the Service Recipient must be in writing and specify in reasonable detail the particular error, defect, or breach, and such request must be made no more than one (1) month from the date such error, defect or breach becomes apparent to the Service Recipient or should have reasonably become apparent to the Service Recipient. This <u>Section 7.1(c)</u> shall survive any termination of this Agreement.

Section 7.2 <u>Indemnification by WhiteFiber</u>. WhiteFiber will indemnify, defend and hold harmless each of the Bit Digital Indemnified Parties for any Liabilities incurred by the Bit Digital Indemnified Parties to the extent arising from or relating to: (a) any material breach of this Agreement by WhiteFiber (including in the event resulting in a termination by Bit Digital under <u>Section 6.3</u>); (b) any gross negligence, willful misconduct, fraud, or bad faith by WhiteFiber, the other members of the HPC Services Business Segment, or its or their employees, suppliers or contractors, in the provision of the WhiteFiber Services by WhiteFiber, the other members of the HPC Services Business Segment or its or their employees, suppliers or contractors pursuant to this Agreement; and (c) the provision of the Bit Digital Services by Bit Digital, the other members of the Bit Digital Group or its or their employees, suppliers or contractors, except to the extent that such Liabilities are finally determined by a court of competent jurisdiction to have arisen out of the material breach of this Agreement, gross negligence, willful misconduct, or bad faith of Bit Digital, the other members of the Bit Digital Group or its or their employees, suppliers, or contractors in providing the Bit Digital Services.

Section 7.3 <u>Indemnification by Bit Digital</u>. Bit Digital will indemnify, defend and hold harmless each of the WhiteFiber Indemnified Parties for any Liabilities incurred by the WhiteFiber Indemnified Parties to the extent arising from or relating to: (a) any material breach of this Agreement by Bit Digital (including in the event resulting in a termination by WhiteFiber under <u>Section 6.3</u>); (b) any gross negligence, willful misconduct, fraud, or bad faith by Bit Digital, the other members of the Bit Digital Group, or its or their employees, suppliers or contractors, in the provision of the Bit Digital Services by Bit Digital, the other members of the Bit Digital Group or its or their employees, suppliers or contractors pursuant to this Agreement; and (c) the provision of the WhiteFiber Services by WhiteFiber, the other members of the HPC Services Business Segment or its or their employees, suppliers or contractors, except to the extent that such Liabilities are finally determined by a court of competent jurisdiction to have arisen out of the material breach of this Agreement, gross negligence, willful misconduct, or bad faith of WhiteFiber, the other members of the HPC Services Business Segment or its or their employees, suppliers, or contractors in providing the WhiteFiber Services.

Section 7.4 <u>Exclusive Remedy</u>. Except for equitable relief and rights pursuant to <u>Section 4.2</u>, <u>Section 4.3(b)</u> or <u>ARTICLE V</u>, the indemnification provisions of this <u>ARTICLE VII</u> will be the exclusive remedy for breach of this Agreement.

Section 7.5 <u>Risk Allocation</u>. Each Party agrees that the Fees charged under this Agreement reflect the allocation of risk between the Parties, including the disclaimer of warranties in <u>Section 3.7</u> and the limitations on liability in <u>Section 7.1</u>. Modifying the allocation of risk from what is stated here would affect the Fees that are charged for the Services, and in consideration of those Fees, each Party agrees to the stated allocation of risk.

Section 7.6 <u>Indemnification Procedures</u>. All claims for indemnification pursuant to <u>ARTICLE V</u> or this <u>ARTICLE VII</u> will be made as follows:

