▸ Digital asset networks are open-source projects and, although there is an influential group of leaders in, for example, the Bitcoin network community known as the “Core Developers,” there is no official developer or group of· · ● 1 ▸ If bitcoin were determined to be a security, we could be subject to additional regulation, which could result in significant compliance costs and operational limitations.· · ● 1 ▸ Our AI and HPC business strategy may not perform as planned.· · ● 1 ▸ Our Strategic Agreement with Starwood subjects us to significant development, execution, financing and counterparty risks, and we may not realize the anticipated benefits of the transaction.· · ● 1 ▸ Our acquisition of Exaion exposes us to risks associated with international operations and the possibility of post-closing challenges to the transaction.· · ● 1 ▸ Our bitcoin holdings expose us to market volatility and liquidity risks.· · ● 1 ▸ Our bitcoin lending and other digital asset management activities expose us to credit, market, liquidity and operational risks, and a material portion of our bitcoin holdings is subject to these risks.· · ● 1 ▸ Our business expansion into the AI and HPC industry may be capital intensive and could affect our liquidity, results of operations and financial condition.· · ● 1 ▸ Our expansion into AI and HPC may divert resources from our core Bitcoin mining operations, limit our power capacity for mining, and introduce operational complexity.· · ● 1 ▸ group Risks Related to Regulatory, Political and Macroeconomic Conditions· · ● 1 ▸ State securities regulators may also take positions regarding the classification of digital assets under state law that differ from federal interpretations, which could subject us to additional regulatory requirements.· · ● 1 ▸ The markets in which we participate are highly competitive, and as we enter new markets, we are competing against companies with greater resources and capitalization.· · ● 1 ▸ A 51% attack on the Bitcoin network could undermine security and market confidence.· ● ● 2 ▸ Bitcoin network forks, where the blockchain splits into two separate networks, could cause disruptions and negatively impact our business.· ● ● 2 ▸ Changes in regulatory interpretations could require us to register as a money services business or money transmitter, leading to increased compliance costs or operational shutdowns.· ● ● 2 ▸ Changes in tax laws or IRS guidance regarding bitcoin’s classification could negatively impact our business and stockholders.· ● ● 2 ▸ Changing environmental regulations and public energy policies could increase our costs and threaten our Bitcoin mining, AI or HPC operations.· ● ● 2 rw ▸ Developing and protecting new inventions and intellectual property is costly, time-consuming and uncertain.· ● ● 2 ▸ Failure to increase our hashrate may reduce our competitiveness and negatively impact our financial performance.· ● ● 2 ▸ Geopolitical and economic crises could lead to increased uncertainty, large-scale selloffs of digital assets and a decline in bitcoin’s value, negatively impacting our business and stock price.· ● ● 2 ▸ Intellectual property disputes related to digital asset technology could threaten our ability to operate.· ● ● 2 ▸ Loss of access to our private keys or data could result in a permanent loss of our digital assets.· ● ● 2 ▸ Noise generated by our mining, AI and HPC operations poses regulatory, legal, operational and reputational risks.· ● ● 2 rw ▸ Operating in foreign jurisdictions exposes us to political, legal, and regulatory risks that could negatively impact our financial condition.· ● ● 2 ▸ Our interactions with the Bitcoin network may expose us to transactions with sanctioned individuals, leading to regulatory penalties and reputational harm.· ● ● 2 ▸ Our ongoing at-the-market stock issuances contribute to stockholder dilution.· ● ● 2 rw ▸ Our reliance on third-party mining pools for a portion of our mining revenue exposes us to operational and financial risks.· ● ● 2 ▸ Regulatory, commercial, and technical uncertainties may influence bitcoin prices.· ● ● 2 rw ▸ Significant disruptions in the cryptocurrency markets could materially impair the value of our mining rigs, and prolonged low bitcoin prices could force us to idle mining rigs.· ● ● 2 rw ▸ Targeted energy or property regulations and taxes could increase our costs and adversely affect our business.· ● ● 2 rw ▸ The classification of bitcoin as a commodity could subject us to additional CFTC regulation, resulting in significant compliance costs or the cessation of certain operations.· ● ● 2 ▸ The irreversibility of digital asset transactions exposes us to risks of theft, loss and human error, which could negatively impact our business.· ● ● 2 ▸ The issuance, conversion, or exercise of convertible notes and other convertible securities, options, and warrants will dilute our stockholders’ ownership.· ● ● 2 rw ▸ The lack of legal recourse and insurance for our digital assets increases the risk of total loss in the event of theft or destruction.· ● ● 2 ▸ The open-source structure of the Bitcoin network exposes us to risks related to software development, security vulnerabilities and potential disruptions.· ● ● 2 ▸ The rapidly evolving and uncertain regulatory landscape for cryptocurrencies exposes us to legal risks, compliance costs, and potential business disruptions.· ● ● 2 ▸ The scheduled reduction of Bitcoin mining rewards due to halving events may decrease our revenue and could force us to cease mining operations.· ● ● 2 ▸ Uncertainty in accounting standards for bitcoin and other cryptocurrencies may lead to financial restatements and business disruptions.· ● ● 2 ▸ We are highly dependent on the continued service of our executive team.· ● ● 2 ▸ We have engaged in, and may continue to engage in, strategic acquisitions and other transactions that could disrupt our business, dilute our stockholders, strain our financial resources and harm our operating results.· ● ● 2 ▸ We may experience liquidity constraints and need additional capital, which may not be available to us on favorable terms, or at all.