SecProbe.io

United States securities and exchange commission logo
June 28, 2024
Gary A. Vecchiarelli
Chief Financial Officer
CleanSpark, Inc.
10624 S. Eastern Ave.
Suite A - 638
Henderson, NV 89052
Re:CleanSpark, Inc.
Form 10-K for the Fiscal Year Ended September 30, 2023
Form 10-Q for the Quarterly Period Ended March 31, 2024
Response Letter dated April 26, 2024
File No. 001-39187
Dear Gary A. Vecchiarelli:
            We have reviewed your April 26, 2024 response to our comment letter and have the
following comments.
            Please respond to this letter within ten business days by providing the requested
information or advise us as soon as possible when you will respond. If you do not believe a
comment applies to your facts and circumstances, please tell us why in your response.
            After reviewing your response to this letter, we may have additional comments. Unless
we note otherwise, any references to prior comments are to comments in our March 29,
2024 letter.
Form 10-K for the Fiscal Year Ended September 30, 2023
General
1.Refer to your response to comment 1. In future filings, please disclose a breakeven
analysis that, along with the energy and hosting costs, includes the mining equipment
costs and related financing costs so that investors understand how the cost to mine one
bitcoin compares to the value of bitcoin.

 FirstName LastNameGary A. Vecchiarelli
 Comapany NameCleanSpark, Inc.
 June 28, 2024 Page 2
 FirstName LastName
Gary A. Vecchiarelli
CleanSpark, Inc.
June 28, 2024
Page 2
Form 10-Q for the Quarterly Period Ended March 31, 2024
Financial Statements
Note 2. Summary of Significant Accounting Policies
Revenue from Contracts with Customers - Revenue from Bitcoin Mining, page F-11
2.We acknowledge your response to prior comment 2. In your response, you indicated that
you would make certain revisions to your disclosure in future periodic reports. We are
unclear how disclosure in your Form 10-Q for the quarterly period ended March 31, 2024
incorporates those changes. Please specifically address the following concerning your
mining revenue recognition under ASC 606:
•Tell us your consideration of disclosing that the services you provide are an output of
your ordinary activities.
•Since you told us that the option to renew does not represent a material right, tell us
your consideration of disclosing that you have determined that the mining pool
operator’s (i.e., the customer's) renewal option is not a material right as the terms,
conditions, and compensation amounts are at then market rates.
•You told us that a more accurate description of your promise and single performance
obligation is a service to perform hash calculations for the pool operator. Please
revise your disclosure in future filings to describe your performance obligation as
such (i.e. the provision of hash calculations).
•In your response, you confirmed our understanding that contract duration is for a
period of less than 24 hours. However, disclosure in your 10-Q continues to imply
contract duration is for a period of one day. For example, on page F-12 of your 10-Q
you state “the performance obligation of computing power services is fulfilled over
time, as opposed to a point in time, because the Company provides the hash
computation computing power throughout the day and the customer simultaneously
obtains control of it and uses the asset to produce bitcoin.” Additionally, you state on
page F-12 “According to the customer contract, daily earnings are calculated from
midnight-to-midnight UTC time.” Please advise or revise.
•In your response, you confirmed that the company measures noncash consideration
received on the date of contract inception. However, it appears based on your
disclosure that you measure noncash consideration received at midnight UTC the day
after contract inception. Please explain to us how your policy is consistent with the
requirement to measure cash consideration on the date of inception, and how you
concluded a time on the date of contract inception (e.g. 23:59:59) is not more
appropriate.
•Based on your response, it appears that network difficulty is a variable that impacts
block rewards and transaction fees, and does not on it’s own seem to be a component
of the revenue recorded for your bitcoin mining activities. Please revise your
disclosure accordingly.

 FirstName LastNameGary A. Vecchiarelli
 Comapany NameCleanSpark, Inc.
 June 28, 2024 Page 3
 FirstName LastName
Gary A. Vecchiarelli
CleanSpark, Inc.
June 28, 2024
Page 3
            Please contact Kate Tillan at 202-551-3604 or Bonnie Baynes at 202-551-4924 if you
have questions regarding comments on the financial statements and related matters. Please
contact Sonia Bednarowski at 202-551-3666 or Sandra Hunter Berkheimer at 202-551-3758 with
any other questions.
Sincerely,
Division of Corporation Finance
Office of Crypto Assets