MARA Marathon Digital Holdings Inc

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Marathon Digital Holdings, Inc. (together with its subsidiaries, the “Company” or “MARA”) is a global leader in digital asset compute that develops and deploys innovative technologies to build a more sustainable and inclusive future. MARA secures the world’s preeminent blockchain ledger (i.e., Bitcoin) and supports the energy transformation by converting stranded, or otherwise underutilized energy into economic value. The Company also offers advanced technology solutions to optimize data center operations, including next-generation liquid immersion cooling and firmware for bitcoin miners. The Company is primarily focused on computing for and holding digital assets as a long-term investment. Bitcoin is seeing increasing adoption, and due to its limited supply, the Company believes it offers opportunity for appreciation in value and long-term growth prospects for its business.

The term “Bitcoin” with a capital “B” is used to denote the Bitcoin protocol which implements a highly available, public, permanent, and decentralized ledger. The term “bitcoin” with a lower case “b” is used to denote the token, bitcoin.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned and controlled subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. The Company has prepared the Condensed Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States (“GAAP”) and regulations of the U.S. Securities and Exchange Commission (the “SEC”) applicable to interim financial information, which permit the omission of certain information to the extent it has not changed materially since the latest annual financial statements. These Condensed Consolidated Financial Statements reflect all adjustments consisting only of normal recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any future fiscal periods in 2024 or for the full year ending December 31, 2024.

These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 28, 2024, as amended by Amendment No. 1 on Form 10-K/A (the “Annual Report”), filed with the SEC on May 24, 2024.

Use of Estimates and Assumptions

 

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant accounting estimates inherent in the preparation of the Company’s financial statements include fair value of assets acquired and liabilities assumed in a business combination, estimates associated with the useful lives of property and equipment, realization of long-lived assets, valuation of derivative instruments, deferred income taxes, unrealized tax positions, and measurement of digital assets. Actual results could differ from those estimates.

Cash and Cash Equivalents

 

The Company considers all highly liquid investments and other short-term investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company maintains cash and cash equivalent balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”). During March 2023, the Company began to participate, to the extent practicable, in insured cash sweep programs which “sweep” its deposits across multiple FDIC insured accounts, each with deposits of no more than $250.0 thousand. As of June 30, 2024, substantially all of the Company’s cash and cash equivalents were FDIC insured.

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Restricted Cash

 

Restricted cash as of June 30, 2024 principally represented those cash balances that support commercial letters of credit and are restricted from withdrawal.

Digital Assets

 

On July 25, 2024, the Company adopted a full holding onto bitcoin (“HODL”) approach towards its bitcoin treasury policy, retaining all bitcoin mined in its operations, and may periodically make strategic open market purchases. As a result, bitcoin digital assets are included in non-current assets in the Condensed Consolidated Balance Sheets due to the Company’s recent intent to retain and hold bitcoin. Kaspa digital assets held with the intent to fund operating expenses are included in current assets on the Condensed Consolidated Balance Sheets. Proceeds from the sale of digital assets are included within investing activities in the accompanying Condensed Consolidated Statement of Cash Flows. Following the adoption of Accounting Standards Update (“ASU”) 2023-08, Accounting for and Disclosure of Crypto Assets, effective January 1, 2023, the Company measures digital assets at fair value with changes recognized in operating expenses in the Condensed Consolidated Statements of Operations. The Company tracks its cost basis of digital assets by-wallet in accordance with the first-in-first-out method of accounting. Refer to Note 5 – Digital Assets, for further information.

Accounts Receivable

 

The Company acquired accounts receivable as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, which consist of trade receivables. Refer to Note 3 - Acquisitions, for further information. The Company provides an allowance for doubtful accounts equal to the estimated uncollectible amounts, based on historical and customer specific experience and current economic and market conditions. The allowance for doubtful accounts was $12.1 million as of June 30, 2024.

Deposits

 

In addition to owned and operated sites, the Company contracts with other service providers for hosting of its equipment and operational support in data centers where the Company’s equipment is deployed. These arrangements typically require advance payments to vendors pursuant to the contractual obligations associated with these services. The Company classifies these payments as “Deposits” or “Long-term deposits” in the Condensed Consolidated Balance Sheets.

Derivatives

The Company enters into derivative contracts to manage its exposure to fluctuations in the price of bitcoin and energy costs and not for any other purpose. In addition, the Company evaluates its financing and service arrangements to determine whether certain arrangements contain features that qualify as embedded derivatives requiring bifurcation in accordance with Accounting Standard Codification (“ASC”) 815 - Derivatives and Hedging. Embedded derivatives that are required to be bifurcated from the host instrument or arrangement are accounted for and valued as separate financial instruments. There were no embedded derivatives requiring separation from the host instrument as of June 30, 2024 and December 31, 2023.

The Company does not elect to designate derivatives as hedges for accounting purposes and as such, records derivatives at fair value with subsequent changes in fair value and settlements recognized in earnings. The Company classifies derivative assets or liabilities in the Condensed Consolidated Balance Sheets as current or non-current based on whether settlement of the instrument could be required within 12 months of the balance sheet date of the Balance Sheets and for derivatives with multiple settlements, based on the term of the contract.

Bitcoin Derivatives

From time to time the Company enters into derivative contracts to mitigate bitcoin market pricing volatility risk. During the six months ended June 30, 2024, the Company recorded a $2.3 million loss on derivatives as a non-operating charge in the Condensed Consolidated Statements of Operations, all settled through cash payments. There were no derivative instruments outstanding as of June 30, 2024 and December 31, 2023.

Energy Derivatives

The Company acquired a commodity swap contract as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, refer to Note 3 - Acquisitions, for further information. The commodity swap contract hedges price variability in electricity purchases and expires on December 31, 2027. The commodity swap contract meets the definition of a derivative due to terms that provide for net settlement. As of June 30, 2024, the estimated

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fair value of the Company’s derivative instrument was $34.0 million, estimated using observable market-based inputs classified under Level 2 of the fair value hierarchy. The significant assumptions used in the discounted cash flow model to estimate fair value include the discount rate and electricity forward curves. Accordingly, the Company records the change in fair value of derivative on the Condensed Consolidated Statements of Operations.

The following table presents the changes in fair value of the derivative instrument:

(in thousands)
Balance at December 31, 2023						$	—
Commodity swap contract						10,989
Change in fair value of derivative						22,999
Balance at June 30, 2024						$	33,988

Property and Equipment

 

Property and equipment are stated at cost, net of accumulated depreciation and impairment, as applicable. Property and equipment acquired through business combinations are measured at fair value at the acquisition date. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The Company’s property and equipment is primarily composed of digital asset mining rigs, which are largely homogeneous and have approximately the same useful lives. Accordingly, the Company utilizes the group method of depreciation for its digital asset mining rigs. The Company will update the estimated useful lives of its digital asset mining server group periodically if information on the operations of the mining equipment indicates changes are required. The Company will assess and adjust the estimated useful lives of its mining equipment when there are indicators that the productivity of the mining assets is longer or shorter than the assigned estimated useful lives.

 

Goodwill

Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not subject to amortization, and instead, assessed for impairment annually at the end of each fiscal year, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount in accordance with ASC 350 - Intangibles - Goodwill and Other.

The Company has the option to first assess qualitative factors to determine whether events or circumstances indicate it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, in which case a quantitative impairment test is not required.

As provided for by ASU 2017-04, Simplifying the Test for Goodwill Impairment, the quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting unit. Income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit are considered when measuring the goodwill impairment loss, if applicable.

Finite-Lived Intangible Assets

Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition date.

Intangible assets with finite lives are comprised of customer relationships and intellectual property and are amortized over their estimated useful lives on an accelerated basis over the projected pattern of economic benefits. Finite-lived intangible assets are reviewed for impairment annually, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value has been reduced to less than its carrying amount.

Business Combinations

The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - Business Combinations, by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair value. The determination of fair value involves assumptions, estimates and judgments. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date). Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets

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acquired. Contingent consideration is included within the purchase price and is initially recognized at fair value as of the acquisition date. Contingent consideration, classified as either an asset or a liability, is remeasured to fair value each reporting period, until the contingency is resolved. Changes in contingent consideration period-over-period are recognized in earnings.

Acquisition related expenses are recognized separately from the business combination and are expensed as incurred.

Investments

 

Investments, which may be made from time to time for strategic reasons, are included in non-current assets in the Condensed Consolidated Balance Sheets. Investments without a readily determinable fair value are recorded at cost minus impairment, plus or minus changes from observable price changes in orderly transactions for identical or similar investments of the same issuer, in accordance with the measurement alternative described in ASC 321 - Investments – Equity Securities.

As part of the Company’s policy to maximize return on strategic investment opportunities, while preserving capital and limiting downside risk, the Company may at times enter into equity investments or Simple Agreements for Future Equity (“SAFE”). The nature and timing of the Company’s investments will depend on available capital at any particular time and the investment opportunities identified and available to the Company. However, the Company generally does not make investments for speculative purposes and does not intend to engage in the business of making investments.

During the three months ended June 30, 2024, the Company entered into a second SAFE agreement. As of June 30, 2024, the Company had two SAFE investments with a carrying value of $1.3 million, with no noted impairments or other adjustments. As of December 31, 2023, the Company had one SAFE investment with a carrying value of $1.0 million, with no impairments or other adjustments.

On January 10, 2024, the Company purchased additional shares of Auradine, Inc. (“Auradine”) preferred stock with a purchase price of $8.0 million, bringing the total carrying amount of its investment in Auradine preferred stock to $48.7 million. The preferred stock purchased on January 10, 2024 was similar to the Company’s other investments in Auradine preferred stock and, as a result, the Company recorded $5.2 million to “Gain on investments” in the Condensed Consolidated Statements of Operations to adjust the carrying amount of its investments to an observable price in accordance with the measurement alternative in ASC 321.

Equity Method Investments

The Company accounts for investments in which it owns between 20% and 50% of the common stock or has the ability to exercise significant influence, but not control, over the investee using the equity method of accounting in accordance with ASC 323 - Equity Method Investments and Joint Ventures. Under the equity method, an investor initially records an investment in the stock of an investee at cost and adjusts the carrying amount of the investment to recognize the investor’s share of the earnings or losses of the investee after the date of acquisition.

On January 27, 2023, the Company and Zero Two (formerly known as FS Innovation, LLC) entered into a Shareholders’ Agreement regarding the formation of an Abu Dhabi Global Markets company (the “ADGM Entity”) in which the Company has a 20% ownership interest, which is accounted for as an equity method investment. The ADGM Entity started mining operations during September 2023. During the six months ended June 30, 2024, the Company received a non-monetary dividend in the amount of $4.4 million associated with approximately 1,950 mining rigs distributed by Zero Two. The Company recorded the mining rigs to property and equipment at fair value and, accordingly, recognized an impairment of $4.1 million that reduced the Company’s investment in the ADGM Entity, for the six months ended June 30, 2024. The Company’s share of net gain was nearly zero and $1.3 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2024, the Company’s investment in the ADGM Entity was $65.4 million and is reflected in “Investments” in the Condensed Consolidated Balance Sheets.

Stock-based Compensation

 

The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant date fair value of the awards. Refer to Note 11 – Stockholders' Equity, for further information.

 

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Impairment of Long-lived Assets

 

Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.

 

Revenues

 

The Company recognizes revenue under ASC 606 – Revenue from Contracts with Customers. The core principle of the revenue standard is that a reporting entity should recognize revenues to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Refer to Note 4 – Revenues, for further information.

Research and Development

Research and development costs consist primarily of contractor costs, equipment, supplies, personnel, and related expenses for research and development activities. Research and development costs are expensed as incurred in accordance with ASC 730 - Research and Development and are included in operating expenses in the Condensed Consolidated Statements of Operations. Research and development costs were $3.8 million and $6.3 million for the three and six months ended June 30, 2024, respectively, and $0.7 million and $0.9 million for the three and six months ended June 30, 2023, respectively.

Income Taxes

 

Effective Tax Rate

The effective tax rate (“ETR”) from continuing operations was 13.69% and 4.44% for the three and six months ended June 30, 2024, respectively, and 2.32% and 0.25% for the three and six months ended June 30, 2023, respectively. The difference between the U.S. statutory tax rate of 21% was primarily due to the change in valuation allowance as a result of current year activity.

During the six months ended June 30, 2024, the Company concluded, based upon all available evidence, that it was more likely than not that it would have sufficient future taxable income to realize the Company’s federal and state deferred tax assets. As a result, the Company released its valuation allowance associated with deferred tax assets and recognized a corresponding benefit from income taxes in the Condensed Consolidated Statements of Operations. The Company’s conclusion regarding the realizability of such deferred tax assets was based on the scheduled reversal of deferred tax liabilities. The foregoing items cause the ETR to be significantly different compared to the Company’s historical annual ETR.

Income Tax in Interim Periods

The Company records its tax expense or benefit on an interim basis using an estimated annual effective tax rate. This rate is applied to the current period ordinary income or loss to determine the income tax provision or benefit allocated to the interim period. The income tax effects of unusual or infrequent items are excluded from the estimated annual effective tax rate and are recognized in the impacted interim period.

Adjustments to the estimated annual effective income tax rate are recognized in the period when such estimates are revised.

Uncertainties

The Company files federal and state income tax returns. The 2020-2023 tax years generally remain subject to examination by the Internal Revenue Service and various state taxing authorities, although the Company is not currently under examination in any jurisdiction.

The Company does not currently expect any of its remaining unrecognized tax benefits to be recognized in the next twelve months.

Recent Accounting Pronouncements

 

The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement may affect the Company’s financial reporting, the Company

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undertakes an analysis to determine any required changes to its Condensed Consolidated Financial Statements and assures that there are proper controls in place to ascertain that the Company’s Condensed Consolidated Financial Statements properly reflect the change.

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires entities to disclose specific rate reconciliations, amount of income taxes separated by federal and individual jurisdiction, and the amount of income (loss) from continuing operations before income tax expense (benefit) disaggregated between federal, state, and foreign. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.

In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 is designed to improve the reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the CODM. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.

APLD - Rattlesnake Den I, LLC Acquisition (Garden City, Texas)

On April 1, 2024, the Company acquired an operational bitcoin mining site located in Garden City, Texas with 132 megawatts of operational capacity and 200 megawatts of nameplate capacity from Applied Digital Corporation (“APLD”) - Rattlesnake Den I, LLC (the “Garden City Acquisition”) for total cash consideration of $96.8 million, including working capital adjustments that were paid during the three months ended June 30, 2024. The acquisition is intended to improve efficiencies and the scale of operations through the integration of the Company’s technology stack and realization of synergies.

The following table summarizes the components of total purchase consideration:

(in thousands)						April 1, 2024
Initial cash consideration, net of cash acquired						$	92,025
Working capital adjustment						4,748
Total purchase consideration						$	96,773

The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805 - Business Combinations.

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The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of April 1, 2024:

(in thousands)						April 1, 2024
Assets
Other current assets						4,644
Property and equipment						78,759
Finance lease right-of-use asset						4,040
Goodwill						14,510
Total assets						$	101,953
Liabilities
Finance lease liability						5,180
Total liabilities						5,180
Total purchase consideration						$	96,773

Goodwill is calculated as the excess of the purchase price over the net assets acquired. The Company expects the goodwill balance to be deductible for tax purposes over a period of 15 years. Goodwill is primarily attributed to growth and efficiency opportunities as well as expected synergies from combining the operations of bitcoin mining sites with the Company.

The fair value of property and equipment was estimated by applying the cost approach, which estimates fair value using replacement or reproduction cost of an asset of comparable utility, adjusted for loss in value due to depreciation and economic obsolescence. The fair value of the finance lease liability was estimated using a discounted cash flow approach, which included assumptions regarding current market prices for similar assets, estimated term and discount rates.

GC Data Center Equity Holdings, LLC Acquisition (Granbury, Texas and Kearney, Nebraska)

On January 12, 2024, the Company acquired two operational bitcoin mining sites located in Granbury, Texas and Kearney, Nebraska, totaling 390 megawatts of operational capacity from GC Data Center Equity Holdings, LLC for total consideration of $189.6 million, including a working capital adjustment that was paid during the three months ended March 31, 2024, plus up to an additional $19.6 million of cash, which amount is contingent on the expansion of additional megawatt capacity at the acquired facilities by certain milestone dates during the three year period following the anniversary of closing. The acquisition is intended to improve efficiencies and the scale of operations through the integration of the Company’s technology stack and realization of synergies.

The Company will not be taking on any new hosting services customers and will transition to self-mining at these two sites as existing customer agreements expire or are terminated early.

The following table summarizes the components of total purchase consideration:

(in thousands)						January 12, 2024
Initial cash consideration, net of cash acquired						$	175,734
Working capital adjustments						8,081
Estimate fair value contingent earn-out and other						5,832
Total purchase consideration						$	189,647

The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805 - Business Combinations.

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The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of January 12, 2024:

(in thousands)						January 12, 2024
Assets
Accounts receivable						$	20,411
Other current assets						8,506
Property and equipment						132,148
Right-of-use asset						8,852
Goodwill						30,852
Customer relationships						22,000
Derivative instrument						10,989
Other non-current assets						6,250
Total assets						$	240,008
Liabilities
Accounts payable and accrued expenses						$	13,940
Lease liability						13,992
Other long-term liabilities						22,429
Total liabilities						50,361
Total purchase consideration						$	189,647

Goodwill is calculated as the excess of the purchase price over the net assets acquired. The Company expects the goodwill balance to be deductible for tax purposes over a period of 15 years. Goodwill is primarily attributed to growth and efficiency opportunities as well as expected synergies from combining the operations of bitcoin mining sites with the Company.

The gross contractual amounts receivable were $24.0 million, of which, $3.6 million is expected to be uncollectible.

The fair value of property and equipment was estimated by applying the cost approach, which estimates fair value using replacement or reproduction cost of an asset of comparable utility, adjusted for loss in value due to depreciation and economic obsolescence. The fair value of the derivative was estimated using a discounted cash flow approach that considers various assumptions including current market prices and electricity forward curves, time value, as well as other relevant economic measures. The fair value of the contingent earn-out was estimated using a discounted cash flow approach, which included assumptions regarding the probability-weighted cash flows of achieving certain capacity development milestones, which are considered Level 3 inputs. The fair value of the lease liability was estimated using a discounted cash flow approach, which included assumptions regarding current market prices for similar assets, estimated term and discount rates. Changes to the fair value of assets and liabilities are recorded in the Condensed Consolidated Statements of Operations.

The following table presents the changes in estimated fair value of the GC Data Center Holdings, LLC contingent consideration liability:

(in thousands)
Balance at December 31, 2023						$	—
Contingent consideration liability						3,523
Change in fair value of contingent earn-out						(90)
Balance at June 30, 2024						$	3,433

Intangible assets were determined to meet the criterion for recognition apart from tangible assets acquired and liabilities assumed. The fair values of intangible assets were estimated based on various valuation techniques including the use of discounted cash flow analyses, and multi-period excess earnings valuation approaches, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. These valuation inputs

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included estimates and assumptions about forecasted future cash flows, long-term revenue growth rates, and discount rates. The fair value of the customer relationships intangible asset was determined using a discounted cash flow model that incorporates the excess earnings method and will be amortized on an accelerated basis over the projected pattern of economic benefits of approximately 4 years. The Company recognized $2.8 million in expense during the three months ended March 31, 2024 for the amortization of these acquired customer relationships.

The results of acquired facilities have been included from the acquisition date. Included in the Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 was revenues of $20.8 million and net loss before tax of $42.5 million, which includes depreciation in the amount of $5.3 million.

The following table presents unaudited consolidated pro forma results as if the acquisitions of the acquired facilities of the Garden City Acquisition and GC Data Center Equity Holdings had occurred as of January 1, 2023 for the indicated periods:

						Three Months Ended June 30,												Six Months Ended June 30,
(in thousands)						2024						2023						2024						2023
Revenue						$	145,139					$	111,722					$	313,430					$	183,029
Income (loss) before income taxes						(233,247)						19,812						151,610						79,811
Earnings per common share:
Basic						$	(0.72)					$	0.12					$	0.54					$	0.49
Diluted						(0.72)						0.12						0.52						0.50

The unaudited pro forma financial information reflects the acquisition of the acquired facilities by the application of pro forma adjustments to the Company’s historical financial statements as if the acquisition had occurred on January 1, 2023. The unaudited pro forma financial information should not be considered indicative of actual results that would have been achieved had the acquisition of the acquired facilities actually been consummated on the date indicated and does not purport to be indicative of the Company's future financial position or results of operations. These pro forma results include the impact of amortizing certain purchase accounting adjustments such as intangible assets and the impact of the acquisition on interest and income tax expense. No adjustments have been reflected in the pro forma financial information for anticipated growth and efficiency opportunities. There were no material nonrecurring pro forma adjustments directly attributable to the acquisition included within the unaudited pro forma financial information.

The Company recognizes revenue in accordance with ASC 606. The core principle of the revenue standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle:

 

•Step 1: Identify the contract with the customer;

•Step 2: Identify the performance obligations in the contract;

•Step 3: Determine the transaction price;

•Step 4: Allocate the transaction price to the performance obligations in the contract; and

•Step 5: Recognize revenue when the Company satisfies a performance obligation.

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In order to identify the performance obligations in a contract with a customer, an entity must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met:

•The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and

•The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract).

If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct.

The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following:

•Variable consideration

•Constraining estimates of variable consideration

•The existence of a significant financing component in the contract

•Noncash consideration

•Consideration payable to a customer

Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized under the accounting contract will not occur when the uncertainty associated with the variable consideration is subsequently resolved.

The transaction price is allocated to each performance obligation on a relative standalone selling price basis.

The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time, as appropriate.

Application of the Five-Step Model to the Company’s Mining and Hosting Operations

The Company’s ongoing major or central operation is to provide bitcoin transaction verification services to the transaction requestor, in addition to the Bitcoin network through a Company-operated mining pool as the operator (“Operator”) (such activity, “mining”) and to provide a service of performing hash calculations to third-party pool operators alongside collectives of third-party bitcoin miners (such collectives, “mining pools”) as a participant (“Participant”). On January 12, 2024, the Company acquired two operational bitcoin mining sites to provide hosting services to institutional-scale crypto mining companies for the purpose of improving efficiencies and the scale of the Company’s mining operations. Refer to Note 3 - Acquisitions, for further information.

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The following table presents the Company’s revenues disaggregated for those arrangements in which the Company is the Operator and Participant:

						Three Months Ended June 30,												Six Months Ended June 30,
(in thousands)						2024						2023						2024						2023
Revenues from contracts with customers
Mining operator - transaction fees						$	4,923					$	6,358					$	13,907					$	7,409
Mining participant						12,839						3,185						26,281						21,061
Hosting services (1)						8,661						—						29,436						—
Total revenues from contracts with customers						26,423						9,543						69,624						28,470
Mining operator - block rewards and other revenue						118,716						72,216						240,713						104,421
Total revenues						$	145,139					$	81,759					$	310,337					$	132,891

(1) Includes revenue beginning January 12, 2024, the date of the GC Data Center Equity Holdings, LLC acquisition. The Company made a strategic decision to exit hosting services business upon acquisition. Intercompany transactions have been eliminated in consolidation. Refer to Note 3 - Acquisitions, for further information.

Mining Operator

As Operator, the Company provides transaction verification services to the transaction requestor, in addition to the Bitcoin network. Transaction verification services are an output of the Company’s ordinary activities; therefore, the Company views the transaction requestor as a customer and recognizes the transaction fees as revenue from contracts with customers under ASC 606. The Bitcoin network is not an entity such that it may not meet the definition of a customer; however, the Company has concluded that it is appropriate to apply ASC 606 by analogy to block rewards earned from the Bitcoin network. The Company is currently entitled to the block reward of 3.125 bitcoin, subsequent to the halving that occurred on April 19, 2024. Prior to the halving, The Company was entitled to the block reward of 6.25 bitcoin from each successful validation of a block. The Company is also entitled to the transaction fees paid by the transaction requester payable in bitcoin for each successful validation of a block. The Company assessed the following factors in the determination of the inception and duration of each individual contract to validate a block and satisfaction of its performance obligation as follows:

•For each individual contract, the parties’ rights, the transaction price, and the payment terms are fixed and known as of the inception of each individual contract.

•The transaction requestor and the Bitcoin network each have a unilateral enforceable right to terminate their respective contracts at any time without penalty.

•For each of these respective contracts, contract inception and completion occur simultaneously upon block validation; that is, the contract begins upon, and the duration of the contract does not extend beyond, the validation of an individual blockchain transaction; and each respective contract contains a single performance obligation to perform a transaction validation service and this performance obligation is satisfied at the point-in-time when a block is successfully validated.

From September 2021 until May 2022, the Company engaged unrelated third-party mining enterprises (“pool participants”) to contribute hash calculations, and in exchange, remitted transaction fees and block rewards to pool participants on a pro rata basis according to each respective pool participant’s contributed hash calculations. The MaraPool wallet (owned by the Company as Operator) is recorded on the distributed ledger as the winner of proof of work block rewards and assignee of all validations and, therefore, the transaction verifier of record. The pool participants entered into contracts with the Company as Operator; they did not directly enter into contracts with the network or the requester and were not known verifiers of the transactions assigned to the pool. As Operator, the Company delegated mining work to the pool participants utilizing software that algorithmically assigned work to each individual miner. By virtue of its selection and operation of the software, the Company as Operator controlled delegation of work to the pool participants. This indicated that the Company directed the mining pool participants to contribute their hash calculations to solve in areas that the Company designated. Therefore, the Company determined that it controlled the service of providing transaction verification services to the network and requester. Accordingly, the Company recorded all of the transaction fees and block rewards earned from transactions assigned to MaraPool as revenue, and the portion of the transaction fees and block rewards remitted to MaraPool participants as cost of revenues.

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In accordance with ASC 606-10-32-21, the Company measures the estimated fair value of the non-cash consideration (block reward and transaction fees) at contract inception, which is at the time the performance obligation to the requester and the network is fulfilled by successfully validating a block. The Company measures the non-cash consideration which is fixed as of the inception of each individual contract using the quoted spot rate for bitcoin determined using the Company’s primary trading platform for bitcoin at the time the Company successfully validates a block.

Expenses associated with providing bitcoin transaction verification services, such as hosting fees, electricity costs, and related fees are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues.

Mining Participant

The Company participates in third-party operated mining pools. When the Company is a Participant in a third-party operated mining pool, the Company provides a service to perform hash calculations to the third-party pool operators. The Company considers the third-party mining pool operators to be its customers under Topic 606. Contract inception and the Company’s enforceable right to consideration begins when the Company commences providing hash calculation services to the mining pool operators. Each party to the contract has the unilateral right to terminate the contract at any time without any compensation to the other party for such termination. As such, the duration of a contract is less than a day and may be continuously renewed multiple times throughout the day. The implied renewal option is not a material right because there are no upfront or incremental fees in the initial contract and the terms, conditions, and compensation amount for the renewal options are at the then market rates.

