BTBT 10-K & 10-Q changes, risk factors and insider trading
Bit Digital, Inc · Nasdaq · Finance Services · CIK 1710350 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Risks Related to Digital Asset Prices, Network Dynamics and Treasury Holdings”
New heading “Volatility in the prices of ETH may materially and adversely affect our business, financial condition and results of operations.”
New heading “The future development and growth of digital assets are subject to a variety of factors that are difficult to predict and evaluate. If digital assets do not grow as we expect, our business, operating results and financial condition could be adversely affected.”
New heading “Ethereum-specific market, technology and regulatory developments may adversely affect the value and liquidity of our ETH holdings and our Treasury Strategy.”
New heading “Our ETH treasury business model has multiple layers of corporate finance risks.”
New heading “Our ETH Treasury Strategy and any decision to hold digital assets may increase our exposure to market volatility and potential uninsured losses.”
New heading “Our strategic exposure to ETH may subject us to ETH-specific market, technology, and regulatory risks.”
New heading “Operational, Cybersecurity and Custody Risks”
New heading “Any ETH staking and related activities may expose us to slashing, lock-ups, liquidity, counterparty and operational risks.”
New heading “Smart contract, bridge, oracle and protocol vulnerabilities could result in loss of digital assets or business interruption.”
New heading “Market structure and liquidity for ETH could deteriorate, impacting our ability to transact or to accurately value our holdings.”
New heading “ETH price declines or prolonged underperformance versus other digital assets could adversely affect our financial position and capital access.”
New heading “Restaking and correlated risk exposures may amplify losses during stress events.”
New heading “Concentration and governance risks in the Ethereum ecosystem could create systemic vulnerabilities.”
New heading “Our treasury strategy and any decision to hold digital assets may increase our exposure to market volatility and potential uninsured losses.”
New heading “Our failure to securely store and manage our fiat currencies and digital assets could adversely affect our business, operating results and financial condition.”
New heading “Reliance on mining pools and other third-party service providers may expose us to counterparty failures, operational issues, and losses.”
New heading “The theft, loss or destruction of private keys required to access any digital assets held in custody for our own account or for our operational partners may be irreversible. If we are unable to access our private keys or if we experience a hack or other data loss relating to our ability to access any digital assets, it could cause regulatory scrutiny, reputational harm, and other losses.”
New heading “Risks Related to WhiteFiber’s Operations”
New heading “WhiteFiber’ s business depends upon the demand for data centers.”
New heading “WhiteFiber depends upon third-party suppliers for power, and is vulnerable to service failures and price increases by such suppliers and to volatility in the supply and price of power in the open market.”
New heading “WhiteFiber’s purchase orders with hardware manufacturers include extended delivery schedules.”
New heading “WhiteFiber depends on third parties to provide network connectivity to the customers in its data centers and any delays or disruptions in connectivity may materially adversely affect its operating results and cash flow.”
New heading “Any failure of WhiteFiber’s physical or information technology or operational technology infrastructure or services could lead to significant costs and disruptions.”
New heading “Any disruption of service experienced by certain of WhiteFiber’s third-party service providers, or its ineffective management of relationships with third-party service providers could harm its business, financial condition, operating results, cash flows and prospects.”
New heading “Any delays or unexpected costs in the development of any new properties acquired for development may delay and harm WhiteFiber’s growth prospects, future operating results and financial condition.”
New heading “WhiteFiber’s ongoing investment in retrofitting data centers involves infrastructure and technologies which is inherently risky, and could divert management attention and harm its business, financial condition, and operating results.”
New heading “Even if this additional space available for lease at any one of its data centers, its ability to lease this space to existing or new customers could be constrained by its ability to provide sufficient electrical power.”
New heading “If WhiteFiber fails to effectively manage its growth, its business, financial condition and results of operations could be harmed.”
New heading “Impact of advancements in AI on demand for AI and WhiteFiber data centers may reduce the need for HPCs and AI-specific data center infrastructure, which could have an adverse effect on WhiteFiber’s business, results of operations, and financial condition.”
New heading “WhiteFiber’s customers frequently make advance payments based on anticipated future usage.”
New heading “Dependence on joint ventures and other local partners could adversely affect WhiteFiber’s profits.”
New heading “WhiteFiber’s operations may be negatively affected if it is unable to obtain, develop and retain key personnel and skilled labor forces.”
New heading “WhiteFiber faces intense competition in its data centers operations and may not be able to compete with other companies. If WhiteFiber does not continue to innovate in the design and management of data centers in order to offer innovative solutions to store, process and manage digital information, including artificial intelligence (“AI”) and machine learning (“ML”) applications, to its customers and partners, it may not remain competitive, which could harm its business, financial condition, data centers and operating results.”
New heading “Supply chain disruptions may adversely affect WhiteFiber’s new project development.”
New heading “WhiteFiber’s business has and is expected to continue to have significant customer concentration.”
New heading “WhiteFiber faces intense competition in the cloud services industry and may not be able to compete with other companies. If WhiteFiber does not continue to innovate and provide cloud services to its customers and partners it may not remain competitive, which could harm our business, financial condition, cloud service and operating results.”
New heading “WhiteFiber’s sales cycles can be long and unpredictable, and its sales efforts require considerable time and expense.”
New heading “WhiteFiber’s ability to maintain customer satisfaction depends in part on the quality of its customer support and cloud operations services. Its failure to maintain high-quality customer support and cloud operations services could have an adverse effect on its business, operating results, financial condition, and future prospects.”
New heading “The broader adoption, use, and commercialization of AI technology, and the continued rapid pace of developments in the AI field, are inherently uncertain. Failure by WhiteFiber’s customers to use its cloud services to support AI use cases in their systems, or its ability to keep up with evolving AI technology requirements and regulatory frameworks, could have a material adverse effect on WhiteFiber’s business, operating results, financial condition, and future prospects.”
New heading “A curtailment or disruption in energy supply in Iceland, Canada or the U.S. due to regulations and policies implemented by their respective governments, which prioritize energy supply, may cause a substantial disruption or discontinuance of WhiteFiber’s data center operations based in Iceland, Canada or prospectively in the U.S., and therefore impair WhiteFiber’s financial condition or results of operations.”
New heading “Establishing data centers in remote areas may adversely affect WhiteFiber’s ability to retain staff and increase its compensation costs.”
New heading “WhiteFiber’s data centers could be adversely impacted by climate change.”
New heading “The broader adoption, use, and commercialization of AI technology, and the continued rapid pace of developments in the AI field, are inherently uncertain. Failure by our customers to use its cloud services to support AI use cases in their systems, or WhiteFiber’s ability to keep up with evolving AI technology requirements and regulatory frameworks, could have a material adverse effect on our business, operating results, financial condition, and future prospects.”
New heading “WhiteFiber operates in a capital-intensive industry and is subject to capital market and interest rate risks.”
New heading “If one of its customers were to obtain exclusive rights to open source technologies that WhiteFiber employs across our businesses, its ability to realize significant operating efficiencies could be jeopardized.”
New heading “WhiteFiber may be vulnerable to physical security breaches, which could disrupt its operations and have a material adverse effect on its business, financial condition and results of operations.”
New heading “WhiteFiber has an evolving business model which is subject to various uncertainties.”
New heading “WhiteFiber does not have any business interruption or disruption insurance coverage.”
New heading “WhiteFiber or Bit Digital may fail to perform under the Transition Services Agreement or WhiteFiber may fail to have necessary systems and services in place when the transition services agreement expires.”
New heading “Cybersecurity incidents and threats including cyberattacks, ransomware attacks and security breaches of cloud services and our information systems, or those impacting our third parties, could adversely impact our brand and reputation and our business, operating results, and financial condition.”
New heading “WhiteFiber may be vulnerable to physical security breaches, which could disrupt its operations and have a material adverse effect on our business, financial condition and results of operations.”
New heading “WhiteFiber’s inability to resolve favorably any disputes that arise between WhiteFiber and Bit Digital with respect to their past and ongoing relationships including potential conflicts of interests among management may adversely affect WhiteFiber’s operating results.”
New heading “WhiteFiber relies upon licenses of third-party intellectual property rights and may be unable to protect our software code.”
New heading “Risks Related to Geopolitical Uncertainty”
New heading “Changes in tariffs or import restrictions could have a material adverse effect on our business, financial condition and results of operations.”
New heading “Uncertainty in the global economy and instability within international relations, including changes in governmental policies relating to technology, and any potential downturn in the semiconductor and electronics industries, may negatively impact our business.”
New heading “Failure to maintain exchange listing standards may reduce liquidity, increase financing costs, and negatively affect valuation.”
New heading “Limited access to banking, payments and insurance services for digital asset-related businesses may create operational friction and liquidity risks.”
New heading “Accounting, Financial Reporting and Internal Control Risks”
New heading “Complex and evolving accounting for digital assets and related items may increase the volatility of our reported results and require significant judgment.”
New heading “Auditor transitions and internal control remediation may result in delays, increased costs, or identification of material weaknesses.”
New heading “If our breakeven metrics or related assumptions are inaccurate, investors may misinterpret our operating performance and risk profile.”
New heading “Strategic, Counterparty and Concentration Risks”
New heading “We operate in a highly competitive industry, and we compete against unregulated or less regulated companies and companies with greater financial and other resources, and our business, operating results, and financial condition could be adversely affected if we are unable to compete effectively.”
New heading “Dependence on a limited number of counterparties and strategic partners may concentrate risk and exacerbate disruptions.”
New heading “Loss of key personnel or inability to recruit and retain qualified employees may adversely affect our operations and growth.”
New heading “Various actual and potential conflicts of interest may be detrimental to shareholders.”
New heading “Litigation, arbitration or governmental proceedings may be costly, time-consuming, and disruptive, and adverse outcomes could result in significant liabilities.”
New heading “Our stock price may be highly volatile, and future sales or issuances of our securities could depress the trading price.”
New heading “Risks Involving Intellectual Property”
New heading “Our internal systems rely on software that is highly technical, and, if it contains undetected errors, our business could be adversely affected.”
New heading “We do not have any patents protecting our intellectual property and may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position.”
New heading “We may be subject to intellectual property infringement claims, which may be expensive to defend and may disrupt our business and operations.”
New heading “We incur significant costs and demands upon management and accounting and finance resources as a result of complying with the laws and regulations affecting public companies; if we fail to maintain proper and effective internal controls, our ability to produce accurate and timely financial statements and otherwise make timely and accurate public disclosure could be impaired, which could harm our operating results, our ability to operate our business and our reputation.”
New heading “We believe that we are, and there is a significant risk that we may continue to be, a passive foreign investment company (a “PFIC”), which could result in adverse U.S. federal income tax consequences to U.S. Holders of our Ordinary Shares.”
New heading “Your percentage of ownership in the Company may be diluted in the future.”
Removed heading “Our new services and changes to existing services could fail to attract or retain users or generate revenue and profits, or otherwise adversely affect our business.”
Removed heading “Supply chain disruptions may adversely affect WhiteFiber’s operations.”