Each Person seeking indemnification under this Agreement (the "<u>Indemnitee</u>") will give prompt written notice to the Person from whom indemnification is sought (the "<u>Indemnifying Party</u>") of the assertion of any claim or the commencement of any Action by any Third Party ("<u>Third-Party Claim</u>"); <u>provided</u> that the failure of the Indemnitee to give notice as provided in this <u>Section 7.6</u> will not relieve any Indemnifying Party of its obligations under <u>ARTICLE V</u> or <u>ARTICLE VII</u>, except to the extent that such failure actually prejudices the rights of any such Indemnifying Party. Such notice will set forth in reasonable detail such claim and the basis for indemnification (taking into account the information then available to the Indemnitee). Thereafter, the Indemnitee will deliver to the Indemnifying Party, as promptly as reasonably practicable following the Indemnitee's receipt thereof, copies of all written notices and documents (including any court papers) received by the Indemnitee relating to the Third-Party Claim and the Indemnitee will provide the Indemnifying Party with such other Information with respect to any such Third-Party Claim reasonably requested by the Indemnifying Party. The Indemnifying Party will have the right, at its sole option and expense, to be represented by counsel of its choice and, subject to the limitations set forth in this <u>Section 7.6</u>, to assume control of, and defend against, negotiate, settle or otherwise deal with such Third-Party Claim, but the Indemnitee may nonetheless participate in the defense of such Third-Party Claim with its own counsel and at its own expense. In the case of any Third-Party Claim for which indemnification is sought, the Indemnifying Party will have the right, upon written notice to the Indemnitee within 30 days after receipt of the notice of such claim (the "<u>Indemnification Dispute Period</u>"), to assume control of and defend against such Third-Party Claim. If the Indemnifying Party elects not to defend against, negotiate, settle or otherwise deal with any Third-Party Claim, or fails to provide the Indemnitee with notice of its intent to assume control of and defend against any Third-Party Claim within the Indemnification Dispute Period, then the Indemnitee may defend against, negotiate, settle or otherwise deal with such Third-Party Claim. If the Indemnifying Party will assume the defense of any Third-Party Claim pursuant to this <u>Article VII</u>, then the Indemnitee may participate, at his or its own expense, in the defense of such Third-Party Claim; <u>provided</u> that such Indemnitee will be entitled to participate in any such defense with separate counsel at the expense of the Indemnifying Party if (i) requested by the Indemnifying Party to participate or (ii) in the reasonable opinion of counsel to the Indemnifying Party, a material conflict exists between the Indemnitee and the Indemnifying Party that would make such separate representation advisable; <u>provided</u>, <u>further</u> that the Indemnifying Party will not be required to pay for more than one such counsel for all Indemnitees in connection with any Third-Party Claim. Notwithstanding the foregoing, participation by the Indemnitee will allow the Indemnitee to consult with independent counsel or advisors and to submit comments and questions, which the Indemnifying Party will consider or respond to in good faith but the Indemnifying Party will not be obligated to act upon and, subject to the terms of this <u>Article VII</u>, such comments or questions will not alter or limit the Indemnifying Party's obligations as set forth in this Agreement.

Notwithstanding anything to the contrary hereunder, neither Party may assert against the other Party or submit to arbitration or legal proceedings any cause of action, dispute or claim for indemnification which accrued more than two (2) years after the later of (a) the occurrence of the act or event giving rise to the underlying cause of action, dispute or claim, and (b) the date on which such act or event was, or should have been, in the exercise of reasonable due diligence, discovered by the Party asserting the cause of action, dispute or claim.

Section 7.7 <u>Project Managers</u>. Each Party shall appoint one or more representatives who will be its authorized representative and empowered to act on its behalf in connection with this Agreement (each a "<u>Project Manager</u>" and collectively, the "<u>Project Managers</u>"). The Project Managers shall (a) represent and act for their respective Party for matters related to the applicable Service, and (b) meet and/or confer on a regular basis (at mutually agreed times and locations) to review the activities under this Agreement and to discuss the status and progress of such activities, including, without limitation, any partial termination of Services and progress towards transitioning off of Services. The Project Managers will have day-to-day responsibility for the provision and use of the Services. The initial Project Managers will be the Persons identified on <u>Annex B</u>. Each Party will promptly notify the other in writing in the event of any change to the appointment a Project Manager.

Section 7.8 <u>Mediation</u>. In the event that a Dispute has not been resolved within 30 days of the receipt of the initial notice in accordance with <u>Section 7.6</u>, or within such longer period as the Parties may agree to in writing, then such Dispute shall, upon the written request of a Party (the "<u>Mediation Request</u>"), be submitted to mandatory mediation in accordance with the American Arbitration Association (the "AAA"), Mediation Procedure (the "<u>Procedure</u>") then in effect, except as modified herein. The mediation shall be held in (i) at the time a Mediation Request is submitted in New York City, New York, or (ii) such other place as the Parties may mutually agree in writing. The parties shall have fifteen (15) days from receipt of a Mediation Request to agree on a mediator. If no mediator has been agreed upon by the Parties within fifteen (15) days of receipt of a Mediation Request, then any Party may request (on written notice to the other Party) that the AAA appoint a mediator in accordance with the Procedure. If the Dispute has not been resolved within thirty (30) days of the appointment of a mediator, or within such longer period as the Parties may agree to in writing, either Party may commence litigation in the appropriate jurisdiction.

