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Correspondence

January 29, 2019

VIA EDGAR AND OVERNIGHT EXPRESS

United States Securities and Exchange Commission

Division of Corporation Finance

100 F Street, N.E.

Washington, D.C.  20549

Re:

Riot Blockchain, Inc.

Current Report on Form 8-K filed October 4, 2017

Response Letter dated March 26, 2018

Form 10-K for the Fiscal Year Ended December 31, 2017

Form 10-K/A for the Fiscal Year Ended December 31, 2017

Form 10-Q for the Quarterly Period Ended March 31, 2018

Response Letter dated June 29, 2018

File No. 001-33675

Ladies and Gentlemen:

We are in receipt of your letter dated December 18, 2018 addressed to Riot Blockchain, Inc. (the "Company") from the staff (the "Staff") of the Securities and Exchange Commission (the "Commission"), regarding your review of the above referenced filings of the Company including the current, quarterly, and annual reports of the Company filed with the Commission (collectively, the "Filings").

In addition to the disclosures contained in the Amendment No. 2 to the Company's Registration Statement on Form S-3/A filed on January 03, 2019, the Company has filed Amendment No. 1 to its Quarterly Report on Form 10-Q for the Period ended September 30, 2018, on January 11, 2019 (the "Q3 2018 Report"), and, as applicable, prepared disclosures therein in response to the Staff's comments.

For your convenience, the texts of the Staff's comments are set forth herein below in italics, followed by our responses.

Riot Blockchain, Inc. 202 6th Street, Suite 401 ● Castle Rock, CO  80104 ● Tel. (303) 794 - 2000

United States Securities and Exchange Commission

January 29, 2019

Page 2

Form 10-Q for the Quarterly Period Ended September 30, 2018

Notes to Condensed Interim Consolidated Financial Statements

Note 2. Basis of presentation, summary of significant accounting policies and recent accounting pronouncements

Digital Currencies Translations and Remeasurements, page 8

1.

We note your response to prior comment two of our letter dated June 15, 2018 and your disclosure on page 9 addressing the correction of an error related to your accounting for digital currencies. You assert that the correction of this error did not have a material impact on your previously reported interim financial statements. Please confirm whether this is the case because all previously reported changes in fair value are now reflected as impairment losses. Please also tell us how you have complied with the disclosure requirements set forth in ASC 350-30-50-3 related to these impairment losses.

Response

Materiality Analysis

The Company assessed the materiality of its change in its accounting policy from the "fair value" method to the "intangible assets" method, during the period ended September 30, 2018 and concluded that the change did not have a material impact on its previously reported financial position or results of operations.

This conclusion was based upon the historical prices of digital currencies as of each reporting period's quarter end. The US dollar spot price of digital assets declined in each subsequent quarterly period as compared to the prior quarter.  Therefore, the fair value method as previously used only recorded write-downs of digital currencies and no write-ups were recorded. This fact pattern resulted in no difference in the reported financial results for the prior period(s) included in the September 30, 2018 filing.  Following is a chart of the digital asset costs and impairment values used in the digital assets' analysis at each period end:

Digital Currencies

Values

Date

Description

BTC

LTC

Comments

31-Dec-17 Period End Values

$

14,156.40

$

232.10

Q4 - 2017 was initial mining operations

31-Mar-18 Period End Values

$

6,973.53

$

116.61

Change

$

(7,182.87

)

$

(115.49

)

30-Jun-18 Period End Values

$

6,404.00

$

81.37

Change

$

(569.53

)

$

(35.24

)

30-Sep-18 Period End Values

$

6,625.56

$

61.14

Pro Forma: @ Fair Value

30-Sep-18 Period End Values (As Recorded)

$

6,404.00

$

61.14

Recorded computed @ lower of historical cost

Change

$

-

$

(20.23

)

The Company has revised its disclosures in its Form 10-Q Amendment #1, filed January 11, 2019 to comply with the disclosure requirements set forth in ASC 350-30-50-3 related to these impairment losses. For the convenience of the Staff, the entire amended disclosure as included on Form 10-Q/A filed on January 11, 2019, is reproduced below:

United States Securities and Exchange Commission

January 29, 2019

Page 3

"Part I: Financial Information

Item 1: Condensed Interim Consolidated Financial Statements

Note 2: Basis of presentation, summary of significant accounting policies and recent accounting pronouncements

Digital Currencies Translations and Remeasurements

Digital currencies are included in current assets in the Company's consolidated balance sheets as intangible assets with indefinite useful lives. Digital currencies are recorded at cost less impairment.