The Company is entitled to non-cash compensation based on the pool operator’s payout model. The payout methodologies differ depending on the type of third-party operated mining pool. Full-Pay-Per-Share (“FPPS”) pools pay block rewards and transaction fees, less mining pool fees and Pay-Per-Share (“PPS”) pools pay block rewards less mining pool fees but no transaction fees. For FPPS and PPS pools, the Company is entitled to non-cash consideration even if a block is not successfully validated by the mining pool operators. Success-based mining pools pay a fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses only if a block is successfully validated.

During 2023, the Company primarily participated in FPPS mining pools and, to a lesser extent, success-based mining pools. During 2022 and 2021, the Company primarily participated in success-based mining pools and, to a lesser extent, PPS mining pools.

FPPS Mining Pools

The Company primarily participates in mining pools that use the FPPS payout method for the year ended December 31, 2023. The Company is entitled to compensation once it begins to perform hash calculations for the pool operator in accordance with the operator’s specifications over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on a daily basis. The non-cash consideration that the Company is entitled to for providing hash calculations to the pool operator under the FPPS payout method is made up of block rewards and transaction fees less pool operator expenses determined as follows:

•The non-cash consideration in the form of a block reward is based on the total blocks expected to be generated on the Bitcoin network for the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: the daily hash calculations that the Company provided to the pool operator as a percent of the Bitcoin network’s implied hash calculations as determined by the network difficulty, multiplied by the total Bitcoin network block rewards expected to be generated for the same daily period.

•The non-cash consideration in the form of transaction fees paid by transaction requestors is based on the share of total actual fees paid over the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: total actual transaction fees generated on the Bitcoin network during the 24-hour period as a percent of total block rewards the Bitcoin network actually generated during the same 24-hour period, multiplied by the block rewards the Company earned for the same 24-hour period noted above.

•The block reward and transaction fees earned by the Company is reduced by mining pool fees charged by the operator for operating the pool based on a rate schedule per the mining pool contract. The mining pool fee is only incurred to the extent the Company performs hash calculations and generates revenue in accordance with the pool operator’s payout formula during the same 24-hour period beginning midnight UTC daily.

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The above non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7, since the amount of block reward earned depends on the amount of hash calculations the Company performs; the amount of transaction fees the Company is entitled to depends on the actual Bitcoin network transaction fees over the same 24-hour period; and the operator fees for the same 24-hour period are variable since they are determined based on the total block rewards and transaction fees in accordance with the pool operator’s agreement. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty without the risk of significant revenue reversal. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception.

The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception.

PPS Mining Pools

The Company participates in PPS pools that provide non-cash consideration similar to the FPPS pools except PPS pools do not include transaction fees, therefore, the non-cash consideration received by the Company is made up of block rewards less mining pool fees. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception.

The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception.

Success-based Mining Pools

The Company also participates, to a lesser extent, in third-party mining pools that pay rewards only when the pool successfully validates a block. For these pools, the Company only earns a reward when the third-party pool successfully mines a block and its reward is the fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses, based on the proportion of hash calculations the Company performed for the mining pool operator to the total hash calculations performed by all mining pool participants in validating the block during the 24-hour period beginning at midnight UTC and ending 23:59:59 UTC daily.

Contract inception and the Company’s enforceable right to consideration begins when the Company commences the performance of hash calculations for the mining pool operator. The non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7 as it depends on whether the third-party mining pool successfully validates a block during each 24-hour period. In addition, other inputs such as the amount of hash calculations and the Company’s fractional share of consideration earned by the pool operator also cause variability. The Company does not have the ability to estimate whether a block will be successfully validated with reasonable certainty at contract inception. The Company constrains the variable consideration at contract inception because it is not probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved. Once a block is successfully validated, the constraint is lifted. The Company recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception.

The Company’s policy was to measure non-cash consideration based on the spot rate of bitcoin at the time the pool successfully validates a block, which was not in accordance with ASC 606-10-32-21 which requires measurement to coincide with contract inception. Additionally, this measurement was not consistent with the measurement of non-cash consideration for FPPS and PPS pools. During the three months ended December 31, 2023, the Company corrected this error and changed its measurement of non-cash consideration to the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin on the date of contract inception, which is the same day that control of the contracted service (hash calculations) is transferred to the pool operator. The change in measurement did not have a material impact to the results of operations for any of the periods presented.

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Expenses associated with providing hash calculation services to third-party operated mining pools, such as hosting fees, electricity costs, and related fees, are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues.

Hosting Services

The Company operates two bitcoin mining sites, which were acquired on January 12, 2024, that provide hosting services to institutional-scale crypto mining companies. Hosting services include colocation and managed services. Colocation services include providing mining companies with sheltered data center space, electrical power, cooling, and internet connectivity. Managed services generally include providing customers with technical support and maintenance services, in addition to colocation services. The Company will not be taking on any new hosting services customers and will transition to self-mining at these two sites as existing customer agreements expire or are terminated early.

Colocation services revenue is recognized over time as the customer simultaneously receives and consumes the benefits of the Company’s performance. Managed services revenue is recognized at a point-in-time as the customer simultaneously receives and consumes the benefits of the Company’s performance. The transaction price for colocation services is variable based on the consumption of energy and the managed services price is a fixed rate per miner basis. The Company recognizes hosting services revenue to the extent that a significant reversal of such revenue will not occur. Hosting services customers are generally invoiced in advance of the month in which the Company satisfies its performance obligation, and deferred revenue is recorded for any upfront payments received in advance of the Company’s performance. The monthly transaction price is generally variable based on the amount of megawatt hours (“MWh”) consumed by the customers equipment and when other monthly contracted services are performed. At the end of each month, the customer is billed for the actual amount owed for services performed. The Company recognizes revenue for hosting services under the right-to-invoice practical expedient in ASC 606-10-55-18, which allows for the recognition of revenue over time as the Company’s right-to-invoice for final payment corresponds directly with the value of services transferred to the customer to-date.

Expenses associated with providing hosting services are recorded as cost of revenues and depreciation on hosting equipment is recorded as a separate component of cost of revenues.

Effective January 1, 2023, the Company early adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in the Condensed Consolidated Statements of Operations each reporting period. The Company’s digital assets were within the scope of ASU 2023-08 and a cumulative-effect adjustment of $11.5 million as of the beginning of the fiscal year ended December 31, 2023 was recorded for the difference between the carrying amount of the Company’s digital assets and fair value.

The following table presents the Company’s significant digital asset holdings as of June 30, 2024 and December 31, 2023, respectively:

(in thousands, except for quantity)						Quantity						Cost Basis						Fair Value
Bitcoin						18,488						$	752,808					$	1,158,615
Kaspa						88,969,525						7,321						17,117
Total digital assets held as of June 30, 2024												$	760,129					$	1,175,732

(in thousands, except for quantity)						Quantity						Cost Basis						Fair Value
Bitcoin						15,126						$	515,315					$	639,660
Total digital assets held as of December 31, 2023												$	515,315					$	639,660

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The Company contracts with bitcoin mining equipment manufacturers to procure equipment necessary for the operation of its bitcoin mining operations. These agreements typically require a certain percentage of the value of the total order to be paid in advance at specific intervals, usually within several days of execution of a specific contract and periodically thereafter with final payments due prior to each shipment date. The Company accounts for these payments as “Advances to vendors” in the Condensed Consolidated Balance Sheets.

 

As of June 30, 2024 and December 31, 2023, such advances totaled approximately $385.4 million and $95.6 million, respectively.

In addition, the Company contracts with other service providers for the hosting of its equipment and operational support in data centers where the Company’s equipment is deployed. These arrangements also typically require advance payments to be made to vendors in conjunction with the contractual obligations associated with these services. The Company classifies these payments as “Deposits” and “Long-term deposits” in the Condensed Consolidated Balance Sheets.

As of June 30, 2024 and December 31, 2023, such deposits totaled approximately $82.8 million and $67.0 million, respectively.

The components of property and equipment as of June 30, 2024 and December 31, 2023 are:

(in thousands, except useful life)						Useful life (Years)						June 30, 2024						December 31, 2023
Land (1)						—						$	4,649					$	—
Land improvements						9						25,246						—
Building and improvements						25						50,866						—
Mining rigs						3						1,034,299						862,055
Containers						10 - 15						58,898						5,676
Equipment						4 - 15						64,640						—
Software and hardware						2						3,307						—
Asset retirement obligation						8						7,879						—
Other						7						813						242
Total gross property, equipment												1,291,538						867,973
Less: Accumulated depreciation and amortization												(362,004)						(196,201)
Property and equipment, net												$	929,534					$	671,772

 

(1) Refer to Note 14 - Leases, for further information regarding the Company’s finance land lease.

The Company recorded an asset retirement obligation of $7.9 million for the Granbury data center land lease. The asset retirement obligation represents the estimated cost to return the site to its original state. The asset retirement obligation is being depreciated over the term of the lease which is approximately 8 years.

The Company’s accretion expense related to the asset retirement obligation for the three and six months ended June 30, 2024 was $0.2 million and $0.4 million, respectively.

The Company’s depreciation expense related to property and equipment for the three months ended June 30, 2024 and 2023 was $87.8 million and $37.3 million, respectively. The Company’s depreciation expense related to property and equipment for the six months ended June 30, 2024 and 2023 was $165.8 million and $55.0 million, respectively.

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Goodwill

The components of goodwill as of June 30, 2024 are as follows:

						As of June 30, 2024
(in thousands)						Cost						Accumulated impairment charges						Net
GC Data Center Equity Holdings, LLC						$	30,852					$	—					$	30,852
Garden City Acquisition						14,510						—						14,510
Total goodwill						$	45,362					$	—					$	45,362

The Company acquired goodwill from the GC Data Center Equity Holdings, LLC acquisition on January 12, 2024 and the Garden City Acquisition on April 1, 2024, refer to Note 3 – Acquisitions, for further information.

There was no goodwill as of December 31, 2023.

Intangible assets

The following table presents the Company’s intangible assets as of June 30, 2024:

						As of June 30, 2024
(in thousands)						Cost						Accumulated amortization						Accumulated impairment charges						Net
Customer relationships						$	22,000					$	(22,000)					$	—					$	—
Intellectual property						2,633						(439)						—						2,194
Total intangible assets						$	24,633					$	(22,439)					$	—					$	2,194

During the three months ended June 30, 2024, the Company fully amortized customer relationships acquired in the GC Data Center Equity Holdings, LLC due to the Company’s strategic decision to exit hosting services business and termination of customer relationships during the period. Refer to Note 3 - Acquisitions, for further information.

There were no intangible assets as of December 31, 2023.

The following table presents the Company’s estimated future amortization of finite-lived intangible assets as of June 30, 2024:

Year						Amount (in thousands)
2024 (remaining)						$	439
2025						878
2026						877
Thereafter						—
Total						$	2,194

 

The Company measures certain financial and non-financial assets and liabilities at fair value on a recurring or non-recurring basis. The Company uses a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability.

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The levels of the fair value hierarchy are:

 

			Level 1:			Observable inputs such as quoted market prices in active markets for identical assets or liabilities
			Level 2:			Observable market-based inputs or unobservable inputs that are corroborated by market data
			Level 3:			Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions

 

The carrying amounts reported in the Condensed Consolidated Balance Sheets for cash and cash equivalents, restricted cash, other receivables, deposits, prepaid expenses and other current assets, property and equipment, advances to vendors, accounts payable, accrued expenses, and legal reserve payable approximate their estimated fair market value based on the short-term maturity of these instruments. Additionally, the carrying amounts reported in the Condensed Consolidated Balance Sheets for the Company’s term loan, operating lease liabilities and other long-term liabilities approximate fair value as the related interest rates approximate rates currently available to the Company.

Financial assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level of input that is significant to their fair value measurement. The Company measures the fair value of its marketable securities and investments by taking into consideration valuations obtained from third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs included reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs.

Recurring measurement of fair value

The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis and the Company’s estimated level within the fair value hierarchy for each of those assets and liabilities as of June 30, 2024 and December 31, 2023, respectively:

			Recurring fair value measured at June 30, 2024
(in thousands)			Total carrying value						Quoted prices in active markets (Level 1)						Significant other observable inputs (Level 2)						Significant unobservable inputs (Level 3)
Assets:
Money market funds			$	168,940					$	168,940					$	—					$	—
U.S. Treasury Bills			65,319						65,319
Digital assets			1,175,732						1,175,732						—						—
Derivative instrument (1)			33,988						—						33,988						—
Liabilities:
Contingent consideration liability (2)			3,433						—						—						3,433

 

			Recurring fair value measured at December 31, 2023
(in thousands)			Total carrying value						Quoted prices in active markets (Level 1)						Significant other observable inputs (Level 2)						Significant unobservable inputs (Level 3)
Assets:
Money market funds			$	141,147					$	141,147					$	—					$	—
U.S. Treasury Bills			60,541						60,541						—						—
Digital assets			639,660						639,660						—						—

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(1) The fair value of the derivative was estimated using a discounted cash flow approach that considers various assumptions including current market prices and electricity forward curves, which are considered Level 2 inputs. Increases (decreases) in market prices and electricity forward curves could result in significant increases (decreases) in the fair value of derivatives. Refer to Note 2 - Summary of Significant Accounting Policies - Derivatives, for further information.

(2) Represents the estimated amount of acquisition-related consideration expected to be paid in the future as of June 30, 2024 for the GC Center Equity Holdings, LLC acquired on January 12, 2024. Increases (decreases) in the probability of achieving the milestones could result in significant increases (decreases) in the fair value of the contingent consideration. Refer to Note 3 - Acquisitions, for further information.

The Company includes the above money market funds and U.S. treasury bills in cash and cash equivalents in the Condensed Consolidated Balance Sheets. The Company’s U.S. treasury bills have original remaining maturities of three months or less when purchased.

Effective January 1, 2023, the Company early adopted ASU 2023-08, measuring digital assets at fair value on a recurring basis. There were no transfers among Levels 1, 2 or 3 during the six months ended June 30, 2024.

Non-recurring measurement of fair value

The following tables present information about the Company’s liabilities measured at fair value on a non-recurring basis and are, therefore, not included in the tables above. These liabilities include outstanding convertible notes measured at fair value based on quoted prices in active markets. These liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., impairment). The Company’s estimated level within the fair value hierarchy for each of these liabilities as of June 30, 2024 and December 31, 2023, respectively, is as follows:

			Non-recurring fair value measured at June 30, 2024
(in thousands)			Total carrying value						Quoted prices in active markets (Level 1)						Significant other observable inputs (Level 2)						Significant unobservable inputs (Level 3)
Liabilities:
Notes payable			$	326,513					$	289,058					$	—					$	—

			Non-recurring fair value measured at December 31, 2023
(in thousands)			Total carrying value						Quoted prices in active markets (Level 1)						Significant other observable inputs (Level 2)						Significant unobservable inputs (Level 3)
Liabilities:
Notes payable			$	325,654					$	269,725					$	—					$	—

 

Net income (loss) per share is calculated in accordance with ASC 260 - Earnings Per Share. Basic income (loss) per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. For the three and six months ended June 30, 2024 and 2023, the Company recorded net income (loss) and as such, the Company calculated the impact of dilutive common stock equivalents in determining diluted earnings per share.

 

The following table presents the securities that were not included in the computation of diluted income (loss) per share, as their inclusion would have been anti-dilutive:

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						Three Months Ended June 30,												Six Months Ended June 30,
						2024						2023						2024						2023
Warrants						324,375						324,375						324,375						324,375
Restricted stock units						9,152,998						3,847,664						—						3,847,664
Performance-based restricted stock units						2,991,580						—						—						—
Convertible notes						4,341,422						9,812,955						—						—
Series A Preferred Stock						—						70,757						—						—
Total dilutive shares						16,810,375						14,055,751						324,375						4,172,039

  

The following table sets forth the computation of basic and diluted income (loss) per share:

						Three Months Ended June 30,												Six Months Ended June 30,
(in thousands, except share and per share data)						2024						2023						2024						2023
Basic earnings per share of common stock:
Net income per share of common stock - basic						$	(199,659)					$	(11,083)					$	137,514					$	107,616
Weighted average shares of common stock - basic						278,674,506						168,474,882						268,899,932						163,856,352
Net income per share of common stock - basic						$	(0.72)					$	(0.07)					$	0.51					$	0.66
Diluted earnings per share of common stock:
Net income per share of common stock - basic						$	(199,659)					$	(11,083)					$	137,514					$	107,616
Add: Notes interest expense, net of tax						—						—						1,969						4,451
Add: Series A preferred stock accretion to redemption value						—						—						—						2,121
Net income per share of common stock - diluted						$	(199,659)					$	(11,083)					$	139,483					$	114,188
Weighted average shares of common stock - basic						278,674,506						168,474,882						268,899,932						163,856,352
Restricted stock units						—						—						4,431,276						—
Performance-based restricted stock units						—						—						287,030						—
Convertible notes						—						—						4,341,422						9,812,955
Preferred stock						—						—						—						70,757
Weighted average shares of common stock - diluted						278,674,506						168,474,882						277,959,660						173,740,064
Net income per share of common stock - diluted						$	(0.72)					$	(0.07)					$	0.50					$	0.66

 

Common Stock

On July 27, 2023, the Company’s shareholders approved an amendment to the Company’s articles of incorporation that increased the amount of common stock authorized for issuance to 500,000,000 with a par value of $0.0001 per share.

Shelf Registration Statements on Form S-3 and At-the-Market Offering Agreements

In February 2024, the Company commenced a new at-the-market (“ATM”) offering program with H.C. Wainwright & Co., LLC (“Wainwright”) acting as sales agent (the “2024 ATM”) pursuant to an ATM agreement, under which

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the Company may offer and sell shares of its common stock from time to time through Wainwright having an aggregate offering price of up to $1,500.0 million. During the six months ended June 30, 2024, the Company sold 17,472,602 shares of common stock for an aggregate purchase price of $344.9 million, net of offering expenses, pursuant to the 2024 ATM. As a result, the Company had $1,146.0 million aggregate offering price remaining under the 2024 ATM.

2018 Equity Incentive Plan

 

On January 1, 2018, the Board adopted the 2018 Equity Incentive Plan (as amended, the “2018 Plan”), which was subsequently approved by the Company’s shareholders on March 7, 2018, The 2018 Plan provides for the issuance of stock options, restricted stock, restricted stock units (“RSUs”), preferred stock and other awards to employees, directors, consultants and other service providers.

In June 2024, the Company’s shareholders approved an amendment to the 2018 Plan that increased the number of shares authorized for issuance thereunder by 15,000,000 shares. As of June 30, 2024, the Company had an aggregate of 15,536,354 shares of common stock reserved for future issuance under the 2018 Plan.

A summary of the Company’s stock-based compensation, by category, is as follows:

						Three Months Ended June 30,												Six Months Ended June 30,
(in thousands)						2024						2023						2024						2023
Performance-based stock awards						$	5,169					$	—					$	5,169					$	—
Service-based stock awards						23,163						4,451						75,076						8,396
Total stock-based compensation						$	28,332					$	4,451					$	80,245					$	8,396

Restricted Stock Units

The Company grants service-based RSUs to employees, directors and consultants. RSUs granted to employees generally vest over a four-year period from the date of grant; however, in certain instances, all or a portion of a grant may vest immediately. RSUs granted to directors generally vest over a one-year period or, in certain instances, immediately. The Company measures the fair value of RSUs at the grant date and recognizes expenses on a straight-line basis over the requisite service period from the date of grant for each separately-vesting tranche under the graded-vesting attribution method.

A summary of the Company’s service-based RSU activity for the six months ended June 30, 2024, is as follows:

			Number of RSUs						Weighted Average Grant Date Fair Value
Nonvested at December 31, 2023			5,765,529						$	9.40
Granted			6,878,838						19.57
Forfeited			(256,459)						12.13
Vested			(3,234,910)						15.64
Nonvested at June 30, 2024			9,152,998						$	14.76

As of June 30, 2024, there was approximately $89.0 million of aggregate unrecognized stock-based compensation related to unvested service-based RSUs that is expected to be recognized over the next 2.8 years.

Performance-based Restricted Stock Units

The Company granted performance-based restricted stock units (“PSUs”) on May 1, 2024 to employees which generally vest over a four-year period from the date of grant. Awards are issued in the form of RSUs and are granted pursuant to the 2018 Plan. The number of PSUs that are subject to vest is directly correlated with the Company’s achievements of a pre-determined metric relating to total stockholder return (“TSR”) for the period from January 1, 2024 through December 31, 2024 (the “Performance Period”).

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Based on the Company’s TSR performance relative to the peer group for the Performance Period, the PSU awards will vest between 0% to 200% of the target amount over an approximate four-year period. Determination regarding the Company’s performance relative to the TSR metric will establish the maximum number of shares that are subject to vesting pursuant to the PSU awards. Once determined, (i) 25% of the PSU awards will vest on January 31, 2025, and (ii) the balance of the awards will vest in 12 equal calendar quarters (with 6.25% of the shares vesting each quarter). The Company measures the fair value of the PSUs at the grant date using the Monte Carlo simulation model.

The Monte Carlo simulation model requires the input of subjective assumptions, including risk-free interest rate, expected term, expected stock price volatility, market capitalization of peer group, and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities as of the grant date. Expected term is consistent with the Performance Period of the awards. Expected volatility is based on the historical volatility of the Company’s common stock over the estimated expected life. The Company does not pay a dividend, therefore, the dividend yield is assumed to be zero.

A summary of the Company’s PSU activity for the six months ended June 30, 2024, is as follows:

			Number of PSUs						Weighted Average Grant Date Fair Value
Nonvested at December 31, 2023			—						$	—
Granted			2,991,580						14.67
Nonvested at June 30, 2024			2,991,580						$	14.67

As of June 30, 2024, there was approximately $38.7 million of aggregate unrecognized stock-based compensation related to unvested PSUs that is expected to be recognized over the next 3.6 years.

Common Stock Warrants

As of June 30, 2024, the Company’s issued and outstanding common stock warrants had no change from December 31, 2023. The Company continues to have 324,375 outstanding warrants, at a weighted average exercise price of $25.00, that are expected to expire in approximately one year.

Convertible Note

On November 18, 2021, the Company issued $650.0 million principal of 1% Convertible Senior Notes due 2026 (the “Notes”). On November 23, 2021, the initial purchasers of the Notes purchased an additional $97.5 million principal of Notes for an aggregate principal amount of $747.5 million. In September 2023, the Company entered into privately negotiated exchange agreements with certain holders of its Notes. In total, the Company exchanged $416.8 million principal amount of Notes for an aggregate 31,722,417 shares of Company common stock. The Notes accrue interest at a rate of 1% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2022.

As of June 30, 2024 and December 31, 2023, the Notes outstanding, net of unamortized discounts of approximately $4.2 million and $5.1 million, respectively, were $326.5 million and $325.7 million, respectively.

The Company is permitted and may seek to repurchase additional Notes prior to the maturity date, whether through privately negotiated purchases, open market purchases, or otherwise.

 

The Company leases office space in the United States under operating lease agreements. The Company also entered into an arrangement with APLD for the use of energized cryptocurrency mining facilities under which the Company pays for electricity per megawatt based on usage. The Company has determined that it has embedded operating leases at two of the facilities governed by this arrangement that commenced in January and March 2023, and has elected not to separate lease and non-lease components. Payments made for these two operating leases are entirely variable and are based on usage of electricity, and the Company therefore does not record a right-of-use (“ROU”) asset or lease liability associated with the leases. Variable lease cost during the three and six months ended June 30,

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2024 and June 30, 2023 are disclosed in the table below. Office space and mining facilities comprise the Company’s material underlying asset class under operating lease agreements.

The Company assumed an operating lease in the GC Data Center Equity Holdings, LLC acquisition related to the data center land lease in Granbury, Texas on January 12, 2024. The ROU asset and total lease liability recorded for the assumption of the lease was $8.9 million and $8.9 million, respectively. An unfavorable lease liability adjustment of $5.1 million related to the GC Data Center Equity Holdings, LLC acquisition is reflected in the total operating lease liabilities. Additionally, the Company assumed a finance lease in the Garden City Acquisition related to the land lease in Garden City, Texas on April 1, 2024. The ROU asset and total lease liability recorded for the assumption of the lease was $4.0 million and $4.0 million, respectively. An unfavorable lease liability adjustment of $1.1 million related to the Garden City Acquisition is reflected in the total finance lease liabilities. The ROU assets and lease liabilities for the leases assumed each were measured based on the net present value of remaining future lease payments on the date of the acquisition, with consideration given for options to extend or renew the lease.

As of June 30, 2024, the Company’s ROU assets and total lease liabilities were $9.7 million and $10.6 million, respectively. As of December 31, 2023, the Company’s ROU assets and total lease liabilities were $0.4 million and $0.5 million, respectively. The Company has amortized the ROU assets totaling $0.4 million and $0.1 million for the three months ended June 30, 2024 and 2023, respectively. The Company has amortized the ROU assets totaling $0.7 million and $0.2 million for the six months ended June 30, 2024 and 2023, respectively.

The following table presents the assets and liabilities related to the Company’s operating and finance leases as of June 30, 2024 and December 31, 2023:

(in thousands)									June 30, 2024						December 31, 2023
Assets			Balance Sheet Classification
Operating lease right-of-use assets			Operating lease right-of-use assets						$	9,728					$	443
Finance lease right-of-use assets			Property and equipment, net						4,029						—
Total right-of-use assets									$	13,757					$	443
Liabilities
Current portion:
Operating lease liabilities			Operating lease liabilities, current portion						$	316					$	124
Finance lease liability			Finance lease liability, current portion						180						—
Long-term portion:
Operating lease liabilities			Operating lease liabilities, net of current portion						15,106						354
Finance lease liability			Finance lease liability, net of current portion						4,834						—
Total lease liabilities									$	20,436					$	478

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Lease costs are recorded on a straight-line basis within operating expenses. The Company’s total lease expenses are comprised of the following:

						For the Three Months Ended June 30,												For the Six Months Ended June 30,
(in thousands)						2024						2023						2024						2023
Lease costs:
Operating lease cost						$	761					$	74					$	965					$	185
Finance lease cost:
Amortization of ROU asset						11						—						11						—
Short-term lease rent expense						21						11						37						20
Variable lease cost						20,043						17,165						43,229						19,938
Total rent expense						$	20,836					$	17,250					$	44,242					$	20,143

  

Additional information regarding the Company’s leasing activities is as follows:

						For the Six Months Ended June 30,
						2024						2023
Operating cash flows from operating leases						$	840					$	229
Financing cash flows from finance lease						163						—
Weighted-average remaining lease term (in years):
Operating leases						9.7						3.4
Finance lease						96.8						—
Weighted-average discount rate:
Operating leases						6.7		%				5.0		%
Finance lease						7.2		%				—		%

The following table presents the Company’s future minimum lease payments as of June 30, 2024:

 

(in thousands)
Year						Operating Leases						Finance Lease
2024 (remaining)						$	170					$	—
2025						457						168
2026						1,080						173
2027						2,835						178
2028						2,782						183
Thereafter						6,960						89,096
Total						14,284						89,798
Less: Imputed interest						(3,681)						(85,921)
Present value of lease liability						$	10,603					$	3,877

 

The Company, and its subsidiaries, from time to time may be subject to various claims, lawsuits and legal proceedings that arise from the ordinary course of business.