ARTICLE VIII<br> MISCELLANEOUS

Section 8.1 <u>Amendments and Waivers</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement may be amended and any provision of this Agreement may be waived; <u>provided</u>, <u>however</u>, that any such amendment or waiver, as the case may be, is in writing and signed, in the case of an amendment, by the Parties or, in the case of a waiver, by the Party against whom the waiver is to be effective. No course of dealing between or among any Persons having any interest in this Agreement will be deemed effective to modify, amend or discharge any part of this Agreement or any rights or obligations of any Party under or by reason of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No delay or failure in exercising any right, power or remedy hereunder will affect or operate as a waiver thereof; nor will any single or partial exercise thereof or any abandonment or discontinuance of steps to enforce such a right, power or remedy preclude any further exercise thereof or of any other right, power or remedy. The rights and remedies hereunder are cumulative and not exclusive of any rights or remedies that any Party would otherwise have.

Section 8.2 <u>Notices</u>. All notices, requests, permissions, waivers and other communications hereunder will be in writing and will be deemed to have been duly given (a) upon transmission, if sent by email with confirmation of receipt, (b) when delivered, if delivered personally to the intended recipient, and (c) one Business Day following sending by overnight delivery via an international courier service and, in each case, addressed to a Party at the following address for such Party:

If to Bit Digital or any member of the Bit Digital Group:

Bit Digital, Inc.

31 Hudson Yards, 11<sup>th</sup> Floor

New York, NY 10001

Attention: Samir Tabar, CEO

Email: sam@bit-digital.com

if WhiteFiber, Inc.:

WhiteFiber, Inc.

31 Hudson Yards, 11th Floor

New York, NY 10001

Attention: Erke Huang, CFO

Email: erke@whitefiber.com

or to such other address(es) as may be furnished in writing by any such Party to the other Party in accordance with the provisions of this <u>Section 8.2</u>.

Section 8.3 <u>Entire Agreement</u>. This Agreement, including the Annexes hereto and the sections of the Separation Agreement referenced herein, constitutes the entire agreement between the Parties with respect to the subject matter of this Agreement, and supersedes all prior negotiations, agreements and understandings of the Parties of any nature, whether oral or written, with respect to such subject matter.

Section 8.4 <u>No Third-Party Beneficiaries</u>. Except to the extent otherwise provided in <u>ARTICLE VII</u>, this Agreement is solely for the benefit of the Parties and does not confer on Third Parties any remedy, claim, reimbursement, claim of action or other right in addition to those existing without reference to this Agreement.

Section 8.5 <u>Governing Law</u>. This Agreement and all disputes or controversies arising out of or relating to this Agreement will be governed by, and construed in accordance with, the Laws of the State of New York, without regard to the conflict of Laws provisions thereof that would cause the Laws of another state to apply.

Section 8.6 <u>Assignability</u>. No Party may assign its rights or delegate its duties under this Agreement without the written consent of the other Party, except that a Party may assign its rights or delegate its duties under this Agreement to a member of its Group, <u>provided</u> that (a) such Person agrees in writing to be bound by the terms and conditions contained in this Agreement and (b) such assignment or delegation will not relieve any Party of its indemnification obligations or other obligations under this Agreement. Any attempted assignment or delegation in contravention of the foregoing will be void.

Section 8.7 <u>Severability</u>. The Parties agree that (a) the provisions of this Agreement will be severable in the event that for any reason whatsoever any of the provisions hereof are invalid, void or otherwise unenforceable, (b) any such invalid, void or otherwise unenforceable provisions will be replaced by other provisions which are as similar as possible in terms to such invalid, void or otherwise unenforceable provisions but are valid and enforceable, and (c) the remaining provisions will remain valid and enforceable to the fullest extent permitted by applicable Law.

