SecProbe.io

United States securities and exchange commission logo
March 1, 2024
Jonathan Bates
Chief Executive Officer
Bitmine Immersion Technologies, Inc.
2030 Powers Ferry Road SE
Suite 212
Atlanta, Georgia 30339
Re:Bitmine Immersion Technologies, Inc.
Form 10-K Filed December 14, 2023
Form 10-Q Filed January 12, 2024
File No. 000-56220
Dear Jonathan Bates:
            We have reviewed your January 12, 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 December 8,
2023 letter.
Form 10-K For the Fiscal Year Ended August 31, 2023
Company Overview, page 1
1.Refer to prior comment 4, to comment 8 in our letter dated August 28, 2023, and to your
responses to these comments and disclosures in this filing. We do not see disclosure
regarding the total hashing power of the pool in which your miners participate and the
percentage thereof contributed by your miners, how that pool holds your proportion of
mining rewards and the duration thereof, whether the pool operator has insurance for theft
or loss and risk factor disclosure related to transferring crypto assets. Also, in your
January 12, 2024 response you advised that you disclosed the material terms of
your mining pool agreement in your Management’s Discussion and Analysis of Financial
Condition and Results of Operation and the notes to your financial statements, yet your
most recent form 10-K doesn't appear to disclose material terms of the mining agreement.

 FirstName LastNameJonathan Bates
 Comapany NameBitmine Immersion Technologies, Inc.
 March 1, 2024 Page 2
 FirstName LastName
Jonathan Bates
Bitmine Immersion Technologies, Inc.
March 1, 2024
Page 2
Furthermore, your October 6, 2023 response letter advises that you will revise future
filings to disclose the percentage of hashing power of your self-mining operations
allocated to each pool for each accounting period in the notes to the financial statements,
and we see no such disclosure. Please direct us to the above disclosures or please provide
draft disclosures and confirm these disclosures will be included in future filings.
2.You state that you "plan to operate [y]our data centers using immersion cooling
technology." In future filings please revise this statement to also clarify the extent to
which your operations currently use immersion cooling technology.
Part I
Item 1. Business, page 1
3.Please clarify in the business section of future filings your intentions to mine digital assets
other than bitcoin. Refer to comment 7 in our August 28, 2023 letter and to your response
on October 6, 2023 that in future filings, including this Form 10-K, you would revise to
"better reflect what has been mined to date and the future intent with regard to other types
of digital assets."  Please advise where in the document you clarify your intent regarding
mining digital assets other than bitcoin or provide draft language you intend to include in
future filings. We note your statements that that mining activities to date have been
limited to Bitcoin and other disclosures in your risk factors on pages 22, 28 and 44
referencing "other cryptocurrencies we mine" or "any other digital assets we mine."
4.We note your response to prior comment 2. In future filings please include a more
comprehensive breakeven analysis for your bitcoin mining operations that compares the
cost to earn/mine one bitcoin with the market value of one bitcoin. Your analysis should
identify and explain all relevant inputs used in your calculation, regardless of whether
various inputs are discussed elsewhere in separate parts of your filing. As part of your
analysis please include the cost of acquiring mining equipment and any related financing
costs.
Trinidad Operations, page 3
5.In future filings please revise your statement in the second paragraph that "our rate for
electricity will be TSTT’s existing rate of 3.5 cents per kwh" to state, if true and as stated
in the paragraph above, that "[y]our hosting containers will be billed for electricity usage
at the local utility’s standard rates, which is the greater of 3.5 cents per kwh or 75% of the
declared reserve capacity, which is equal to the customer’s highest expected monthly
kilovolt-ampere demand at $7.40." Please also revise the similar statement on page 12.
6.You state that "[w]hile [y]our TSTT site was delayed pending electrification,
[you] entered into a hosting agreement with a third party in Trinidad to host up to 192
miners in one immersion container until August 31, 2024." In future filings please
disclose the electrical rates you have been paying at this location.

 FirstName LastNameJonathan Bates
 Comapany NameBitmine Immersion Technologies, Inc.
 March 1, 2024 Page 3
 FirstName LastName
Jonathan Bates
Bitmine Immersion Technologies, Inc.
March 1, 2024
Page 3
Revenue Sources, page 5
7.We note your disclosure on page 46 that you "generally liquidate [y]our bitcoin within 2-3
weeks of receipt in order to pay operational expenses. Therefore, [you] do not expect to
incur material losses on bitcoin that [you] hold due to the short holding period. However,
the volatility of bitcoin prices makes it more likely that [you] experience losses from
holding bitcoin, which could have a material, adverse impact on [y]our liquidity and
[y]our business." In future filings please revise this risk factor to address the fact that, as
stated on page 5, you do not have a set policy in regard to how long you hold digital assets
that you receive as payment. Address how the lack of such policy could exacerbate the
volatility risk from holding bitcoin.
8.We reissue comment 10 in our letter dated August 28, 2023. In future filings please
reconcile your disclosures regarding whether you hold or plan to hold crypto assets for
investment. For example, on page 6 you state that you "do not plan to hold any digital
assets that [you] receive as a long-term investment," however on page 2 you state that you
"may hold [y]our digital assets as investments in anticipation of continued adoption of
digital assets as a 'store of value' and a more efficient medium of exchange than traditional
fiat currencies." Likewise on page 56 you state that you "reserve the right to hold [y]our
digital assets as a long-term investment." We note that in your October 6, 2023 response
letter you advised that the "proper statement of the Company’s intent is the first statement,
and the second statement will be removed or revised to be consistent with the first."