In accordance with ASC 450 - Contingencies, if a loss contingency associated with the following legal matters are probable to be incurred and the amount of loss can be reasonably estimated, an accrual is recorded on the Condensed

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Consolidated Balance Sheets. As of June 30, 2024, the Company has determined that the liabilities associated with certain litigation matters are not expected to have a material impact on the Company’s Financial Statements. The Company will continue to monitor each related legal issue and adjust accruals as new information and developments occur.

Compute North Bankruptcy

 

On September 22, 2022, Compute North Holdings, Inc. (currently d/b/a Mining Project Wind Down Holdings, Inc.) and certain of its affiliates (collectively, “Compute North”) filed for chapter 11 bankruptcy protection. Compute North provided operating services to the Company and hosted its mining rigs at multiple facilities. The Company delivered miners to Compute North, which then installed the mining rigs at those facilities, operated and maintained the mining rigs, and provided energy to keep the miners operating. During the course of the chapter 11 cases, Compute North sold substantially all of their assets in a series of 363 sale transactions, including Compute North’s ownership interests in non-debtor entities that own or partially own facilities that house the Company’s miners.

On November 23, 2022, the Company and certain of its affiliates timely filed proofs of claim asserting various claims against Compute North, including: (i) claims arising under hosting agreements between the Company and Compute North LLC; (ii) claims arising under that certain Senior Promissory Note, dated as of July 1, 2022, by and between the Company, as Lender, and Compute North LLC, as Borrower; (iii) claims arising from the breach of a letter of intent between us and Compute North LLC; and (iv) claims for daily lost revenue, profits and other damages against Compute North.

On February 9, 2023, the Bankruptcy Court approved a settlement stipulation between the Company and Compute North, pursuant to which the proofs of claim filed by the Company and certain of its affiliates were resolved, and the Company received a single allowed unsecured claim against Compute North LLC in the amount of $40.0 million and its Preferred Equity Interests in Compute North Holdings, Inc. in the amount of 39,597 shares of Series C Preferred Stock was confirmed. In exchange, the Company agreed to vote in favor of Compute North’s chapter 11 plan.

On February 16, 2023, the Bankruptcy Court confirmed Compute North’s chapter 11 plan (the “Plan”), pursuant to which Compute North will liquidate its remaining assets and distribute proceeds arising therefrom in accordance with the waterfall set forth in the Plan. In its disclosure statement filed on December 19, 2022, the Compute North Debtors projected that holders of allowed general unsecured claims could recover anywhere between 8% to 65% on their claims, while holders of preferred equity interests are expected to recover nothing on their interests. The Plan became effective on March 31, 2023. At this time, the Company cannot predict the quantum of its potential recovery on account of its allowed general unsecured claim and preferred equity interests or the timing of when it would receive any distributions under the Plan on account of its claims and interests.

Moreno v. Marathon

On March 30, 2023, a putative class action complaint was filed in the United States District Court for the District of Nevada, against the Company and present and former senior management, alleging claims under Section 10(b) and 20(a) of the Exchange Act arising out of the Company’s announcement of accounting restatements on February 28, 2023. On March 29, 2024, the court appointed lead plaintiffs and counsel. On June 4, 2024, lead plaintiffs filed an amended class action complaint, styled as Langer et al. v. Marathon et al. The allegations in the amended class action complaint are substantially similar to those in the March 30, 2023 putative class action complaint. The defendants have until August 5, 2024 to respond to the amended class action complaint.

Derivative Complaints

On June 22, 2023, a shareholder derivative complaint was filed in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida, against current members of the Company’s Board and senior management, alleging claims for breach of fiduciary duty and unjust enrichment based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno.

On July 8, 2023, a second shareholder derivative complaint was filed in the United States District Court for the District of Nevada, against current and former members of the Company’s Board and senior management, alleging claims under Sections 14(a), 10(b), and 21D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and for breach of fiduciary duty, unjust enrichment, and waste of corporate assets, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno.

On July 12, 2023, a third shareholder derivative complaint was filed in the United States District Court for the District of Nevada, against current and former members of the Company’s Board and senior management, alleging

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claims under Section 14(a) of the Exchange Act and for breach of fiduciary duty, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno.

On July 13, 2023, a fourth shareholder derivative complaint was filed in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida (together with the complaint filed on June 22, 2023, the “Florida Derivative Actions”), against current members of the Company’s Board and senior management, alleging claims for breach of fiduciary duty, unjust enrichment, and waste of corporate assets, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno.

On August 14, 2023, the two derivative actions pending in the United States District Court for the District of Nevada were consolidated (the “Nevada Derivative Action”). On April 1, 2024, the United States District Court for the District of Nevada appointed co-lead counsel for plaintiffs in the Nevada Derivative Action. On June 25, 2024, plaintiffs filed an amended consolidated complaint alleging breaches of fiduciary duties, unjust enrichment, waste of corporate assets, claims under Section 14(a) of the Exchange Act, and for contribution under Sections 10(b) and 21D of the Exchange Act. The allegations remain substantially similar to those in the March 30, 2023 putative class action complaint in Moreno. The defendants have until August 9, 2024 to respond to the amended complaint.

On October 16, 2023, the parties to the derivative actions pending in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida filed an agreed order to stay both actions pending completion of the Nevada Derivative Action. On July 25, 2024, the Florida Derivative Actions were administratively closed.

Information Subpoena

 

On October 6, 2020, the Company entered into a series of agreements with multiple parties to design and build a data center for up to 100-megawatts in Hardin, Montana. In conjunction therewith, the Company filed a Current Report on Form 8-K on October 13, 2020 disclosing that, pursuant to a Data Facility Services Agreement, the Company issued 6,000,000 shares of restricted common stock, in transactions exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). During the quarter ended September 30, 2021, the Company and certain of its executives received a subpoena to produce documents and communications concerning the Hardin, Montana data center facility. The Company received an additional subpoena from the SEC on April 10, 2023, relating to, among other things, transactions with related parties. The Company understands that the SEC may be investigating whether or not there may have been any violations of the federal securities law. The Company is cooperating with the SEC.

Ho v. Marathon

 

On January 14, 2021, plaintiff Michael Ho (“Ho”) filed a civil complaint (the “Complaint”) in which he alleged, among other things, that the Company breached the terms of a non-disclosure agreement, profited from commercially sensitive information he shared with the Company, and refused to compensate him for his role in securing the Company’s acquisition of an energy supplier. The Complaint initially alleged six causes of action including: (1) breach of written contract, (2) breach of implied contract, (3) quasi-contract, (4) services rendered, (5) intentional interference with prospective economic relations, and (6) negligent interference with prospective economic relations. On February 22, 2021, the Company responded to the Complaint with a general denial of the claims and asserted certain affirmative defenses. On February 25, 2021, the Company removed the action to the United States District Court in the Central District of California (the “Court”). The Company filed a motion for summary judgment with respect to each of the causes of action, and the Court dismissed all of the causes of action other than breach of written contract. On July 8, 2024, the Court commenced a jury trial with respect to the sole remaining claim. On July 18, 2024, the jury determined that the Company had breached certain provisions of the non-disclosure agreement and returned a verdict in the amount of $138.8 million. The judgment has not yet been entered and the Company has not paid any portion of the award. The Company intends to defend its positions vigorously and assert its various well-founded legal claims to challenge both the verdict and the amount of the award. In particular, even if the jury verdict is not reversed, the Company believes applicable law supports a significant reduction in the amount of the award.

During September 2023, the Company entered into an agreement with Auradine to secure certain rights to future purchases by the Company from Auradine for which the Company paid $15.0 million. In addition, during the six months ended June 30, 2024, the Company made advances of $29.1 million, for future purchases resulting in a total advances to Auradine of $43.6 million as of June 30, 2024.

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The following table provides supplemental disclosure of Condensed Consolidated Statements of Cash Flows information:

						Six Months Ended June 30,
						2024						2023
Supplemental information
Cash paid during the year for:
Income taxes						$	1,256					$	782
Interest						4						4,524
Supplemental schedule of non-cash investing and financing activities:
Series A Preferred Stock accretion to redemption value						$	—					$	2,121
Reclassifications from advances to vendor to property and equipment upon receipt of equipment						175,442						542,517
Reclassifications from long-term prepaid to property and equipment						3,273						—
Reclassifications from investments to property and equipment						4,416						—
Reclassifications from long-term prepaid to intangible assets						2,633						—
Effective settlement of pre-existing relationships						—						—
Dividends received from equity method investment						18,912						—

On July 25, 2024, the Company announced acquiring $100.0 million bitcoin as part of the Company’s strategy to hold bitcoin and not sell for the foreseeable future.

Subsequent to June 30, 2024, the Company issued an aggregate 7,276,739 shares of common stock under the 2024 ATM. As a result, the Company had $982.3 million aggregate offering price remaining under the 2024 ATM.

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On May 13, 2024, Doug Mellinger, a member of the Company’s board of directors, entered into a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a “10b5-1 Plan”). Mr. Mellinger’s 10b5-1 Plan provides for the potential sale of up to 10,000 shares of the Company’s common stock between the first potential sale date on August 12, 2024 and the expiration of the 10b5-1 Plan on May 13, 2025.

On June 5, 2024, Jay Leupp, a member of the Company’s board of directors, entered into a 10b5-1 Plan. Mr. Leupp’s 10b5-1 Plan provides for the potential sale of up to 31,200 shares of the Company’s common stock between the first potential sale date on September 4, 2024 and the expiration of the 10b5-1 Plan on June 5, 2025.

On June 18, 2024, Fred Thiel, Chief Executive Officer and Chairperson of the Board, entered into a 10b5-1 Plan. Mr. Thiel’s 10b5-1 Plan provides for the potential sale of up to 357,572 shares of the Company’s common stock between the first potential sale date on September 16, 2024 and the expiration of the 10b5-1 Plan on September 16, 2025.

On June 18, 2024, Salman Khan, Chief Financial Officer, entered into a 10b5-1 Plan. Mr. Khan’s 10b5-1 Plan provides for the potential sale of up to 66,800 shares of the Company’s common stock between the first potential sale date on September 16, 2024 and the expiration of the 10b5-1 Plan on December 31, 2024.

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v3.24.2.u1

COVER - shares	6 Months Ended
	Jun. 30, 2024	Jul. 25, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2024
Document Transition Report	false
Entity File Number	001-36555
Entity Registrant Name	MARATHON DIGITAL HOLDINGS, INC.
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	01-0949984
Entity Address, Address Line One	101 NE Third Avenue
Entity Address, Address Line Two	Suite 1200
Entity Address, City or Town	Fort Lauderdale
Entity Address, State or Province	FL
Entity Address, Postal Zip Code	33301
City Area Code	800
Local Phone Number	804-1690
Title of 12(b) Security	Common Stock, par value $0.0001 per share
Trading Symbol	MARA
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		294,474,622
Entity Central Index Key	0001507605
Document Fiscal Year Focus	2024
Amendment Flag	false
Document Fiscal Period Focus	Q2
Current Fiscal Year End Date	--12-31

v3.24.2.u1

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Current assets:
Cash and cash equivalents	$ 256,027,000	$ 357,313,000
Restricted cash	12,000,000	0
Digital assets	17,117,000	639,660,000
Accounts receivable, net	18,743,000	0
Deposits	26,185,000	7,240,000
Derivative instrument, current portion	13,710,000	0
Prepaid expenses and other current assets	28,164,000	25,590,000
Total current assets	371,946,000	1,029,803,000
Digital assets	1,158,615,000	0
Property and equipment, net	929,534,000	671,772,000
Advances to vendors	385,424,000	95,589,000
Investments	116,282,000	106,292,000
Long-term deposits	56,639,000	59,790,000
Long-term prepaids	21,153,000	27,284,000
Operating lease right-of-use assets	9,728,000	443,000
Derivative instrument, net of current portion	20,278,000	0
Goodwill	45,362,000	0
Intangible assets, net	2,194,000	0
Total long-term assets	2,745,209,000	961,170,000
TOTAL ASSETS	3,117,155,000	1,990,973,000
Current liabilities:
Accounts payable	28,840,000	11,343,000
Accrued expenses	67,182,000	22,291,000
Operating lease liabilities, current portion	316,000	124,000
Finance lease liability, current portion	180,000	0
Other current liabilities	2,693,000	0
Total current liabilities	99,211,000	33,758,000
Long-term liabilities:
Notes payable	326,513,000	325,654,000
Operating lease liabilities, net of current portion	15,106,000	354,000
Finance lease liability, net of current portion	4,834,000	0
Deferred tax liabilities	20,842,000	15,286,000
Other long-term liabilities	7,994,000	0
Total long-term liabilities	375,289,000	341,294,000
Commitments and Contingencies (Note 15)
Stockholders’ Equity:
Preferred stock, par value $0.0001 per share, 50,000,000 shares authorized; no shares issued and outstanding at June 30, 2024 and December 31, 2023	0	0
Common stock, par value $0.0001 per share, 500,000,000 shares authorized; 287,046,579 shares and 242,829,391 shares issued and outstanding at June 30, 2024 and December 31, 2023, respectively	28,000	24,000
Additional paid-in capital	3,072,753,000	2,183,537,000
Accumulated deficit	(430,126,000)	(567,640,000)
Total stockholders’ equity	2,642,655,000	1,615,921,000
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$ 3,117,155,000	$ 1,990,973,000

v3.24.2.u1

CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Jun. 30, 2024	Dec. 31, 2023
Statement of Financial Position [Abstract]
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, authorized (in shares)	50,000,000	50,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, authorized (in shares)	500,000,000	500,000,000
Common stock, issued (in shares)	287,046,579	242,829,391
Common stock, outstanding (in shares)	287,046,579	242,829,391

v3.24.2.u1

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Income Statement [Abstract]
Total revenues	$ 145,139	$ 81,759	$ 310,337	$ 132,891
Cost of revenues
Mining and hosting services	(93,887)	(55,222)	(184,098)	(88,599)
Depreciation and amortization	(87,808)	(37,275)	(165,803)	(55,008)
Total cost of revenues	(181,695)	(92,497)	(349,901)	(143,607)
Operating expenses
General and administrative expenses	(57,118)	(19,840)	(130,429)	(34,976)
Change in fair value of digital assets	(147,999)	25,162	340,808	162,560
Change in fair value of derivative	38,251	0	22,999	0
Research and development	(3,845)	(651)	(6,311)	(860)
Early termination expenses	(5,660)	0	(27,757)	0
Amortization of intangible assets	(19,470)	0	(22,439)	0
Total operating expenses	(195,841)	4,671	176,871	126,724
Operating income (loss)	(232,397)	(6,067)	137,307	116,008
Gain on investments	0	0	5,236	0
Loss on hedge instruments	0	0	(2,292)	0
Equity in net earnings of unconsolidated affiliate	49	0	1,308	0
Net loss from extinguishment of debt	0	0	0	(333)
Interest income	2,188	118	4,761	910
Interest expense	(1,369)	(2,840)	(2,625)	(6,600)
Other non-operating income	213	30	213	30
Income (loss) before income taxes	(231,316)	(8,759)	143,908	110,015
Income tax benefit (expense)	31,657	(203)	(6,394)	(278)
Net income (loss)	(199,659)	(8,962)	137,514	109,737
Series A preferred stock accretion to redemption value	0	(2,121)	0	(2,121)
Net income (loss) attributable to common stockholders - basic	$ (199,659)	$ (11,083)	$ 137,514	$ 107,616
Net income (loss) per share of common stock - basic (in dollars per share)	$ (0.72)	$ (0.07)	$ 0.51	$ 0.66
Weighted average shares of common stock - basic (in shares)	278,674,506	168,474,882	268,899,932	163,856,352
Net income (loss) per share of common stock - diluted (in dollars per share)	$ (0.72)	$ (0.07)	$ 0.50	$ 0.66
Weighted average shares of common stock - diluted (in shares)	278,674,506	168,474,882	277,959,660	173,740,064

v3.24.2.u1

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (unaudited) - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Deficit Cumulative Effect, Period of Adoption, Adjustment
Beginning balance (in shares) at Dec. 31, 2022			145,565,916
Beginning balance at Dec. 31, 2022	$ 385,941	$ 11,483	$ 15	$ 1,226,267	$ (840,341)	$ 11,483
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation, net of tax withholding (in shares)			519,868
Stock-based compensation, net of tax withholding	8,209			8,209
Issuance of common stock, net of offering costs (in shares)			28,123,254
Issuance of common stock, net of offering costs	228,835		$ 2	228,833
Series A Preferred Stock accretion to redemption value	(2,121)			(2,121)
Net income (loss)	109,737				109,737
Ending balance (in shares) at Jun. 30, 2023			174,209,038
Ending balance at Jun. 30, 2023	742,084		$ 17	1,461,188	(719,121)
Beginning balance (in shares) at Mar. 31, 2023			167,259,602
Beginning balance at Mar. 31, 2023	683,286		$ 17	1,393,428	(710,159)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation, net of tax withholding (in shares)			183,357
Stock-based compensation, net of tax withholding	4,341			4,341
Issuance of common stock, net of offering costs (in shares)			6,766,079
Issuance of common stock, net of offering costs	65,540			65,540
Series A Preferred Stock accretion to redemption value	(2,121)			(2,121)
Net income (loss)	(8,962)				(8,962)
Ending balance (in shares) at Jun. 30, 2023			174,209,038
Ending balance at Jun. 30, 2023	$ 742,084		$ 17	1,461,188	(719,121)
Beginning balance (in shares) at Dec. 31, 2023	242,829,391		242,829,391
Beginning balance at Dec. 31, 2023	$ 1,615,921		$ 24	2,183,537	(567,640)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation, net of tax withholding (in shares)			3,320,993
Stock-based compensation, net of tax withholding	78,090			78,090
Issuance of common stock, net of offering costs (in shares)			42,135,953
Issuance of common stock, net of offering costs	834,243		$ 4	834,239
Repurchase of shares in settlement of restricted stock (in shares)			(1,239,758)
Repurchase of shares in settlement of restricted stock	(23,113)			(23,113)
Net income (loss)	$ 137,514				137,514
Ending balance (in shares) at Jun. 30, 2024	287,046,579		287,046,579
Ending balance at Jun. 30, 2024	$ 2,642,655		$ 28	3,072,753	(430,126)
Beginning balance (in shares) at Mar. 31, 2024			268,944,172
Beginning balance at Mar. 31, 2024	2,476,893		$ 27	2,707,333	(230,467)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock-based compensation, net of tax withholding (in shares)			1,008,225
Stock-based compensation, net of tax withholding	27,049			27,049
Issuance of common stock, net of offering costs (in shares)			17,472,602
Issuance of common stock, net of offering costs	344,950		$ 1	344,949
Repurchase of shares in settlement of restricted stock (in shares)			(378,420)
Repurchase of shares in settlement of restricted stock	(6,578)			(6,578)
Net income (loss)	$ (199,659)				(199,659)
Ending balance (in shares) at Jun. 30, 2024	287,046,579		287,046,579
Ending balance at Jun. 30, 2024	$ 2,642,655		$ 28	$ 3,072,753	$ (430,126)

v3.24.2.u1

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income			$ 137,514	$ 109,737
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization			165,803	55,008
Deferred tax expense			5,556	278
Change in fair value of digital assets	$ 147,999	$ (25,162)	(340,808)	(162,560)
Gain on investments	0	0	(5,236)	0
Loss on hedge instruments	0	0	2,292	0
Stock-based compensation			80,245	8,396
Change in fair value of derivative	(38,251)	0	(22,999)	0
Early termination expenses	5,660	0	27,757	0
Amortization of intangible assets	19,470	0	22,439	0
Amortization of debt issuance costs			859	1,942
Equity in net earnings of unconsolidated affiliate	(49)	0	(1,308)	0
Loss on extinguishment of debt, net	0	0	0	333
Other adjustments from operations, net			(1,393)	1,131
Changes in operating assets and liabilities:
Revenues from digital assets production			(280,732)	(132,891)
Accounts receivable			(2,163)	0
Deposits			(16,504)	(19,325)
Prepaid expenses and other assets			1,360	(6,963)
Accounts payable and accrued expenses			23,807	2,434
Accrued interest			0	(388)
Net cash used in operating activities			(203,511)	(142,868)
CASH FLOWS FROM INVESTING ACTIVITIES
Advances to vendors			(465,277)	(61,834)
Acquisition, net of cash acquired			(275,880)	0
Purchase of property and equipment			(26,309)	(23,316)
Proceeds from sale of digital assets			113,701	113,928
Purchase of digital assets			(19,026)	0
Investment in equity method investments			(13,791)	(62,729)
Purchase of equity investments			(8,005)	0
Net cash used in investing activities			(694,587)	(33,951)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of common stock, net of issuance costs			834,243	228,833
Proceeds from issuance of Series A preferred stock, net of issuance costs			0	13,629
Repurchase of shares in settlement of restricted stock			(23,113)	0
Repayments of finance lease liabilities			(163)	0
Repayments of revolving credit agreement			0	(50,000)
Value of shares withheld for taxes			(2,155)	(187)
Net cash provided by financing activities			808,812	192,275
Net increase (decrease) in cash, cash equivalents and restricted cash			(89,286)	15,456
Cash, cash equivalents and restricted cash — beginning of period			357,313	112,505
Cash, cash equivalents and restricted cash — end of period	$ 268,027	$ 127,961	$ 268,027	$ 127,961

v3.24.2.u1

ORGANIZATION AND DESCRIPTION OF BUSINESS	6 Months Ended
	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND DESCRIPTION OF BUSINESS	ORGANIZATION AND DESCRIPTION OF BUSINESS Marathon Digital Holdings, Inc. (together with its subsidiaries, the “Company” or “MARA”) is a global leader in digital asset compute that develops and deploys innovative technologies to build a more sustainable and inclusive future. MARA secures the world’s preeminent blockchain ledger (i.e., Bitcoin) and supports the energy transformation by converting stranded, or otherwise underutilized energy into economic value. The Company also offers advanced technology solutions to optimize data center operations, including next-generation liquid immersion cooling and firmware for bitcoin miners. The Company is primarily focused on computing for and holding digital assets as a long-term investment. Bitcoin is seeing increasing adoption, and due to its limited supply, the Company believes it offers opportunity for appreciation in value and long-term growth prospects for its business. The term “Bitcoin” with a capital “B” is used to denote the Bitcoin protocol which implements a highly available, public, permanent, and decentralized ledger. The term “bitcoin” with a lower case “b” is used to denote the token, bitcoin.