Removed heading “We operate in a capital-intensive industry and are subject to capital market and interest rate risks.”
Removed heading “Our operations could be negatively impacted by import tariffs and/or other government mandates.”
Removed heading “Cloud service technology and infrastructure may not operate properly or as we expect them to, which could cause us to incur fines and monetary penalties adversely affecting our business, results of operations and financial condition.”
Removed heading “Impact of advancements in artificial intelligence on demand for AI and HPC data centers may reduce the need for high-performance computing (HPC) and AI-specific data center infrastructure, which could have an adverse effect on our business, results of operations, and financial condition.”
Removed heading “We face intense competition in the cloud services industry and may not be able to compete with other companies. If we do not continue to innovate and provide cloud services to our customers and partners, we may not remain competitive, which could harm our business, financial condition, cloud service and operating results.”
Removed heading “Our ongoing investment in new cloud services, and technologies is inherently risky, and could divert management attention and harm our business, financial condition, and operating results.”
Removed heading “Regulatory restrictions that target AI, including, but not limited to, export restrictions may have a material adverse impact on our intended operations.”
Removed heading “Issues in the development and use of AI may result in reputational or competitive harm or liability.”
Removed heading “A curtailment or disruption in energy supply in Iceland or Canada due to regulations and policies implemented by their respective governments, which prioritize energy supply, may cause a substantial disruption or discontinuance of WhiteFiber’s colocation business operations based in Iceland or Canada, and therefore impair WhiteFiber’s financial condition or results of operations.”
Removed heading “Risks Related to Our Data Center Operations”
Removed heading “We are at an early stage of development of our business, currently have limited sources of revenue, and may not become profitable in the future.”
Removed heading “We may be unable to access sufficient additional capital needed to grow our business.”
Removed heading “We are subject to a highly evolving regulatory landscape and any adverse changes to or our colocation customers’ failure to comply with any laws or regulations could adversely affect our business, prospects or operations.”
Removed heading “Our business depends upon the demand for data centers.”
Removed heading “Our business has and is expected to continue to have significant customer concentration.”
Removed heading “Failure to attract, grow and retain a diverse and balanced customer base, could adversely affect our business and operating results.”
Removed heading “We depend upon third-party suppliers for power, and we are vulnerable to service failures and price increases by such suppliers and to volatility in the supply and price of power in the open market.”
Removed heading “We depend on third parties to provide network connectivity to the customers in our data centers and any delays or disruptions in connectivity may materially adversely affect our operating results and cash flow.”
Removed heading “Any failure of our physical or information technology or operational technology infrastructure or services could lead to significant costs and disruptions.”
Removed heading “Any disruption of service experienced by certain of our third-party service providers, or our ineffective management of relationships with third-party service providers could harm our business, financial condition, operating results, cash flows and prospects.”
Removed heading “Any delays or unexpected costs in the development of any new properties acquired for development may delay and harm our growth prospects, future operating results and financial condition.”
Removed heading “If we incorrectly estimate our hosting capacity requirements and related capital expenditures, our results of operations could be adversely affected.”
Removed heading “Certain natural disasters or other external events, including climate change or mechanical failures, could harm our business, financial condition, results of operations, cash flows, and prospects.”
Removed heading “If we fail to effectively manage our growth, our business, financial condition and results of operations could be harmed.”
Removed heading “Even if we have additional space available for lease at any one of our data centers, our ability to lease this space to existing or new customers could be constrained by our ability to provide sufficient electrical power.”
Removed heading “Increased scrutiny and changing expectations from stakeholders with respect to our environmental, social, and governance (“ESG”) practices and the impacts of climate change may result in additional costs or risks.”
Removed heading “Digital Assets Related Risks”
Removed heading “Our operating results have fluctuated due to the highly volatile nature of digital assets.”
Removed heading “Unfavorable Digital Asset Market Conditions”
Removed heading “We may be unable to raise additional capital needed to grow our business.”
Removed heading “Our mining operating costs outpace our mining revenues, which could seriously harm our business or increase our losses.”
Removed heading “The properties included in our mining network may experience damage, including damage that is not covered by insurance.”
Removed heading “From time to time, our service providers have been unable to supply sufficient electric power for us to operate our miners, which has adversely affected our operations, causing us to relocate some or all of our miners to an alternative facility, which may have a less advantageous cost structure and our business and results of operations may suffer as a result.”
Removed heading “If our Hosting Agreements with the current hosting service providers in the U.S. and Canada are terminated, we may be forced to seek a replacement facility to operate our miners on acceptable terms; should this occur, our operations may be disrupted, which may have a material adverse effect on our operations.”
Removed heading “The development and acceptance of cryptographic and algorithmic protocols governing the issuance of and transactions in digital assets is subject to a variety of factors that are difficult to evaluate.”
Removed heading “Banks and financial institutions may not provide banking services, or may cut off services, to businesses that engage in cryptocurrency-related activities or that accept digital assets as payment, including financial institutions of investors in our securities.”
Removed heading “We may suffer significant and adverse effects due to hacking or one or more adverse software events.”
Removed heading “The impact of geopolitical and economic events on the supply and demand for digital assets is uncertain.”
Removed heading “Acceptance and/or widespread use of bitcoin is uncertain.”
Removed heading “Transactional fees may decrease demand for bitcoin and prevent expansion.”
Removed heading “There is a lack of liquid markets for digital assets, and blockchain/bitcoin-based assets are susceptible to potential manipulation.”
Removed heading “Our operations, investment strategies and profitability may be adversely affected by competition from other methods of investing in digital assets.”
Removed heading “The development and acceptance of competing blockchain platforms or technologies may cause consumers to use alternative distributed ledgers or other alternatives.”
Removed heading “Our digital assets may be subject to loss, theft or restriction on access.”
Removed heading “Incorrect or fraudulent bitcoin transactions may be irreversible.”
Removed heading “Our reliance primarily on a few models of miners may subject our operations to increased risk of mining failure.”
Removed heading “The Company’s reliance on a third-party mining pool service provider for our mining revenue payouts may have a negative impact on the Company’s operations.”
Removed heading “The limited rights of legal recourse available to us and our lack of insurance protection for risk of loss of our digital assets exposes us and our shareholders to the risk of loss of our digital assets for which no person may ultimately be held liable and we may not be able to recover our losses.”
Removed heading “Digital assets face significant scaling obstacles that can lead to high fees or slow transaction settlement times.”
Removed heading “The price of digital assets may be affected by the sale of such digital assets by other vehicles investing in digital assets or tracking bitcoin markets.”
Removed heading “There are risks related to technological obsolescence, the vulnerability of the global supply chain for bitcoin hardware disruption, and difficulty in obtaining new hardware which may have a negative effect on our business.”
Removed heading “The bitcoin we mine is subject to halving; the bitcoin reward for successfully uncovering a block will halve several times in the future and bitcoin’s value may not adjust to compensate us for the reduction in the rewards we receive from our mining efforts.”
Removed heading “The impact of social media and influencers on the price for digital assets is uncertain.”
Removed heading “We may not be able to realize the benefits of forks.”
Removed heading “There is a possibility of bitcoin mining algorithms transitioning to proof of stake validation and other mining related risks, which could make us less competitive and ultimately adversely affect our business and the value of our shares.”
Removed heading “To the extent that the profit margins of bitcoin mining operations are not high, operators of bitcoin mining operations are more likely to immediately sell bitcoin rewards earned by mining in the market, thereby constraining growth of the price of bitcoin that could adversely impact us, and similar actions could affect other digital assets.”
Removed heading “If a malicious actor or botnet obtains control of more than 50% of the processing power on a bitcoin network, or 33% or more share of the Ethereum Validators, such actor or botnet could manipulate blockchains to adversely affect us, which would adversely affect an investment in us or our ability to operate.”
Removed heading “We are subject to risks associated with our need for significant electrical power. Government regulators may potentially restrict the ability of electricity suppliers to provide electricity to mining operations, such as ours.”
Removed heading “We may not adequately respond to price fluctuations and rapidly changing technology, which may negatively affect our business.”
Removed heading “The value of stable coins that we hold may be subject to volatility and risk of loss”
Removed heading “Ethereum Risk Factors”
Removed heading “Risks Associated with Staking on Ethereum 2.0”
Removed heading “Risks under the Federal securities laws associated with Staking”
Removed heading “Speculative and Volatile Nature of ETH”
Removed heading “Underlying Value Risk”
Removed heading “Development of the Ethereum Platform”
Removed heading “Uncertainty Regarding the Growth of Blockchain and Web 3 Technologies”
Removed heading “Potential Decrease in Global Demand for ETH”
Removed heading “Smart Contract Risk”
Removed heading “Risks Associated with the Ethereum Network”
Removed heading “Dependence on Ethereum Network Developers”
Removed heading “Issues with the Cryptography Underlying the Ethereum Network”
Removed heading “Disputes on the Development of the Ethereum Network may lead to Delays in the Development of the Network”
Removed heading “The Ethereum Blockchain may Temporarily or Permanently Fork and/or Split”
Removed heading “Risk if a Person Gains a 33% or More Share of the Ethereum Validators”
Removed heading “Dependence on the Internet”
Removed heading “Attacks on the Ethereum Network”
Removed heading “Decrease in Block Reward or Yield”
Removed heading “Competitors to ETH and the Ethereum Network”
Removed heading “Financial Institutions may Refuse to Support Transactions Involving ETH”
Removed heading “New York State Moratorium on Cryptocurrency Mining Operations”
Removed heading “Current regulation of the exchange of bitcoins under the CEA by the CFTC is unclear; to the extent we become subject to regulation under the CFTC in connection with our exchange of bitcoin, we may incur additional compliance costs, which may be significant.”
Removed heading “We may be subject to fines and penalties for our prior mining activities in mainland China.”
Removed heading “We may be subject measures from the Cyberspace Administration of China concerning the collection of data and required to obtain clearance from the CAC.”
Removed heading “United States regulators may be limited in their ability to conduct investigations or inspections of our operations in Hong Kong.”
Removed heading “Our Hong Kong subsidiaries could become subject to certain PRC laws if such laws are applied to Hong Kong.”
Removed heading “Enhanced scrutiny over acquisition transactions by the PRC tax authorities may have a negative impact on the indirect transfer of equity in the past and potential acquisitions we may pursue in the future.”
Removed heading “Risks Related to Singapore Government Regulations”
Removed heading “Regulations on Payment Services in Singapore”
Removed heading “Regulations on Anti-money Laundering and Countering the Financing of Terrorism (“AML/CFT”)”
Removed heading “We may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position.”
Removed heading “Our customers frequently make advance payments based on anticipated future usage.”
Removed heading “Various actual and potential conflicts of interest may be detrimental to stockholders.”
Removed heading “We may depend upon outside advisors who may not be available on reasonable terms as needed.”
Removed heading “The nature of our business requires the application of complex financial accounting rules, and there is limited guidance from accounting standard setting bodies. If financial accounting standards undergo significant changes, our operating results could be adversely affected.”
