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Bit Digital(BTBT) - 2023 Q2 - Quarterly Report
BTBTBit Digital(BTBT)2023-06-11 16:00

Revenue and Earnings - Total revenue for Q1 2023 was 8.3million,primarilyfrombitcoinmining[2]−AdjustedEBITDAforQ12023was8.3 million, primarily from bitcoin mining[2] - Adjusted EBITDA for Q1 2023 was 1.5 million, with adjusted earnings per share of 0.01[2]−Revenuefromdigitalassetminingservicesdecreasedby0.01[2] - Revenue from digital asset mining services decreased by 0.3 million (3.6%) to 8.2millionforQ12023comparedtoQ12022,primarilyduetoloweraverageBTCprices,partiallyoffsetbyanincreaseof167.5bitcoinsgenerated[51]−Thecompanyrecognizedrevenueof8.2 million for Q1 2023 compared to Q1 2022, primarily due to lower average BTC prices, partially offset by an increase of 167.5 bitcoins generated[51] - The company recognized revenue of 8.2 million from bitcoin mining services for the three months ended March 31, 2023[49] - Revenue from ETH native staking for the three months ended March 31, 2023, was 14,232,comparedto14,232, compared to nil in 2022[157] - Revenue from ETH liquid staking for the three months ended March 31, 2023, was 36,377,comparedto36,377, compared to nil in 2022[160] - The company's revenue from the Foundry USA Pool for the three months ended March 31, 2023, was 8,214,390,comparedto8,214,390, compared to 8,031,626 for the same period in 2022[153] - The company's revenue from the Ethermine Mining Pool for the three months ended March 31, 2022, was 542,121,withnorevenuereportedforthesameperiodin2023[153]−Thecompany′stotalrevenueforthethreemonthsendedMarch31,2023,was542,121, with no revenue reported for the same period in 2023[153] - The company's total revenue for the three months ended March 31, 2023, was 8,264,999, compared to 8,573,747forthesameperiodin2022[161]−RevenuesforQ12023were8,573,747 for the same period in 2022[161] - Revenues for Q1 2023 were 8,264,999, a decrease of 3.6% compared to 8,573,747inQ12022[106]BitcoinandEthereumMining−Thecompanyearned362.0bitcoinsduringQ12023,withtreasuryholdingsofBTCandETHvaluedat8,573,747 in Q1 2022[106] Bitcoin and Ethereum Mining - The company earned 362.0 bitcoins during Q1 2023, with treasury holdings of BTC and ETH valued at 20.6 million and 16.6million,respectively[2][3]−Thecompanyowned37,676bitcoinminersand730ETHminers,withanactivehashrateof1.25EH/sforbitcoinminingasofMarch31,2023[4]−Thecompanyearnedanaggregateof5,184.9bitcoinsfromtheinceptionofitsbitcoinminingbusinessinFebruary2020toMarch31,2023[37]−ForthethreemonthsendedMarch31,2023,thecompanyreceived362.0bitcoinsfromminingservices,withabalanceof724.5bitcoinsasofMarch31,2023[38]−Thecompanyearned8.7ETHfromnativestakingand23.0rETH−hfromPortaraliquidstakinginQ12023,generatingrevenuesof16.6 million, respectively[2][3] - The company owned 37,676 bitcoin miners and 730 ETH miners, with an active hash rate of 1.25 EH/s for bitcoin mining as of March 31, 2023[4] - The company earned an aggregate of 5,184.9 bitcoins from the inception of its bitcoin mining business in February 2020 to March 31, 2023[37] - For the three months ended March 31, 2023, the company received 362.0 bitcoins from mining services, with a balance of 724.5 bitcoins as of March 31, 2023[38] - The company earned 8.7 ETH from native staking and 23.0 rETH-h from Portara liquid staking in Q1 2023, generating revenues of 14,232 and 36,377,respectively[54]−Thecompanystaked1,120ETHnativelyontheEthereumblockchainforQ12023,earning31.7ETHinstakingrewards,comparedtonilinQ12022[169]−BTCopeningbalanceforQ12023was36,377, respectively[54] - The company staked 1,120 ETH natively on the Ethereum blockchain for Q1 2023, earning 31.7 ETH in staking rewards, compared to nil