v3.24.2.u1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned and controlled subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. The Company has prepared the Condensed Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States (“GAAP”) and regulations of the U.S. Securities and Exchange Commission (the “SEC”) applicable to interim financial information, which permit the omission of certain information to the extent it has not changed materially since the latest annual financial statements. These Condensed Consolidated Financial Statements reflect all adjustments consisting only of normal recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any future fiscal periods in 2024 or for the full year ending December 31, 2024. These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 28, 2024, as amended by Amendment No. 1 on Form 10-K/A (the “Annual Report”), filed with the SEC on May 24, 2024. Use of Estimates and Assumptions   The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant accounting estimates inherent in the preparation of the Company’s financial statements include fair value of assets acquired and liabilities assumed in a business combination, estimates associated with the useful lives of property and equipment, realization of long-lived assets, valuation of derivative instruments, deferred income taxes, unrealized tax positions, and measurement of digital assets. Actual results could differ from those estimates. Cash and Cash Equivalents   The Company considers all highly liquid investments and other short-term investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company maintains cash and cash equivalent balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”). During March 2023, the Company began to participate, to the extent practicable, in insured cash sweep programs which “sweep” its deposits across multiple FDIC insured accounts, each with deposits of no more than $250.0 thousand. As of June 30, 2024, substantially all of the Company’s cash and cash equivalents were FDIC insured. Restricted Cash   Restricted cash as of June 30, 2024 principally represented those cash balances that support commercial letters of credit and are restricted from withdrawal. Digital Assets   On July 25, 2024, the Company adopted a full holding onto bitcoin (“HODL”) approach towards its bitcoin treasury policy, retaining all bitcoin mined in its operations, and may periodically make strategic open market purchases. As a result, bitcoin digital assets are included in non-current assets in the Condensed Consolidated Balance Sheets due to the Company’s recent intent to retain and hold bitcoin. Kaspa digital assets held with the intent to fund operating expenses are included in current assets on the Condensed Consolidated Balance Sheets. Proceeds from the sale of digital assets are included within investing activities in the accompanying Condensed Consolidated Statement of Cash Flows. Following the adoption of Accounting Standards Update (“ASU”) 2023-08, Accounting for and Disclosure of Crypto Assets, effective January 1, 2023, the Company measures digital assets at fair value with changes recognized in operating expenses in the Condensed Consolidated Statements of Operations. The Company tracks its cost basis of digital assets by-wallet in accordance with the first-in-first-out method of accounting. Refer to Note 5 – Digital Assets, for further information. Accounts Receivable   The Company acquired accounts receivable as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, which consist of trade receivables. Refer to Note 3 - Acquisitions, for further information. The Company provides an allowance for doubtful accounts equal to the estimated uncollectible amounts, based on historical and customer specific experience and current economic and market conditions. The allowance for doubtful accounts was $12.1 million as of June 30, 2024. Deposits   In addition to owned and operated sites, the Company contracts with other service providers for hosting of its equipment and operational support in data centers where the Company’s equipment is deployed. These arrangements typically require advance payments to vendors pursuant to the contractual obligations associated with these services. The Company classifies these payments as “Deposits” or “Long-term deposits” in the Condensed Consolidated Balance Sheets. Derivatives The Company enters into derivative contracts to manage its exposure to fluctuations in the price of bitcoin and energy costs and not for any other purpose. In addition, the Company evaluates its financing and service arrangements to determine whether certain arrangements contain features that qualify as embedded derivatives requiring bifurcation in accordance with Accounting Standard Codification (“ASC”) 815 - Derivatives and Hedging. Embedded derivatives that are required to be bifurcated from the host instrument or arrangement are accounted for and valued as separate financial instruments. There were no embedded derivatives requiring separation from the host instrument as of June 30, 2024 and December 31, 2023. The Company does not elect to designate derivatives as hedges for accounting purposes and as such, records derivatives at fair value with subsequent changes in fair value and settlements recognized in earnings. The Company classifies derivative assets or liabilities in the Condensed Consolidated Balance Sheets as current or non-current based on whether settlement of the instrument could be required within 12 months of the balance sheet date of the Balance Sheets and for derivatives with multiple settlements, based on the term of the contract. Bitcoin Derivatives From time to time the Company enters into derivative contracts to mitigate bitcoin market pricing volatility risk. During the six months ended June 30, 2024, the Company recorded a $2.3 million loss on derivatives as a non-operating charge in the Condensed Consolidated Statements of Operations, all settled through cash payments. There were no derivative instruments outstanding as of June 30, 2024 and December 31, 2023. Energy Derivatives The Company acquired a commodity swap contract as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, refer to Note 3 - Acquisitions, for further information. The commodity swap contract hedges price variability in electricity purchases and expires on December 31, 2027. The commodity swap contract meets the definition of a derivative due to terms that provide for net settlement. As of June 30, 2024, the estimated fair value of the Company’s derivative instrument was $34.0 million, estimated using observable market-based inputs classified under Level 2 of the fair value hierarchy. The significant assumptions used in the discounted cash flow model to estimate fair value include the discount rate and electricity forward curves. Accordingly, the Company records the change in fair value of derivative on the Condensed Consolidated Statements of Operations. The following table presents the changes in fair value of the derivative instrument: (in thousands) Balance at December 31, 2023 $ —  Commodity swap contract 10,989  Change in fair value of derivative 22,999  Balance at June 30, 2024 $ 33,988  Property and Equipment   Property and equipment are stated at cost, net of accumulated depreciation and impairment, as applicable. Property and equipment acquired through business combinations are measured at fair value at the acquisition date. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The Company’s property and equipment is primarily composed of digital asset mining rigs, which are largely homogeneous and have approximately the same useful lives. Accordingly, the Company utilizes the group method of depreciation for its digital asset mining rigs. The Company will update the estimated useful lives of its digital asset mining server group periodically if information on the operations of the mining equipment indicates changes are required. The Company will assess and adjust the estimated useful lives of its mining equipment when there are indicators that the productivity of the mining assets is longer or shorter than the assigned estimated useful lives.   Goodwill Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not subject to amortization, and instead, assessed for impairment annually at the end of each fiscal year, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount in accordance with ASC 350 - Intangibles - Goodwill and Other. The Company has the option to first assess qualitative factors to determine whether events or circumstances indicate it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, in which case a quantitative impairment test is not required. As provided for by ASU 2017-04, Simplifying the Test for Goodwill Impairment, the quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting unit. Income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit are considered when measuring the goodwill impairment loss, if applicable. Finite-Lived Intangible Assets Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition date. Intangible assets with finite lives are comprised of customer relationships and intellectual property and are amortized over their estimated useful lives on an accelerated basis over the projected pattern of economic benefits. Finite-lived intangible assets are reviewed for impairment annually, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value has been reduced to less than its carrying amount. Business Combinations The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - Business Combinations, by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair value. The determination of fair value involves assumptions, estimates and judgments. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date). Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets acquired. Contingent consideration is included within the purchase price and is initially recognized at fair value as of the acquisition date. Contingent consideration, classified as either an asset or a liability, is remeasured to fair value each reporting period, until the contingency is resolved. Changes in contingent consideration period-over-period are recognized in earnings. Acquisition related expenses are recognized separately from the business combination and are expensed as incurred. Investments   Investments, which may be made from time to time for strategic reasons, are included in non-current assets in the Condensed Consolidated Balance Sheets. Investments without a readily determinable fair value are recorded at cost minus impairment, plus or minus changes from observable price changes in orderly transactions for identical or similar investments of the same issuer, in accordance with the measurement alternative described in ASC 321 - Investments – Equity Securities. As part of the Company’s policy to maximize return on strategic investment opportunities, while preserving capital and limiting downside risk, the Company may at times enter into equity investments or Simple Agreements for Future Equity (“SAFE”). The nature and timing of the Company’s investments will depend on available capital at any particular time and the investment opportunities identified and available to the Company. However, the Company generally does not make investments for speculative purposes and does not intend to engage in the business of making investments. During the three months ended June 30, 2024, the Company entered into a second SAFE agreement. As of June 30, 2024, the Company had two SAFE investments with a carrying value of $1.3 million, with no noted impairments or other adjustments. As of December 31, 2023, the Company had one SAFE investment with a carrying value of $1.0 million, with no impairments or other adjustments. On January 10, 2024, the Company purchased additional shares of Auradine, Inc. (“Auradine”) preferred stock with a purchase price of $8.0 million, bringing the total carrying amount of its investment in Auradine preferred stock to $48.7 million. The preferred stock purchased on January 10, 2024 was similar to the Company’s other investments in Auradine preferred stock and, as a result, the Company recorded $5.2 million to “Gain on investments” in the Condensed Consolidated Statements of Operations to adjust the carrying amount of its investments to an observable price in accordance with the measurement alternative in ASC 321. Equity Method Investments The Company accounts for investments in which it owns between 20% and 50% of the common stock or has the ability to exercise significant influence, but not control, over the investee using the equity method of accounting in accordance with ASC 323 - Equity Method Investments and Joint Ventures. Under the equity method, an investor initially records an investment in the stock of an investee at cost and adjusts the carrying amount of the investment to recognize the investor’s share of the earnings or losses of the investee after the date of acquisition. On January 27, 2023, the Company and Zero Two (formerly known as FS Innovation, LLC) entered into a Shareholders’ Agreement regarding the formation of an Abu Dhabi Global Markets company (the “ADGM Entity”) in which the Company has a 20% ownership interest, which is accounted for as an equity method investment. The ADGM Entity started mining operations during September 2023. During the six months ended June 30, 2024, the Company received a non-monetary dividend in the amount of $4.4 million associated with approximately 1,950 mining rigs distributed by Zero Two. The Company recorded the mining rigs to property and equipment at fair value and, accordingly, recognized an impairment of $4.1 million that reduced the Company’s investment in the ADGM Entity, for the six months ended June 30, 2024. The Company’s share of net gain was nearly zero and $1.3 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2024, the Company’s investment in the ADGM Entity was $65.4 million and is reflected in “Investments” in the Condensed Consolidated Balance Sheets. Stock-based Compensation   The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant date fair value of the awards. Refer to Note 11 – Stockholders' Equity, for further information.   Impairment of Long-lived Assets   Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.   Revenues   The Company recognizes revenue under ASC 606 – Revenue from Contracts with Customers. The core principle of the revenue standard is that a reporting entity should recognize revenues to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Refer to Note 4 – Revenues, for further information. Research and Development Research and development costs consist primarily of contractor costs, equipment, supplies, personnel, and related expenses for research and development activities. Research and development costs are expensed as incurred in accordance with ASC 730 - Research and Development and are included in operating expenses in the Condensed Consolidated Statements of Operations. Research and development costs were $3.8 million and $6.3 million for the three and six months ended June 30, 2024, respectively, and $0.7 million and $0.9 million for the three and six months ended June 30, 2023, respectively. Income Taxes   Effective Tax Rate The effective tax rate (“ETR”) from continuing operations was 13.69% and 4.44% for the three and six months ended June 30, 2024, respectively, and 2.32% and 0.25% for the three and six months ended June 30, 2023, respectively. The difference between the U.S. statutory tax rate of 21% was primarily due to the change in valuation allowance as a result of current year activity. During the six months ended June 30, 2024, the Company concluded, based upon all available evidence, that it was more likely than not that it would have sufficient future taxable income to realize the Company’s federal and state deferred tax assets. As a result, the Company released its valuation allowance associated with deferred tax assets and recognized a corresponding benefit from income taxes in the Condensed Consolidated Statements of Operations. The Company’s conclusion regarding the realizability of such deferred tax assets was based on the scheduled reversal of deferred tax liabilities. The foregoing items cause the ETR to be significantly different compared to the Company’s historical annual ETR. Income Tax in Interim Periods The Company records its tax expense or benefit on an interim basis using an estimated annual effective tax rate. This rate is applied to the current period ordinary income or loss to determine the income tax provision or benefit allocated to the interim period. The income tax effects of unusual or infrequent items are excluded from the estimated annual effective tax rate and are recognized in the impacted interim period. Adjustments to the estimated annual effective income tax rate are recognized in the period when such estimates are revised. Uncertainties The Company files federal and state income tax returns. The 2020-2023 tax years generally remain subject to examination by the Internal Revenue Service and various state taxing authorities, although the Company is not currently under examination in any jurisdiction. The Company does not currently expect any of its remaining unrecognized tax benefits to be recognized in the next twelve months. Recent Accounting Pronouncements   The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement may affect the Company’s financial reporting, the Company undertakes an analysis to determine any required changes to its Condensed Consolidated Financial Statements and assures that there are proper controls in place to ascertain that the Company’s Condensed Consolidated Financial Statements properly reflect the change. In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires entities to disclose specific rate reconciliations, amount of income taxes separated by federal and individual jurisdiction, and the amount of income (loss) from continuing operations before income tax expense (benefit) disaggregated between federal, state, and foreign. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 is designed to improve the reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the CODM. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.

v3.24.2.u1

ACQUISITIONS	6 Months Ended
	Jun. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]
ACQUISITIONS	ACQUISITIONS APLD - Rattlesnake Den I, LLC Acquisition (Garden City, Texas) On April 1, 2024, the Company acquired an operational bitcoin mining site located in Garden City, Texas with 132 megawatts of operational capacity and 200 megawatts of nameplate capacity from Applied Digital Corporation (“APLD”) - Rattlesnake Den I, LLC (the “Garden City Acquisition”) for total cash consideration of $96.8 million, including working capital adjustments that were paid during the three months ended June 30, 2024. The acquisition is intended to improve efficiencies and the scale of operations through the integration of the Company’s technology stack and realization of synergies. The following table summarizes the components of total purchase consideration: (in thousands) April 1, 2024 Initial cash consideration, net of cash acquired $ 92,025  Working capital adjustment 4,748  Total purchase consideration $ 96,773  The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805 - Business Combinations. The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of April 1, 2024: (in thousands) April 1, 2024 Assets Other current assets 4,644  Property and equipment 78,759  Finance lease right-of-use asset 4,040  Goodwill 14,510  Total assets $ 101,953  Liabilities Finance lease liability 5,180  Total liabilities 5,180  Total purchase consideration $ 96,773  Goodwill is calculated as the excess of the purchase price over the net assets acquired. The Company expects the goodwill balance to be deductible for tax purposes over a period of 15 years. Goodwill is primarily attributed to growth and efficiency opportunities as well as expected synergies from combining the operations of bitcoin mining sites with the Company. The fair value of property and equipment was estimated by applying the cost approach, which estimates fair value using replacement or reproduction cost of an asset of comparable utility, adjusted for loss in value due to depreciation and economic obsolescence. The fair value of the finance lease liability was estimated using a discounted cash flow approach, which included assumptions regarding current market prices for similar assets, estimated term and discount rates. GC Data Center Equity Holdings, LLC Acquisition (Granbury, Texas and Kearney, Nebraska) On January 12, 2024, the Company acquired two operational bitcoin mining sites located in Granbury, Texas and Kearney, Nebraska, totaling 390 megawatts of operational capacity from GC Data Center Equity Holdings, LLC for total consideration of $189.6 million, including a working capital adjustment that was paid during the three months ended March 31, 2024, plus up to an additional $19.6 million of cash, which amount is contingent on the expansion of additional megawatt capacity at the acquired facilities by certain milestone dates during the three year period following the anniversary of closing. The acquisition is intended to improve efficiencies and the scale of operations through the integration of the Company’s technology stack and realization of synergies. The Company will not be taking on any new hosting services customers and will transition to self-mining at these two sites as existing customer agreements expire or are terminated early. The following table summarizes the components of total purchase consideration: (in thousands) January 12, 2024 Initial cash consideration, net of cash acquired $ 175,734  Working capital adjustments 8,081  Estimate fair value contingent earn-out and other 5,832  Total purchase consideration $ 189,647  The acquisition was accounted for as a business combination using the acquisition method of accounting in accordance with ASC 805 - Business Combinations. The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of January 12, 2024: (in thousands) January 12, 2024 Assets Accounts receivable $ 20,411  Other current assets 8,506  Property and equipment 132,148  Right-of-use asset 8,852  Goodwill 30,852  Customer relationships 22,000  Derivative instrument 10,989  Other non-current assets 6,250  Total assets $ 240,008  Liabilities Accounts payable and accrued expenses $ 13,940  Lease liability 13,992  Other long-term liabilities 22,429  Total liabilities 50,361  Total purchase consideration $ 189,647  Goodwill is calculated as the excess of the purchase price over the net assets acquired. The Company expects the goodwill balance to be deductible for tax purposes over a period of 15 years. Goodwill is primarily attributed to growth and efficiency opportunities as well as expected synergies from combining the operations of bitcoin mining sites with the Company. The gross contractual amounts receivable were $24.0 million, of which, $3.6 million is expected to be uncollectible. The fair value of property and equipment was estimated by applying the cost approach, which estimates fair value using replacement or reproduction cost of an asset of comparable utility, adjusted for loss in value due to depreciation and economic obsolescence. The fair value of the derivative was estimated using a discounted cash flow approach that considers various assumptions including current market prices and electricity forward curves, time value, as well as other relevant economic measures. The fair value of the contingent earn-out was estimated using a discounted cash flow approach, which included assumptions regarding the probability-weighted cash flows of achieving certain capacity development milestones, which are considered Level 3 inputs. The fair value of the lease liability was estimated using a discounted cash flow approach, which included assumptions regarding current market prices for similar assets, estimated term and discount rates. Changes to the fair value of assets and liabilities are recorded in the Condensed Consolidated Statements of Operations. The following table presents the changes in estimated fair value of the GC Data Center Holdings, LLC contingent consideration liability: (in thousands) Balance at December 31, 2023 $ —  Contingent consideration liability 3,523  Change in fair value of contingent earn-out (90) Balance at June 30, 2024 $ 3,433  Intangible assets were determined to meet the criterion for recognition apart from tangible assets acquired and liabilities assumed. The fair values of intangible assets were estimated based on various valuation techniques including the use of discounted cash flow analyses, and multi-period excess earnings valuation approaches, which use significant unobservable inputs, or Level 3 inputs, as defined by the fair value hierarchy. These valuation inputs included estimates and assumptions about forecasted future cash flows, long-term revenue growth rates, and discount rates. The fair value of the customer relationships intangible asset was determined using a discounted cash flow model that incorporates the excess earnings method and will be amortized on an accelerated basis over the projected pattern of economic benefits of approximately 4 years. The Company recognized $2.8 million in expense during the three months ended March 31, 2024 for the amortization of these acquired customer relationships. The results of acquired facilities have been included from the acquisition date. Included in the Condensed Consolidated Statements of Operations for the three months ended March 31, 2024 was revenues of $20.8 million and net loss before tax of $42.5 million, which includes depreciation in the amount of $5.3 million. The following table presents unaudited consolidated pro forma results as if the acquisitions of the acquired facilities of the Garden City Acquisition and GC Data Center Equity Holdings had occurred as of January 1, 2023 for the indicated periods: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Revenue $ 145,139  $ 111,722  $ 313,430  $ 183,029  Income (loss) before income taxes (233,247) 19,812  151,610  79,811  Earnings per common share: Basic $ (0.72) $ 0.12  $ 0.54  $ 0.49  Diluted (0.72) 0.12  0.52  0.50  The unaudited pro forma financial information reflects the acquisition of the acquired facilities by the application of pro forma adjustments to the Company’s historical financial statements as if the acquisition had occurred on January 1, 2023. The unaudited pro forma financial information should not be considered indicative of actual results that would have been achieved had the acquisition of the acquired facilities actually been consummated on the date indicated and does not purport to be indicative of the Company's future financial position or results of operations. These pro forma results include the impact of amortizing certain purchase accounting adjustments such as intangible assets and the impact of the acquisition on interest and income tax expense. No adjustments have been reflected in the pro forma financial information for anticipated growth and efficiency opportunities. There were no material nonrecurring pro forma adjustments directly attributable to the acquisition included within the unaudited pro forma financial information.

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REVENUES	6 Months Ended
	Jun. 30, 2024
Revenue from Contract with Customer [Abstract]
REVENUES	REVENUES The Company recognizes revenue in accordance with ASC 606. The core principle of the revenue standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle:   •Step 1: Identify the contract with the customer; •Step 2: Identify the performance obligations in the contract; •Step 3: Determine the transaction price; •Step 4: Allocate the transaction price to the performance obligations in the contract; and •Step 5: Recognize revenue when the Company satisfies a performance obligation. In order to identify the performance obligations in a contract with a customer, an entity must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: •The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and •The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following: •Variable consideration •Constraining estimates of variable consideration •The existence of a significant financing component in the contract •Noncash consideration •Consideration payable to a customer Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized under the accounting contract will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time, as appropriate. Application of the Five-Step Model to the Company’s Mining and Hosting Operations The Company’s ongoing major or central operation is to provide bitcoin transaction verification services to the transaction requestor, in addition to the Bitcoin network through a Company-operated mining pool as the operator (“Operator”) (such activity, “mining”) and to provide a service of performing hash calculations to third-party pool operators alongside collectives of third-party bitcoin miners (such collectives, “mining pools”) as a participant (“Participant”). On January 12, 2024, the Company acquired two operational bitcoin mining sites to provide hosting services to institutional-scale crypto mining companies for the purpose of improving efficiencies and the scale of the Company’s mining operations. Refer to Note 3 - Acquisitions, for further information. The following table presents the Company’s revenues disaggregated for those arrangements in which the Company is the Operator and Participant: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Revenues from contracts with customers Mining operator - transaction fees $ 4,923  $ 6,358  $ 13,907  $ 7,409  Mining participant 12,839  3,185  26,281  21,061  Hosting services (1) 8,661  —  29,436  —  Total revenues from contracts with customers 26,423  9,543  69,624  28,470  Mining operator - block rewards and other revenue 118,716  72,216  240,713  104,421  Total revenues $ 145,139  $ 81,759  $ 310,337  $ 132,891  (1) Includes revenue beginning January 12, 2024, the date of the GC Data Center Equity Holdings, LLC acquisition. The Company made a strategic decision to exit hosting services business upon acquisition. Intercompany transactions have been eliminated in consolidation. Refer to Note 3 - Acquisitions, for further information. Mining Operator As Operator, the Company provides transaction verification services to the transaction requestor, in addition to the Bitcoin network. Transaction verification services are an output of the Company’s ordinary activities; therefore, the Company views the transaction requestor as a customer and recognizes the transaction fees as revenue from contracts with customers under ASC 606. The Bitcoin network is not an entity such that it may not meet the definition of a customer; however, the Company has concluded that it is appropriate to apply ASC 606 by analogy to block rewards earned from the Bitcoin network. The Company is currently entitled to the block reward of 3.125 bitcoin, subsequent to the halving that occurred on April 19, 2024. Prior to the halving, The Company was entitled to the block reward of 6.25 bitcoin from each successful validation of a block. The Company is also entitled to the transaction fees paid by the transaction requester payable in bitcoin for each successful validation of a block. The Company assessed the following factors in the determination of the inception and duration of each individual contract to validate a block and satisfaction of its performance obligation as follows: •For each individual contract, the parties’ rights, the transaction price, and the payment terms are fixed and known as of the inception of each individual contract. •The transaction requestor and the Bitcoin network each have a unilateral enforceable right to terminate their respective contracts at any time without penalty. •For each of these respective contracts, contract inception and completion occur simultaneously upon block validation; that is, the contract begins upon, and the duration of the contract does not extend beyond, the validation of an individual blockchain transaction; and each respective contract contains a single performance obligation to perform a transaction validation service and this performance obligation is satisfied at the point-in-time when a block is successfully validated. From September 2021 until May 2022, the Company engaged unrelated third-party mining enterprises (“pool participants”) to contribute hash calculations, and in exchange, remitted transaction fees and block rewards to pool participants on a pro rata basis according to each respective pool participant’s contributed hash calculations. The MaraPool wallet (owned by the Company as Operator) is recorded on the distributed ledger as the winner of proof of work block rewards and assignee of all validations and, therefore, the transaction verifier of record. The pool participants entered into contracts with the Company as Operator; they did not directly enter into contracts with the network or the requester and were not known verifiers of the transactions assigned to the pool. As Operator, the Company delegated mining work to the pool participants utilizing software that algorithmically assigned work to each individual miner. By virtue of its selection and operation of the software, the Company as Operator controlled delegation of work to the pool participants. This indicated that the Company directed the mining pool participants to contribute their hash calculations to solve in areas that the Company designated. Therefore, the Company determined that it controlled the service of providing transaction verification services to the network and requester. Accordingly, the Company recorded all of the transaction fees and block rewards earned from transactions assigned to MaraPool as revenue, and the portion of the transaction fees and block rewards remitted to MaraPool participants as cost of revenues. In accordance with ASC 606-10-32-21, the Company measures the estimated fair value of the non-cash consideration (block reward and transaction fees) at contract inception, which is at the time the performance obligation to the requester and the network is fulfilled by successfully validating a block. The Company measures the non-cash consideration which is fixed as of the inception of each individual contract using the quoted spot rate for bitcoin determined using the Company’s primary trading platform for bitcoin at the time the Company successfully validates a block. Expenses associated with providing bitcoin transaction verification services, such as hosting fees, electricity costs, and related fees are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues. Mining Participant The Company participates in third-party operated mining pools. When the Company is a Participant in a third-party operated mining pool, the Company provides a service to perform hash calculations to the third-party pool operators. The Company considers the third-party mining pool operators to be its customers under Topic 606. Contract inception and the Company’s enforceable right to consideration begins when the Company commences providing hash calculation services to the mining pool operators. Each party to the contract has the unilateral right to terminate the contract at any time without any compensation to the other party for such termination. As such, the duration of a contract is less than a day and may be continuously renewed multiple times throughout the day. The implied renewal option is not a material right because there are no upfront or incremental fees in the initial contract and the terms, conditions, and compensation amount for the renewal options are at the then market rates. The Company is entitled to non-cash compensation based on the pool operator’s payout model. The payout methodologies differ depending on the type of third-party operated mining pool. Full-Pay-Per-Share (“FPPS”) pools pay block rewards and transaction fees, less mining pool fees and Pay-Per-Share (“PPS”) pools pay block rewards less mining pool fees but no transaction fees. For FPPS and PPS pools, the Company is entitled to non-cash consideration even if a block is not successfully validated by the mining pool operators. Success-based mining pools pay a fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses only if a block is successfully validated. During 2023, the Company primarily participated in FPPS mining pools and, to a lesser extent, success-based mining pools. During 2022 and 2021, the Company primarily participated in success-based mining pools and, to a lesser extent, PPS mining pools. FPPS Mining Pools The Company primarily participates in mining pools that use the FPPS payout method for the year ended December 31, 2023. The Company is entitled to compensation once it begins to perform hash calculations for the pool operator in accordance with the operator’s specifications over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on a daily basis. The non-cash consideration that the Company is entitled to for providing hash calculations to the pool operator under the FPPS payout method is made up of block rewards and transaction fees less pool operator expenses determined as follows: •The non-cash consideration in the form of a block reward is based on the total blocks expected to be generated on the Bitcoin network for the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: the daily hash calculations that the Company provided to the pool operator as a percent of the Bitcoin network’s implied hash calculations as determined by the network difficulty, multiplied by the total Bitcoin network block rewards expected to be generated for the same daily period. •The non-cash consideration in the form of transaction fees paid by transaction requestors is based on the share of total actual fees paid over the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: total actual transaction fees generated on the Bitcoin network during the 24-hour period as a percent of total block rewards the Bitcoin network actually generated during the same 24-hour period, multiplied by the block rewards the Company earned for the same 24-hour period noted above. •The block reward and transaction fees earned by the Company is reduced by mining pool fees charged by the operator for operating the pool based on a rate schedule per the mining pool contract. The mining pool fee is only incurred to the extent the Company performs hash calculations and generates revenue in accordance with the pool operator’s payout formula during the same 24-hour period beginning midnight UTC daily. The above non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7, since the amount of block reward earned depends on the amount of hash calculations the Company performs; the amount of transaction fees the Company is entitled to depends on the actual Bitcoin network transaction fees over the same 24-hour period; and the operator fees for the same 24-hour period are variable since they are determined based on the total block rewards and transaction fees in accordance with the pool operator’s agreement. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty without the risk of significant revenue reversal. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception. PPS Mining Pools The Company participates in PPS pools that provide non-cash consideration similar to the FPPS pools except PPS pools do not include transaction fees, therefore, the non-cash consideration received by the Company is made up of block rewards less mining pool fees. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception. Success-based Mining Pools The Company also participates, to a lesser extent, in third-party mining pools that pay rewards only when the pool successfully validates a block. For these pools, the Company only earns a reward when the third-party pool successfully mines a block and its reward is the fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses, based on the proportion of hash calculations the Company performed for the mining pool operator to the total hash calculations performed by all mining pool participants in validating the block during the 24-hour period beginning at midnight UTC and ending 23:59:59 UTC daily. Contract inception and the Company’s enforceable right to consideration begins when the Company commences the performance of hash calculations for the mining pool operator. The non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7 as it depends on whether the third-party mining pool successfully validates a block during each 24-hour period. In addition, other inputs such as the amount of hash calculations and the Company’s fractional share of consideration earned by the pool operator also cause variability. The Company does not have the ability to estimate whether a block will be successfully validated with reasonable certainty at contract inception. The Company constrains the variable consideration at contract inception because it is not probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved. Once a block is successfully validated, the constraint is lifted. The Company recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company’s policy was to measure non-cash consideration based on the spot rate of bitcoin at the time the pool successfully validates a block, which was not in accordance with ASC 606-10-32-21 which requires measurement to coincide with contract inception. Additionally, this measurement was not consistent with the measurement of non-cash consideration for FPPS and PPS pools. During the three months ended December 31, 2023, the Company corrected this error and changed its measurement of non-cash consideration to the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin on the date of contract inception, which is the same day that control of the contracted service (hash calculations) is transferred to the pool operator. The change in measurement did not have a material impact to the results of operations for any of the periods presented. Expenses associated with providing hash calculation services to third-party operated mining pools, such as hosting fees, electricity costs, and related fees, are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues. Hosting Services The Company operates two bitcoin mining sites, which were acquired on January 12, 2024, that provide hosting services to institutional-scale crypto mining companies. Hosting services include colocation and managed services. Colocation services include providing mining companies with sheltered data center space, electrical power, cooling, and internet connectivity. Managed services generally include providing customers with technical support and maintenance services, in addition to colocation services. The Company will not be taking on any new hosting services customers and will transition to self-mining at these two sites as existing customer agreements expire or are terminated early. Colocation services revenue is recognized over time as the customer simultaneously receives and consumes the benefits of the Company’s performance. Managed services revenue is recognized at a point-in-time as the customer simultaneously receives and consumes the benefits of the Company’s performance. The transaction price for colocation services is variable based on the consumption of energy and the managed services price is a fixed rate per miner basis. The Company recognizes hosting services revenue to the extent that a significant reversal of such revenue will not occur. Hosting services customers are generally invoiced in advance of the month in which the Company satisfies its performance obligation, and deferred revenue is recorded for any upfront payments received in advance of the Company’s performance. The monthly transaction price is generally variable based on the amount of megawatt hours (“MWh”) consumed by the customers equipment and when other monthly contracted services are performed. At the end of each month, the customer is billed for the actual amount owed for services performed. The Company recognizes revenue for hosting services under the right-to-invoice practical expedient in ASC 606-10-55-18, which allows for the recognition of revenue over time as the Company’s right-to-invoice for final payment corresponds directly with the value of services transferred to the customer to-date. Expenses associated with providing hosting services are recorded as cost of revenues and depreciation on hosting equipment is recorded as a separate component of cost of revenues.