Removed heading “If we are classified as a passive foreign investment company, United States taxpayers who own our Ordinary Shares may have adverse United States federal income tax consequences.”
Largest changes
“Cybersecurity incidents and threats including cyberattacks, ransomware attacks and security breaches of cloud services and our information systems, or those impacting our third parties, could adversely impact our brand and reputation and our business, operating results, and financial condition.”see in full comparison
“For example, certain global privacy laws regulate the use of automated decision making and may require that the existence of automated decision making be disclosed to the data subject with a meaningful explanation of the logic used in such decision making in certain circumstances, and that safeguards must be implemented to safeguard individual rights, including the right to obtain human intervention and to contest any decision. …”see in full comparison
“As a public company, we are subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act and the Dodd-Frank Act and are required to prepare its financial statements according to the rules and regulations required by the SEC. In addition, the Exchange Act requires that we file annual, quarterly and current reports. The Company’s failure to prepare and disclose this information in a timely manner or to otherwise comply with applicable law could subject it to penalties under federal securities laws, expose it to lawsuits and restrict its ability to access financing. …”see in full comparison
“Our listing on NASDAQ subjects us to continued quantitative and qualitative listing requirements. Failure to maintain minimum price, market capitalization, public float, shareholder equity, governance, or filing standards could result in warnings, additional costs, or delisting, reducing liquidity and potentially triggering defaults or investor redemptions.”see in full comparison
“We may be subject to fines and penalties for our prior mining activities in mainland China.”see in full comparison
“Also, based on the Negative List for Market Access (2022 Edition), “the Catalogue for Guidance on Industrial Restructuring shall be included in the Negative List for Market Access”; plus, according to the Decision of the State Council on Promulgating and Implementing the “Temporary Provisions on Promoting Industrial Structure Adjustment,” valid from December. …”see in full comparison
Full comparison: every changed paragraph (548)
Ownership of our securities involves a high degree of risk. You should carefully consider the risks described below, together with all other information contained in or incorporated by reference into this Annual Report on Form 10-K, including our audited financial statements and the notes thereto, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” The following discussion highlights material risks that could adversely affect our business, financial condition, results of operations, cash flows, liquidity, prospects and the trading price of our Ordinary Shares.
An investment in our
Ordinary Shares involves a high degree of risk. You should carefully consider the risks and uncertainties described below together with
all other information contained in this report, including the matters discussed under the heading “Forward-Looking Statements”
before you decide to invest in our Ordinary Shares. The Company may be subject to various legal
and operational risks as a result
of its previously being a China-based Issuer with substantial amounts of the Company’s operations
previously in China and Hong Kong.
The legal and regulatory environment in China is in many respects different from the United States.
These risks and others could result
in a material change in the value of our securities and/or significantly limit or completely limit
or completely hinder our ability to
offer or continue to offer our securities to investors and cause the value of such securities to
significantly decline or be worthless.
If any of the following risks, or any other risks and uncertainties that are not presently foreseeable to us, actually occur, our business,
financial condition, results of operations, liquidity and our future growth prospects could be materially and adversely affected.
Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also impair our business operations. If any of the risks actually occur, our business could be materially harmed and the market price of our ordinary shares could decline, and you could lose all or part of your investment.
The Company is not required to provide the information
called for in this item due to its status as a Smaller Reporting Company, however we describe below some of the risks we believe are material
to our business. You should carefully consider the following risks in evaluating us and our business. You should also refer to the other
information set forth in this report, including the information set forth in “Business” and “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 the following risks.
We have a history
of operating losses, and
we may not be able to sustain profitability; we have recently shifted our emphasis from our digital assets mining
business, business to cloudthe servicesETH
staking and HPCtreasury data centersbusiness and we may not be continuously successful in this business.
For the year ended December
31, 2023 (“Fiscal 2023”), as a result of the decline in revenue from digital assets mining, we recognized a net loss of $13.9
million. Although we have experienced profitability from
our cloud services and HPC data centerscenters, forwhich theare yearpresently endedoperated December 31, 2024
(“Fiscal 2024”), we may incur losses as we continue to work to shift and growby our cloudsubsidiary servicesWhiteFiber, andInc., HPC data centers businesses.
Ourour current business, including
our growth strategy for our business, involves industries that are itself new and constantly evolving
and is subject risks, many of which are
discussed below. See “Digital AssetsRisks Related Risksto Digital Asset Prices, Network Dynamics and Treasury Holdings” below.
Our results of operations,
including the levels
of our net revenues, expenses, net loss and other key metrics, may vary significantly in the future due to a variety
of factors, some
of which are outside of our control, and period-to-period comparisons of our operating results may not be meaningful,
especially given
our limited cloud services and HPC data centers operating history.history in the area of digital assets. As a result of adverse factors described below, there
can be no assurance
we will achieve and maintain profitability.
We seek to enteracquire cloud
servicesdigital and HPC data centersasset-related businesses
around the globe. However, we cannot offer any assurance that acquisitions of businesses, assets
and/or entering into strategic alliances
or joint ventures will be successful. We may not be able to find suitable partners or acquisition
candidates and may not be able to complete
such transactions on favorable terms, if at all. If we make any acquisitions, we may not be
able to integrate these acquisitions successfully
into our existing infrastructure. In addition, in the event we acquire any existing
businesses businesses, we could assume unknown or contingent
liabilities.
Our new services and changes to existing
services could fail to attract or retain users or generate revenue and profits, or otherwise adversely affect our business.
We may evaluate and consider
strategic investments,
combinations, joint-ventures, acquisitions or alliances in the bitcoindigital mining,asset cloud“ecosystem” services or HPC data centers
and related businesses around the
globe. These transactions could be material to our financial condition and results of operations if
consummated. If we are able to identify
an appropriate business opportunity, we may not be able to successfully consummate the transaction
and, even if we do consummate such
a transaction, we may be unable to obtain the benefits or avoid the difficulties and risks of such
transaction.
Our success and future
growth will depend to
a significant degree on the skills and services of our management team, including Mr. Sam Tabar, our Chief Executive
Officer, and Mr. Erke
Huang, our Chief Financial Officer.Officer Weand haveMr. recentlyJustin hiredZhu, severalour keyChief membersAccounting Officer and Senior Vice President of SeniorFinance. Management including executive
officers, Billy Krassakopoulos, CEO of Enovum, and Thomas Sanfilippo, Chief Technology Officer, in order to grow WhiteFiber’s business.
We will need
to continue to grow our management in order to alleviate pressure on our existing team and in order to continue to develop
our business.
If our management team, including any new hires that we may make, fails to work together effectively and to execute our
plans and strategies
on a timely basis, our business could be harmed. Furthermore, if we fail to execute an effective contingency or succession
plan with
the loss of any member of management, the loss of such management personnel may significantly disrupt our business.
As of December 31, 2023, previous deficiencies
in disclosure controls and procedures were remediated, and controls were found to be operating effectively. As of December 31, 2024,2025, we
concluded that our
internal control over financial reporting contained no material weaknesses. We will continue to periodically review
our internal control
over financial reporting as part of our ongoing efforts to ensure compliance with the requirements of Section 404
of the Sarbanes-Oxley
Act.
Cyberattacks and security breaches of cloudour
services,systems, or those impacting our third parties, could adversely impact our brand and reputation and our business, operating results, and
financial condition.
As a result, any actual or perceived security breach of our systems or our third-party partners may:
Our cloud services involve
the collection, storage, processing, and transmission of confidential information, employee, service provider, and other personal data.
We have built our cloud services on the premise that we maintain a secure way to secure, store, and transact in cloud services. As a result,
any actual or perceived security breach of us or our third-party partners may:
Although we have developed
systems and processes
designed to protect the data we manage, prevent data loss and other security breaches, effectively respond to known
and potential risks,
and expect to continue to expend significant resources to bolster these protections, there can be no assurance that
these security measures
will provide absolute security or prevent breaches or attacks. We have experienced from time to time, and may
experience in the future,
breaches of our security measures due to human error, malfeasance, insider threats, system errors or vulnerabilities,
or other irregularities.
Unauthorized parties have attempted, and we expect that they will continue to attempt, to gain access to our
its systems and facilities,
as well as those of our customers, partners, and third-party service providers, through various means, including
hacking, social engineering,
phishing, and attempting to fraudulently induce individuals (including employees, service providers, and
our customers) into disclosing
usernames, passwords, payment card information, or other sensitive information, which may, in turn, be
used to access our cloud services.
Threats can come from a variety of sources, including criminal hackers, hacktivists, state-sponsored
intrusions, industrial espionage,
and insiders. Certain threat actors may be supported by significant financial and technological resources,
making them even more sophisticated
and difficult to detect. As a result, our costs and the resources we devote to protecting against
these advanced threats and their consequences
may continue to increase over time.
We must attract, develop and
retain executive
officers and other professional, technical and labor forces with the skills and experience necessary to successfully
manage, operate
and grow. We have recently hired certain key personnel for WhiteFiber, as well as the management team of Enovum.Company. However,
competition for these employees is high, due, in part,
to the nascent HPCworkforce Businessin workforce.the digital asset “ecosystem.” In some cases, competition for these employees
is on a regional,
national, or global basis. At times of low unemployment, it can be difficult for us to attract and retain qualified
and affordable personnel.
A shortage in the supply of skilled personnel creates competitive hiring markets, increased labor expenses,
decreased productivity and
potentially lost business opportunities to support our operating and growth strategies. Additionally, if we
are unable to hire employees
with the requisite skills, we may be forced to incur significant training expenses. As a result, our ability
to maintain productivity,
relationships with customers, competitive costs, and quality services is limited by the ability to employ, retain
and train the necessary
skilled personnel and could negatively affect its results of operations, financial position and cash flows.
Supply chain disruptions may adversely affect
WhiteFiber’s operations.
WhiteFiber is a provider of
Graphic Processing Units (“GPUs”) compute and purchases NVIDA H100 servers, as well as other servers, through OEMS for example,
Supermicro, Dell, Hewlett Packard and ASUSTeK Computer Inc. Disruptions, shortages or delays
in WhiteFiber’s ability to source GPUs and price increases from suppliers have and may continue to occur, which would be expected
to adversely affect WhiteFiber’s results of operations, financial condition, cash flows and harm customer relationships. Any material
disruption at WhiteFiber’s facilities or those of its customers or suppliers or otherwise within its supply chain, whether as a
result of downtime, work stoppages or facility damage could prevent WhiteFiber from meeting customer demands or expected timelines, require
it to incur unplanned capital expenditures, or cause other material disruptions to its operations, any of which could have a material
adverse effect on WhiteFiber’s operations, financial position and cash flows. Further, supply chain disruptions can occur from events
out of the WhiteFiber’s control such as environmental incidents or other catastrophes.
We operate in a capital-intensive industry
and are subject to capital market and interest rate risks.