An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not that an impairment exists. If it is determined that it is not more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. The Company assesses impairment of its digital currencies quarterly if the fair value of digital assets is less than its cost basis.  The Company recognizes impairment losses on digital assets caused by decreases in fair value using the average US dollar spot price of the related digital currency as of each impairment date.  Impairment losses related to digital assets totaled $163,837 and $3,374,976 for the three and nine-month periods ended September 30, 2018, respectively. Impairment charges are included in as a separate line item in costs and expenses, in the accompanying statements of operations.

Realized gain or loss on the sale of digital currencies is included in other income or expenses in the condensed interim consolidated statements of operations. Realized gains on the sale of digital currencies totaled $219,247 and $451,341 for the three and nine month periods ended September 30, 2018, respectively.

The Company originally adopted an accounting policy regarding digital currencies transactions and remeasurement that stated:

"Digital currencies are recorded at their fair value on the date they are received as revenues, and are revalued to their current market value at each reporting date. Fair value is determined by taking the spot rate from the most liquid exchanges."

Based on reviews of the available accounting guidance, the Company has concluded that its originally adopted accounting policy was in error and the digital currencies should have been recorded at cost less impairment. The change in this accounting policy did not have a material impact of the Company's previously reported condensed interim consolidated financial statements."

ASC 350-30-50-3 Reporting Analysis

Following the change in accounting practices for the Company's digital currency assets, the Company has amended its compliance and reporting practices per ASC 350-30-50-3 to comport with the requirements for reporting of impairment losses. ASC 350-30-50-3 requires that, for each impairment loss recognized related to an intangible asset, all of the following information shall be disclosed in the notes to financial statements that include the period in which the impairment loss is recognized:

a.

a description of the impaired intangible asset and the facts and circumstances leading to the impairment;

b.

the amount of the impairment loss and the method for determining fair value Impairment;

c.

The caption in the income statement or the statement of activities in which the impairment loss is aggregated; and

d.

If applicable, the segment in which the impaired intangible asset is reported under Topic 280.

Accordingly, the Company has determined, after consulting with its outside public accountants and legal counsel, that the Company's previous disclosures regarding its accounting for digital currencies actually reflected the impairment losses it would have shown under the revised accounting policy and therefore that no revised disclosure is required to comply with ASC 350-30-50-3.

United States Securities and Exchange Commission

January 29, 2019

Page 4

Item 2. Management's Discussion and Analysis…

Management's plans and basis of presentation:, page 27

2.

Please revise your fifth paragraphs in this section of your Form 10-Q for the quarter ended September 30, 2018 to expand your disclosure regarding your current mining operations, including, for example, the number of miners that were operating at your facility on September 30, 2018, and any expected changes.

Response

The Company acknowledges the Staff's comment and has revised its disclosure to: (i) explicitly state that it operates 8,000 digital currency miners, which includes 7,500 model S9 and 500 model L3+ miners, at its Oklahoma City, Oklahoma facility; (ii) state that the changes in the lease of the facility will not affect the number of miners deployed there; and (iii) state that the variable electricity charges under the amended lease agreement will enable the Company to operate its miners in a manner more responsive to various market and environmental forces affecting the relative profitability of its mining operation.  For the Staff's convenience, the full text of the disclosure is included below:

"Part I: Financial Information

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's plans and basis of presentation:

Digital Currency Mining Operations

Overview of Digital Currency Mining Operations

The primary focus of the Company is our digital currency mining operations.  Digital currencies are digital or virtual currencies used as a medium of exchange outside of the traditional state-backed fiat currencies. Digital or "crypto" currencies rely on complex cryptographically recorded data entries known as "blocks" on decentralized digital ledger system known as a blockchain.  Blocks are added to the blockchain chronologically and, once added, are unchangeable. Thus, digital currencies are seen as a secure means of storing and recording information regarding a transaction or set of transactions.  To incentivize the creation of blocks for the blockchain, digital currency tokens are awarded on a per block basis for block creation, a process which is known in the industry as digital currency mining.