in Q1 2022[169] - BTC opening balance for Q1 2023 was 15,796,147, with an ending balance of 13,191,157aftermining,sales,andimpairments[173]−ETHopeningbalanceforQ12023was13,191,157 after mining, sales, and impairments[173] - ETH opening balance for Q1 2023 was 11,791,181, with an ending balance of 13,917,057aftermining,staking,andsales[174]−DigitalassetsminedforthethreemonthsendedMarch31,2023were13,917,057 after mining, staking, and sales[174] - Digital assets mined for the three months ended March 31, 2023 were 8,214,390, compared to 8,573,747forthesameperiodin2022,representinga4.28,573,747 for the same period in 2022, representing a 4.2% decrease[115] - Digital assets earned from staking for the three months ended March 31, 2023 were 50,609, compared to 0forthesameperiodin2022[115]OperationalCostsandExpenses−Electricitycostsincreasedby0 for the same period in 2022[115] Operational Costs and Expenses - Electricity costs increased by 0.9 million (27%) in Q1 2023 compared to Q1 2022, primarily due to an increase in the number of deployed miners[58] - Profit-sharing fees increased by 36,523(436,523 (4%) in Q1 2023 compared to Q1 2022, remaining relatively stable due to consistent mining revenues despite lower BTC prices[59] - Depreciation and amortization expenses were 3.6 million in Q1 2023, down from 3.8millioninQ12022,basedonanestimatedusefulminerlifeofthreeyears[59]−DepreciationexpensesforQ12023were3.8 million in Q1 2022, based on an estimated useful miner life of three years[59] - Depreciation expenses for Q1 2023 were 3,646,048, compared to 3,799,629inQ12022[180]−Totaloperatingexpensesdecreasedby24.03,799,629 in Q1 2022[180] - Total operating expenses decreased by 24.0% from 14,901,993 in Q1 2022 to 11,321,525inQ12023[106]−Share−basedcompensationexpenseforQ12023was11,321,525 in Q1 2023[106] - Share-based compensation expense for Q1 2023 was 4,873, compared to 453,484inQ12022[194]DigitalAssetsandImpairment−Thecompanyrecordedarealizedgainof453,484 in Q1 2022[194] Digital Assets and Impairment - The company recorded a realized gain of 4.9 million from the exchange of 583.8 bitcoins and 3,000.1 ETH in Q1 2023, compared to a gain of 2.1millionfrom170.6bitcoinsand29.4ETHinQ12022[61]−Impairmentofdigitalassetswas2.1 million from 170.6 bitcoins and 29.4 ETH in Q1 2022[61] - Impairment of digital assets was 2.2 million in Q1 2023, comprising 1.7milliononbitcoinsand1.7 million on bitcoins and 0.5 million on ETH, down from 4.6millioninQ12022[63]−Impairmentofdigitalassetsdecreasedby51.74.6 million in Q1 2022[63] - Impairment of digital assets decreased by 51.7% from 4,625,698 in Q1 2022 to 2,233,665inQ12023[106]−Thecompanyrecognizedanimpairmentlossof2,233,665 in Q1 2023[106] - The company recognized an impairment loss of 2,233,665 on digital assets for the three months ended March 31, 2023, consisting of 1,709,484onBTCand1,709,484 on BTC and 524,181 on ETH[168] - The ending balance of digital assets as of March 31, 2023, was 27,108,214,comparedto27,108,214, compared to 27,587,328 as of December 31, 2022[168] - Digital assets held decreased by 479,114to479,114 to 27.1 million as of March 31, 2023, primarily due to exchanges of bitcoins and ETH into cash or other assets[74] - Digital assets decreased by 0.5millionfromDecember31,2022,toMarch31,2023,primarilyduetoa0.5 million from December 31, 2022, to March 31, 2023, primarily due to a 2.2 million impairment on bitcoin and ETH, and 7.9millionexchangedintocash,partiallyoffsetby7.9 million exchanged into cash, partially offset by 8.2 million generated from mining[75] - Realized gain on exchange of digital assets for the three months ended March 31, 2023 was 4,881,937,comparedto4,881,937, compared to 2,064,280 for the same period