Fixed Assets, net

6 Months Ended

Jun. 30, 2024

Property, Plant and Equipment [Abstract]

Note 3. Fixed Assets, net

The components of fixed assets as of June 30, 2024 and December 31, 2023 are as follows:


	Useful Life (Years)	June 30, 2024			December 31, 2023
Mining machines	4	$	29,249,432		$	29,799,782
Real estate assets owned	30		80,057			80,057
Furniture, computer and office equipment	3-5		230,062			230,063
Gross fixed assets			29,559,551			30,109,902
Less: accumulated depreciation			(9,888,040	)		(5,590,292	)
Fixed assets, net		$	19,671,511		$	24,519,610

As of June 30, 2024 and December 31, 2023, there were approximately 5,900 miners located at various hosting sites. The Company’s depreciation expense recognized for the three and six months ended June 30, 2024 and 2023 was $2.3 million and $4.8 million, respectively for 2024 and was $1.2 million and $2.0 million, respectively for 2023.

In order to accommodate an expected incoming shipment of S21 mining machines in April 2024, management identified 365 mining machines at a Core hosting facility that would require relocation. As part of its impairment testing management considered the possible cashflows and probabilities associated with the relocation and continued use of 365 mining machines at a separate hosting facility location and the potential sale of such assets to a third-party. Based on the assessment performed, management concluded a sale was probable and an impairment of $1.2 million on the mining machines was recorded during the first quarter, which was calculated as the net carrying value of the 365 mining machines of $1.3 million less the expected sales price of $79 thousand. The loss was recorded on our Consolidated Statements of Operations as "Impairment loss on mining equipment" for the three and six months ended June 30, 2024 as nil and $1.2 million respectively.

On April 16, 2024, the 365 mining machines were sold to a third-party for $79 thousand. There was no additional loss recognized upon the asset sale.

There was no impairment loss recorded on fixed assets during the three and six months ended June 30, 2023.