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DIGITAL ASSETS	6 Months Ended
	Jun. 30, 2024
Crypto Asset [Abstract]
DIGITAL ASSETS	DIGITAL ASSETS Effective January 1, 2023, the Company early adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in the Condensed Consolidated Statements of Operations each reporting period. The Company’s digital assets were within the scope of ASU 2023-08 and a cumulative-effect adjustment of $11.5 million as of the beginning of the fiscal year ended December 31, 2023 was recorded for the difference between the carrying amount of the Company’s digital assets and fair value. The following table presents the Company’s significant digital asset holdings as of June 30, 2024 and December 31, 2023, respectively: (in thousands, except for quantity) Quantity Cost Basis Fair Value Bitcoin 18,488 $ 752,808  $ 1,158,615  Kaspa 88,969,525 7,321  17,117  Total digital assets held as of June 30, 2024 $ 760,129  $ 1,175,732  (in thousands, except for quantity) Quantity Cost Basis Fair Value Bitcoin 15,126 $ 515,315  $ 639,660  Total digital assets held as of December 31, 2023 $ 515,315  $ 639,660  The Company earned 50 and 48 bitcoin that were pending distribution from the Company’s equity method investee, the ADGM Entity, which are excluded from the Company’s holdings as of June 30, 2024 and December 31, 2023, respectively.

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ADVANCES TO VENDORS AND DEPOSITS	6 Months Ended
	Jun. 30, 2024
Advances To Vendors And Deposits
ADVANCES TO VENDORS AND DEPOSITS	ADVANCES TO VENDORS AND DEPOSITS The Company contracts with bitcoin mining equipment manufacturers to procure equipment necessary for the operation of its bitcoin mining operations. These agreements typically require a certain percentage of the value of the total order to be paid in advance at specific intervals, usually within several days of execution of a specific contract and periodically thereafter with final payments due prior to each shipment date. The Company accounts for these payments as “Advances to vendors” in the Condensed Consolidated Balance Sheets.   As of June 30, 2024 and December 31, 2023, such advances totaled approximately $385.4 million and $95.6 million, respectively. In addition, the Company contracts with other service providers for the hosting of its equipment and operational support in data centers where the Company’s equipment is deployed. These arrangements also typically require advance payments to be made to vendors in conjunction with the contractual obligations associated with these services. The Company classifies these payments as “Deposits” and “Long-term deposits” in the Condensed Consolidated Balance Sheets. As of June 30, 2024 and December 31, 2023, such deposits totaled approximately $82.8 million and $67.0 million, respectively.

v3.24.2.u1

PROPERTY AND EQUIPMENT	6 Months Ended
	Jun. 30, 2024
Property, Plant and Equipment [Abstract]
PROPERTY AND EQUIPMENT	PROPERTY AND EQUIPMENT The components of property and equipment as of June 30, 2024 and December 31, 2023 are: (in thousands, except useful life) Useful life (Years) June 30, 2024 December 31, 2023 Land (1) — $ 4,649  $ —  Land improvements 9 25,246  —  Building and improvements 25 50,866  —  Mining rigs 3 1,034,299  862,055  Containers 10 - 15 58,898  5,676  Equipment 4 - 15 64,640  —  Software and hardware 2 3,307  —  Asset retirement obligation 8 7,879  —  Other 7 813  242  Total gross property, equipment 1,291,538 867,973 Less: Accumulated depreciation and amortization (362,004) (196,201) Property and equipment, net $ 929,534  $ 671,772    (1) Refer to Note 14 - Leases, for further information regarding the Company’s finance land lease. The Company recorded an asset retirement obligation of $7.9 million for the Granbury data center land lease. The asset retirement obligation represents the estimated cost to return the site to its original state. The asset retirement obligation is being depreciated over the term of the lease which is approximately 8 years. The Company’s accretion expense related to the asset retirement obligation for the three and six months ended June 30, 2024 was $0.2 million and $0.4 million, respectively. The Company’s depreciation expense related to property and equipment for the three months ended June 30, 2024 and 2023 was $87.8 million and $37.3 million, respectively. The Company’s depreciation expense related to property and equipment for the six months ended June 30, 2024 and 2023 was $165.8 million and $55.0 million, respectively.

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GOODWILL AND INTANGIBLE ASSETS	6 Months Ended
	Jun. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL AND INTANGIBLE ASSETS	GOODWILL AND INTANGIBLE ASSETS Goodwill The components of goodwill as of June 30, 2024 are as follows: As of June 30, 2024 (in thousands) Cost Accumulated impairment charges Net GC Data Center Equity Holdings, LLC $ 30,852  $ —  $ 30,852  Garden City Acquisition 14,510  —  14,510  Total goodwill $ 45,362  $ —  $ 45,362  The Company acquired goodwill from the GC Data Center Equity Holdings, LLC acquisition on January 12, 2024 and the Garden City Acquisition on April 1, 2024, refer to Note 3 – Acquisitions, for further information. There was no goodwill as of December 31, 2023. Intangible assets The following table presents the Company’s intangible assets as of June 30, 2024: As of June 30, 2024 (in thousands) Cost Accumulated amortization Accumulated impairment charges Net Customer relationships $ 22,000  $ (22,000) $ —  $ —  Intellectual property 2,633  (439) —  2,194  Total intangible assets $ 24,633  $ (22,439) $ —  $ 2,194  During the three months ended June 30, 2024, the Company fully amortized customer relationships acquired in the GC Data Center Equity Holdings, LLC due to the Company’s strategic decision to exit hosting services business and termination of customer relationships during the period. Refer to Note 3 - Acquisitions, for further information. There were no intangible assets as of December 31, 2023. The following table presents the Company’s estimated future amortization of finite-lived intangible assets as of June 30, 2024: Year Amount (in thousands) 2024 (remaining) $ 439  2025 878  2026 877  Thereafter —  Total $ 2,194

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FAIR VALUE MEASUREMENT	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENT	FAIR VALUE MEASUREMENT   The Company measures certain financial and non-financial assets and liabilities at fair value on a recurring or non-recurring basis. The Company uses a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability. The levels of the fair value hierarchy are:     Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities   Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data   Level 3: Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions   The carrying amounts reported in the Condensed Consolidated Balance Sheets for cash and cash equivalents, restricted cash, other receivables, deposits, prepaid expenses and other current assets, property and equipment, advances to vendors, accounts payable, accrued expenses, and legal reserve payable approximate their estimated fair market value based on the short-term maturity of these instruments. Additionally, the carrying amounts reported in the Condensed Consolidated Balance Sheets for the Company’s term loan, operating lease liabilities and other long-term liabilities approximate fair value as the related interest rates approximate rates currently available to the Company. Financial assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level of input that is significant to their fair value measurement. The Company measures the fair value of its marketable securities and investments by taking into consideration valuations obtained from third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs included reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs. Recurring measurement of fair value The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis and the Company’s estimated level within the fair value hierarchy for each of those assets and liabilities as of June 30, 2024 and December 31, 2023, respectively: Recurring fair value measured at June 30, 2024 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market funds $ 168,940  $ 168,940  $ —  $ —  U.S. Treasury Bills 65,319  65,319  Digital assets 1,175,732  1,175,732  —  —  Derivative instrument (1) 33,988  —  33,988  —  Liabilities: Contingent consideration liability (2) 3,433  —  —  3,433    Recurring fair value measured at December 31, 2023 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market funds $ 141,147  $ 141,147  $ —  $ —  U.S. Treasury Bills 60,541  60,541  —  —  Digital assets 639,660  639,660  —  —  (1) The fair value of the derivative was estimated using a discounted cash flow approach that considers various assumptions including current market prices and electricity forward curves, which are considered Level 2 inputs. Increases (decreases) in market prices and electricity forward curves could result in significant increases (decreases) in the fair value of derivatives. Refer to Note 2 - Summary of Significant Accounting Policies - Derivatives, for further information. (2) Represents the estimated amount of acquisition-related consideration expected to be paid in the future as of June 30, 2024 for the GC Center Equity Holdings, LLC acquired on January 12, 2024. Increases (decreases) in the probability of achieving the milestones could result in significant increases (decreases) in the fair value of the contingent consideration. Refer to Note 3 - Acquisitions, for further information. The Company includes the above money market funds and U.S. treasury bills in cash and cash equivalents in the Condensed Consolidated Balance Sheets. The Company’s U.S. treasury bills have original remaining maturities of three months or less when purchased. Effective January 1, 2023, the Company early adopted ASU 2023-08, measuring digital assets at fair value on a recurring basis. There were no transfers among Levels 1, 2 or 3 during the six months ended June 30, 2024. Non-recurring measurement of fair value The following tables present information about the Company’s liabilities measured at fair value on a non-recurring basis and are, therefore, not included in the tables above. These liabilities include outstanding convertible notes measured at fair value based on quoted prices in active markets. These liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., impairment). The Company’s estimated level within the fair value hierarchy for each of these liabilities as of June 30, 2024 and December 31, 2023, respectively, is as follows: Non-recurring fair value measured at June 30, 2024 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities: Notes payable $ 326,513  $ 289,058  $ —  $ —  Non-recurring fair value measured at December 31, 2023 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities: Notes payable $ 325,654  $ 269,725  $ —  $ —  There were no transfers among Levels 1, 2 or 3 during the six months ended June 30, 2024. As of June 30, 2024 and December 31, 2023 there were no other assets and liabilities measured at fair value on a non-recurring basis.

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NET INCOME (LOSS) PER SHARE	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
NET INCOME (LOSS) PER SHARE	NET INCOME (LOSS) PER SHARE   Net income (loss) per share is calculated in accordance with ASC 260 - Earnings Per Share. Basic income (loss) per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. For the three and six months ended June 30, 2024 and 2023, the Company recorded net income (loss) and as such, the Company calculated the impact of dilutive common stock equivalents in determining diluted earnings per share.   The following table presents the securities that were not included in the computation of diluted income (loss) per share, as their inclusion would have been anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Warrants 324,375  324,375  324,375  324,375  Restricted stock units 9,152,998  3,847,664  —  3,847,664  Performance-based restricted stock units 2,991,580  —  —  —  Convertible notes 4,341,422  9,812,955  —  —  Series A Preferred Stock —  70,757  —  —  Total dilutive shares 16,810,375  14,055,751  324,375  4,172,039     The following table sets forth the computation of basic and diluted income (loss) per share: Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share and per share data) 2024 2023 2024 2023 Basic earnings per share of common stock: Net income per share of common stock - basic $ (199,659) $ (11,083) $ 137,514  $ 107,616  Weighted average shares of common stock - basic 278,674,506  168,474,882  268,899,932  163,856,352  Net income per share of common stock - basic $ (0.72) $ (0.07) $ 0.51  $ 0.66  Diluted earnings per share of common stock: Net income per share of common stock - basic $ (199,659) $ (11,083) $ 137,514  $ 107,616  Add: Notes interest expense, net of tax —  —  1,969  4,451  Add: Series A preferred stock accretion to redemption value —  —  —  2,121  Net income per share of common stock - diluted $ (199,659) $ (11,083) $ 139,483  $ 114,188  Weighted average shares of common stock - basic 278,674,506  168,474,882  268,899,932  163,856,352  Restricted stock units —  —  4,431,276  —  Performance-based restricted stock units —  —  287,030  —  Convertible notes —  —  4,341,422  9,812,955  Preferred stock —  —  —  70,757  Weighted average shares of common stock - diluted 278,674,506  168,474,882  277,959,660  173,740,064  Net income per share of common stock - diluted $ (0.72) $ (0.07) $ 0.50  $ 0.66

v3.24.2.u1

STOCKHOLDERS’ EQUITY	6 Months Ended
	Jun. 30, 2024
Equity [Abstract]
STOCKHOLDERS’ EQUITY	STOCKHOLDERS' EQUITY   Common Stock On July 27, 2023, the Company’s shareholders approved an amendment to the Company’s articles of incorporation that increased the amount of common stock authorized for issuance to 500,000,000 with a par value of $0.0001 per share. Shelf Registration Statements on Form S-3 and At-the-Market Offering Agreements In February 2024, the Company commenced a new at-the-market (“ATM”) offering program with H.C. Wainwright & Co., LLC (“Wainwright”) acting as sales agent (the “2024 ATM”) pursuant to an ATM agreement, under which the Company may offer and sell shares of its common stock from time to time through Wainwright having an aggregate offering price of up to $1,500.0 million. During the six months ended June 30, 2024, the Company sold 17,472,602 shares of common stock for an aggregate purchase price of $344.9 million, net of offering expenses, pursuant to the 2024 ATM. As a result, the Company had $1,146.0 million aggregate offering price remaining under the 2024 ATM.

v3.24.2.u1

STOCK-BASED COMPENSATION	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
STOCK-BASED COMPENSATION	STOCK-BASED COMPENSATION 2018 Equity Incentive Plan   On January 1, 2018, the Board adopted the 2018 Equity Incentive Plan (as amended, the “2018 Plan”), which was subsequently approved by the Company’s shareholders on March 7, 2018, The 2018 Plan provides for the issuance of stock options, restricted stock, restricted stock units (“RSUs”), preferred stock and other awards to employees, directors, consultants and other service providers. In June 2024, the Company’s shareholders approved an amendment to the 2018 Plan that increased the number of shares authorized for issuance thereunder by 15,000,000 shares. As of June 30, 2024, the Company had an aggregate of 15,536,354 shares of common stock reserved for future issuance under the 2018 Plan. A summary of the Company’s stock-based compensation, by category, is as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Performance-based stock awards $ 5,169  $ —  $ 5,169  $ —  Service-based stock awards 23,163  4,451  75,076  8,396  Total stock-based compensation $ 28,332  $ 4,451  $ 80,245  $ 8,396  Restricted Stock Units The Company grants service-based RSUs to employees, directors and consultants. RSUs granted to employees generally vest over a four-year period from the date of grant; however, in certain instances, all or a portion of a grant may vest immediately. RSUs granted to directors generally vest over a one-year period or, in certain instances, immediately. The Company measures the fair value of RSUs at the grant date and recognizes expenses on a straight-line basis over the requisite service period from the date of grant for each separately-vesting tranche under the graded-vesting attribution method. A summary of the Company’s service-based RSU activity for the six months ended June 30, 2024, is as follows: Number of RSUs Weighted Average Grant Date Fair Value Nonvested at December 31, 2023 5,765,529  $ 9.40  Granted 6,878,838  19.57  Forfeited (256,459) 12.13  Vested (3,234,910) 15.64  Nonvested at June 30, 2024 9,152,998  $ 14.76  As of June 30, 2024, there was approximately $89.0 million of aggregate unrecognized stock-based compensation related to unvested service-based RSUs that is expected to be recognized over the next 2.8 years. Performance-based Restricted Stock Units The Company granted performance-based restricted stock units (“PSUs”) on May 1, 2024 to employees which generally vest over a four-year period from the date of grant. Awards are issued in the form of RSUs and are granted pursuant to the 2018 Plan. The number of PSUs that are subject to vest is directly correlated with the Company’s achievements of a pre-determined metric relating to total stockholder return (“TSR”) for the period from January 1, 2024 through December 31, 2024 (the “Performance Period”). Based on the Company’s TSR performance relative to the peer group for the Performance Period, the PSU awards will vest between 0% to 200% of the target amount over an approximate four-year period. Determination regarding the Company’s performance relative to the TSR metric will establish the maximum number of shares that are subject to vesting pursuant to the PSU awards. Once determined, (i) 25% of the PSU awards will vest on January 31, 2025, and (ii) the balance of the awards will vest in 12 equal calendar quarters (with 6.25% of the shares vesting each quarter). The Company measures the fair value of the PSUs at the grant date using the Monte Carlo simulation model. The Monte Carlo simulation model requires the input of subjective assumptions, including risk-free interest rate, expected term, expected stock price volatility, market capitalization of peer group, and dividend yield. The risk-free interest rate assumption is based upon observed interest rates for constant maturity U.S. Treasury securities as of the grant date. Expected term is consistent with the Performance Period of the awards. Expected volatility is based on the historical volatility of the Company’s common stock over the estimated expected life. The Company does not pay a dividend, therefore, the dividend yield is assumed to be zero. A summary of the Company’s PSU activity for the six months ended June 30, 2024, is as follows: Number of PSUs Weighted Average Grant Date Fair Value Nonvested at December 31, 2023 —  $ —  Granted 2,991,580  14.67  Nonvested at June 30, 2024 2,991,580  $ 14.67  As of June 30, 2024, there was approximately $38.7 million of aggregate unrecognized stock-based compensation related to unvested PSUs that is expected to be recognized over the next 3.6 years. Common Stock Warrants As of June 30, 2024, the Company’s issued and outstanding common stock warrants had no change from December 31, 2023. The Company continues to have 324,375 outstanding warrants, at a weighted average exercise price of $25.00, that are expected to expire in approximately one year.

v3.24.2.u1

DEBT	6 Months Ended
	Jun. 30, 2024
Debt Disclosure [Abstract]
DEBT	DEBT Convertible Note On November 18, 2021, the Company issued $650.0 million principal of 1% Convertible Senior Notes due 2026 (the “Notes”). On November 23, 2021, the initial purchasers of the Notes purchased an additional $97.5 million principal of Notes for an aggregate principal amount of $747.5 million. In September 2023, the Company entered into privately negotiated exchange agreements with certain holders of its Notes. In total, the Company exchanged $416.8 million principal amount of Notes for an aggregate 31,722,417 shares of Company common stock. The Notes accrue interest at a rate of 1% per annum, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2022. As of June 30, 2024 and December 31, 2023, the Notes outstanding, net of unamortized discounts of approximately $4.2 million and $5.1 million, respectively, were $326.5 million and $325.7 million, respectively. The Company is permitted and may seek to repurchase additional Notes prior to the maturity date, whether through privately negotiated purchases, open market purchases, or otherwise.

v3.24.2.u1

LEASES	6 Months Ended
	Jun. 30, 2024
Leases [Abstract]
LEASES	LEASES   The Company leases office space in the United States under operating lease agreements. The Company also entered into an arrangement with APLD for the use of energized cryptocurrency mining facilities under which the Company pays for electricity per megawatt based on usage. The Company has determined that it has embedded operating leases at two of the facilities governed by this arrangement that commenced in January and March 2023, and has elected not to separate lease and non-lease components. Payments made for these two operating leases are entirely variable and are based on usage of electricity, and the Company therefore does not record a right-of-use (“ROU”) asset or lease liability associated with the leases. Variable lease cost during the three and six months ended June 30, 2024 and June 30, 2023 are disclosed in the table below. Office space and mining facilities comprise the Company’s material underlying asset class under operating lease agreements. The Company assumed an operating lease in the GC Data Center Equity Holdings, LLC acquisition related to the data center land lease in Granbury, Texas on January 12, 2024. The ROU asset and total lease liability recorded for the assumption of the lease was $8.9 million and $8.9 million, respectively. An unfavorable lease liability adjustment of $5.1 million related to the GC Data Center Equity Holdings, LLC acquisition is reflected in the total operating lease liabilities. Additionally, the Company assumed a finance lease in the Garden City Acquisition related to the land lease in Garden City, Texas on April 1, 2024. The ROU asset and total lease liability recorded for the assumption of the lease was $4.0 million and $4.0 million, respectively. An unfavorable lease liability adjustment of $1.1 million related to the Garden City Acquisition is reflected in the total finance lease liabilities. The ROU assets and lease liabilities for the leases assumed each were measured based on the net present value of remaining future lease payments on the date of the acquisition, with consideration given for options to extend or renew the lease. As of June 30, 2024, the Company’s ROU assets and total lease liabilities were $9.7 million and $10.6 million, respectively. As of December 31, 2023, the Company’s ROU assets and total lease liabilities were $0.4 million and $0.5 million, respectively. The Company has amortized the ROU assets totaling $0.4 million and $0.1 million for the three months ended June 30, 2024 and 2023, respectively. The Company has amortized the ROU assets totaling $0.7 million and $0.2 million for the six months ended June 30, 2024 and 2023, respectively. The following table presents the assets and liabilities related to the Company’s operating and finance leases as of June 30, 2024 and December 31, 2023: (in thousands) June 30, 2024 December 31, 2023 Assets Balance Sheet Classification Operating lease right-of-use assets Operating lease right-of-use assets $ 9,728  $ 443  Finance lease right-of-use assets Property and equipment, net 4,029  —  Total right-of-use assets $ 13,757  $ 443  Liabilities Current portion: Operating lease liabilities Operating lease liabilities, current portion $ 316  $ 124  Finance lease liability Finance lease liability, current portion 180  —  Long-term portion: Operating lease liabilities Operating lease liabilities, net of current portion 15,106  354  Finance lease liability Finance lease liability, net of current portion 4,834  —  Total lease liabilities $ 20,436  $ 478  Lease costs are recorded on a straight-line basis within operating expenses. The Company’s total lease expenses are comprised of the following: For the Three Months Ended June 30, For the Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Lease costs: Operating lease cost $ 761  $ 74  $ 965  $ 185  Finance lease cost: Amortization of ROU asset 11  —  11  —  Short-term lease rent expense 21  11  37  20  Variable lease cost 20,043  17,165  43,229  19,938  Total rent expense $ 20,836  $ 17,250  $ 44,242  $ 20,143     Additional information regarding the Company’s leasing activities is as follows: For the Six Months Ended June 30, 2024 2023 Operating cash flows from operating leases $ 840 $ 229 Financing cash flows from finance lease 163 — Weighted-average remaining lease term (in years): Operating leases 9.7 3.4 Finance lease 96.8 — Weighted-average discount rate: Operating leases 6.7  % 5.0  % Finance lease 7.2  % —  % The following table presents the Company’s future minimum lease payments as of June 30, 2024:   (in thousands) Year Operating Leases Finance Lease 2024 (remaining) $ 170  $ —  2025 457  168  2026 1,080  173  2027 2,835  178  2028 2,782  183  Thereafter 6,960  89,096  Total 14,284  89,798  Less: Imputed interest (3,681) (85,921) Present value of lease liability $ 10,603  $ 3,877

v3.24.2.u1

LEGAL PROCEEDINGS	6 Months Ended
	Jun. 30, 2024
Commitments and Contingencies Disclosure [Abstract]
LEGAL PROCEEDINGS	LEGAL PROCEEDINGS   The Company, and its subsidiaries, from time to time may be subject to various claims, lawsuits and legal proceedings that arise from the ordinary course of business. In accordance with ASC 450 - Contingencies, if a loss contingency associated with the following legal matters are probable to be incurred and the amount of loss can be reasonably estimated, an accrual is recorded on the Condensed Consolidated Balance Sheets. As of June 30, 2024, the Company has determined that the liabilities associated with certain litigation matters are not expected to have a material impact on the Company’s Financial Statements. The Company will continue to monitor each related legal issue and adjust accruals as new information and developments occur. Compute North Bankruptcy   On September 22, 2022, Compute North Holdings, Inc. (currently d/b/a Mining Project Wind Down Holdings, Inc.) and certain of its affiliates (collectively, “Compute North”) filed for chapter 11 bankruptcy protection. Compute North provided operating services to the Company and hosted its mining rigs at multiple facilities. The Company delivered miners to Compute North, which then installed the mining rigs at those facilities, operated and maintained the mining rigs, and provided energy to keep the miners operating. During the course of the chapter 11 cases, Compute North sold substantially all of their assets in a series of 363 sale transactions, including Compute North’s ownership interests in non-debtor entities that own or partially own facilities that house the Company’s miners. On November 23, 2022, the Company and certain of its affiliates timely filed proofs of claim asserting various claims against Compute North, including: (i) claims arising under hosting agreements between the Company and Compute North LLC; (ii) claims arising under that certain Senior Promissory Note, dated as of July 1, 2022, by and between the Company, as Lender, and Compute North LLC, as Borrower; (iii) claims arising from the breach of a letter of intent between us and Compute North LLC; and (iv) claims for daily lost revenue, profits and other damages against Compute North. On February 9, 2023, the Bankruptcy Court approved a settlement stipulation between the Company and Compute North, pursuant to which the proofs of claim filed by the Company and certain of its affiliates were resolved, and the Company received a single allowed unsecured claim against Compute North LLC in the amount of $40.0 million and its Preferred Equity Interests in Compute North Holdings, Inc. in the amount of 39,597 shares of Series C Preferred Stock was confirmed. In exchange, the Company agreed to vote in favor of Compute North’s chapter 11 plan. On February 16, 2023, the Bankruptcy Court confirmed Compute North’s chapter 11 plan (the “Plan”), pursuant to which Compute North will liquidate its remaining assets and distribute proceeds arising therefrom in accordance with the waterfall set forth in the Plan. In its disclosure statement filed on December 19, 2022, the Compute North Debtors projected that holders of allowed general unsecured claims could recover anywhere between 8% to 65% on their claims, while holders of preferred equity interests are expected to recover nothing on their interests. The Plan became effective on March 31, 2023. At this time, the Company cannot predict the quantum of its potential recovery on account of its allowed general unsecured claim and preferred equity interests or the timing of when it would receive any distributions under the Plan on account of its claims and interests. Moreno v. Marathon On March 30, 2023, a putative class action complaint was filed in the United States District Court for the District of Nevada, against the Company and present and former senior management, alleging claims under Section 10(b) and 20(a) of the Exchange Act arising out of the Company’s announcement of accounting restatements on February 28, 2023. On March 29, 2024, the court appointed lead plaintiffs and counsel. On June 4, 2024, lead plaintiffs filed an amended class action complaint, styled as Langer et al. v. Marathon et al. The allegations in the amended class action complaint are substantially similar to those in the March 30, 2023 putative class action complaint. The defendants have until August 5, 2024 to respond to the amended class action complaint. Derivative Complaints On June 22, 2023, a shareholder derivative complaint was filed in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida, against current members of the Company’s Board and senior management, alleging claims for breach of fiduciary duty and unjust enrichment based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno. On July 8, 2023, a second shareholder derivative complaint was filed in the United States District Court for the District of Nevada, against current and former members of the Company’s Board and senior management, alleging claims under Sections 14(a), 10(b), and 21D of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and for breach of fiduciary duty, unjust enrichment, and waste of corporate assets, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno. On July 12, 2023, a third shareholder derivative complaint was filed in the United States District Court for the District of Nevada, against current and former members of the Company’s Board and senior management, alleging claims under Section 14(a) of the Exchange Act and for breach of fiduciary duty, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno. On July 13, 2023, a fourth shareholder derivative complaint was filed in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida (together with the complaint filed on June 22, 2023, the “Florida Derivative Actions”), against current members of the Company’s Board and senior management, alleging claims for breach of fiduciary duty, unjust enrichment, and waste of corporate assets, based on allegations substantially similar to the allegations in the March 30, 2023 putative class action complaint in Moreno. On August 14, 2023, the two derivative actions pending in the United States District Court for the District of Nevada were consolidated (the “Nevada Derivative Action”). On April 1, 2024, the United States District Court for the District of Nevada appointed co-lead counsel for plaintiffs in the Nevada Derivative Action. On June 25, 2024, plaintiffs filed an amended consolidated complaint alleging breaches of fiduciary duties, unjust enrichment, waste of corporate assets, claims under Section 14(a) of the Exchange Act, and for contribution under Sections 10(b) and 21D of the Exchange Act. The allegations remain substantially similar to those in the March 30, 2023 putative class action complaint in Moreno. The defendants have until August 9, 2024 to respond to the amended complaint. On October 16, 2023, the parties to the derivative actions pending in the Circuit Court of the 17th Judicial Circuit for Broward County, Florida filed an agreed order to stay both actions pending completion of the Nevada Derivative Action. On July 25, 2024, the Florida Derivative Actions were administratively closed. Information Subpoena   On October 6, 2020, the Company entered into a series of agreements with multiple parties to design and build a data center for up to 100-megawatts in Hardin, Montana. In conjunction therewith, the Company filed a Current Report on Form 8-K on October 13, 2020 disclosing that, pursuant to a Data Facility Services Agreement, the Company issued 6,000,000 shares of restricted common stock, in transactions exempt from registration under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). During the quarter ended September 30, 2021, the Company and certain of its executives received a subpoena to produce documents and communications concerning the Hardin, Montana data center facility. The Company received an additional subpoena from the SEC on April 10, 2023, relating to, among other things, transactions with related parties. The Company understands that the SEC may be investigating whether or not there may have been any violations of the federal securities law. The Company is cooperating with the SEC. Ho v. Marathon   On January 14, 2021, plaintiff Michael Ho (“Ho”) filed a civil complaint (the “Complaint”) in which he alleged, among other things, that the Company breached the terms of a non-disclosure agreement, profited from commercially sensitive information he shared with the Company, and refused to compensate him for his role in securing the Company’s acquisition of an energy supplier. The Complaint initially alleged six causes of action including: (1) breach of written contract, (2) breach of implied contract, (3) quasi-contract, (4) services rendered, (5) intentional interference with prospective economic relations, and (6) negligent interference with prospective economic relations. On February 22, 2021, the Company responded to the Complaint with a general denial of the claims and asserted certain affirmative defenses. On February 25, 2021, the Company removed the action to the United States District Court in the Central District of California (the “Court”). The Company filed a motion for summary judgment with respect to each of the causes of action, and the Court dismissed all of the causes of action other than breach of written contract. On July 8, 2024, the Court commenced a jury trial with respect to the sole remaining claim. On July 18, 2024, the jury determined that the Company had breached certain provisions of the non-disclosure agreement and returned a verdict in the amount of $138.8 million. The judgment has not yet been entered and the Company has not paid any portion of the award. The Company intends to defend its positions vigorously and assert its various well-founded legal claims to challenge both the verdict and the amount of the award. In particular, even if the jury verdict is not reversed, the Company believes applicable law supports a significant reduction in the amount of the award.