Section 8.8 <u>Counterparts</u>. This Agreement may be executed in multiple counterparts (any one of which need not contain the signatures of more than one Party), each of which will be deemed to be an original but all of which taken together will constitute one and the same agreement. This Agreement, and any amendments hereto, to the extent signed and delivered by means of a facsimile machine or other electronic transmission, will be treated in all manner and respects as an original agreement and will be considered to have the same binding legal effects as if it were the original signed version thereof delivered in person. At the request of any Party, the other Party will re-execute original forms thereof and deliver them to the requesting Party.

Section 8.9 <u>Rules of Construction</u>. The descriptive headings herein are inserted for convenience of reference only and are not intended to be a substantive part of or to affect the meaning or interpretation of this Agreement. Whenever required by the context, any pronoun used in this Agreement or Annexes will include the corresponding masculine, feminine or neuter forms, and the singular forms of nouns, pronouns, and verbs will include the plural and vice versa. Reference to any agreement, document, or instrument means such agreement, document, or instrument as amended or otherwise modified from time to time in accordance with the terms thereof, and if applicable hereof. References in this Agreement to any document, instrument or agreement (including this Agreement) includes and incorporates all exhibits, disclosure letters, schedules and other attachments thereto. Unless the context otherwise requires, any references to an "Annex," "Section" or "Article" will be to an Annex, Section or Article to or of this Agreement. The use of the words "include" or "including" in this Agreement or the Schedules will be deemed to be followed by the words "without limitation." The use of the word "covenant" will mean "covenant and agreement." The use of the words "or," "either" or "any" will not be exclusive. Days mean calendar days unless specified as Business Days. References to statutes will include all regulations promulgated thereunder, and references to statutes or regulations will be construed to include all statutory and regulatory provisions consolidating, amending or replacing the statute or regulation as of the date hereof. The Parties have participated jointly in the negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the Parties, and no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of the authorship of any of the provisions of this Agreement. Except as otherwise expressly provided elsewhere in this Agreement or any other Transaction Document, any provision herein which contemplates the agreement, approval or consent of, or exercise of any right of, a Party, such Party may give or withhold such agreement, approval or consent, or exercise such right, in its sole and absolute discretion, the Parties hereby expressly disclaiming any implied duty of good faith and fair dealing or similar concept.

Section 8.10 <u>Specific Performance</u>. The Parties agree that irreparable damage would occur if any provision of this Agreement was not performed in accordance with its specific terms or was otherwise breached. It is accordingly agreed that the Parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the performance of the terms and provisions of this Agreement without proof of actual damages, this being in addition to any other remedy to which any Party is entitled at Law or in equity. Each Party further agrees that no other Party or any other Person will be required to obtain, furnish or post any bond or similar instrument in connection with or as a condition to obtaining any remedy referred to in this <u>Section 8.10</u>, and each Party irrevocably waives any right it may have to require the obtaining, furnishing or posting of any such bond or similar instrument and will not contest the appropriateness of specific performance as a remedy.

Section 8.11 <u>Precedence of Schedules</u>. Each Schedule attached to or referenced in this Agreement is hereby incorporated into and shall form a part of this Agreement; <u>provided</u>, <u>however</u>, that the terms contained in such Schedule shall only apply with respect to the Services provided under that Schedule. In the event of a conflict between the terms contained in an individual Schedule and the terms in the body of this Agreement, the terms in the Schedule shall take precedence with respect to the Services under such Schedule only. No terms contained in individual Schedules shall otherwise modify the terms of this Agreement.

Section 8.12 <u>Force Majeure</u>. No Party shall be deemed in default of this Agreement for any delay or failure to fulfill any obligation (other than a payment obligation) hereunder so long as and to the extent to which any delay or failure in the fulfillment of such obligation is prevented, frustrated, hindered or delayed as a consequence of circumstances of Force Majeure. Without limiting the termination rights contained in this Agreement, in the event of any such excused delay, the time for performance of such obligation (other than a payment obligation) shall be extended for a period equal to the time lost by reason of the delay. A Party claiming the benefit of this provision shall, as soon as reasonably practicable after the occurrence of any such event, (a) provide written notice to the other Party of the nature and extent of any such Force Majeure condition; and (b) use Commercially Reasonable Efforts to remove any such causes and resume performance under this Agreement as soon as reasonably practicable (and in no event later than the date that the affected Party resumes analogous performance under any other agreement for itself, its Affiliates or any Third Party) unless this Agreement has previously been terminated under <u>ARTICLE VI</u>.