Our operations require
significant capital investment to purchase and maintain the property and equipment required to provide specialized infrastructures
to support generative AI work streams. In addition, WhiteFiber’s operations include a significant level of fixed and
semi-fixed costs. Consequently, we will rely on capital markets, as sources of liquidity for capital requirements for growth. If we
are unable to access capital at competitive rates, the ability to implement business plans, make capital expenditures or pursue
acquisitions it would otherwise rely on for future growth may be adversely affected. Market disruptions may increase the cost of
borrowing or adversely affect our ability to access one or more financial markets. Such market disruptions could include:
If we raise additional equity
financing, our shareholders may experience significant dilution of their ownership interests, and the per share value of our ordinary
shares could decline. Furthermore, if we engage in debt financing, the holders of debt likely would have priority over the holders of
our ordinary shares on order of payment preference. We may be required to accept terms that restrict or limit our ability to, among other
things:
These restrictions may limit
our ability to obtain additional financing, withstand downturns in our business or take advantage of business opportunities.
As clouddigital servicesasset and HPC
data centersplatforms become more widely
available, we expect the services and products associated with them to evolve. In order to stay current
with the industry, our business
model requires us to evolve as well. From time to time, we have modified and will continue to modify aspects
of our business model relating
to our strategy. We cannot offer any assurance that these or any other modifications will be successful
or will not result in harm to
our business. We may not be able to manage growth effectively, which could damage our reputation, limit
our growth and negatively affect
our operating results. Further, we cannot provide any assurance that we will successfully identify all
emerging trends and growth opportunities
in this business sector, and we may lose out on those opportunities. Such circumstances could
have a material adverse effect on our business,
prospects or operations.
Our operations could be negatively impacted by import tariffs
and/or other government mandates.
We operate in or provides
services to capital-intensive industries in which federal trade policies could significantly impact the availability and cost of materials.
Imposed and proposed tariffs by the Trump administration could significantly increase the prices and delivery lead times on GPUs that
are critical to WhiteFiber and its customers. WhiteFiber faces competition from source providers both in the U.S. and around the world.
Prolonged lead times on the delivery of GPUs and further tariff increases could adversely affect WhiteFiber’s business, financial
condition and results of operations.
We are subject to environmental
laws and regulations
affecting many aspects of itsour operations, including those affecting the operation of itsdigital dataasset centers.platforms. These laws
and regulations
can increase capital, operating and other costs; cause delays as a result of litigation and administrative proceedings;
and create environmental
compliance, remediation, containment, monitoring and reporting obligations for construction materials facilities.
Environmental laws
and regulations can also require us to install pollution control equipment at facilities where it operates, and correct environmental
environmental hazards, including payment of all or part of the cost to remediate sites where activities of other parties, caused environmental contamination.
contamination. These laws and regulations generally require us to obtain and comply with a variety of environmental licenses, permits,
inspections and
other approvals. Although we strive to comply with all applicable environmental laws and regulations, public and private
entities and
private individuals may interpret our legal or regulatory requirements differently and seek injunctive relief or other remedies against
against us. We cannot predict the outcome, financial or operational, of any such litigation or administrative proceedings.
We maintain cash deposits in excess of federally insured limits. Adverse developments affecting financial institutions, including bank failures, could adversely affect our liquidity and financial performance.
In July 2025, we sold an aggregate of 22,000,000 ordinary shares at $3.06 per share pursuant to a registered direct offering. In October 2025, we sold an aggregate of $150 million of 4.0% convertible senior notes due 2030 pursuant to a registered offering. During the year ended December 31, 2025, we sold an aggregate of 30,189,161 ordinary shares for an aggregate price of $2.15, net of offering costs pursuant to an at-the-market offering. We had proceeds of $63.4 million, net of offering costs pursuant to an at-the-market offering.
Since May 4, 2022 until March 7, 2025, we have
sold an aggregate of 81,990,654 shares of common stock for an aggregate purchase price of $288.1 million net of offering costs pursuant
to an at-the-market offering. We had a net income of $28.3 million for Fiscal 2024 . We incurred a net loss of $13.9 million for Fiscal
2023, which included $6.6 million impairment of digital assets. We had negative cash flows for our operating activities of $13.0 million
for Fiscal 2024. We had positive cash flows from our operating activities of $1.1 million for Fiscal 2023. Negative cash flow during Fiscal
2024 resulted, in part, from gains on digital assets of $55.7 million and revenue from bitcoin mining of $58.6 million, offset by depreciation
and amortization expenses of $32.3 million. Positive cash flow during Fiscal 2023 resulted, in part, from gain from exchange of digital
assets of $18.8 million offset by $6.6 million impairment of digital assets.
We cannot assure you our
business model will allow us to continue to
generate positive cash, given our substantial expenses in relation to our revenue at
this stage of our Company’s development. Our
inability to offset our expenses with adequate revenue will adversely affect our
liquidity, financial condition and results of operations.
Although Althoughwe believe we have adequate cash on hand and have drawn down on an effective
$500 million$2.5 billion at-the-market shelf registration statement and anticipated
cash flows from operating activities are expected to be
sufficient to meet our anticipated working capital requirements and capital expenditures
in the ordinary course of business for the
next 12 months, we cannot assure you that will be the case. We expect to need additional cash
resources in the future as we wish to
pursue opportunities for investment, acquisition, capital expenditure or similar actions in order
to implement our business plan. We may evaluate financing opportunities from time to time, including through ETH-collateralized financing
arrangements, related-party or other investor financing, and other debt or equity financings. The issuance and sale of additional equity
would result in further dilution to our shareholders. The incurrence of indebtedness
would result in increased fixed obligations and could
result in operating covenants that would restrict our operations. We cannot
assure you that financing will be available in amounts or
on terms acceptable to us, if at all. Further, if we seek to obtain financing through ETH-collateralized financing arrangements, we may
be required to pledge a substantial portion of our ETH and satisfy margin maintenance and other collateral requirements. If the value
of the pledged collateral declines, we could be required to post additional collateral, repay indebtedness earlier than anticipated or
permit the liquidation of pledged ETH, which could adversely affect our liquidity, financial condition and results of operations.
Risks Related to Digital Asset Prices, Network Dynamics and Treasury Holdings
Volatility in the prices of ETH may materially and adversely affect our business, financial condition and results of operations.
Our revenues, gross margins, liquidity and ability to service obligations depend significantly on prevailing ETH prices and. Prolonged or sharp price declines, or heightened volatility, may impede ETH ecosystem growth or render BTC mining activities unprofitable, reduce the carrying value and liquidity of digital assets held, and decrease investor demand for our securities.
The future development and growth of digital assets are subject to a variety of factors that are difficult to predict and evaluate. If digital assets do not grow as we expect, our business, operating results and financial condition could be adversely affected.
Digital assets built on blockchain technology were only introduced in 2008 and remain in the early stages of development. In addition, different digital assets are designed for different purposes. Ethereum, for instance, was designed to serve as a smart contract and decentralized application platform, while Bitcoin was designed to serve as a peer-to-peer electronic cash system. Many other blockchain networks, ranging from cloud computing to tokenized securities networks, have only recently been established. The further growth and development of any digital assets and their underlying networks and other cryptographic and algorithmic protocols governing the creation, transfer and usage of digital assets and related assets represent a new and evolving paradigm that is subject to a variety of factors that are difficult to evaluate, including:
Various other technical issues have also been uncovered from time to time that resulted in disabled functionalities, exposure of certain users’ personal information, theft of users’ assets, and other negative consequences, and which required resolution with the attention and efforts of their global miner, user, and development communities. If any such risks or other risks materialize, and in particular if they are not resolved, the development and growth of digital assets may be significantly affected and, as a result, our business, operating results, and financial condition could be adversely affected.
Ethereum-specific market, technology and regulatory developments may adversely affect the value and liquidity of our ETH holdings and our Treasury Strategy.
The Ethereum network is subject to rapidly evolving technology, competitive dynamics (including alternative Layer 1 and Layer 2 networks), and changing regulatory and market-structure frameworks. Adverse developments—including protocol upgrades with unintended consequences, forks or chain instability, validator concentration, consensus failures, smart contract vulnerabilities, L2 settlement failures, bridge exploits, or regulatory restrictions—could reduce the value or liquidity of ETH and impair our treasury strategy.
Our ETH treasury business model has multiple layers of corporate finance risks.
Our ETH Treasury Strategy has multiple layers of risk based on corporate finance principles and blockchain mechanics, including but not limited to the following:
Together, these risks form the structural challenges of our ETH Treasury Strategy. Its success depends on maintaining perpetual premium expansion in a market that is inherently cyclical.
Our ETH Treasury Strategy and any decision to hold digital assets may increase our exposure to market volatility and potential uninsured losses.
Market conditions and operational needs may necessitate longer holding periods, increasing exposure to price swings. If we hold ETH or other digital assets under our treasury strategy, we would be exposed to additional volatility, regulatory, and market structure risks specific to those assets. We are currently exposed to potential uninsured losses to the extent digital asset balances exceed the custodian’s applicable insurance coverage.
Our strategic exposure to ETH may subject us to ETH-specific market, technology, and regulatory risks.
The Ethereum network has distinct market structure, technology, regulatory and liquidity considerations compared to Bitcoin. Adverse developments specific to ETH—including protocol changes, forks, validator dynamics, market dislocations, bridge or DeFi exploits, or regulatory actions—could impair the value or liquidity of our ETH holdings and related strategies.
Operational, Cybersecurity and Custody Risks
Any ETH staking and related activities may expose us to slashing, lock-ups, liquidity, counterparty and operational risks.
Staking requires operational reliability and adherence to protocol rules. Validators that act maliciously or suffer extended downtime can be “slashed,” resulting in a partial loss of staked principal. Staking may also involve unbonding or lock-up periods that reduce liquidity and flexibility, and, where conducted through third-party providers, introduces counterparty and operational risk. Liquid staking or restaking mechanisms may involve additional smart contract risk, rehypothecation or correlation risks, and market liquidity considerations for derivative tokens. Any failure in our validator operations or at a third-party staking provider could result in losses and reputational harm.
Smart contract, bridge, oracle and protocol vulnerabilities could result in loss of digital assets or business interruption.
Decentralized protocols and token standards underpin many Ethereum-based activities. Exploits or failures—whether in widely used standards, core protocol implementations, bridges, or oracles—can cause material losses or network instability. Even if we are not directly exposed to a compromised protocol, contagion effects can depress market prices, reduce liquidity, and disrupt counterparties or service providers on which we rely.
Market structure and liquidity for ETH could deteriorate, impacting our ability to transact or to accurately value our holdings.
We rely on a limited number of venues for price discovery and liquidity. Market events—including exchange or market-maker disruptions, de-platforming of digital asset participants by banks or service providers, stress in stablecoin markets, or regulatory actions that affect trading venues—could reduce liquidity and increase volatility. A lack of reliable liquidity may impair valuation, hedging, or the ability to rebalance our treasury.
ETH price declines or prolonged underperformance versus other digital assets could adversely affect our financial position and capital access.
Our strategy is focused on ETH as our primary treasury asset. Sustained price declines in ETH or underperformance relative to other assets could reduce the carrying value of our digital assets, increase the frequency or magnitude of impairment charges under applicable accounting policies, and diminish our ability to raise capital or maintain compliance with exchange listing standards.