v3.24.2.u1

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2024
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS	RELATED PARTY TRANSACTIONS During September 2023, the Company entered into an agreement with Auradine to secure certain rights to future purchases by the Company from Auradine for which the Company paid $15.0 million. In addition, during the six months ended June 30, 2024, the Company made advances of $29.1 million, for future purchases resulting in a total advances to Auradine of $43.6 million as of June 30, 2024.

v3.24.2.u1

SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION	6 Months Ended
	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION	SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION The following table provides supplemental disclosure of Condensed Consolidated Statements of Cash Flows information: Six Months Ended June 30, 2024 2023 Supplemental information Cash paid during the year for: Income taxes $ 1,256  $ 782  Interest 4  4,524  Supplemental schedule of non-cash investing and financing activities: Series A Preferred Stock accretion to redemption value $ —  $ 2,121  Reclassifications from advances to vendor to property and equipment upon receipt of equipment 175,442  542,517  Reclassifications from long-term prepaid to property and equipment 3,273  —  Reclassifications from investments to property and equipment 4,416  —  Reclassifications from long-term prepaid to intangible assets 2,633  —  Effective settlement of pre-existing relationships —  —  Dividends received from equity method investment 18,912  —

v3.24.2.u1

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2024
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	SUBSEQUENT EVENTS  On July 25, 2024, the Company announced acquiring $100.0 million bitcoin as part of the Company’s strategy to hold bitcoin and not sell for the foreseeable future. Subsequent to June 30, 2024, the Company issued an aggregate 7,276,739 shares of common stock under the 2024 ATM. As a result, the Company had $982.3 million aggregate offering price remaining under the 2024 ATM.

v3.24.2.u1

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Pay vs Performance Disclosure
Net income (loss)	$ (199,659)	$ (8,962)	$ 137,514	$ 109,737

v3.24.2.u1

Insider Trading Arrangements	3 Months Ended	6 Months Ended
	Jun. 30, 2024 shares	Jun. 30, 2024 shares
Trading Arrangements, by Individual
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false
Doug Mellinger [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On May 13, 2024, Doug Mellinger, a member of the Company’s board of directors, entered into a trading plan intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act (a “10b5-1 Plan”). Mr. Mellinger’s 10b5-1 Plan provides for the potential sale of up to 10,000 shares of the Company’s common stock between the first potential sale date on August 12, 2024 and the expiration of the 10b5-1 Plan on May 13, 2025.
Name	Doug Mellinger
Title	board of directors
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	May 13, 2024
Expiration Date	May 13, 2025
Aggregate Available	10,000	10,000
Jay Leupp [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On June 5, 2024, Jay Leupp, a member of the Company’s board of directors, entered into a 10b5-1 Plan. Mr. Leupp’s 10b5-1 Plan provides for the potential sale of up to 31,200 shares of the Company’s common stock between the first potential sale date on September 4, 2024 and the expiration of the 10b5-1 Plan on June 5, 2025.
Name	Jay Leupp
Title	board of directors
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	June 5, 2024
Expiration Date	June 5, 2025
Aggregate Available	31,200	31,200
Fred Thiel [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On June 18, 2024, Fred Thiel, Chief Executive Officer and Chairperson of the Board, entered into a 10b5-1 Plan. Mr. Thiel’s 10b5-1 Plan provides for the potential sale of up to 357,572 shares of the Company’s common stock between the first potential sale date on September 16, 2024 and the expiration of the 10b5-1 Plan on September 16, 2025.
Name	Fred Thiel
Title	Chief Executive Officer and Chairperson of the Board
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	June 18, 2024
Expiration Date	September 16, 2025
Aggregate Available	357,572	357,572
Salman Khan [Member]
Trading Arrangements, by Individual
Material Terms of Trading Arrangement		On June 18, 2024, Salman Khan, Chief Financial Officer, entered into a 10b5-1 Plan. Mr. Khan’s 10b5-1 Plan provides for the potential sale of up to 66,800 shares of the Company’s common stock between the first potential sale date on September 16, 2024 and the expiration of the 10b5-1 Plan on December 31, 2024.
Name	Salman Khan
Title	Chief Financial Officer
Rule 10b5-1 Arrangement Adopted	true
Adoption Date	June 18, 2024
Expiration Date	December 31, 2024
Aggregate Available	66,800	66,800
Doug Mellinger [Member]
Trading Arrangements, by Individual
Arrangement Duration	365 days
Jay Leupp [Member]
Trading Arrangements, by Individual
Arrangement Duration	365 days
Fred Thiel [Member]
Trading Arrangements, by Individual
Arrangement Duration	455 days
Salman Khan [Member]
Trading Arrangements, by Individual
Arrangement Duration	196 days

v3.24.2.u1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its wholly owned and controlled subsidiaries. Intercompany balances and transactions have been eliminated in consolidation. The Company has prepared the Condensed Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States (“GAAP”) and regulations of the U.S. Securities and Exchange Commission (the “SEC”) applicable to interim financial information, which permit the omission of certain information to the extent it has not changed materially since the latest annual financial statements. These Condensed Consolidated Financial Statements reflect all adjustments consisting only of normal recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the periods presented. The results of operations for the interim periods are not necessarily indicative of the results to be expected for any future fiscal periods in 2024 or for the full year ending December 31, 2024. These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 28, 2024, as amended by Amendment No. 1 on Form 10-K/A (the “Annual Report”), filed with the SEC on May 24, 2024.
Use of Estimates and Assumptions	Use of Estimates and Assumptions   The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant accounting estimates inherent in the preparation of the Company’s financial statements include fair value of assets acquired and liabilities assumed in a business combination, estimates associated with the useful lives of property and equipment, realization of long-lived assets, valuation of derivative instruments, deferred income taxes, unrealized tax positions, and measurement of digital assets. Actual results could differ from those estimates.
Cash and Cash Equivalents	Cash and Cash Equivalents   The Company considers all highly liquid investments and other short-term investments with a maturity of three months or less, when purchased, to be cash equivalents. The Company maintains cash and cash equivalent balances at financial institutions that are insured by the Federal Deposit Insurance Corporation (“FDIC”). During March 2023, the Company began to participate, to the extent practicable, in insured cash sweep programs which “sweep” its deposits across multiple FDIC insured accounts, each with deposits of no more than $250.0 thousand. As of June 30, 2024, substantially all of the Company’s cash and cash equivalents were FDIC insured.
Restricted Cash	Restricted Cash   Restricted cash as of June 30, 2024 principally represented those cash balances that support commercial letters of credit and are restricted from withdrawal.
Digital Assets	Digital Assets   On July 25, 2024, the Company adopted a full holding onto bitcoin (“HODL”) approach towards its bitcoin treasury policy, retaining all bitcoin mined in its operations, and may periodically make strategic open market purchases. As a result, bitcoin digital assets are included in non-current assets in the Condensed Consolidated Balance Sheets due to the Company’s recent intent to retain and hold bitcoin. Kaspa digital assets held with the intent to fund operating expenses are included in current assets on the Condensed Consolidated Balance Sheets. Proceeds from the sale of digital assets are included within investing activities in the accompanying Condensed Consolidated Statement of Cash Flows. Following the adoption of Accounting Standards Update (“ASU”) 2023-08, Accounting for and Disclosure of Crypto Assets, effective January 1, 2023, the Company measures digital assets at fair value with changes recognized in operating expenses in the Condensed Consolidated Statements of Operations. The Company tracks its cost basis of digital assets by-wallet in accordance with the first-in-first-out method of accounting. Refer to Note 5 – Digital Assets, for further information. Effective January 1, 2023, the Company early adopted ASU 2023-08, which requires entities to measure crypto assets at fair value with changes recognized in the Condensed Consolidated Statements of Operations each reporting period. The Company’s digital assets were within the scope of ASU 2023-08 and a cumulative-effect adjustment of $11.5 million as of the beginning of the fiscal year ended December 31, 2023 was recorded for the difference between the carrying amount of the Company’s digital assets and fair value.
Accounts Receivable	Accounts Receivable   The Company acquired accounts receivable as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, which consist of trade receivables. Refer to Note 3 - Acquisitions, for further information. The Company provides an allowance for doubtful accounts equal to the estimated uncollectible amounts, based on historical and customer specific experience and current economic and market conditions.
Deposits	Deposits   In addition to owned and operated sites, the Company contracts with other service providers for hosting of its equipment and operational support in data centers where the Company’s equipment is deployed. These arrangements typically require advance payments to vendors pursuant to the contractual obligations associated with these services. The Company classifies these payments as “Deposits” or “Long-term deposits” in the Condensed Consolidated Balance Sheets.
Derivatives	Derivatives The Company enters into derivative contracts to manage its exposure to fluctuations in the price of bitcoin and energy costs and not for any other purpose. In addition, the Company evaluates its financing and service arrangements to determine whether certain arrangements contain features that qualify as embedded derivatives requiring bifurcation in accordance with Accounting Standard Codification (“ASC”) 815 - Derivatives and Hedging. Embedded derivatives that are required to be bifurcated from the host instrument or arrangement are accounted for and valued as separate financial instruments. There were no embedded derivatives requiring separation from the host instrument as of June 30, 2024 and December 31, 2023. The Company does not elect to designate derivatives as hedges for accounting purposes and as such, records derivatives at fair value with subsequent changes in fair value and settlements recognized in earnings. The Company classifies derivative assets or liabilities in the Condensed Consolidated Balance Sheets as current or non-current based on whether settlement of the instrument could be required within 12 months of the balance sheet date of the Balance Sheets and for derivatives with multiple settlements, based on the term of the contract. Bitcoin Derivatives From time to time the Company enters into derivative contracts to mitigate bitcoin market pricing volatility risk. During the six months ended June 30, 2024, the Company recorded a $2.3 million loss on derivatives as a non-operating charge in the Condensed Consolidated Statements of Operations, all settled through cash payments. There were no derivative instruments outstanding as of June 30, 2024 and December 31, 2023. Energy Derivatives The Company acquired a commodity swap contract as a result of its acquisition of GC Data Center Equity Holdings, LLC on January 12, 2024, refer to Note 3 - Acquisitions, for further information. The commodity swap contract hedges price variability in electricity purchases and expires on December 31, 2027. The commodity swap contract meets the definition of a derivative due to terms that provide for net settlement. As of June 30, 2024, the estimated fair value of the Company’s derivative instrument was $34.0 million, estimated using observable market-based inputs classified under Level 2 of the fair value hierarchy. The significant assumptions used in the discounted cash flow model to estimate fair value include the discount rate and electricity forward curves.
Property and Equipment	Property and Equipment   Property and equipment are stated at cost, net of accumulated depreciation and impairment, as applicable. Property and equipment acquired through business combinations are measured at fair value at the acquisition date. Depreciation is computed using the straight-line method over the estimated useful lives of the assets. The Company’s property and equipment is primarily composed of digital asset mining rigs, which are largely homogeneous and have approximately the same useful lives. Accordingly, the Company utilizes the group method of depreciation for its digital asset mining rigs. The Company will update the estimated useful lives of its digital asset mining server group periodically if information on the operations of the mining equipment indicates changes are required. The Company will assess and adjust the estimated useful lives of its mining equipment when there are indicators that the productivity of the mining assets is longer or shorter than the assigned estimated useful lives.
Goodwill	Goodwill Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not subject to amortization, and instead, assessed for impairment annually at the end of each fiscal year, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying amount in accordance with ASC 350 - Intangibles - Goodwill and Other. The Company has the option to first assess qualitative factors to determine whether events or circumstances indicate it is more likely than not that the fair value of a reporting unit is greater than its carrying amount, in which case a quantitative impairment test is not required. As provided for by ASU 2017-04, Simplifying the Test for Goodwill Impairment, the quantitative goodwill impairment test is performed by comparing the fair value of the reporting unit with its carrying amount, including goodwill. If the fair value of the reporting unit exceeds its carrying amount, goodwill is not impaired. An impairment loss is recognized for any excess of the carrying amount of the reporting unit over its fair value up to the amount of goodwill allocated to the reporting unit. Income tax effects from any tax-deductible goodwill on the carrying amount of the reporting unit are considered when measuring the goodwill impairment loss, if applicable.
Finite-Lived Intangible Assets	Finite-Lived Intangible Assets Intangible assets are recorded at cost less any accumulated amortization and any accumulated impairment losses. Intangible assets acquired through business combinations are measured at fair value at the acquisition date. Intangible assets with finite lives are comprised of customer relationships and intellectual property and are amortized over their estimated useful lives on an accelerated basis over the projected pattern of economic benefits. Finite-lived intangible assets are reviewed for impairment annually, or more frequently when events or changes in circumstances indicate that it is more likely than not that the fair value has been reduced to less than its carrying amount.
Business Combinations	Business Combinations The Company accounts for business combinations under the acquisition method of accounting in accordance with ASC 805 - Business Combinations, by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at the acquisition date fair value. The determination of fair value involves assumptions, estimates and judgments. The initial allocation of the purchase price is considered preliminary and therefore subject to change until the end of the measurement period (up to one year from the acquisition date). Goodwill as of the acquisition date is measured as the excess of consideration transferred over the net assets acquired. Contingent consideration is included within the purchase price and is initially recognized at fair value as of the acquisition date. Contingent consideration, classified as either an asset or a liability, is remeasured to fair value each reporting period, until the contingency is resolved. Changes in contingent consideration period-over-period are recognized in earnings. Acquisition related expenses are recognized separately from the business combination and are expensed as incurred.
Investments	Investments   Investments, which may be made from time to time for strategic reasons, are included in non-current assets in the Condensed Consolidated Balance Sheets. Investments without a readily determinable fair value are recorded at cost minus impairment, plus or minus changes from observable price changes in orderly transactions for identical or similar investments of the same issuer, in accordance with the measurement alternative described in ASC 321 - Investments – Equity Securities. As part of the Company’s policy to maximize return on strategic investment opportunities, while preserving capital and limiting downside risk, the Company may at times enter into equity investments or Simple Agreements for Future Equity (“SAFE”). The nature and timing of the Company’s investments will depend on available capital at any particular time and the investment opportunities identified and available to the Company. However, the Company generally does not make investments for speculative purposes and does not intend to engage in the business of making investments.
Equity Method Investments	Equity Method Investments The Company accounts for investments in which it owns between 20% and 50% of the common stock or has the ability to exercise significant influence, but not control, over the investee using the equity method of accounting in accordance with ASC 323 - Equity Method Investments and Joint Ventures. Under the equity method, an investor initially records an investment in the stock of an investee at cost and adjusts the carrying amount of the investment to recognize the investor’s share of the earnings or losses of the investee after the date of acquisition. On January 27, 2023, the Company and Zero Two (formerly known as FS Innovation, LLC) entered into a Shareholders’ Agreement regarding the formation of an Abu Dhabi Global Markets company (the “ADGM Entity”) in which the Company has a 20% ownership interest, which is accounted for as an equity method investment. The ADGM Entity started mining operations during September 2023. During the six months ended June 30, 2024, the Company received a non-monetary dividend in the amount of $4.4 million associated with approximately 1,950 mining rigs distributed by Zero Two. The Company recorded the mining rigs to property and equipment at fair value and, accordingly, recognized an impairment of $4.1 million that reduced the Company’s investment in the ADGM Entity, for the six months ended June 30, 2024. The Company’s share of net gain was nearly zero and $1.3 million for the three and six months ended June 30, 2024, respectively. As of June 30, 2024, the Company’s investment in the ADGM Entity was $65.4 million and is reflected in “Investments” in the Condensed Consolidated Balance Sheets.
Stock-based Compensation	Stock-based Compensation   The Company expenses stock-based compensation to employees and non-employees over the requisite service period based on the grant date fair value of the awards. Refer to Note 11 – Stockholders' Equity, for further information.
Impairment of Long-lived Assets	Impairment of Long-lived Assets   Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets.
Revenues	Revenues   The Company recognizes revenue under ASC 606 – Revenue from Contracts with Customers. The core principle of the revenue standard is that a reporting entity should recognize revenues to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Refer to Note 4 – Revenues, for further information. The Company recognizes revenue in accordance with ASC 606. The core principle of the revenue standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. The following five steps are applied to achieve that core principle:   •Step 1: Identify the contract with the customer; •Step 2: Identify the performance obligations in the contract; •Step 3: Determine the transaction price; •Step 4: Allocate the transaction price to the performance obligations in the contract; and •Step 5: Recognize revenue when the Company satisfies a performance obligation. In order to identify the performance obligations in a contract with a customer, an entity must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: •The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and •The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). If a good or service is not distinct, the good or service is combined with other promised goods or services until a bundle of goods or services is identified that is distinct. The transaction price is the amount of consideration to which an entity expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both. When determining the transaction price, an entity must consider the effects of all of the following: •Variable consideration •Constraining estimates of variable consideration •The existence of a significant financing component in the contract •Noncash consideration •Consideration payable to a customer Variable consideration is included in the transaction price only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized under the accounting contract will not occur when the uncertainty associated with the variable consideration is subsequently resolved. The transaction price is allocated to each performance obligation on a relative standalone selling price basis. The transaction price allocated to each performance obligation is recognized when that performance obligation is satisfied, at a point in time or over time, as appropriate. Application of the Five-Step Model to the Company’s Mining and Hosting Operations The Company’s ongoing major or central operation is to provide bitcoin transaction verification services to the transaction requestor, in addition to the Bitcoin network through a Company-operated mining pool as the operator (“Operator”) (such activity, “mining”) and to provide a service of performing hash calculations to third-party pool operators alongside collectives of third-party bitcoin miners (such collectives, “mining pools”) as a participant (“Participant”). On January 12, 2024, the Company acquired two operational bitcoin mining sites to provide hosting services to institutional-scale crypto mining companies for the purpose of improving efficiencies and the scale of the Company’s mining operations. Refer to Note 3 - Acquisitions, for further information. Mining Operator As Operator, the Company provides transaction verification services to the transaction requestor, in addition to the Bitcoin network. Transaction verification services are an output of the Company’s ordinary activities; therefore, the Company views the transaction requestor as a customer and recognizes the transaction fees as revenue from contracts with customers under ASC 606. The Bitcoin network is not an entity such that it may not meet the definition of a customer; however, the Company has concluded that it is appropriate to apply ASC 606 by analogy to block rewards earned from the Bitcoin network. The Company is currently entitled to the block reward of 3.125 bitcoin, subsequent to the halving that occurred on April 19, 2024. Prior to the halving, The Company was entitled to the block reward of 6.25 bitcoin from each successful validation of a block. The Company is also entitled to the transaction fees paid by the transaction requester payable in bitcoin for each successful validation of a block. The Company assessed the following factors in the determination of the inception and duration of each individual contract to validate a block and satisfaction of its performance obligation as follows: •For each individual contract, the parties’ rights, the transaction price, and the payment terms are fixed and known as of the inception of each individual contract. •The transaction requestor and the Bitcoin network each have a unilateral enforceable right to terminate their respective contracts at any time without penalty. •For each of these respective contracts, contract inception and completion occur simultaneously upon block validation; that is, the contract begins upon, and the duration of the contract does not extend beyond, the validation of an individual blockchain transaction; and each respective contract contains a single performance obligation to perform a transaction validation service and this performance obligation is satisfied at the point-in-time when a block is successfully validated. From September 2021 until May 2022, the Company engaged unrelated third-party mining enterprises (“pool participants”) to contribute hash calculations, and in exchange, remitted transaction fees and block rewards to pool participants on a pro rata basis according to each respective pool participant’s contributed hash calculations. The MaraPool wallet (owned by the Company as Operator) is recorded on the distributed ledger as the winner of proof of work block rewards and assignee of all validations and, therefore, the transaction verifier of record. The pool participants entered into contracts with the Company as Operator; they did not directly enter into contracts with the network or the requester and were not known verifiers of the transactions assigned to the pool. As Operator, the Company delegated mining work to the pool participants utilizing software that algorithmically assigned work to each individual miner. By virtue of its selection and operation of the software, the Company as Operator controlled delegation of work to the pool participants. This indicated that the Company directed the mining pool participants to contribute their hash calculations to solve in areas that the Company designated. Therefore, the Company determined that it controlled the service of providing transaction verification services to the network and requester. Accordingly, the Company recorded all of the transaction fees and block rewards earned from transactions assigned to MaraPool as revenue, and the portion of the transaction fees and block rewards remitted to MaraPool participants as cost of revenues. In accordance with ASC 606-10-32-21, the Company measures the estimated fair value of the non-cash consideration (block reward and transaction fees) at contract inception, which is at the time the performance obligation to the requester and the network is fulfilled by successfully validating a block. The Company measures the non-cash consideration which is fixed as of the inception of each individual contract using the quoted spot rate for bitcoin determined using the Company’s primary trading platform for bitcoin at the time the Company successfully validates a block. Expenses associated with providing bitcoin transaction verification services, such as hosting fees, electricity costs, and related fees are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues. Mining Participant The Company participates in third-party operated mining pools. When the Company is a Participant in a third-party operated mining pool, the Company provides a service to perform hash calculations to the third-party pool operators. The Company considers the third-party mining pool operators to be its customers under Topic 606. Contract inception and the Company’s enforceable right to consideration begins when the Company commences providing hash calculation services to the mining pool operators. Each party to the contract has the unilateral right to terminate the contract at any time without any compensation to the other party for such termination. As such, the duration of a contract is less than a day and may be continuously renewed multiple times throughout the day. The implied renewal option is not a material right because there are no upfront or incremental fees in the initial contract and the terms, conditions, and compensation amount for the renewal options are at the then market rates. The Company is entitled to non-cash compensation based on the pool operator’s payout model. The payout methodologies differ depending on the type of third-party operated mining pool. Full-Pay-Per-Share (“FPPS”) pools pay block rewards and transaction fees, less mining pool fees and Pay-Per-Share (“PPS”) pools pay block rewards less mining pool fees but no transaction fees. For FPPS and PPS pools, the Company is entitled to non-cash consideration even if a block is not successfully validated by the mining pool operators. Success-based mining pools pay a fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses only if a block is successfully validated. During 2023, the Company primarily participated in FPPS mining pools and, to a lesser extent, success-based mining pools. During 2022 and 2021, the Company primarily participated in success-based mining pools and, to a lesser extent, PPS mining pools. FPPS Mining Pools The Company primarily participates in mining pools that use the FPPS payout method for the year ended December 31, 2023. The Company is entitled to compensation once it begins to perform hash calculations for the pool operator in accordance with the operator’s specifications over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on a daily basis. The non-cash consideration that the Company is entitled to for providing hash calculations to the pool operator under the FPPS payout method is made up of block rewards and transaction fees less pool operator expenses determined as follows: •The non-cash consideration in the form of a block reward is based on the total blocks expected to be generated on the Bitcoin network for the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: the daily hash calculations that the Company provided to the pool operator as a percent of the Bitcoin network’s implied hash calculations as determined by the network difficulty, multiplied by the total Bitcoin network block rewards expected to be generated for the same daily period. •The non-cash consideration in the form of transaction fees paid by transaction requestors is based on the share of total actual fees paid over the daily 24-hour period beginning midnight UTC and ending 23:59:59 UTC in accordance with the following formula: total actual transaction fees generated on the Bitcoin network during the 24-hour period as a percent of total block rewards the Bitcoin network actually generated during the same 24-hour period, multiplied by the block rewards the Company earned for the same 24-hour period noted above. •The block reward and transaction fees earned by the Company is reduced by mining pool fees charged by the operator for operating the pool based on a rate schedule per the mining pool contract. The mining pool fee is only incurred to the extent the Company performs hash calculations and generates revenue in accordance with the pool operator’s payout formula during the same 24-hour period beginning midnight UTC daily. The above non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7, since the amount of block reward earned depends on the amount of hash calculations the Company performs; the amount of transaction fees the Company is entitled to depends on the actual Bitcoin network transaction fees over the same 24-hour period; and the operator fees for the same 24-hour period are variable since they are determined based on the total block rewards and transaction fees in accordance with the pool operator’s agreement. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty without the risk of significant revenue reversal. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception. PPS Mining Pools The Company participates in PPS pools that provide non-cash consideration similar to the FPPS pools except PPS pools do not include transaction fees, therefore, the non-cash consideration received by the Company is made up of block rewards less mining pool fees. While the non-cash consideration is variable, the Company has the ability to estimate the variable consideration at contract inception with reasonable certainty. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company measures the non-cash consideration based on the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin over a 24-hour period beginning midnight UTC and ending 23:59:59 UTC on the day of contract inception. The Company recognizes non-cash consideration on the same day that control of the contracted service is transferred to the pool operator, which is the same day as the contract inception. Success-based Mining Pools The Company also participates, to a lesser extent, in third-party mining pools that pay rewards only when the pool successfully validates a block. For these pools, the Company only earns a reward when the third-party pool successfully mines a block and its reward is the fractional share of the successfully mined block and transaction fees, reduced by pool operator expenses, based on the proportion of hash calculations the Company performed for the mining pool operator to the total hash calculations performed by all mining pool participants in validating the block during the 24-hour period beginning at midnight UTC and ending 23:59:59 UTC daily. Contract inception and the Company’s enforceable right to consideration begins when the Company commences the performance of hash calculations for the mining pool operator. The non-cash consideration is variable in accordance with paragraphs ASC 606-10-32-5 to 606-10-32-7 as it depends on whether the third-party mining pool successfully validates a block during each 24-hour period. In addition, other inputs such as the amount of hash calculations and the Company’s fractional share of consideration earned by the pool operator also cause variability. The Company does not have the ability to estimate whether a block will be successfully validated with reasonable certainty at contract inception. The Company constrains the variable consideration at contract inception because it is not probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved. Once a block is successfully validated, the constraint is lifted. The Company recognizes the non-cash consideration on the same day that control is transferred, which is the same day as contract inception. The Company’s policy was to measure non-cash consideration based on the spot rate of bitcoin at the time the pool successfully validates a block, which was not in accordance with ASC 606-10-32-21 which requires measurement to coincide with contract inception. Additionally, this measurement was not consistent with the measurement of non-cash consideration for FPPS and PPS pools. During the three months ended December 31, 2023, the Company corrected this error and changed its measurement of non-cash consideration to the simple average daily spot rate of bitcoin determined using the Company’s primary trading platform for bitcoin on the date of contract inception, which is the same day that control of the contracted service (hash calculations) is transferred to the pool operator. The change in measurement did not have a material impact to the results of operations for any of the periods presented. Expenses associated with providing hash calculation services to third-party operated mining pools, such as hosting fees, electricity costs, and related fees, are recorded as cost of revenues. Depreciation on digital asset mining equipment is also recorded as a component of cost of revenues. Hosting Services The Company operates two bitcoin mining sites, which were acquired on January 12, 2024, that provide hosting services to institutional-scale crypto mining companies. Hosting services include colocation and managed services. Colocation services include providing mining companies with sheltered data center space, electrical power, cooling, and internet connectivity. Managed services generally include providing customers with technical support and maintenance services, in addition to colocation services. The Company will not be taking on any new hosting services customers and will transition to self-mining at these two sites as existing customer agreements expire or are terminated early. Colocation services revenue is recognized over time as the customer simultaneously receives and consumes the benefits of the Company’s performance. Managed services revenue is recognized at a point-in-time as the customer simultaneously receives and consumes the benefits of the Company’s performance. The transaction price for colocation services is variable based on the consumption of energy and the managed services price is a fixed rate per miner basis. The Company recognizes hosting services revenue to the extent that a significant reversal of such revenue will not occur. Hosting services customers are generally invoiced in advance of the month in which the Company satisfies its performance obligation, and deferred revenue is recorded for any upfront payments received in advance of the Company’s performance. The monthly transaction price is generally variable based on the amount of megawatt hours (“MWh”) consumed by the customers equipment and when other monthly contracted services are performed. At the end of each month, the customer is billed for the actual amount owed for services performed. The Company recognizes revenue for hosting services under the right-to-invoice practical expedient in ASC 606-10-55-18, which allows for the recognition of revenue over time as the Company’s right-to-invoice for final payment corresponds directly with the value of services transferred to the customer to-date. Expenses associated with providing hosting services are recorded as cost of revenues and depreciation on hosting equipment is recorded as a separate component of cost of revenues.
Research and Development	Research and Development Research and development costs consist primarily of contractor costs, equipment, supplies, personnel, and related expenses for research and development activities. Research and development costs are expensed as incurred in accordance with ASC 730 - Research and Development and are included in operating expenses in the Condensed Consolidated Statements of Operations.
Income Taxes	Income Taxes   Effective Tax Rate The effective tax rate (“ETR”) from continuing operations was 13.69% and 4.44% for the three and six months ended June 30, 2024, respectively, and 2.32% and 0.25% for the three and six months ended June 30, 2023, respectively. The difference between the U.S. statutory tax rate of 21% was primarily due to the change in valuation allowance as a result of current year activity. During the six months ended June 30, 2024, the Company concluded, based upon all available evidence, that it was more likely than not that it would have sufficient future taxable income to realize the Company’s federal and state deferred tax assets. As a result, the Company released its valuation allowance associated with deferred tax assets and recognized a corresponding benefit from income taxes in the Condensed Consolidated Statements of Operations. The Company’s conclusion regarding the realizability of such deferred tax assets was based on the scheduled reversal of deferred tax liabilities. The foregoing items cause the ETR to be significantly different compared to the Company’s historical annual ETR. Income Tax in Interim Periods The Company records its tax expense or benefit on an interim basis using an estimated annual effective tax rate. This rate is applied to the current period ordinary income or loss to determine the income tax provision or benefit allocated to the interim period. The income tax effects of unusual or infrequent items are excluded from the estimated annual effective tax rate and are recognized in the impacted interim period. Adjustments to the estimated annual effective income tax rate are recognized in the period when such estimates are revised. Uncertainties The Company files federal and state income tax returns. The 2020-2023 tax years generally remain subject to examination by the Internal Revenue Service and various state taxing authorities, although the Company is not currently under examination in any jurisdiction. The Company does not currently expect any of its remaining unrecognized tax benefits to be recognized in the next twelve months.
Recent Accounting Pronouncements	Recent Accounting Pronouncements   The Company continually assesses any new accounting pronouncements to determine their applicability. When it is determined that a new accounting pronouncement may affect the Company’s financial reporting, the Company undertakes an analysis to determine any required changes to its Condensed Consolidated Financial Statements and assures that there are proper controls in place to ascertain that the Company’s Condensed Consolidated Financial Statements properly reflect the change. In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 requires entities to disclose specific rate reconciliations, amount of income taxes separated by federal and individual jurisdiction, and the amount of income (loss) from continuing operations before income tax expense (benefit) disaggregated between federal, state, and foreign. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard. In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 is designed to improve the reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly provided to the CODM. The new standard is effective for the Company for its fiscal year beginning January 1, 2025, with early adoption permitted. The Company is currently evaluating the impact of adopting the standard.
Fair Value Measurement	The Company measures certain financial and non-financial assets and liabilities at fair value on a recurring or non-recurring basis. The Company uses a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, essentially an exit price, based on the highest and best use of the asset or liability. The levels of the fair value hierarchy are:     Level 1: Observable inputs such as quoted market prices in active markets for identical assets or liabilities   Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data   Level 3: Unobservable inputs for which there is little or no market data, which require the use of the reporting entity’s own assumptions   The carrying amounts reported in the Condensed Consolidated Balance Sheets for cash and cash equivalents, restricted cash, other receivables, deposits, prepaid expenses and other current assets, property and equipment, advances to vendors, accounts payable, accrued expenses, and legal reserve payable approximate their estimated fair market value based on the short-term maturity of these instruments. Additionally, the carrying amounts reported in the Condensed Consolidated Balance Sheets for the Company’s term loan, operating lease liabilities and other long-term liabilities approximate fair value as the related interest rates approximate rates currently available to the Company. Financial assets and liabilities are classified in their entirety within the fair value hierarchy based on the lowest level of input that is significant to their fair value measurement. The Company measures the fair value of its marketable securities and investments by taking into consideration valuations obtained from third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs included reported trades of and broker-dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities and other observable inputs. The Company includes the above money market funds and U.S. treasury bills in cash and cash equivalents in the Condensed Consolidated Balance Sheets. The Company’s U.S. treasury bills have original remaining maturities of three months or less when purchased. Effective January 1, 2023, the Company early adopted ASU 2023-08, measuring digital assets at fair value on a recurring basis. There were no transfers among Levels 1, 2 or 3 during the six months ended June 30, 2024.
Net Income Per Share	Net income (loss) per share is calculated in accordance with ASC 260 - Earnings Per Share. Basic income (loss) per share is computed by dividing net income by the weighted average number of shares of common stock outstanding during the period. For the three and six months ended June 30, 2024 and 2023, the Company recorded net income (loss) and as such, the Company calculated the impact of dilutive common stock equivalents in determining diluted earnings per share.
Leases	The Company leases office space in the United States under operating lease agreements. The Company also entered into an arrangement with APLD for the use of energized cryptocurrency mining facilities under which the Company pays for electricity per megawatt based on usage. The Company has determined that it has embedded operating leases at two of the facilities governed by this arrangement that commenced in January and March 2023, and has elected not to separate lease and non-lease components. Payments made for these two operating leases are entirely variable and are based on usage of electricity, and the Company therefore does not record a right-of-use (“ROU”) asset or lease liability associated with the leases. Variable lease cost during the three and six months ended June 30, 2024 and June 30, 2023 are disclosed in the table below. Office space and mining facilities comprise the Company’s material underlying asset class under operating lease agreements.