in 2022, representing a 136.5% increase[115] Financial Performance and Net Loss - The company's net loss for the three months ended March 31, 2023, was 2.26million,animprovementfromanetlossof2.26 million, an improvement from a net loss of 4.33 million in the same period in 2022[46] - Net loss for Q1 2023 was 2.3million,animprovementfromanetlossof2.3 million, an improvement from a net loss of 4.3 million in Q1 2022[67] - Net loss improved to 2,260,305inQ12023from2,260,305 in Q1 2023 from 4,332,627 in Q1 2022, a 47.8% reduction[106] - Net loss for the three months ended March 31, 2023 was 2,260,305,comparedto2,260,305, compared to 4,332,627 for the same period in 2022, representing a 47.8% decrease in net loss[115] - Basic and diluted loss per share improved from 0.06inQ12022to0.06 in Q1 2022 to 0.03 in Q1 2023[106] Cash Flow and Financial Position - Cash and cash equivalents decreased by 4.8millionto4.8 million to 27.9 million as of March 31, 2023, due to net cash used in operating, investing, and financing activities[71] - Net cash used in operating activities for Q1 2023 was 1.5million,primarilyduetoanetlossof1.5 million, primarily due to a net loss of 2.3 million and a decrease in digital assets and stable coins of 10.9million[91]−NetcashusedininvestingactivitiesforQ12023was10.9 million[91] - Net cash used in investing activities for Q1 2023 was 2.5 million, primarily due to 2.1millioninvestedinequityinvesteesand2.1 million invested in equity investees and 0.4 million in loans to a third party[93] - Net cash used in financing activities for Q1 2023 was 0.8million,primarilyduetodividendpaymentstopreferredshareholders[93]−NetcashusedinoperatingactivitiesforthethreemonthsendedMarch31,2023was0.8 million, primarily due to dividend payments to preferred shareholders[93] - Net cash used in operating activities for the three months ended March 31, 2023 was 1,480,014, compared to net cash provided by operating activities of 339,572forthesameperiodin2022[115]−NetcashusedininvestingactivitiesforthethreemonthsendedMarch31,2023was339,572 for the same period in 2022[115] - Net cash used in investing activities for the three months ended March 31, 2023 was 2,503,807, compared to 11,112,195forthesameperiodin2022,representinga77.511,112,195 for the same period in 2022, representing a 77.5% decrease[115] - Net cash used in financing activities for the three months ended March 31, 2023 was 800,000, compared to 2,219,355forthesameperiodin2022,representinga63.92,219,355 for the same period in 2022, representing a 63.9% decrease[115] - Cash, cash equivalents and restricted cash decreased by 4,783,821 to 29,227,239asofMarch31,2023,comparedto29,227,239 as of March 31, 2023, compared to 34,011,060 as of December 31, 2022[115][116] - Working capital as of March 31, 2023, was 56.6million,including56.6 million, including 0.5 million in USDC and 27.1millionindigitalassets,comparedto27.1 million in digital assets, compared to 57.0 million as of December 31, 2022[84] - Total assets decreased from 100,420,667to100,420,667 to 92,162,541, a decline of 8.2%[99][103] - Total current liabilities decreased by 71.8% from 7,443,354to7,443,354 to 2,100,642[100] - Shareholders' equity decreased from 89,933,309to89,933,309 to 86,979,845, a decline of 3.3%[103] - Accumulated deficit increased by 2.3% from 131,416,011to131,416,011 to 134,476,316[103] - Total non-current assets decreased by 7.1% from 36,025,394to36,025,394 to 33,463,723[99] Strategic Investments and Agreements - The company made a 2millionstrategicinvestmentinAurosGlobalLimitedonFebruary24,2023[5]−Thecompanysignedpurchaseagreementsfor3,600S19minersonApril28,2023,and3,000S19JProminersonMay12,2023[7]−ThecompanyexpandedintoIcelandwithan8.25MWhostingcapacityagreementanda2 