Restaking and correlated risk exposures may amplify losses during stress events.
If we engage in restaking or similar activities that create stacked security obligations or re-use of staked collateral across protocols, we may face correlated losses across multiple positions in a single adverse event. Losses at one protocol could affect the security or liquidity of positions at another, and recovery pathways may be uncertain or prolonged.
Concentration and governance risks in the Ethereum ecosystem could create systemic vulnerabilities.
Concentration of validators among a small number of providers, reliance on a limited set of client implementations, or governance capture by large stakeholders could increase systemic risk. A critical bug in a dominant client, or adverse decisions by influential governance participants, could affect network stability, validator incentives, or ETH economics.
Our treasury strategy and any decision to hold digital assets may increase our exposure to market volatility and potential uninsured losses.
Management's Discussion & Analysis (MD&A)
New heading “ETH Staking Business”
New heading “Revenue from cloud services”
New heading “Revenue from colocation services”
New heading “Cost of revenue - cloud services”
New heading “Cost of revenue - Colocation Services”
New heading “Cost of revenue - digital asset mining”
New heading “Cost of revenue - ETH staking”
New heading “(Losses) gains on digital assets”
New heading “Impairment of digital intangible assets”
New heading “Net loss from disposal of property, plant and equipment”
New heading “Change in fair value of derivative liability”
New heading “Other (expense) income, net”
New heading “Income tax benefit (expenses)”
New heading “Net (loss) income and (loss) earnings per share”
New heading “Realized gain on exchange of digital assets”
New heading “Impairment of digital assets”
New heading “Restricted cash”
New heading “Other current assets, net”
New heading “Other non-current assets, net”
New heading “Other payables and accrued liabilities”
New heading “Convertible note payable, net”
New heading “Derivative liability”
New heading “Royal Bank of Canada Credit Facility”
New heading “Off-Balance Sheet Arrangements”
Removed heading “Results of Operations for the Year Ended December 31, 2023 and 2022”
Removed heading “Loss on write-off of deposit to hosting facility”
Removed heading “Net (loss) gain from disposal of property and equipment.”
Removed heading “Gain from sale of investment security”
Removed heading “Income tax expenses”
Removed heading “Net income (loss) and earnings (loss) per share”
Removed heading “Digital assets held in fund”
Removed heading “Revenue from Operations”
Largest changes
“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. …”see in full comparison
“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. …”see in full comparison
Our discussion and analysis of our financial condition and results of operations are based upon oursee in full comparisonunaudited condensedconsolidated 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 theunauditedconsolidatedcondensed consolidatedfinancial statements, and to disclose the reported amounts of revenues and expenses incurred during the financial reporting periods. The most significant estimates and assumptionsincludeinclude, but are not limited to, the valuation ofdigital assets and othercurrent assets, useful lives ofpropertyproperty, plant, and equipment,the recoverabilityimpairment 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 ourunauditedconsolidatedcondensedfinancial statements. For a summary of significant accounting policies, refer to Note 2. Summary of Significant Accounting Policies in our Notes to consolidated financialstatements.statements included elsewhere herein.
“In January 2026, WhiteFiber issued $230.0 million aggregate principal amount of 4.50% convertible senior notes due 2031, resulting in net proceeds of approximately $102.5 million after deducting the Zero Strike Call Premium, initial purchasers’ discounts and estimated offering expenses. The issuance enhances our liquidity and provides additional capital to fund upcoming development projects, including construction activities and other strategic growth initiatives. …”see in full comparison
Full comparison: every changed paragraph (299)
The following discussion and analysis of
our our
financial condition and results of operations should be read in conjunction with our financial statements and the related notes
included included
elsewhere in this report.Annual Report. This discussion contains forward-looking statements reflecting our current expectations
that involve risks
and uncertainties. See “DisclosureForward Regarding Forward-LookingLooking Statements and Risk Factor Summary” for a discussion of the
uncertainties, risks, and
assumptions associated with these statements. Actual results and the timing of events could differ
materially from those discussed in
our forward-looking statements as a result of many factors, including those set forth under
“Risk Factors” and elsewhere
in this report.Annual Report.
Bit Digital, Inc. (“BTBT” or the “Company” or “We”), is a holding company incorporated on February 17, 2017, under the laws of the Cayman Islands. The Company is a strategic asset company focused on active participation in Ethereum (ETH)-native treasury and staking strategies. Through our majority equity stake in WhiteFiber Inc. (Nasdaq: WYFI), the Company also engages in high performance computing (“HPC”) business, including cloud services and HPC data center services.
Bit Digital, Inc. or the “Company”,
is a global platform for high performance computing (“HPC”) infrastructure and digital asset production, with headquarters
in New York City.
The Company’s HPC business operates under
the WhiteFiber Inc. (“WhiteFiber”) brand. OurWhiteFiber operations are located in the US, Canada, and Iceland. We areis a leading provider
of high-performanceAI
infrastructure computingsolutions. (“WhiteFiber owns HPC”) data centers/colocation services and provide cloud-based HPC graphicsGPU processing units (“GPU”)
services, which we term cloud services,
for customers such as artificialAI intelligence (“AI”)application and machineML learningdevelopers (the “MLHPC Business”)
developers.. Our HPCThe Tier-3 data centers provide hosting and
colocation servicesservices. and are developed and operated by our wholly-owned subsidiary, Enovum.
OurThe cloud services aresupport providedgenerative byAI ourworkstreams, WhiteFiberespecially AI,training Incand subsidiary. Collectively, we refer to these offerings as our HPC Business.inference.
On July 30, 2025, WhiteFiber entered into the Contribution Agreement with us in connection with WhiteFiber’s IPO, pursuant to which, on August 6, 2025, we contributed our HPC business to WhiteFiber through the transfer of 100% of the capital shares of our cloud services subsidiary, WhiteFiber AI, Inc. and our wholly-owned subsidiaries WhiteFiber HPC, Inc., WhiteFiber Canada, Inc., WhiteFiber Japan G.K. and WhiteFiber Iceland, ehf, in exchange for 27,043,749 Ordinary Shares.
On October 11, 2024, we significantly expanded
our HPC data center operations and capabilities by acquiring Enovum Data Centers Corp (“Enovum”), a Tier-3 HPC data center
platform based in Montreal, Canada. Through Enovum, we lease and operate a 4MW AI data center located in Montreal, Canada (“MTL
1”). MTL 1 is a fully operational Tier-3 data center that is designed for HPC workloads. MTL 1’s full capacity is occupied
by customers under lease agreements with an average duration of approximately 30 months. On December 27, 2024, we announced that we had
acquired the real estate and building for a build-to-suit 5MW Tier-3 data center expansion project in Montreal (“MTL 2”).
The MTL 2 data center is expected to be completed and operational by June 2025.
In addition to providing highly desirable HPC
data center hosting capacity to our customers, our business model integrates HPC data center infrastructure and cloud service to provide
scalable, high-performance computing solutions for enterprises, research institutions, and AI-driven businesses. Our integrated approach
aligns specialized data center operations with GPU-focused cloud services, addressing the unique requirements of AI and HPC workloads.
These workloads demand greater power density, advanced cooling solutions, and robust bandwidth to handle large-scale data transfers. By
operating our data centers, we believe we can better meet these needs and reduce the complexity associated with procuring power and connectivity
from external vendors. We can also design our facilities to accommodate the higher heat loads generated by modern GPUs, potentially shortening
deployment timelines for customers who require rapid expansion of their compute infrastructure. From a financial standpoint, our vertically
integrated solution allows us to capture additional margin for both of our HPC data center and cloud services businesses, avoiding expenses
that would otherwise be due to third-party providers.
Our cloud services business provides cutting-edge, bespoke services
involving a sophisticated array of computers and chips, including NVIDIA GPUs, servers, network equipment, and data storage solutions.
We believe we provide our cloud services customers with the highest levels of performance and reliability while offering flexibility to
scale with customer needs. Our cloud services solutions include a proprietary software layer that enables our customers to rapidly and
reliably deploy AI applications with superior performance. We are offering our cloud services initially at a data center maintained by
a third-party colocation provider in Iceland (the “Iceland Data Center”) but have plans to seamlessly integrate our cloud
services at data centers across key regions in Europe and North America. We believe that both of our businesses are posted to benefit
from increased market demand. This is illustrated by our demonstrated ability to pre-sign end users prior to committing capital for expansions,
both for new data center sites and for GPU server procurement.
We are actively engaged in research and development
efforts to enhance our cloud services capabilities for our customers. For example, we are developing integrated software to automate layering
of stacks and self-service portals on top of the cross-data center fabric, allowing our customers to access GPU or CPU nodes on demand—no
matter where they physically reside. This provides significant flexibility as scaling is required to accelerate development of AI applications.
In addition, we are working on advanced interconnect technologies like InfiniBand (IB) or RDMA over Converged Ethernet (“RoCE”).
When combined with cross-data center links, these ensure that training jobs can be distributed without bottlenecks or high latency. By
emphasizing scale, performance, and reliability, we believe that we will be positioned to maximize customer retention while pricing our
services at a premium to those offered by our competitors.
We leverage a global network of data center resources
by partnering with eight third-party data center providers to achieve high autonomy in locations across Europe, Canada, and the U.S. Our
initial HPC data center partnership through which we lease capacity is at BlöndUos Campus, Iceland, offering a world-class operations
team with certified technicians and reliable engineers. The facility has 50kW rack density and 6MW total capacity. Its energy source is
100% renewable energy, mainly from Blanda Hydro PowerStation, the winner of IHA Blue Planet Awards in 2017. In the fourth quarter of 2023,
we secured our first cloud customer through a three-year service agreement to provide services using our advanced AI equipment. In January
2024, the Company announced that its WhiteFiber AI business commenced generating revenue.
Colocation/HPC Data Center ServicesService
WhiteFiber designs, develops, and operates Tier-3 data centers that provide hosting and colocation services with high reliability infrastructure, including N+1 redundancy, advanced cooling, and strict monitoring systems designed to support AI workloads. Its strategy focuses on rapidly developing retrofit data centers in metro areas with existing power infrastructure, allowing for significantly faster deployment than greenfield projects. The current portfolio includes facilities such as MTL-1, MTL-2, MTL-3 in Quebec and NC-1 in North Carolina, with a goal of reaching approximately 76 MW of total capacity by the end of 2026 and a broader development pipeline of roughly 1,500 MW under review. During 2025, WhiteFiber prioritized projects with committed customer demand and long-term contracts, including a major services agreement at the NC-1 facility expected to generate approximately $865 million of contracted revenue over 10 years, with electricity and certain operating costs passed through to the customer.
Cloud Service
WhiteFiber provides specialized GPU-based cloud infrastructure tailored for generative AI training and inference workloads, offering customized solutions and high service reliability. The business leverages partnerships with major hardware providers such as NVIDIA, SuperMicro, Dell, Hewlett Packard Enterprise, and QCT, and deploys advanced GPU architectures including H200, B200, and GB200 systems. Rather than building all infrastructure itself, WhiteFiber uses a global network of third-party data centers to host GPU clusters. Revenue is generated through a series of service agreements and MSAs with customers for GPU capacity and AI compute services, ranging from short-term deployments to multi-year contracts. Key agreements include large GPU deployments for AI workloads and cloud gaming providers such as Boosteroid, with some contracts offering significant expansion potential and long-term recurring revenue streams.