v3.24.2.u1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)	6 Months Ended
	Jun. 30, 2024
Accounting Policies [Abstract]
Schedule of Changes in Fair Value of the Derivative Instrument	The following table presents the changes in fair value of the derivative instrument: (in thousands) Balance at December 31, 2023 $ —  Commodity swap contract 10,989  Change in fair value of derivative 22,999  Balance at June 30, 2024 $ 33,988

v3.24.2.u1

ACQUISITIONS (Tables)	6 Months Ended
	Jun. 30, 2024
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]
Schedule of Components of Total Purchase Consideration	The following table summarizes the components of total purchase consideration: (in thousands) April 1, 2024 Initial cash consideration, net of cash acquired $ 92,025  Working capital adjustment 4,748  Total purchase consideration $ 96,773  The following table summarizes the components of total purchase consideration: (in thousands) January 12, 2024 Initial cash consideration, net of cash acquired $ 175,734  Working capital adjustments 8,081  Estimate fair value contingent earn-out and other 5,832  Total purchase consideration $ 189,647
Schedule of Preliminary Allocation of Purchase Price	The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of April 1, 2024: (in thousands) April 1, 2024 Assets Other current assets 4,644  Property and equipment 78,759  Finance lease right-of-use asset 4,040  Goodwill 14,510  Total assets $ 101,953  Liabilities Finance lease liability 5,180  Total liabilities 5,180  Total purchase consideration $ 96,773  The following table summarizes the preliminary allocation of the purchase price based on the estimated fair values of the assets acquired and liabilities assumed as of January 12, 2024: (in thousands) January 12, 2024 Assets Accounts receivable $ 20,411  Other current assets 8,506  Property and equipment 132,148  Right-of-use asset 8,852  Goodwill 30,852  Customer relationships 22,000  Derivative instrument 10,989  Other non-current assets 6,250  Total assets $ 240,008  Liabilities Accounts payable and accrued expenses $ 13,940  Lease liability 13,992  Other long-term liabilities 22,429  Total liabilities 50,361  Total purchase consideration $ 189,647
Schedule of Changes in Estimated Fair Value of the Contingent Consideration Liability	The following table presents the changes in estimated fair value of the GC Data Center Holdings, LLC contingent consideration liability: (in thousands) Balance at December 31, 2023 $ —  Contingent consideration liability 3,523  Change in fair value of contingent earn-out (90) Balance at June 30, 2024 $ 3,433
Schedule of Pro Forma Results of Acquisition	The following table presents unaudited consolidated pro forma results as if the acquisitions of the acquired facilities of the Garden City Acquisition and GC Data Center Equity Holdings had occurred as of January 1, 2023 for the indicated periods: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Revenue $ 145,139  $ 111,722  $ 313,430  $ 183,029  Income (loss) before income taxes (233,247) 19,812  151,610  79,811  Earnings per common share: Basic $ (0.72) $ 0.12  $ 0.54  $ 0.49  Diluted (0.72) 0.12  0.52  0.50

v3.24.2.u1

REVENUES (Tables)	6 Months Ended
	Jun. 30, 2024
Revenue from Contract with Customer [Abstract]
Schedule of Disaggregation of Revenue	The following table presents the Company’s revenues disaggregated for those arrangements in which the Company is the Operator and Participant: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Revenues from contracts with customers Mining operator - transaction fees $ 4,923  $ 6,358  $ 13,907  $ 7,409  Mining participant 12,839  3,185  26,281  21,061  Hosting services (1) 8,661  —  29,436  —  Total revenues from contracts with customers 26,423  9,543  69,624  28,470  Mining operator - block rewards and other revenue 118,716  72,216  240,713  104,421  Total revenues $ 145,139  $ 81,759  $ 310,337  $ 132,891  (1) Includes revenue beginning January 12, 2024, the date of the GC Data Center Equity Holdings, LLC acquisition. The Company made a strategic decision to exit hosting services business upon acquisition. Intercompany transactions have been eliminated in consolidation. Refer to Note 3 - Acquisitions, for further information.

v3.24.2.u1

DIGITAL ASSETS (Tables)	6 Months Ended
	Jun. 30, 2024
Crypto Asset [Abstract]
Schedule of Digital Assets	The following table presents the Company’s significant digital asset holdings as of June 30, 2024 and December 31, 2023, respectively: (in thousands, except for quantity) Quantity Cost Basis Fair Value Bitcoin 18,488 $ 752,808  $ 1,158,615  Kaspa 88,969,525 7,321  17,117  Total digital assets held as of June 30, 2024 $ 760,129  $ 1,175,732  (in thousands, except for quantity) Quantity Cost Basis Fair Value Bitcoin 15,126 $ 515,315  $ 639,660  Total digital assets held as of December 31, 2023 $ 515,315  $ 639,660

v3.24.2.u1

PROPERTY AND EQUIPMENT (Tables)	6 Months Ended
	Jun. 30, 2024
Property, Plant and Equipment [Abstract]
Schedule of Components of Property and Equipment	The components of property and equipment as of June 30, 2024 and December 31, 2023 are: (in thousands, except useful life) Useful life (Years) June 30, 2024 December 31, 2023 Land (1) — $ 4,649  $ —  Land improvements 9 25,246  —  Building and improvements 25 50,866  —  Mining rigs 3 1,034,299  862,055  Containers 10 - 15 58,898  5,676  Equipment 4 - 15 64,640  —  Software and hardware 2 3,307  —  Asset retirement obligation 8 7,879  —  Other 7 813  242  Total gross property, equipment 1,291,538 867,973 Less: Accumulated depreciation and amortization (362,004) (196,201) Property and equipment, net $ 929,534  $ 671,772    (1) Refer to Note 14 - Leases, for further information regarding the Company’s finance land lease.

v3.24.2.u1

GOODWILL AND INTANGIBLE ASSETS (Tables)	6 Months Ended
	Jun. 30, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of Components of Goodwill	The components of goodwill as of June 30, 2024 are as follows: As of June 30, 2024 (in thousands) Cost Accumulated impairment charges Net GC Data Center Equity Holdings, LLC $ 30,852  $ —  $ 30,852  Garden City Acquisition 14,510  —  14,510  Total goodwill $ 45,362  $ —  $ 45,362
Schedule of Intangible Assets	The following table presents the Company’s intangible assets as of June 30, 2024: As of June 30, 2024 (in thousands) Cost Accumulated amortization Accumulated impairment charges Net Customer relationships $ 22,000  $ (22,000) $ —  $ —  Intellectual property 2,633  (439) —  2,194  Total intangible assets $ 24,633  $ (22,439) $ —  $ 2,194
Schedule of Estimated Future Amortization of Finite-Lived Intangible Assets	The following table presents the Company’s estimated future amortization of finite-lived intangible assets as of June 30, 2024: Year Amount (in thousands) 2024 (remaining) $ 439  2025 878  2026 877  Thereafter —  Total $ 2,194

v3.24.2.u1

FAIR VALUE MEASUREMENT (Tables)	6 Months Ended
	Jun. 30, 2024
Fair Value Disclosures [Abstract]
Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis	The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis and the Company’s estimated level within the fair value hierarchy for each of those assets and liabilities as of June 30, 2024 and December 31, 2023, respectively: Recurring fair value measured at June 30, 2024 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market funds $ 168,940  $ 168,940  $ —  $ —  U.S. Treasury Bills 65,319  65,319  Digital assets 1,175,732  1,175,732  —  —  Derivative instrument (1) 33,988  —  33,988  —  Liabilities: Contingent consideration liability (2) 3,433  —  —  3,433    Recurring fair value measured at December 31, 2023 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Assets: Money market funds $ 141,147  $ 141,147  $ —  $ —  U.S. Treasury Bills 60,541  60,541  —  —  Digital assets 639,660  639,660  —  —  (1) The fair value of the derivative was estimated using a discounted cash flow approach that considers various assumptions including current market prices and electricity forward curves, which are considered Level 2 inputs. Increases (decreases) in market prices and electricity forward curves could result in significant increases (decreases) in the fair value of derivatives. Refer to Note 2 - Summary of Significant Accounting Policies - Derivatives, for further information. (2) Represents the estimated amount of acquisition-related consideration expected to be paid in the future as of June 30, 2024 for the GC Center Equity Holdings, LLC acquired on January 12, 2024. Increases (decreases) in the probability of achieving the milestones could result in significant increases (decreases) in the fair value of the contingent consideration. Refer to Note 3 - Acquisitions, for further information.
Schedule of Liabilities Measured at Fair Value on Non-Recurring Basis	The following tables present information about the Company’s liabilities measured at fair value on a non-recurring basis and are, therefore, not included in the tables above. These liabilities include outstanding convertible notes measured at fair value based on quoted prices in active markets. These liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances (e.g., impairment). The Company’s estimated level within the fair value hierarchy for each of these liabilities as of June 30, 2024 and December 31, 2023, respectively, is as follows: Non-recurring fair value measured at June 30, 2024 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities: Notes payable $ 326,513  $ 289,058  $ —  $ —  Non-recurring fair value measured at December 31, 2023 (in thousands) Total carrying value Quoted prices in active markets (Level 1) Significant other observable inputs (Level 2) Significant unobservable inputs (Level 3) Liabilities: Notes payable $ 325,654  $ 269,725  $ —  $ —

v3.24.2.u1

NET INCOME (LOSS) PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2024
Earnings Per Share [Abstract]
Schedule of Antidilutive Securities Excluded from Computation of Diluted Income Per Share	The following table presents the securities that were not included in the computation of diluted income (loss) per share, as their inclusion would have been anti-dilutive: Three Months Ended June 30, Six Months Ended June 30, 2024 2023 2024 2023 Warrants 324,375  324,375  324,375  324,375  Restricted stock units 9,152,998  3,847,664  —  3,847,664  Performance-based restricted stock units 2,991,580  —  —  —  Convertible notes 4,341,422  9,812,955  —  —  Series A Preferred Stock —  70,757  —  —  Total dilutive shares 16,810,375  14,055,751  324,375  4,172,039
Schedule of Computation of Basic and Diluted Income (Loss) Per Share	The following table sets forth the computation of basic and diluted income (loss) per share: Three Months Ended June 30, Six Months Ended June 30, (in thousands, except share and per share data) 2024 2023 2024 2023 Basic earnings per share of common stock: Net income per share of common stock - basic $ (199,659) $ (11,083) $ 137,514  $ 107,616  Weighted average shares of common stock - basic 278,674,506  168,474,882  268,899,932  163,856,352  Net income per share of common stock - basic $ (0.72) $ (0.07) $ 0.51  $ 0.66  Diluted earnings per share of common stock: Net income per share of common stock - basic $ (199,659) $ (11,083) $ 137,514  $ 107,616  Add: Notes interest expense, net of tax —  —  1,969  4,451  Add: Series A preferred stock accretion to redemption value —  —  —  2,121  Net income per share of common stock - diluted $ (199,659) $ (11,083) $ 139,483  $ 114,188  Weighted average shares of common stock - basic 278,674,506  168,474,882  268,899,932  163,856,352  Restricted stock units —  —  4,431,276  —  Performance-based restricted stock units —  —  287,030  —  Convertible notes —  —  4,341,422  9,812,955  Preferred stock —  —  —  70,757  Weighted average shares of common stock - diluted 278,674,506  168,474,882  277,959,660  173,740,064  Net income per share of common stock - diluted $ (0.72) $ (0.07) $ 0.50  $ 0.66

v3.24.2.u1

STOCK-BASED COMPENSATION (Tables)	6 Months Ended
	Jun. 30, 2024
Share-Based Payment Arrangement [Abstract]
Schedule of Stock-Based Compensation	A summary of the Company’s stock-based compensation, by category, is as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Performance-based stock awards $ 5,169  $ —  $ 5,169  $ —  Service-based stock awards 23,163  4,451  75,076  8,396  Total stock-based compensation $ 28,332  $ 4,451  $ 80,245  $ 8,396
Schedule of Service-Based RSU Activity	A summary of the Company’s service-based RSU activity for the six months ended June 30, 2024, is as follows: Number of RSUs Weighted Average Grant Date Fair Value Nonvested at December 31, 2023 5,765,529  $ 9.40  Granted 6,878,838  19.57  Forfeited (256,459) 12.13  Vested (3,234,910) 15.64  Nonvested at June 30, 2024 9,152,998  $ 14.76
Schedule of Performance-Based RSU Activity	A summary of the Company’s PSU activity for the six months ended June 30, 2024, is as follows: Number of PSUs Weighted Average Grant Date Fair Value Nonvested at December 31, 2023 —  $ —  Granted 2,991,580  14.67  Nonvested at June 30, 2024 2,991,580  $ 14.67

v3.24.2.u1

LEASES (Tables)	6 Months Ended
	Jun. 30, 2024
Leases [Abstract]
Schedule of Assets and Liabilities Related to Operating and Finance Leases	The following table presents the assets and liabilities related to the Company’s operating and finance leases as of June 30, 2024 and December 31, 2023: (in thousands) June 30, 2024 December 31, 2023 Assets Balance Sheet Classification Operating lease right-of-use assets Operating lease right-of-use assets $ 9,728  $ 443  Finance lease right-of-use assets Property and equipment, net 4,029  —  Total right-of-use assets $ 13,757  $ 443  Liabilities Current portion: Operating lease liabilities Operating lease liabilities, current portion $ 316  $ 124  Finance lease liability Finance lease liability, current portion 180  —  Long-term portion: Operating lease liabilities Operating lease liabilities, net of current portion 15,106  354  Finance lease liability Finance lease liability, net of current portion 4,834  —  Total lease liabilities $ 20,436  $ 478
Schedule of Total Lease Expense and Leasing Activities	Lease costs are recorded on a straight-line basis within operating expenses. The Company’s total lease expenses are comprised of the following: For the Three Months Ended June 30, For the Six Months Ended June 30, (in thousands) 2024 2023 2024 2023 Lease costs: Operating lease cost $ 761  $ 74  $ 965  $ 185  Finance lease cost: Amortization of ROU asset 11  —  11  —  Short-term lease rent expense 21  11  37  20  Variable lease cost 20,043  17,165  43,229  19,938  Total rent expense $ 20,836  $ 17,250  $ 44,242  $ 20,143  Additional information regarding the Company’s leasing activities is as follows: For the Six Months Ended June 30, 2024 2023 Operating cash flows from operating leases $ 840 $ 229 Financing cash flows from finance lease 163 — Weighted-average remaining lease term (in years): Operating leases 9.7 3.4 Finance lease 96.8 — Weighted-average discount rate: Operating leases 6.7  % 5.0  % Finance lease 7.2  % —  %
Schedule of Future Minimum Operating Lease Payments	The following table presents the Company’s future minimum lease payments as of June 30, 2024:   (in thousands) Year Operating Leases Finance Lease 2024 (remaining) $ 170  $ —  2025 457  168  2026 1,080  173  2027 2,835  178  2028 2,782  183  Thereafter 6,960  89,096  Total 14,284  89,798  Less: Imputed interest (3,681) (85,921) Present value of lease liability $ 10,603  $ 3,877

v3.24.2.u1

SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION (Tables)	6 Months Ended
	Jun. 30, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Schedule of Supplemental Disclosure of Condensed Consolidated Statements of Cash Flows Information	The following table provides supplemental disclosure of Condensed Consolidated Statements of Cash Flows information: Six Months Ended June 30, 2024 2023 Supplemental information Cash paid during the year for: Income taxes $ 1,256  $ 782  Interest 4  4,524  Supplemental schedule of non-cash investing and financing activities: Series A Preferred Stock accretion to redemption value $ —  $ 2,121  Reclassifications from advances to vendor to property and equipment upon receipt of equipment 175,442  542,517  Reclassifications from long-term prepaid to property and equipment 3,273  —  Reclassifications from investments to property and equipment 4,416  —  Reclassifications from long-term prepaid to intangible assets 2,633  —  Effective settlement of pre-existing relationships —  —  Dividends received from equity method investment 18,912  —

v3.24.2.u1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details)		1 Months Ended	3 Months Ended		6 Months Ended
	Jan. 10, 2024 USD ($)	Sep. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) derivativeInstrument investment	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) derivativeInstrument investment segement	Jun. 30, 2023 USD ($)	Dec. 31, 2023 USD ($) derivativeInstrument investment	Jan. 27, 2023
Accounting Policies [Line Items]
Allowance for doubtful accounts			$ 12,100,000		$ 12,100,000
Embedded derivatives requiring separation from the host instrument			0		0		$ 0
Loss on derivatives			$ 0	$ 0	$ 2,292,000	$ 0
Number of derivative instruments outstanding | derivativeInstrument			0		0		0
Estimated fair value of derivative instrument			$ 33,988,000		$ 33,988,000		$ 0
Investments			116,282,000		116,282,000		$ 106,292,000
Gain on investment			0	0	5,236,000	0
Non-monetary dividend					$ 4,400,000
Number of miners rigs distributed | segement					1,950
Impairment on equity investment					$ (4,100,000)
Equity in net earnings of unconsolidated affiliate			49,000	0	1,308,000	0
Research and development costs			$ 3,845,000	$ 651,000	$ 6,311,000	$ 860,000
Effective tax rate from continuing operations			13.69%	2.32%	4.44%	0.25%
Auradine, Inc.
Accounting Policies [Line Items]
Payments to acquire investments		$ 15,000,000			$ 29,100,000
Auradine, Inc. | Preferred Stock
Accounting Policies [Line Items]
Investments	$ 48,700,000
Payments to acquire investments	8,000,000
Gain on investment	$ 5,200,000
SAFE Investment
Accounting Policies [Line Items]
Number of investments | investment			2		2		1
Investments			$ 1,300,000		$ 1,300,000		$ 1,000,000
ADGM Entity
Accounting Policies [Line Items]
Equity method investment, ownership percentage								20.00%
Equity in net earnings of unconsolidated affiliate			0		1,300,000
Equity method investments			$ 65,400,000		$ 65,400,000