· ● ● 2 ▸ Widespread delays in the recording of transactions could erode confidence in the Bitcoin network and negatively impact our business.· ● ● 2 ▸ High operating costs and the need for professionalized mining operations may lead to downward pressure on bitcoin prices.· ● · 1 ▸ If bitcoin is classified as a security, we may be subject to extensive regulation, which could result in significant costs or force us to cease certain operations.· ● · 1 ▸ Our HODL strategy exposes us to market volatility and liquidity risks.· ● · 1 ▸ Our bitcoin lending arrangements expose us to risks of borrower default, operational failures and cybersecurity threats.· ● · 1 ▸ Our increasing reliance on immersion-cooling technology exposes us to operational and regulatory risks.· ● · 1 ▸ Our reliance on third-party hosting providers for bitcoin mining operations exposes us to financial and operational risks.· ● · 1 ▸ The unregulated nature and lack of transparency of many bitcoin trading venues may expose us to fraud, security failures, and operational risks, potentially harming the value of our bitcoin holdings.· ● · 1 ▸ These risks, whether occurring individually or in combination, could negatively impact our financial performance and increase our exposure to regulatory investigations, litigation, and financial penalties.· ● · 1 ▸ Any of these, individually or in aggregate, could have a material adverse effect on our earnings, cash flows and financial condition.● · · 1 ▸ Because there has been limited precedent set for financial accounting of bitcoin and other cryptocurrency assets, the determination that we have made for how to account for cryptocurrency assets transactions may be subject to change.● · · 1 ▸ Changing environmental regulation and public energy policy may expose our business to new risks.● · · 1 ▸ Due to the unregulated nature and lack of transparency surrounding the operations of many bitcoin trading venues, they may experience fraud, security failures or operational problems, which may adversely affect the value of our bitcoin.● · · 1 ▸ Exercise or conversion of warrants and other convertible securities, along with new issuances of our common stock, will dilute our stockholder’s percentage of ownership.● · · 1 ▸ Fluctuations in the price of bitcoin may significantly influence the market price of our bitcoin holdings and therefore, the price of our common stock.● · · 1 ▸ Further significant disruptions in the crypto asset markets, such as those experienced in the second half of 2022, may cause further material impairment of the value and use of our mining rigs.● · · 1 ▸ If we fail to grow our hash rate, we may be unable to compete, and our results of operations could suffer.● · · 1 ▸ Intellectual property rights claims may adversely affect the operation of some or all digital asset networks.● · · 1 ▸ Our ability to adopt technology in response to changing security needs or trends and our reliance on, third-party custody providers, poses a challenge to the safekeeping of our digital assets.● · · 1 ▸ Our bitcoin holdings could subject us to regulatory scrutiny and potential restrictions on future transactions.● ● · 2 rw ▸ Our interactions with the bitcoin network may expose us to specially designated nationals (“SDN”) or blocked persons or cause us to violate provisions of law that did not contemplate distributed ledger technology.● · · 1 ▸ Our reliance on immersion-cooling exposes us to additional risks.● · · 1 ▸ Regulatory changes or actions may restrict the use of bitcoins or the operation of the Bitcoin network in a manner that adversely affects an investment in our securities.● · · 1 ▸ group Risks Related to Governmental Regulation and Enforcement● ● · 2 ▸ group Risks Related to Our Common Stock● · · 1 ▸ Security threats to our business could result in, a loss of our digital assets, or damage to our reputation and our brand, each of which could adversely affect an investment in our securities.● · · 1 ▸ The limited rights of legal recourse against us, and our lack of insurance protection expose us and our stockholders to the risk of loss of our digital assets for which no person is liable.● · · 1 ▸ The price of bitcoin may be influenced by regulatory, commercial, and technical factors that are highly uncertain.● · · 1 ▸ The sale of our digital assets to pay expenses at a time of low digital asset prices could adversely affect an investment in our securities.● · · 1 ▸ To the extent investors view the value of our common stock as linked to the value or change in the value of our bitcoin, fluctuations in the price of bitcoin may significantly influence the market price of our common stock.● · · 1 ▸ We are highly dependent on the continued services of our small team of executives.● · · 1 ▸ We have engaged in, and in the future may engage in, strategic acquisitions and other arrangements that could disrupt our business, cause dilution to our stockholders, reduce our financial resources and harm our operating results.● · · 1 ▸ We have never paid nor do we expect in the near future to pay cash dividends.● · · 1 ▸ We have unresolved Staff comments.● · · 1 ▸ We may have further restrictions on our liquidity due to unique risks which we could face in 2024.● · · 1 ▸ Bitcoin price volatility may affect our ability to effectively manage our growth plans and profitability.● ● ● 3 rw ▸ Increased scrutiny and changing expectations from stockholders with respect to our environmental, social and governance (“ESG”) practices and the impacts of climate change may result in additional costs or risks.● ● ● 3 ▸ Our future success depends on our ability to expand our organization to match the growth of our activities.● ● ● 3 ▸ Prolonged power and internet outages, shortages or capacity constraints could harm our business.● ● ● 3 rw ▸ group Risks Related to Our Business● ● ● 3 ▸ The sale or availability of a substantial number of shares of our common stock may negatively impact our stock price.● ● ● 3 rw ▸ Variability in intellectual property laws may adversely affect our intellectual property position.● ● ● 3 