The Company's digital currency mining operations focus primarily on bitcoin mining.  Bitcoin mining entails solving complex mathematical problems using custom designed and programmed application-specific integrated circuit computers (referred to as "miners"). Bitcoin miners provide transaction verification services to a given blockchain by solving complex algorithms to encode additional blocks into the blockchain; which blocks serve as immutable records of transactions once added to the blockchain. When a miner is successful in adding a block to the blockchain, it is rewarded with a fixed number of bitcoin. Blocks are added to the blockchain on a first-to-finish basis, meaning that the first miner to solve an algorithm and verify a given transaction is the only miner to receive a bitcoin reward.  This first-to-finish environment has created a computing power arms race whereby miners are encouraged through competition to allocate ever-increasing computing power (known as "hash rate") to solving algorithms in the hopes of finishing first.  The resulting energy costs are substantial, and, in light of the recent decline in the market price of bitcoin and other "benchmark" digital currencies such as bitcoin cash, litecoin, and ethereum, the profitability of digital currency mining operations has been reduced while competition to solve each block continues to increase.  The Company's digital currency mining operations operate at a maximum hash rate of 95 petahash per second.

In response to these factors, the Company has entered into digital currency mining pools, whereby multiple miners allocate their collective computing powers to solving a given algorithm, thereby increasing the hash rate devoted to a given algorithm while spreading the cost of providing that increased hash rate across the digital currency mining pool. By pooling their efforts, miners in a pool are more likely to receive a reward from the verification a given transaction than miners acting individually.  Pool miners are awarded a fractional reward based on the hash rate each miner contributed to the pool in a successfully solved algorithm by the pool operator, regardless of whether the individual miner actually solved the applicable algorithm and added a block to the blockchain.  Miners participating in digital currency mining pools accept the proportional share of a bitcoin reward rather than seeking to obtain whole bitcoin rewards individually for two reasons: first, by pooling their efforts, miners participating in a digital currency mining pool are able to devote a greater collective hash rate to solving a given algorithm than would be economically feasible for any individual miner to do so themselves, thereby increasing the likelihood they will receive more bitcoin from their digital currency mining activities on average than they would operating outside of a pool; and second, they enjoy the benefit of their fellow digital currency mining pool participants' contributed hash rates, without incurring the significant cost of producing a greater hash rate individually. The Company participates in pools on an at-will basis, and is under no obligation to remain in a given pool and may terminate its engagement with a given pool at any time.  Presently, management believes participating in digital currency mining pools is the most efficient means of digital currency mining digital currencies, but is under no obligation, nor does it provide any assurance that it will continue to do so in the future.

United States Securities and Exchange Commission

January 29, 2019

Page 5

Oklahoma City Mining Facility

Beginning in February of 2018, we relocated our digital currency mining operations to our Oklahoma City, Oklahoma facility (our "Mining Facility"), which is leased by our subsidiary, Kairos Global Technology, Inc. ("Kairos"). As of September 30, 2018, we have moved all of our 8,000 digital currency miners, which includes 7,500 model S9 and 500 model L3+ miners, to our Mining Facility.  These miners have been installed and operational since being deployed in June of 2018. Kairos leased the Mining Facility from 7725 Reno #1, L.L.C.  ("7725 Reno") by a lease agreement dated February 27, 2018, as amended on March 26, 2018 (the "Lease"). Effective as of November 29, 2018, Kairos amended the Lease with 7725 Reno by: (i) extending the initial term of the Lease through August 15, 2019; (ii) effective as of December 1, 2018, changing the monthly rent for the Lease as follows: (a) $235,000 for December of 2018, (b) $230,000 for January of 2019, and (c) $190,000 per month thereafter for the duration of the Lease, including any renewals; (iii) reducing the monthly electricity usage charges due under the Lease; (iv) providing that Kairos will reimburse 7725 Reno for up