v3.24.2.u1

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Changes in Fair Value of the Derivative Instrument (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Fair Value Of Derivative Instrument [Roll Forward]
Beginning balance			$ 0
Commodity swap contract			10,989
Change in fair value of derivative	$ 38,251	$ 0	22,999	$ 0
Ending balance	$ 33,988		$ 33,988

v3.24.2.u1

ACQUISITIONS - Narrative (Details) $ in Thousands			3 Months Ended			6 Months Ended
	Apr. 01, 2024 USD ($) Megawatt	Jan. 12, 2024 USD ($) bitcoin_mining_site Megawatt	Jun. 30, 2024 USD ($) bitcoin_mining_site	Mar. 31, 2024 USD ($)	Jun. 30, 2023 USD ($)	Jun. 30, 2024 USD ($) bitcoin_mining_site	Jun. 30, 2023 USD ($)
Business Acquisition [Line Items]
Amortization of intangible assets			$ 19,470		$ 0	$ 22,439	$ 0
APLD - Rattlesnake Den I LLC
Business Acquisition [Line Items]
Megawatts of operational capacity | Megawatt	132
Megawatts of nameplate capacity | Megawatt	200
Total consideration	$ 96,773
GC Data Center Equity Holdings, LLC
Business Acquisition [Line Items]
Megawatts of operational capacity | Megawatt		390
Total consideration		$ 189,647
Number of bitcoin mining sites acquired | bitcoin_mining_site		2	2			2
Contingent consideration (up to)		$ 19,600
Contingent consideration, milestone period after anniversary of closing		3 years
Gross contractual amounts receivable		$ 24,000
Expected uncollectible receivables		$ 3,600
Intangible assets amortization period		4 years
Amortization of intangible assets				$ 2,800
Revenue of acquiree since acquisition date				20,800
Net loss before tax of acquiree since acquisition date				42,500
Depreciation of acquiree since acquisition date				$ 5,300

v3.24.2.u1

ACQUISITIONS - Schedule of Components of Total Purchase Consideration (Details) - USD ($) $ in Thousands	Apr. 01, 2024	Jan. 12, 2024
APLD - Rattlesnake Den I LLC
Business Acquisition [Line Items]
Initial cash consideration, net of cash acquired	$ 92,025
Working capital adjustments	4,748
Total purchase consideration	$ 96,773
GC Data Center Equity Holdings, LLC
Business Acquisition [Line Items]
Initial cash consideration, net of cash acquired		$ 175,734
Working capital adjustments		8,081
Estimate fair value contingent earn-out and other		5,832
Total purchase consideration		$ 189,647

v3.24.2.u1

ACQUISITIONS - Schedule of Preliminary Allocation of Purchase Price (Details) - USD ($)	Jun. 30, 2024	Apr. 01, 2024	Jan. 12, 2024	Dec. 31, 2023
Assets
Goodwill	$ 45,362,000			$ 0
APLD - Rattlesnake Den I LLC
Assets
Other current assets		$ 4,644,000
Property and equipment		78,759,000
Right-of-use asset		4,040,000
Goodwill	14,510,000	14,510,000
Total assets		101,953,000
Liabilities
Lease liability		5,180,000
Total liabilities		5,180,000
Total purchase consideration		$ 96,773,000
GC Data Center Equity Holdings, LLC
Assets
Accounts receivable			$ 20,411,000
Other current assets			8,506,000
Property and equipment			132,148,000
Right-of-use asset			8,852,000
Goodwill	$ 30,852,000		30,852,000
Customer relationships			22,000,000
Derivative instrument			10,989,000
Other non-current assets			6,250,000
Total assets			240,008,000
Liabilities
Accounts payable and accrued expenses			13,940,000
Lease liability			13,992,000
Other long-term liabilities			22,429,000
Total liabilities			50,361,000
Total purchase consideration			$ 189,647,000

v3.24.2.u1

ACQUISITIONS - Schedule of Changes in Estimated Fair Value of the Contingent Consideration Liability (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2024 USD ($)
Fair Value of Contingent Consideration Liability [Roll Forward]
Ending balance	$ 3,433
GC Data Center Equity Holdings, LLC
Fair Value of Contingent Consideration Liability [Roll Forward]
Beginning balance	0
Contingent consideration liability	3,523
Change in fair value of contingent earn-out	(90)
Ending balance	$ 3,433

v3.24.2.u1

ACQUISITIONS - Schedule of Pro Forma Results of Acquisition (Details) - Garden City Acquisition and GC Data Center Equity Holdings - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Business Acquisition [Line Items]
Revenue	$ 145,139	$ 111,722	$ 313,430	$ 183,029
Income (loss) before income taxes	$ (233,247)	$ 19,812	$ 151,610	$ 79,811
Earnings per common share:
Basic (in dollars per share)	$ (0.72)	$ 0.12	$ 0.54	$ 0.49
Diluted (in dollars per share)	$ (0.72)	$ 0.12	$ 0.52	$ 0.50

v3.24.2.u1

REVENUES - Narrative (Details)	Apr. 19, 2024 USD ($)	Apr. 18, 2024 USD ($)	Jun. 30, 2024 bitcoin_mining_site	Jan. 12, 2024 bitcoin_mining_site
Business Acquisition [Line Items]
Digital assets acquired through mining | $	$ 3.125	$ 6.25
GC Data Center Equity Holdings, LLC
Business Acquisition [Line Items]
Number of bitcoin mining sites acquired | bitcoin_mining_site			2	2

v3.24.2.u1

REVENUES - Schedule of Disaggregation of Revenue (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Disaggregation of Revenue [Line Items]
Total revenues from contracts with customers	$ 26,423	$ 9,543	$ 69,624	$ 28,470
Mining operator - block rewards and other revenue	118,716	72,216	240,713	104,421
Total revenues	145,139	81,759	310,337	132,891
Mining operator - transaction fees
Disaggregation of Revenue [Line Items]
Total revenues from contracts with customers	4,923	6,358	13,907	7,409
Mining participant
Disaggregation of Revenue [Line Items]
Total revenues from contracts with customers	12,839	3,185	26,281	21,061
Hosting Services
Disaggregation of Revenue [Line Items]
Total revenues from contracts with customers	$ 8,661	$ 0	$ 29,436	$ 0

v3.24.2.u1

DIGITAL ASSETS - Narrative (Details) $ in Thousands	Jun. 30, 2024 USD ($) bitcoin	Dec. 31, 2023 USD ($) bitcoin	Jan. 01, 2023 USD ($)
Crypto Asset, Activity [Line Items]
Cumulative-effect adjustment for difference between carrying amount and fair value of digital assets	$ (430,126)	$ (567,640)
Digital assets pending distribution to the company | bitcoin	50	48
Cumulative Effect, Period of Adoption, Adjustment
Crypto Asset, Activity [Line Items]
Cumulative-effect adjustment for difference between carrying amount and fair value of digital assets			$ 11,500

v3.24.2.u1

DIGITAL ASSETS - Schedule of Digital Assets (Details) $ in Thousands	Jun. 30, 2024 USD ($) bitcoin	Dec. 31, 2023 USD ($) bitcoin
Crypto Asset, Holding [Line Items]
Cost Basis	$ 760,129	$ 515,315
Digital assets	$ 1,175,732	$ 639,660
Bitcoin
Crypto Asset, Holding [Line Items]
Quantity | bitcoin	18,488	15,126
Cost Basis	$ 752,808	$ 515,315
Digital assets	$ 1,158,615	$ 639,660
Kaspa
Crypto Asset, Holding [Line Items]
Quantity | bitcoin	88,969,525
Cost Basis	$ 7,321
Digital assets	$ 17,117

v3.24.2.u1

ADVANCES TO VENDORS AND DEPOSITS (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Advances To Vendors And Deposits
Advances to vendors	$ 385,424	$ 95,589
Deposits	$ 82,800	$ 67,000

v3.24.2.u1

PROPERTY AND EQUIPMENT - Schedule of Components of Property and Equipment (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Property, Plant and Equipment [Line Items]
Total gross property, equipment	$ 1,291,538	$ 867,973
Less: Accumulated depreciation and amortization	(362,004)	(196,201)
Property and equipment, net	929,534	671,772
Land
Property, Plant and Equipment [Line Items]
Total gross property, equipment	$ 4,649	0
Land improvements
Property, Plant and Equipment [Line Items]
Useful life (Years)	9 years
Total gross property, equipment	$ 25,246	0
Building and improvements
Property, Plant and Equipment [Line Items]
Useful life (Years)	25 years
Total gross property, equipment	$ 50,866	0
Mining rigs
Property, Plant and Equipment [Line Items]
Useful life (Years)	3 years
Total gross property, equipment	$ 1,034,299	862,055
Containers
Property, Plant and Equipment [Line Items]
Total gross property, equipment	$ 58,898	5,676
Containers | Minimum
Property, Plant and Equipment [Line Items]
Useful life (Years)	10 years
Containers | Maximum
Property, Plant and Equipment [Line Items]
Useful life (Years)	15 years
Equipment
Property, Plant and Equipment [Line Items]
Total gross property, equipment	$ 64,640	0
Equipment | Minimum
Property, Plant and Equipment [Line Items]
Useful life (Years)	4 years
Equipment | Maximum
Property, Plant and Equipment [Line Items]
Useful life (Years)	15 years
Software and hardware
Property, Plant and Equipment [Line Items]
Useful life (Years)	2 years
Total gross property, equipment	$ 3,307	0
Asset retirement obligation
Property, Plant and Equipment [Line Items]
Useful life (Years)	8 years
Total gross property, equipment	$ 7,879	0
Other
Property, Plant and Equipment [Line Items]
Useful life (Years)	7 years
Total gross property, equipment	$ 813	$ 242

v3.24.2.u1

PROPERTY AND EQUIPMENT - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Property, Plant and Equipment [Abstract]
Asset retirement obligation	$ 7.9		$ 7.9
Lease term	8 years		8 years
Accretion expense	$ 0.2		$ 0.4
Depreciation expense	$ 87.8	$ 37.3	$ 165.8	$ 55.0

v3.24.2.u1

GOODWILL AND INTANGIBLE ASSETS - Schedule of Components of Goodwill (Details) - USD ($)	Jun. 30, 2024	Apr. 01, 2024	Jan. 12, 2024	Dec. 31, 2023
Business Acquisition [Line Items]
Cost	$ 45,362,000
Accumulated impairment charges	0
Net	45,362,000			$ 0
GC Data Center Equity Holdings, LLC
Business Acquisition [Line Items]
Cost	30,852,000
Accumulated impairment charges	0
Net	30,852,000		$ 30,852,000
Garden City Acquisition
Business Acquisition [Line Items]
Cost	14,510,000
Accumulated impairment charges	0
Net	$ 14,510,000	$ 14,510,000

v3.24.2.u1

GOODWILL AND INTANGIBLE ASSETS - Narrative (Details) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 45,362,000	$ 0
Intangible assets	$ 2,194,000	$ 0

v3.24.2.u1

GOODWILL AND INTANGIBLE ASSETS - Schedule of Intangible Assets (Details) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]
Cost	$ 24,633,000
Accumulated amortization	(22,439,000)
Accumulated impairment charges	0
Total	2,194,000	$ 0
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Cost	22,000,000
Accumulated amortization	(22,000,000)
Accumulated impairment charges	0
Total	0
Intellectual property
Finite-Lived Intangible Assets [Line Items]
Cost	2,633,000
Accumulated amortization	(439,000)
Accumulated impairment charges	0
Total	$ 2,194,000

v3.24.2.u1

GOODWILL AND INTANGIBLE ASSETS - Schedule of Estimated Future Amortization of Finite-Lived Intangible Assets (Details) - USD ($)	Jun. 30, 2024	Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
2024 (remaining)	$ 439,000
2025	878,000
2026	877,000
Thereafter	0
Total	$ 2,194,000	$ 0

v3.24.2.u1

FAIR VALUE MEASUREMENT - Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Assets:
Digital assets	$ 1,175,732	$ 639,660
Derivative instrument	33,988
Liabilities:
Contingent consideration liability	3,433
Money market funds
Assets:
Cash and cash equivalents	168,940	141,147
U.S. Treasury Bills
Assets:
Cash and cash equivalents	65,319	60,541
Quoted prices in active markets (Level 1)
Assets:
Digital assets	1,175,732	639,660
Derivative instrument	0
Liabilities:
Contingent consideration liability	0
Quoted prices in active markets (Level 1) | Money market funds
Assets:
Cash and cash equivalents	168,940	141,147
Quoted prices in active markets (Level 1) | U.S. Treasury Bills
Assets:
Cash and cash equivalents	65,319	60,541
Significant other observable inputs (Level 2)
Assets:
Digital assets	0	0
Derivative instrument	33,988
Liabilities:
Contingent consideration liability	0
Significant other observable inputs (Level 2) | Money market funds
Assets:
Cash and cash equivalents	0	0
Significant other observable inputs (Level 2) | U.S. Treasury Bills
Assets:
Cash and cash equivalents		0
Significant unobservable inputs (Level 3)
Assets:
Digital assets	0	0
Derivative instrument	0
Liabilities:
Contingent consideration liability	3,433
Significant unobservable inputs (Level 3) | Money market funds
Assets:
Cash and cash equivalents	0	0
Significant unobservable inputs (Level 3) | U.S. Treasury Bills
Assets:
Cash and cash equivalents		$ 0

v3.24.2.u1

FAIR VALUE MEASUREMENT - Schedule of Liabilities Measured at Fair Value on Non-Recurring Basis (Details) - Fair Value, Nonrecurring - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notes payable	$ 326,513	$ 325,654
Quoted prices in active markets (Level 1)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notes payable	289,058	269,725
Significant other observable inputs (Level 2)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notes payable	0	0
Significant unobservable inputs (Level 3)
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Notes payable	$ 0	$ 0

v3.24.2.u1

NET INCOME (LOSS) PER SHARE - Schedule of Antidilutive Securities Excluded from Computation of Diluted Income Per Share (Details) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	16,810,375	14,055,751	324,375	4,172,039
Warrants
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	324,375	324,375	324,375	324,375
Restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	9,152,998	3,847,664	0	3,847,664
Performance-based restricted stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	2,991,580	0	0	0
Convertible notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	4,341,422	9,812,955	0	0
Series A Preferred Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total dilutive shares (in shares)	0	70,757	0	0

v3.24.2.u1

NET INCOME (LOSS) PER SHARE - Schedule of Computation of Basic and Diluted Income (Loss) Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Basic earnings per share of common stock:
Net income per share of common stock - basic	$ (199,659)	$ (11,083)	$ 137,514	$ 107,616
Weighted average shares of common stock - basic (in shares)	278,674,506	168,474,882	268,899,932	163,856,352
Net income per share of common stock - basic (in dollars per share)	$ (0.72)	$ (0.07)	$ 0.51	$ 0.66
Diluted earnings per share of common stock:
Net income per share of common stock - basic	$ (199,659)	$ (11,083)	$ 137,514	$ 107,616
Add: Notes interest expense, net of tax	0	0	1,969	4,451
Add: Series A preferred stock accretion to redemption value	0	0	0	2,121
Net income per share of common stock - diluted	$ (199,659)	$ (11,083)	$ 139,483	$ 114,188
Weighted average shares of common stock - basic (in shares)	278,674,506	168,474,882	268,899,932	163,856,352
Convertible notes (in shares)	0	0	4,341,422	9,812,955
Preferred stock (in shares)	0	0	0	70,757
Weighted average shares of common stock - diluted (in shares)	278,674,506	168,474,882	277,959,660	173,740,064
Net income (loss) per share of common stock - diluted (in dollars per share)	$ (0.72)	$ (0.07)	$ 0.50	$ 0.66
Restricted stock units
Diluted earnings per share of common stock:
Restricted stock units and performance-based restricted stock units (in shares)	0	0	4,431,276	0
Performance-based restricted stock units
Diluted earnings per share of common stock:
Restricted stock units and performance-based restricted stock units (in shares)	0	0	287,030	0

v3.24.2.u1

STOCKHOLDERS’ EQUITY (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended	6 Months Ended
	Feb. 29, 2024	Jun. 30, 2024	Dec. 31, 2023	Jul. 27, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Common stock, authorized (in shares)		500,000,000	500,000,000	500,000,000
Common stock, par value (in dollars per share)		$ 0.0001	$ 0.0001	$ 0.0001
2024 At The Market Offering Agreement
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Sale of stock, consideration received on transaction		$ 1,146.0
Sale of stock, shares issued in transaction (in shares)		17,472,602
Aggregate purchase price, net of offering costs		$ 344.9
2024 At The Market Offering Agreement | Maximum
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Sale of stock, consideration received on transaction	$ 1,500.0

v3.24.2.u1

STOCK-BASED COMPENSATION - Narrative (Details) $ / shares in Units, $ in Millions		1 Months Ended	6 Months Ended
	May 01, 2024	Jun. 30, 2024 USD ($) $ / shares shares	Jun. 30, 2024 USD ($) shares $ / shares
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Warrants issued during period (in shares)			0
Number of outstanding warrants (in shares)		324,375	324,375
Weighted average exercise price (in dollars per share) | $ / shares		$ 25.00	$ 25.00
Weighted average remaining contractual terms			1 year
2018 LTIP
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Number of additional shares authorized (in shares)		15,000,000
Common stock reserved (in shares)		15,536,354	15,536,354
Service-based stock awards
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting period			4 years
Aggregate unrecognized stock-based compensation | $		$ 89.0	$ 89.0
Aggregate unrecognized stock-based compensation, period for recognition			2 years 9 months 18 days
Service-based stock awards | Director
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting period			1 year
Performance-based restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting period	4 years
Aggregate unrecognized stock-based compensation | $		$ 38.7	$ 38.7
Aggregate unrecognized stock-based compensation, period for recognition			3 years 7 months 6 days
Performance-based restricted stock units | Tranche One
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting percentage			25.00%
Performance-based restricted stock units | Tranche Two
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting percentage			6.25%
Minimum | Performance-based restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting percentage	0.00%
Maximum | Performance-based restricted stock units
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Award vesting percentage	200.00%

v3.24.2.u1

STOCK-BASED COMPENSATION - Schedule of Stock-Based Compensation (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock-based compensation	$ 28,332	$ 4,451	$ 80,245	$ 8,396
Performance-based stock awards
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock-based compensation	5,169	0	5,169	0
Service-based stock awards
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items]
Total stock-based compensation	$ 23,163	$ 4,451	$ 75,076	$ 8,396

v3.24.2.u1

STOCK-BASED COMPENSATION - Schedule of Service-Based RSU Activity and Performance-Based RSU Activity (Details)	6 Months Ended
	Jun. 30, 2024 $ / shares shares
Service-based stock awards
Number of RSUs and PSUs
Beginning balance (in shares) | shares	5,765,529
Granted (in shares) | shares	6,878,838
Forfeited (in shares) | shares	(256,459)
Vested (in shares) | shares	(3,234,910)
Ending balance (in shares) | shares	9,152,998
Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share) | $ / shares	$ 9.40
Granted (in dollars per share) | $ / shares	19.57
Forfeited (in dollars per share) | $ / shares	12.13
Vested (in dollars per share) | $ / shares	15.64
Ending balance (in dollars per share) | $ / shares	$ 14.76
Performance-based restricted stock units
Number of RSUs and PSUs
Beginning balance (in shares) | shares	0
Granted (in shares) | shares	2,991,580
Ending balance (in shares) | shares	2,991,580
Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share) | $ / shares	$ 0
Granted (in dollars per share) | $ / shares	14.67
Ending balance (in dollars per share) | $ / shares	$ 14.67

v3.24.2.u1

DEBT (Details) - USD ($) $ in Millions	1 Months Ended
	Sep. 30, 2023	Jun. 30, 2024	Dec. 31, 2023	Nov. 23, 2021	Nov. 18, 2021
Debt Instrument [Line Items]
Principal amount issued				$ 747.5
Exchange Agreement
Debt Instrument [Line Items]
Principal amount of debt exchanged	$ 416.8
Shares issued from debt exchange (in shares)	31,722,417
Convertible Senior Notes Due 2026
Debt Instrument [Line Items]
Principal amount issued				$ 97.5	$ 650.0
Interest rate					1.00%
Convertible Notes
Debt Instrument [Line Items]
Unamortized discounts		$ 4.2	$ 5.1
Notes outstanding		$ 326.5	$ 325.7

v3.24.2.u1

LEASES - Narrative (Details) $ in Thousands	3 Months Ended			6 Months Ended
	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Mar. 31, 2023 operatingLease	Jun. 30, 2024 USD ($)	Jun. 30, 2023 USD ($)	Apr. 01, 2024 USD ($)	Jan. 12, 2024 USD ($)	Dec. 31, 2023 USD ($)
Lessee, Lease, Description [Line Items]
Operating lease ROU assets	$ 9,728			$ 9,728				$ 443
Operating lease liabilities, net of current portion	10,603			10,603				$ 500
Right-of-use asset amortization	$ 400	$ 100		$ 700	$ 200
GC Data Center Equity Holdings, LLC
Lessee, Lease, Description [Line Items]
ROU asset							$ 8,852
Total lease liabilities, before unfavorable lease liability adjustment							8,900
Unfavorable lease liability adjustment							$ 5,100
APLD - Rattlesnake Den I LLC
Lessee, Lease, Description [Line Items]
ROU asset						$ 4,040
Total lease liabilities, before unfavorable lease liability adjustment						4,000
Unfavorable lease liability adjustment						$ 1,100
Applied Blockchain
Lessee, Lease, Description [Line Items]
Number of operating leases | operatingLease			2

v3.24.2.u1

LEASES - Schedule of Assets and Liabilities Related to Operating and Finance Leases (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
ASSETS
Operating lease right-of-use assets	$ 9,728	$ 443
Finance lease right-of-use assets	4,029	0
Total right-of-use assets	13,757	443
Current portion:
Operating lease liabilities	316	124
Finance lease liability	180	0
Long-term portion:
Operating lease liabilities	15,106	354
Finance lease liability	4,834	0
Total lease liabilities	$ 20,436	$ 478

v3.24.2.u1

LEASES - Schedule of Total Lease Expense (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023	Jun. 30, 2024	Jun. 30, 2023
Lease costs:
Operating lease cost	$ 761	$ 74	$ 965	$ 185
Amortization of ROU asset	11	0	11	0
Short-term lease rent expense	21	11	37	20
Variable lease cost	20,043	17,165	43,229	19,938
Total rent expense	$ 20,836	$ 17,250	$ 44,242	$ 20,143

v3.24.2.u1

LEASES - Schedule of Leasing Activities (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Leases [Abstract]
Operating cash flows from operating leases	$ 840	$ 229
Financing cash flows from finance lease	$ 163	$ 0
Operating leases, weighted-average remaining lease term (in years)	9 years 8 months 12 days	3 years 4 months 24 days
Finance leases, weighted-average remaining lease term (in years)	96 years 9 months 18 days
Operating lease, weighted-average discount rate	6.70%	5.00%
Finance lease, weighted-average discount rate	7.20%	0.00%

v3.24.2.u1

LEASES - Schedule of Future Minimum Operating Lease Payments (Details) - USD ($) $ in Thousands	Jun. 30, 2024	Dec. 31, 2023
Operating Leases
2024 (remaining)	$ 170
2025	457
2026	1,080
2027	2,835
2028	2,782
Thereafter	6,960
Total	14,284
Less: Imputed interest	(3,681)
Present value of lease liability	10,603	$ 500
Finance Lease
2024 (remaining)	0
2025	168
2026	173
2027	178
2028	183
Thereafter	89,096
Total	89,798
Less: Imputed interest	(85,921)
Present value of lease liability	$ 3,877

v3.24.2.u1

LEGAL PROCEEDINGS (Details) $ in Millions	Jul. 18, 2024 USD ($)	Feb. 09, 2023 USD ($) shares	Oct. 06, 2020 Megawatt shares	Aug. 14, 2023 derivative_complaint	Dec. 19, 2022
Loss Contingencies [Line Items]
Number of derivative complaints consolidated | derivative_complaint				2
Hardin, MT
Loss Contingencies [Line Items]
Megawatts of operational capacity | Megawatt			100
Compute North Holdings, Inc.
Loss Contingencies [Line Items]
Litigation settlement, amount awarded from other party | $		$ 40.0
Compute North Holdings, Inc. | Minimum
Loss Contingencies [Line Items]
Claim recovery percentage					8.00%
Compute North Holdings, Inc. | Maximum
Loss Contingencies [Line Items]
Claim recovery percentage					65.00%
Compute North Holdings, Inc. | Compute North LLC
Loss Contingencies [Line Items]
Number of shares held in litigation entity | shares		39,597
Hardin, MT
Loss Contingencies [Line Items]
Stock issued during period, shares, restricted stock award, gross (in shares) | shares			6,000,000
Ho v Marathon | Subsequent Event
Loss Contingencies [Line Items]
Loss contingency, damages awarded, value | $	$ 138.8

v3.24.2.u1

RELATED PARTY TRANSACTIONS (Details) - Auradine, Inc. - USD ($) $ in Millions	1 Months Ended	6 Months Ended
	Sep. 30, 2023	Jun. 30, 2024
Related Party Transaction [Line Items]
Payments to acquire investments	$ 15.0	$ 29.1
Purchases from related party		$ 43.6

v3.24.2.u1

SUPPLEMENTAL CONDENSED CONSOLIDATED FINANCIAL INFORMATION (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2024	Jun. 30, 2023
Cash paid during the year for:
Income taxes	$ 1,256	$ 782
Interest	4	4,524
Supplemental schedule of non-cash investing and financing activities:
Series A Preferred Stock accretion to redemption value	0	2,121
Reclassifications from advances to vendor to property and equipment upon receipt of equipment	175,442	542,517
Reclassifications from long-term prepaid to property and equipment	3,273	0
Reclassifications from investments to property and equipment	4,416	0
Reclassifications from long-term prepaid to intangible assets	2,633	0
Effective settlement of pre-existing relationships	0	0
Dividends received from equity method investment	$ 18,912	$ 0

v3.24.2.u1

SUBSEQUENT EVENTS (Details) - USD ($)		1 Months Ended	6 Months Ended
	Jul. 25, 2024	Aug. 01, 2024	Jun. 30, 2024
2024 At The Market Offering Agreement
Subsequent Event [Line Items]
Common stock issued (in shares)			17,472,602
Subsequent Event
Subsequent Event [Line Items]
Payment for acquisition of crypto asset	$ 100,000,000
Subsequent Event | 2024 At The Market Offering Agreement
Subsequent Event [Line Items]
Common stock issued (in shares)		7,276,739
Aggregate offering price remaining		$ 982,300,000

v3.24.2.u1

Label	Element	Value
Accounting Standards Update [Extensible Enumeration]	us-gaap_AccountingStandardsUpdateExtensibleList	Accounting Standards Update 2023-08 [Member]

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