We design, develop, and operate HPC data centers,
through which we offer our hosting and colocation services. Our data centers meet the requirements of the Tier-3 standard, including power
redundancy, concurrent maintainability, multiple power feeds, uninterruptible power supply, highly reliable cooling systems, and strict
monitoring and management systems. On October 11, 2024 the Company completed the acquisition of Enovum Data Centers Corp (“Enovum”).
On December 27, 2024, we acquired the real estate and building for a build-to-suit 5MW Tier-3 data center expansion project near Montreal,
Canada.
We use a well-defined set of criteria to select
our data center sites. We actively target sub-20MW sites with proximity to metro areas and partial infrastructure in place, where we are
retrofitting rather than developing greenfield projects. A retrofit entails sourcing and acquiring an existing industrial building with
underutilized, in-place power connectivity. Our average build time for retrofits is six months, which we believe is approximately one-third
to one-half of the industry average development timeline for greenfield projects. We are also developing a proprietary software capability
that will link clusters across multiple sites, leveraging existing dark fiber networks connecting smaller data centers within a radius
of approximately 700 kilometers. By productizing cross-data center operation, we intend to create a single supercluster, enabling us to
sidestep potential fragmentation problems and dynamically “borrow” compute or storage resources from any site. We also prioritize
sites offering opportunities to increase site power over time, enabling our HPC data centers to grow with customer demand. In addition,
we selectively target certain larger opportunities with 50MW of power or more, subject to customer demand, to drive AI-driven compute
super-clusters. Finally, we target sites powered by sustainable, green energy sources.
The digital asset business segment of the Digital Infrastructure Business (the “Digital Asset Business Segment”) 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”); and (ii) digital asset mining (the “Digital
Asset Mining Operations”).
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 has been converting its BTC holdings into ETH over time and has been winding down its bitcoin mining operations, with any net proceeds to be re-deployed into ETH.
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
Coinmint LLC (“Coinmint”) and 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 HoldingsEnergy CorpPartner LLC (“KaboomRacksDEP”).
Soluna Computing, IncInc. and DVSL ComputeCo, LLC (collectively collectively,
“Soluna”) previously maintained our mining facilities in Kentucky and Texas.
OurTexas, mining facility in Iceland is maintained byand GreenBlocks ehf, an Icelandic private limited
company (“GreenBlocks”)., We
havepreviously relocated our miners frommaintained our mining facility in CanadaIceland. maintainedThe byCompany’s Blockbreakerspartnership Inc. (“Blockbreakers”) towith Soluna
and CoinmintGreenBlocks afterconcluded our service agreement expired in November 2024. From time to time,at the Companyend mayof changeFebruary 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.2026.
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.
In the fourth quarter of 2022, we formally commenced
Ethereum staking operations. We intend to 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.
We initiated our native staking operations 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 provided flexibility to engage in both staking and restaking through a broader range of strategies and platforms. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025.
During the year ended December 31, 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.
During the third quarter of 2025, the Company received an additional 1,855 miners, of which 410 miners were deployed in July 2025 and 1,445 miners were deployed in August 2025.
During the fourth quarter of 2025, the Company reallocated a portion of its mining fleet across hosting facilities as part of its ongoing efforts to recalibrate its bitcoin mining operations. This transition, driven by changes in hosting partnerships, including the transfer of 1,443 miners from Soluna’s facilities to Digital Energy Partners LLC (“DEP”), which was formerly known as A.R.T Digital.
As of December 31, 2025, the Company’s active hash rate totals approximately 1.5 EH/s, with operations in North America and Iceland.
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. This new 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 will pay 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% percent or better for any period. We are not privy to the emissions rate at the Coinmint facility or at any other hosting facility. However, the Coinmint facility operates in an upstate New York region that reportedly utilizes 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, as subsequently amended, 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 is for two (2) 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 new agreement brings 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 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 December 31, 2025, Digihost provided approximately 6.0 MW of capacity for our miners at their facility.
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 December 31, 2025, GreenBlocks provided approximately 9.1 MW of capacity for our miners at their facility. Our partnership with GreenBlocks concluded in February 2026, and the Company is currently evaluating alternative hosting arrangements for the miners previously deployed at the GreenBlocks facility. As of the date of this report, these miners are in storage.
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 December 31, 2025, Soluna provided approximately 10.0 MW of capacity for our miners at their facility. Our partnership with Soluna concluded in February 2026. The Company has since relocated approximately 2,050 miners to a third-party hosting facility and is evaluating alternative deployment options for the remaining miners, which are currently in storage.
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 (1) 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 Bit Digital to support 17.5 MW of capacity. Bitdeer shall also be entitled to 30% of the net profit generated by the miners. Bit Digital shall have the first right, but not obligation, to accept services for any extra capacity under the terms of this Agreement. As of December 31, 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. In accordance with the agreements, we paid a refundable advance of $1.3 million, which will be applied against monthly hosting charges over an 18-month period.
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. On November 12, 2025, we received communication regarding a change in the contracting entity under its existing hosting arrangements. Effective immediately, Digital Energy Partners LLC (“DEP”) replaced KaboomRacks as the sole contracting counterparty. Under the updated terms, KaboomRacks will return all deposits previously held by it, and we will remit a one-month deposit related to electricity costs to DEP. In connection with the transition, DEP assumed the remaining portion of the $1.3 million loan, with an outstanding balance of approximately $1.0 million as of December 31, 2025. As of December 31, 2025, DEP provided approximately 17.1 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. 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 named Blockfusion’s CEO, Alexander Martini-Lomanto, as an additional defendant. The total amount of damages sought exceeds of $5 million. Blockfusion has filed a motion to dismiss the Second Amended Complaint. The Court held a hearing on the motion on January 6, 2026. Following the hearing, the Court granted the motion to dismiss. The Court dismissed the claims against the individual defendant without prejudice on the ground that it lacked personal jurisdiction, and did not reach the merits of certain substantive issues raised in the motion. The Company’s contract-based claims and related claims for contractual recovery against Blockfusion were not dismissed and remain pending.
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 year ended December 31, 2025, the Company disposed approximately 7,900 bitcoin miners and wrote off 3 bitcoin miners.
As of December 31, 2025, we had 21,354 miners owned or operating (in Iceland) for bitcoin mining with a total maximum hash rate of 2.8 EH/s.
From the inception of our bitcoin mining business in February 2020 to December 31, 2025, we earned an aggregate of 7,550.8 bitcoins.
The following table presents our bitcoin mining activities for the year ended December 31, 2025:
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.
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. Subsequently, we ceased our liquid staking activities with Liquid Collective protocol in October 2025.
During the year ended December 31, 2024, we continued
to work with our hosting partners to deploy our miners in North America and Iceland.
During the first quarter of 2024, the Company
deployed an additional 2,350 miners at one of Coinmint’s hosting facilities.
During the second quarter of 2024, the Company
deployed an additional 600 miners at Blockbreakers’ hosting facility.
During the third quarter of 2024, the Company
deployed an additional 546 miners at one of Soluna’s hosting facilities.
What changed in the latest 10-Q
Risk Factors
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
New heading “RBC Credit Facility”
New heading “Syndicated RBC Credit Facility Agreement executed on July 6, 2026”
New heading “Global Data Center Infrastructure and Partnerships”
New heading “Customer Base and Concentration”
New heading “Selected Customer Agreements”
New heading “New Business Developments”
New heading “Key Factors that May Affect Future Results of Operations”
New heading “Impairment of capitalized software assets”
New heading “Gains on digital intangible assets”
New heading “Impairment on digital intangible assets”
New heading “Change in fair value of derivative liability”
New heading “Interest expense”
New heading “Other (expense) income, net”
New heading “Income tax provisions”
New heading “Net (loss) income and (loss) earnings per share”
New heading “Revenue from cloud services”
New heading “Revenue from colocation services”
New heading “Revenue from digital asset mining”
New heading “Revenue from ETH staking”
New heading “Cost of revenue”
New heading “Cost of revenue - cloud services”
New heading “Cost of revenue - Colocation Services”
New heading “Cost of revenue - digital asset mining”
New heading “Cost of revenue - ETH staking business”
New heading “Depreciation and amortization expenses”
New heading “Impairment of capitalized software assets”
New heading “General and administrative expenses”
New heading “Losses on digital assets”
New heading “Gains on digital intangible assets”
New heading “Impairment on digital intangible assets”
New heading “Digital intangible assets”
New heading “Short-term and long-term debt, net”
New heading “Other long-term liabilities”
New heading “B. Riley Facility”
New heading “NC-1 Project Financing Update”
New heading “Collateralized borrowing”
Removed heading “RBC Facility Agreement Executed on June 18, 2025”
Removed heading “RBC Facility Agreement amended on April 27, 2026”
Removed heading “Critical Accounting Policies and Estimates”
Largest changes
“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. …”see in full comparison
“Borrowings under the facility bear interest, at WhiteFiber’s option, at either Daily Simple CORRA plus 2.75% per annum or Royal Bank Prime plus 1.00% per annum, with the prime-based rate serving as the default option.”see in full comparison
Full comparison: every changed paragraph (285)
The
following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed
consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q for the period ended
March 31,June 30, 2026 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, 2025 (“Form 10-K”). This discussion contains forward-looking statements reflecting
our current expectations that involve risks and uncertainties. See “Forward Looking Statements and Risk Factor Summary” for
a discussion of the uncertainties, risks, and assumptions associated with these statements. Actual results and the timing of events could
differ materially from those discussed in our forward-looking statements as a result of many factors, including those set forth under
“Risk Factors” and elsewhere in this Quarterly Report.
Based
on their collective industry experience, WhiteFiber’s data center team is adept at bringing new sites online on an accelerated
timeline. WhiteFiber is aggressively pursuing the development pipeline and intendintends to achieve an estimated 7670 MW (gross) of total data
center capacity by the end of the fourth quarter of 2026, a target that is underpinned by assets including the MTL-2, MTL-3, and NC-1
facilities. As of MarchJune 31,30, 2026, its pipeline of potential data center projects represents approximately 1,500 MW (gross) under management
review. WhiteFiber follows a disciplined process prioritizing projects that are backed by customer lease commitments. In select cases,
WhiteFiber may pursue early-stage acquisitions based on strong customer demand signals and defined commercialization pathways. Accordingly,
the foregoing timelines and capacities are subject to change based on many factors, many of which are outside of WhiteFiber’s control.