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed on the date first written above by their respective duly authorized officers.

**BIT DIGITAL, INC.** 

---

| | |
|:---|:---|
| By: | /s/ Sam Tabar |
| Name: | Sam Tabar |
| Title: | Chief Executive Officer |
| **WHITEFIBER, INC.** | **WHITEFIBER, INC.** |
| By: | /s/ Erke Huang |
| Name: | Erke Huang |
| Title: | Chief Financial Officer |

---

**<u>ANNEX A</u>**

**<u>Services and Fees Charged by Bit Digital</u>**

**<u>ANNEX B</u>**

**<u>Services and Fees Charged by WhiteFiber</u>**

## Exhibit 31.1

**Exhibit 31.1**

**CERTIFICATION OF THE PRINCIPAL EXECUTIVE OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Sam Tabar, the Chief Executive Officer of Bit Digital, Inc., certify that:

1. I
have reviewed this report on Form 10-Q of Bit Digital, Inc. for the quarter ended June 30, 2025;

2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered
by this report;

3. Based
on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I
am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e))
and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed
such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure
that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;

&nbsp;&nbsp;&nbsp;&nbsp;b) Designed
such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision,
to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external
purposes in accordance with generally accepted accounting principles;

&nbsp;&nbsp;&nbsp;&nbsp;c) Evaluated
the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
and

&nbsp;&nbsp;&nbsp;&nbsp;d) Disclosed
in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a quarterly report) that has materially affected,
or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. I
have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors
and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;a) All
significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

&nbsp;&nbsp;&nbsp;&nbsp;b) Any
fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.

---

| | | |
|:---|:---|:---|
|  | **Bit Digital, Inc.** | **Bit Digital, Inc.** |
| Date: August 14, 2025 | By: | */s/ Sam Tabar* |
|  |  | Sam Tabar, Chief Executive Officer |
|  |  | (Principal Executive Officer) |

---

## Exhibit 31.2

**Exhibit 31.2**

**CERTIFICATION OF THE PRINCIPAL FINANCIAL OFFICER**

**PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002**

I, Justin Zhu, the Chief Accounting Officer and Senior Vice President of Finance of Bit Digital, Inc., certify that:

1. I have reviewed this report on Form 10-Q of Bit Digital, Inc., for the quarter ended June 30, 2025;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. I am responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

&nbsp;&nbsp;&nbsp;&nbsp;a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of a quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent function):

&nbsp;&nbsp;&nbsp;&nbsp;a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

---

| | | |
|:---|:---|:---|
|  | **Bit Digital, Inc.** | **Bit Digital, Inc.** |
| Date: August 14, 2025 | By: | */s/ Justin Zhu* |
|  |  | Justin Zhu, Chief Accounting Officer and Senior Vice President of Finance |
|  |  | (Principal Financial Officer) |

---

## Exhibit 32.1

**Exhibit 32.1**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Quarterly Report on Form 10-Q for the period ended June 30, 2025 of Bit Digital, Inc. (the "Company") fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
|  | **Bit Digital, Inc.** | **Bit Digital, Inc.** |
| Date: August 14, 2025 | By: | */s/ Sam Tabar* |
|  |  | Sam Tabar |
|  |  | Principal Executive Officer |

---

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Bit Digital, Inc. and will be retained by Bit Digital, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.

## Exhibit 32.2

**Exhibit 32.2**

**CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO**

**SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002**

Pursuant to 18 U.S.C. § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned hereby certifies that the Quarterly Report on Form 10-Q for the period ended June 30, 2025 of Bit Digital, Inc. (the "Company") fully complies with the requirements of Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 and that the information contained in such Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

---

| | | |
|:---|:---|:---|
|  | **Bit Digital, Inc.** | **Bit Digital, Inc.** |
| Date: August 14, 2025 | By: | */s/ Justin Zhu* |
|  |  | Justin Zhu |
|  |  | Principal Financial Officer |

---

A signed original of this written statement required by Section 906, or other document authenticating, acknowledging, or otherwise adopting the signature that appears in typed form within the electronic version of this written statement required by Section 906, has been provided to Bit Digital, Inc. and will be retained by Bit Digital, Inc. and furnished to the Securities and Exchange Commission or its staff upon request.