million strategic investment in Auros Global Limited on February 24, 2023[5] - The company signed purchase agreements for 3,600 S19 miners on April 28, 2023, and 3,000 S19J Pro miners on May 12, 2023[7] - The company expanded into Iceland with an 8.25 MW hosting capacity agreement and a 5 million loan facility with GreenBlocks[11][25] - The company entered into hosting agreements for over 30 MW of additional mining capacity post-Q1, with a focus on carbon-free energy[11] - The company invested 1,999,987inAurosGlobalLimited,acrypto−nativealgorithmictradingfirm,inFebruary2023[187]−Thecompanyinvested1,999,987 in Auros Global Limited, a crypto-native algorithmic trading firm, in February 2023[187] - The company invested 88,994 in Marsprotocol Technologies Pte. Ltd., representing a 40% equity interest[189] - The company declared an 8% dividend (800,000)onpreferencesharestoGeneyDevelopmentLtd.inFebruary2023[199]EnvironmentalandESGInitiatives−Approximately85800,000) on preference shares to Geney Development Ltd. in February 2023[199] Environmental and ESG Initiatives - Approximately 85% of the company's mining fleet was powered by carbon-free energy sources as of March 31, 2023[4] - The company aims to achieve 100% clean energy usage and is working with Apex Group Ltd to receive an independent ESG rating[41] - The company joined the Bitcoin Mining Council on December 7, 2021, to promote transparency and share best practices in bitcoin mining[42] Mining Infrastructure and Capacity - As of March 31, 2023, the company deployed 12,938 bitcoin miners representing 1.25 EH/s in North America[27] - The company's total contracted hosting capacity with Blockbreakers reached approximately 9 MW after securing an additional 4 MW agreement[28] - Coinmint provided approximately 20 MW of capacity for the company's miners as of March 31, 2023, with a total contracted hosting capacity reaching 40 MW after new agreements[29][30][31] - The company had 37,676 bitcoin miners and 730 ETH miners as of March 31, 2023, with a total maximum hash rate of 2.6 EH/s and 0.3 TH/s, respectively[34] - The company aims to double its active hash rate in 2023 and targets having approximately half of its digital assets actively staked[11][12] - The company's deposits for property and equipment had an ending balance of 2,609,706 for the three months ended March 31, 2023, compared to 54,147,381forthesameperiodin2022[143]OtherFinancialMetrics−AdjustedEBITDAforQ12023was54,147,381 for the same period in 2022[143] Other Financial Metrics - Adjusted EBITDA for Q1 2023 was 1,503,336, compared to a loss of 2,068,635inQ12022[80]−AdjustedEPSforQ12023was2,068,635 in Q1 2022[80] - Adjusted EPS for Q1 2023 was 0.01, compared to a loss of 0.02inQ12022[82]−Accountspayabledecreasedby0.02 in Q1 2022[82] - Accounts payable decreased by 2.8 million from December 31, 2022, to March 31, 2023, due to payments to hosting partners[76] - Long-term income tax payable increased by 38,050fromDecember31,2022,toMarch31,2023,duetoincrementalpenaltiesonunrecognizedtaxbenefits[76]−Thecompany′sUSDCbalanceasofMarch31,2023,was38,050 from December 31, 2022, to March 31, 2023, due to incremental penalties on unrecognized tax benefits[76] - The company's USDC balance as of March 31, 2023, was 481,293, compared to 15,768,934asofMarch31,2022[167]−TotalothercurrentassetsasofMarch31,2023,were15,768,934 as of March 31, 2022[167] - Total other current assets as of March 31, 2023, were 1,226,515, down from 1,433,999attheendof2022[177]−Thecompanyrecordedupwardadjustmentsof1,433,999 at the end of 2022[177] - The company recorded upward adjustments of 42,891 on its investment in Nine Blocks Offshore Feeder Fund for Q1 2023[186]