DISCONTINUED OPERATIONS

12 Months Ended

Jun. 30, 2025

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

16. DISCONTINUED OPERATIONS

Through June 6, 2024, we operated our digital asset mining operations in a hosted facility in Granbury, Texas. As of June 7, 2024, all miners were disconnected from their power source and many were sold during the year ended June 30, 2025. This marked a strategic shift in the Company’s operations.

The following is a reconciliation of major classes of assets and liabilities classified as held for sale on our consolidated balance sheets:

	June 30,
	2025		2024
Major classes of assets included as held for sale
Prepaid expenses and other current assets	$	220	$	-
Deposits, current		-		578,147
Current assets held for sale		220		578,147
Property and equipment, net		72,719		1,343,453
Other assets held for sale		72,719		1,343,453
Total major classes of assets held for sale in the consolidated balance sheets	$	72,939	$	1,921,600
Major classes of liabilities included as discontinued operations
Accounts payable	$	-	$	843,543
Total major classes of liabilities held for sale in the consolidated balance sheets	$	-	$	843,543

The following is a reconciliation of major classes of revenue and expenses classified as discontinued operations on our consolidated income statements:

	During the Years Ended  June 30,
	2025			2024
Major classes of line items constituting net income (loss) from discontinued operations
Digital asset mining revenue	$	-		$	5,863,935
Cost of revenues – energy, hosting, and other		-			(3,930,336	)
Depreciation and amortization		(1,097,276	)		(2,835,225	)
Loss on disposition of property and equipment		-			(367,404	)
Impairment expense		(173,458	)		(1,101,542	)
Gain on settlement of payables		352,397
Gain on sale of property and equipment		88,780			-
Total major classes of line items constituting net income (loss) from discontinued operations	$	(829,557	)	$	(2,370,572	)

Digital Asset Mining - Revenue

To generate revenue from mining bitcoin, the Company had entered into a digital asset mining pool by executing a contract, as amended from time to time, with the mining pool operator to provide computing power to the mining pool. The contract was terminable at any time by either party without penalty and the Company’s enforceable right to compensation only began when the Company provided computing power to the mining pool operator. In exchange for providing computing power, we were entitled to a Full-Pay-Per-Share payout of Bitcoin based on a contractual formula, which primarily calculated the hash rate provided by us to the mining pool as a percentage of total network hash rate, and other inputs. We were entitled to consideration even if a block was not successfully placed by the mining pool operator. As of June 7, 2024, all miners were disconnected from their power source and many were sold during the year ended June 30, 2025.

Digital Asset Mining - Expenses

During the years ended June 30, 2025 and 2024, the Company discontinued the use of damaged or non-serviceable mining equipment and wrote off its net book value of $0 and $367,404, respectively, to loss on disposition of property and equipment.

During the year ended June 30, 2025 and 2024, we impaired mining equipment and recognized impairment expense of $103,410 and $1,101,542, respectively.

Digital Asset Mining - Gains

On February 7, 2025, the Company agreed to terminate its hosting and power purchase agreement. As a result, the hosting facility agreed to forgive $843,544 of payables and pay the Company $87,000 in exchange for the $578,147 deposit collected as part of the hosting and power purchase agreement. Accordingly, during the year ended June 30, 2025, the Company recognized a $352,397 gain on settlement of payables. The hosting facility further released the Company’s miners.

During the years ended June 30, 2025 and 2024, we recognized a $88,780 and $0 gain, respectively, on the sale of property and equipment for the sale of 304 miners.