On May 20, 2025, WhiteFiber completed the purchase
of a former industrial/manufacturing building from UMI. Pursuant to the Purchase Agreement WhiteFiber agreed to purchase from UMI, an
industrial/manufacturing building together with the underlying land located in Madison, North Carolina, which WhiteFiber refers to as
“NC-1”, 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 May 20, 2025, 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 May 20, 2025. Additionally, the purchase
price will increase by an additional $200,000$200 thousand 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 May
20, 2025. 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 NC-1 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 NC-1 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 August 4, 2025, Enovum NC-1 Bidco LLC, a subsidiary of WhiteFiber,
entered into an Assignment and Assumption Agreement with Unifi Manufacturing and Duke Energy Carolinas, LLC, pursuant to which Enovum
assumed Unifi’s rights and obligations under certain electric service agreements for facilities located in North Carolina. Duke
Energy consented to the assignment. Refer to Note 21.22. Commitments and contingencies to our condensed consolidated financial statements
for further detail.
As the business grows, WhiteFiber’s ability to fund its operating needs will depend on the ongoing ability to generate positive cash flow from our operations and raise capital in the capital markets. Accordingly, WhiteFiber has entered into certain credit facilities to finance these areas of growth, including the RBC Facility Agreement discussed here. Refer to Liquidity and capital resources for further discussion on this Facility and other credit facilities of WhiteFiber.
RBC Credit Facility
On June 18, 2025, WhiteFiber entered into a non-recourse credit agreement with RBC (as subsequently amended on July 4, 2025, the “original credit agreement”) providing for an aggregate of up to approximately CAD 60 million (approximately $43.8 million) of financing intended primarily to refinance the buildout of MTL-2 and to provide $5.8 million of revolving term financing. The facilities had not been authorized for use by the lender, as certain conditions precedent had not yet been satisfied, and accordingly no amounts were drawn and no borrowings were available under the original credit agreement.
RBC
Facility Agreement Executed on June 18, 2025
On
June 18, 2025, WhiteFiber entered into the Credit Facility with RBC. The Credit Facility provides for an aggregate of up to approximately
CAD 60 million (approximately $43.8 million) of financing. The proceeds are to be used primarily to refinance the buildout of MTL-2 as
well as $5.8 million of revolving term financing (the “Revolver”). The Credit Facility is non-recourse to the Company. WhiteFiber
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 Credit 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 Credit Facility, WhiteFiber entered into a three-year $19.6 million non-revolving real estate term loan facility. The purpose
of this facility is to refinance WhiteFiber’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 $5.8 million and other related supporting documents. WhiteFiber 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.
RBC
Facility Agreement amended on April 27, 2026
On
April 27, 2026, WhiteFiber entered into an amended credit agreement with RBC.RBC, This agreement replacesreplacing the original credit agreement dated
June 18, 2025, as subsequently amended on July 4, 2025. The amended credit agreement providesprovided for an authorized credit facility of CAD
$28 million (approximately $20 million)., Thethe proceeds haveof beenwhich were used as a real estate acquisition bridge loan to finance the acquisition
of the MTL-3 facility,facility. atThe amended credit agreement also included a purchase price of CAD $24.2$8 million (approximately USD $17.4$5.8 million). Therevolving closingfacility datein occurredthe onform Mayof 8,
2026.Letters of Credit and Letters of Guarantee, available for a 12-month term. On July 15, 2026, the amended credit agreement was repaid in full and refinanced through the Syndicated RBC Credit Facility Agreement described below; the revolving Letters of Credit and Letters of Guarantee facility remains in place.
Syndicated RBC Credit Facility Agreement executed on July 6, 2026
On July 6, 2026, WhiteFiber’s wholly-owned subsidiary, Enovum Data Center Corp entered into a syndicated credit agreement with a group of lenders and RBC as administrative agent. The Syndicated Credit Facility Agreement provides for an aggregate of up to approximately CAD $115 million (approximately $80.8 million) to refinance the Amended Credit Agreement and finance its data centers business. The agreement also includes an accordion feature that permits WhiteFiber to increase by up to an additional CAD $25 million (approximately $17.7 million) to refinance the Amended Credit Agreement, subject to the satisfaction of specified conditions. The Syndicated Credit Facility Agreement is a non-revolving facility, and amounts repaid or prepaid may not be reborrowed.
Borrowings under the Syndicated Credit Facility Agreement bear interest, at WhiteFiber’s option, at either (i) the CORRA-based benchmark rate for such interest period plus 2.45% per annum plus the credit spread adjustment for the applicable interest period (29.547 basis points for one month interest period, 32.138 basis points for a three month interest period and 0 for a daily interest period), or (ii) RBC Prime rate plus 1.00% per annum. The facility has a three-year term from the date of the initial drawdown and requires interest-only payments until the first full quarter after the date of the initial drawdown. The loan will be amortized through quarterly principal repayments based on a 15-year amortization schedule, with the outstanding principal due in full at maturity. The specific borrowing terms are established at the time of each drawdown pursuant to a borrowing request submitted by WhiteFiber and accepted by the lender.
The Syndicated Credit Facility is secured by first-ranking security interests over substantially all present and future personal property and assets of the borrower and the guarantors, together with first-ranking mortgages on certain owned real estate, including WhiteFiber’s MTL-2 and MTL-3 properties and related improvements and equipment.
Borrowings
under the facility bear interest, at WhiteFiber’s option, at either Daily Simple CORRA plus 2.75% per annum or Royal Bank Prime
plus 1.00% per annum, with the prime-based rate serving as the default option.
The
facility has a six-month term from the date of drawdown and requires interest-only payments during the term, with the outstanding principal
due in full at maturity. The specific borrowing terms are established at the time of each drawdown pursuant to a borrowing request submitted
by WhiteFiber and accepted by the lender.
Additionally,
RBC is providing a CAD $8 million (approximately $5.8 million) revolving facility in the form of Letters of Credit and Letters of Guarantee.
The fees will be determined on a transaction-by-transaction basis, and the facility will be available for a 12-month term.
On July 15, 2026, WhiteFiber drew a CORRA loan amount of CAD $36.8 million (approximately $26.2 million) under the Syndicated Credit Facility Agreement.
As
of the reporting date, the April 27, 2026 bridge loan has been authorized and funded by RBC for the MTL-3 facility acquisition. WhiteFiber
and RBC are currently in discussions regarding new syndicated credit facilities, including i) a delayed draw term loan facility of CAD
$115 million (approximately $82.5 million), which includes the CAD $24.2 million (approximately $17.4 million) bridge loan ii) an accordion
facility of CAD $25 million (approximately $17.9 million) and iii) the CAD $8 million (approximately $5.7million) revolving facility.
In November 2025, WhiteFiber’s wholly owned
subsidiary, Enovum NC-1 Bidco, LLC, entered into the Services Agreement with Nscale Services US Inc. and Nscale Global Holdings Limited
(collectively, “Nscale”) for the provision of colocation and related services at its NC-1 facility. The agreement represents
a significant commercial milestone for the high-density data center platform and provides long-term contracted revenue visibility. The
initial Service Order pursuant to the Services Agreement represents approximately $865 million in total contracted revenue over a 10-year
term, inclusive of contractual annual rate escalators and non-recurring installation services (“NRCs”). Electricity and certain
other operating costs are structured as pass-through charges to Nscale. Billing is expected to commence during the secondthird quarter, subject
to completion of construction and commissioning. As a result, WhiteFiber expects full revenue contribution from this agreement to begin
during the third quarter of 2026 as the facility reaches its contractual capacity.
WhiteFiber is also developing a capital-light managed services offering through which customers would fund the underlying hardware while WhiteFiber deploys and operates it on their behalf. This offering has not yet generated material revenue.
Global Data Center Infrastructure and Partnerships
WhiteFiber
expects to leverage a global network of data centers for hosting capacity for its GPU business, in many instances, by negotiating with
third-party providers to seamlessly integrate its cloud services at strategically located data centerscenters. across key regions in Europe, North America and Asia.
WhiteFiber’s initial data center partnership through which it leases capacity is at Blönduós Campus, Iceland, offering
a world-class operations team with certified technicians and reliable engineers. The facility has a 45 kW rack density and 6 MW (gross)
total capacity. WhiteFiber has executed contracts for 5.5 MW IT load 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. In addition, WhiteFiber has leased additional
capacity to install our data center in Atlanta, Georgia, USA to expand its cloud services offering. The capacity leases commenced in
February 2026. WhiteFiber also intendintends to lease additional capacity to expand its cloud services offering. In July 2026, WhiteFiber entered into a lease for 2.5 MW IT load Tier 3 design data center space in Sydney, Australia to expand our cloud services offering. The lease is scheduled to commence in the fourth quarter of 2026.
In
April 2025, WhiteFiber received its first shipment of NVIDIA GB200 GraceNVL72 Blackwell Superchipsystem powered NVIDIA GB200 NVL72Grace systemBlackwell chips,
Superchips, from Quanta Cloud Technology, a leading provider of data center solutions. WhiteFiber believes that support with proof of concept (POC)
access from Quanta will enable it to meet and exceed expectations around delivery and timeline, performance and reliability.
Customer Base and Concentration
As of the date of this Form 10-Q, WhiteFiber has seven existing customers. Its largest customer accounted for approximately 63% of WhiteFiber’s revenue during the six months ended June 30, 2026. During the period WhiteFiber had discontinuation of three customer orders. The discontinued orders resulted in approximately $5.1M impact to revenue during the six months ended June 30, 2026. However, there were new customer orders contracted in the six months ended June 30, 2026 and through the date of this Form 10-Q for total contracted revenue of $635.8M over a six months to three-year period.
Discontinued customer agreements during the six months ended June 30, 2026 and through the date of this Form 10-Q include: (i) WhiteFiber’s Initial Customer, following execution of the Termination Agreement described below; (ii) a customer whose Master Services Agreement and related purchase order, as previously amended, was terminated in January 2026; and (iii) a customer whose service order, entered into in January 2026, was terminated during the period.
New customer agreements signed during the six months ended June 30, 2026 and through the date of this Form 10-Q include new service orders entered into with existing customers for additional GPU and CPU/storage capacity, as well as new service orders entered into with new customers, in each case as further described below.
Selected Customer Agreements
The following summaries reflect selected GPU cloud service agreements that were entered into or discontinued during the period, or that WhiteFiber otherwise considers to be material or representative. WhiteFiber has entered into additional agreements that are not individually material and are not included below.
In
January 2025, WhiteFiber entered into a new agreement to supply its Initial Customer with an additional 464 GPUs for a period of 18 months.
This new agreement replaces the prior agreement whereby WhiteFiber 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
elected to defer the commencement date until August 20, 2025, which is the latest allowable date under the agreement. Deployment commenced
on August 20, 2025, using WhiteFiber’s inventory of B200 GPUs.
In
October 2025, Bit Digital’s existing guaranty arrangement with the Initial Customer was scheduled to expire. Beginning in November
2025, the customer will provide a service deposit to WhiteFiber in lieu of the Bit Digital parent guaranty. The deposit will be funded
through fifteen consecutive monthly payments of approximately $0.24 million each, totaling $3.6 million, payable from November 2025 through
January 2027. The deposit will serve as security for the customer’s performance obligations under the amended service agreements.
Each monthly payment is expected to be invoiced on the first day of the month and paid within thirty days. WhiteFiber will be required
to return the deposit in cash upon termination or expiration of the service agreements, provided that all obligations have been fully
satisfied and no payment defaults or material breaches exist.
In the second quarter of 2026, WhiteFiber executed a termination agreement (the “Termination Agreement”) with the Initial Customer. The Termination Agreement preserved $12.5 million of previously invoiced, unpaid trade receivables. This preserved balance was fully collected as of June 30, 2026. Prepayment and service deposit balances were applied against other outstanding receivables and WhiteFiber recognized a bad debt expense of approximately $2.2 million for the unpreserved remaining receivable balance outstanding. Additionally, under the Termination Agreement the Initial Customer is obligated to pay WhiteFiber a fixed termination fee of $12.3 million that was recognized as revenue during the second quarter of 2026. Subsequently, after quarter-end, the termination fee was amended to $15.7 million. The amended amount of $15.7 million remains outstanding as of the date of this Form 10-Q. Following the service pause and termination of the agreement, WhiteFiber redeployed the GPUs previously allocated to the Initial Customer to other customers.
In November 2025, WhiteFiber terminated the MSA and all related purchase orders with DNA Fund in accordance with the terms of the contract. At the time of termination, we had approximately $7.3 million in outstanding accounts receivable. Pursuant to the termination agreement, the customer agreed to repay the outstanding balance. As of the date of this Form 10-Q, we have collected $2.2 million of the outstanding amount.
As
of the date of this Form 10-Q, WhiteFiber and the Initial Customer are engaged in discussions regarding a potential resolution of the
existing service agreements following the agreed pause of services. No definitive termination or settlement agreement has been executed.
In connection with these discussions, the parties are negotiating the treatment of the remaining non-refundable prepayment, service deposit,
outstanding receivables, and a potential early termination fee, which WhiteFiber believes would be equal to 40% of the fees that would
have accrued for services during the remainder of the term of the MSA and applicable purchase orders. Following the service pause, WhiteFiber
has redeployed the GPUs previously allocated to the Initial Customer to three other customers and continues to evaluate the related financial
and operational implications. There can be no assurance as to the timing, terms, or final outcome of these discussions.
On November 6, 2024, WhiteFiber 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$0.16 million for the term. The deployment commenced on November 7, 2024, using WhiteFiber’s
existing inventory of H200 GPUs. The service under the purchase order concluded in May 2025. Between May 2025 and September 2025, WhiteFiber
signed six additional agreements on a month-to-month basis for a total of 88 H200 GPUs, which were terminated in January 2026.
In
March 2026, WhiteFiber entered into another service order with the customer to provide services utilizing a total of 256 H100 GPU servers.
The service order has an initial term of 24 months beginning on the services commencement date, with an option to renew for an additional
twelve months. The service order represents an aggregate revenue opportunity of approximately $50.2 million. The deployment and revenue
generation is expected to beginbegan in Aprilthe second quarter of 2026.
On
December 30, 2024, WhiteFiber entered into a Master Services Agreement (“MSA”) with an AI Compute Fund managed by DNA Holdings
Venture Inc. (“DNA Fund”). The MSA had a minimum purchase commitment of 32 GPUs, along with an associated purchase order.
The purchase order provides for services utilizing a total of 576 H200 GPUs over a 25-month period and terminable by either party upon
at least 90 days’ written notice prior to any renewal date. Concurrently, WhiteFiber placed a purchase order for 130 H200 servers
for approximately $30 million. The deployment commenced in February 2025.
In
April 2025, WhiteFiber 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.
In
November 2025, WhiteFiber terminated the MSA and all related purchase orders with DNA Fund in accordance with the terms of the contract.
At the time of termination, WhiteFiber had approximately $7.3 million in outstanding accounts receivable. Pursuant to the termination
agreement, the customer agreed to repay the outstanding balance. As of the date of this Form 10-Q, WhiteFiber has collected $2.2 million
of the outstanding amount.
On
January 6, 2025, WhiteFiber 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 WhiteFiber’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, WhiteFiber 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 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
WhiteFiber’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, WhiteFiber 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
WhiteFiber’s existing inventory of H200 GPUs. In October 2025, the purchase order was amended to reduce the number of H200 GPUs
from 40 to 8 and to extend the term of service through May 2027. This contract was terminated in January 2026. Between April and July
2025, WhiteFiber signed four additional agreements on a month-to-month basis for a total of 184 H200 GPUs, which were terminated in August
2025.
In
March 2025, WhiteFiber 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
August and September 2025, WhiteFiber entered into three service orders with a new customer. Each order form provides for services utilizing
a total of 64 B200 GPUs on a weekly basis, which either party may terminate by not extending it with mutual written agreement. In September,
the customer renewed one order form for an additional week for services utilizing a total of 64 B200 GPUs. As of the reporting date,
no additional renewals have occurred.
In
September 2025, WhiteFiber entered into a service order with a new customer, which provides services utilizing a total of 16 B200 GPUs
on a monthly basis, automatically renewing for an additional one month period unless and until otherwise terminated upon at least seven
days’ prior written notice. The deployment commenced and revenue generation began on September 23, 2025. The agreement was not
renewed after the initial term.
In
October 2025, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 48 H200 GPUs. The
service order had an initial term of 36 months. The deployment commenced and revenue generation began on October 21, 2025. The contract
was terminated in December 2025.
In October 2025, WhiteFiber entered into a two-week
service order with a new customer to provide services utilizing a total of 72 B200 GPUs. In January 2026, WhiteFiber entered into an
additional two-week service order with this customer for 72 B200 GPUs. These contracts were terminated as of February 2026.
In
February April 2026, WhiteFiber entered into a furtheranother service order with thisthe customer to provide servicesCPU utilizingand astorage totalserver ofservices. 384 B200 GPUs.
ThisThe service order has an initial term of 24 months commencingbeginning on the serviceservices commencement date, after which it will automatically renew
for successive one-month periods unless terminated by either party.date. The service order represents an aggregate revenue opportunity of
approximately $18.1$0.8 million. DeploymentThe deployment and revenue generation commencedbegan onin Januarythe 27,second quarter of 2026.
On January 30, 2025, WhiteFiber 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 $0.8 million for the term. In October 2025, the purchase order was amended to reduce the number of H200 GPUs from 40 to 8 and to extend the term of service through May 2027. This contract was terminated in January 2026.
In
November 2025, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 128 B200 GPUs. The
service order has an initial term of 12 months, representing total contracted value of approximately $3.0 million, after which it automatically
renews for successive one-month periods unless terminated by either party. Deployment and revenue generation began on December 1, 2025.
In
February 2026, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 256 GPUs. The service
order has an initial term of 12 months beginning on the services commencement date, after which it automatically renews for successive
one-month periods unless terminated by either party. The deployment and revenue generation began on February 1, 2026.
In
March 2026,October 2025, WhiteFiber entered into a two-week service order with a new customer to provide services utilizing a total of 72 GB200B200 GPUs. TheIn January 2026, WhiteFiber entered into an additional two-week service
order with this customer for 72 B200 GPUs. These contracts were terminated as of February 2026. In January 2026, WhiteFiber entered into a further service order with this customer to provide services utilizing a total of 384 B200 GPUs. This service order has an initial term of 1224 months beginningcommencing on the servicesservice commencement date, after which it will automatically renewsrenew for successive
one-month periods unless terminated by either party. The deploymentservice order represents an aggregate revenue opportunity of approximately $18.1 million. Deployment and revenue generation begancommenced onin March 7,January 2026.
In
February 2026, WhiteFiber entered into a service order with a new customer to provide services utilizing a total of 80 H200256 GPUs. The
service order has an initial term of 12 months beginning on the services commencement date.date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began
on February 1, 2026.2026 which is expected to generate total revenues of $3.6 million.
In March 2026, WhiteFiber entered into a service order with a new customer, Prime Intellect, to provide services utilizing a total of 72 GB200 GPUs. The service order has an initial term of six months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation began on March 7, 2026 and will generate a total revenue of up to $1.0 million. Additionally, in April 2026, WhiteFiber entered into a service order with this customer to provide services utilizing a total of 216 GB200 GPUs. The service order has an initial term of 12 months beginning on the services commencement date, after which it automatically renews for successive one-month periods unless terminated by either party. The deployment and revenue generation is scheduled to begin in July 2026 generating total revenues of up to $6.8 million.
New Business Developments
In May 2026, WhiteFiber entered into a five-year agreement to provide AI compute infrastructure for an investment-grade technology customer in the Paris region utilizing advanced NVIDIA GPU systems, with total contract value in excess of $160 million. Service under this agreement, which was previously expected to commence in July 2026, is now expected to commence in September 2026, subject to final equipment delivery and acceptance milestones. WhiteFiber has secured third-party data center capacity in France to support the deployment and has entered into a binding term sheet for project-level financing with respect to this deployment (the “France Project Financing”). WhiteFiber is currently in the process of negotiating definitive documentation for the France Project Financing; however, certain material terms remain subject to ongoing negotiation between the parties. While WhiteFiber expects to finalize the France Project Financing in the near term, no definitive agreements have been entered into as of the date of this Quarterly Report, and no assurance can be given that WhiteFiber will enter into such financing on the timeline currently anticipated, on the terms contemplated by the binding term sheet, on other terms satisfactory to us, or at all. If consummated, the France Project Financing is expected to be incurred at a project-level subsidiary and would not be guaranteed by WhiteFiber, Inc. The project is expected to be supported by customer prepayments, including 12 months of advance service fees, and project-level financing, with limited long-term reliance on our corporate balance sheet and existing cash resources.
Also in May 2026, WhiteFiber entered into a two-year cloud services agreement with Hyperbolic Labs, Inc., with Modal Labs as the end customer and reference partner, to deploy H200 GPUs from our existing owned fleet, with total contract value of approximately $17 million. Revenue under this agreement commenced in June 2026. No incremental GPU capital expenditures were required for this deployment.
BTBT insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 0 filings. Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-31 | Tabar Samir |
Option exercise | 535,000 | $1.43 | $765.0K |
| 2026-08-31 | Huang Erke |
Option exercise | 535,000 | $1.43 | $765.0K |
| 2026-08-18 | Huang Erke |
Other | 200,000 | — | — |
| 2026-08-18 | Tabar Samir |
Other | 200,000 | — | — |
Well-known investors holding BTBT (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Millennium Management (Israel Englander) | 2026-06-30 | 9,160,871 | $16.5M | 0.01% | Added 221% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 7,886,233 | $14.2M | 0.01% | Reduced 20% |
| Renaissance Technologies | 2026-06-30 | 3,912,096 | $7.0M | 0.01% | Reduced 47% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 2,138,260 | $3.8M | 0.0% | Added 425% |
| Two Sigma Investments | 2026-06-30 | 1,074,489 | $1.9M | 0.0% | New position |
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 290,774 | $523.4K | 0.0% | Added 91% |
| D. E. Shaw & Co. | 2026-06-30 | 60,263 | $108.5K | 0.0% | Added 38% |