Key Factors Affecting Our Performance
Halving, page 10
9.Refer to prior comment 5, your response and your disclosures. We note that you have not
included the requested cross-reference in either your most recent Form 10-K or 10-Q
filings. Please confirm that you will revise the halving disclosure in your Business section
of future filings to provide a cross-reference to your risk factor on the risks of halving.

 FirstName LastNameJonathan Bates
 Comapany NameBitmine Immersion Technologies, Inc.
 March 1, 2024 Page 4
 FirstName LastName
Jonathan Bates
Bitmine Immersion Technologies, Inc.
March 1, 2024
Page 4
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Critical Accounting Policies, page 62
10.We note your response to comment 7 and that you recognized an impairment of fixed
assets of $122,950 for the year ending August 31, 2023. Please enhance future filings to
reflect your response and include a subheading for property and equipment.  We note that
within your critical accounting estimates discussion you separately discuss revenue
recognition, cash and cash equivalents, cryptocurrency, stock-based compensation, related
party transactions, net loss per share and income taxes but not property and equipment.
Please also revise the header of your discussion from Critical Accounting Policies to
Critical Accounting Estimates.  Refer to Release No. 33-8350 Interpretation: Commission
Guidance Regarding Management's Discussion and Analysis of Financial Condition and
Results of Operations and Item 303(b)(3) of Regulation S-K.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters, page 78
11.We note your response to prior comment 8. We note that the percent of common stock
column in the table on page 78 does not compute based on the shares beneficially
owned and the 49,665,649 shares of common stock issued and outstanding at December 1,
2023.
•For example, you disclose 23,595,583 shares beneficially owned by Jonathan Bates,
which represents 47.5% of common stock based on 49,665,649 shares of common
stock issued and outstanding at December 1, 2023, not 41.0% as disclosed in the
percentage of common stock column; and
•For example, you disclose 16,786,887 shares beneficially owned by Innovative
Digital Investors Emerging Technology, LP, which represents 33.8% of common
stock based on 49,665,649 shares of common stock issued and outstanding at
December 1, 2023, not 30.5% as disclosed in the percentage of common stock
column.

We note these computational discrepancies for all beneficial share owners. Please revise
future filings to address these concerns. Show us what your proposed disclosure will look
like in your response, or advise otherwise.
Statement of Cash Flows, page F-6
12.We note your response to comment 1 and that the basis of the one immersion container
with a carrying value of $231,429 contributed by you in the joint venture was stepped up
to $300,000, and is included in the total cost basis of $987,429 of your joint venture
investment.  Please tell us how you accounted for the increase in step-up of $69,000 and
the accounting guidance to support your accounting.

 FirstName LastNameJonathan Bates
 Comapany NameBitmine Immersion Technologies, Inc.
 March 1, 2024 Page 5
 FirstName LastName
Jonathan Bates
Bitmine Immersion Technologies, Inc.
March 1, 2024
Page 5
13.Please address the following:
•Tell us how cryptocurrency proceeds from the sale of equipment of $56,730 is
reflected in supplemental non-cash activities; and
•Tell us how cryptocurrency used to pay expenses and to purchase equipment of
$213,918 is reflected in supplemental non-cash activities.
Notes to Condensed Financial Statements
Note 1 - Basis of Presentation and Summary of Significant Policies
Revenues From Digital Currency Mining, page F-8
14.We note your response to comments 9 and 10. Please address the following:

•You assert that the mining pool agreement renews daily as long as neither party elects
to terminate it, and you do not believe the duration is less than 24 hours. The
guidance in ASC 606-10-25-3 indicates that the duration of the contract is the period
in which the parties have present enforceable rights and obligations considering
termination and renewal rights.  Tell us your consideration of the interpretation in the
FASB Revenue Recognition Implementation Q&A question 8 and whether a contract
that can be terminated at any time without penalty would result in a contract that is
continuously renewed throughout the day and therefore results in many contracts with
durations less than 24 hours.  If true, revise future filings to specifically disclose that,
"the contract duration is less than 24 hours and is continuously renewed throughout
the day," or advise;
•You assert that your mining pool contracts are terminable at any time by either party
without penalty and the formula for payment does not change upon renewal. Your
response implies that your customer does not have a material right. Confirm our
understanding and, if so, enhance your disclosures in future filings to support that you
have a single performance obligation. Refer to ASC 606-10-55-42;
•Revise future filings to remove reference to your performance obligation as being the
provision of “computing power” and instead describe the performance obligation as
the provision of “hash calculation services” or something similar. In this regard, we
note your response to the fifth bullet of prior comment 9 but continue to believe that
the provision of “computing power” is too imprecise to describe your performance
obligation to provide a service to the mine pool operator to run its software on your
equipment to, in part, construct header candidates and perform hash calculations;
•Enhance future filings to indicate, if true, that providing hash calculation services for
the pool operator is an output of your ordinary activities, that you determine when to
provide services, and that your enforceable right to compensation begins when, and
continues for as long as, services are provided; and
•You state in your response and your disclosures that you measure Bitcoin
consideration earned at the end of the day spot price which is not materially different
than at contract inception. Please remove these statements and indicate that you
measure Bitcoin consideration earned on the date of contract inception.

 FirstName LastNameJonathan Bates
 Comapany NameBitmine Immersion Technologies, Inc.
 March 1, 2024 Page 6
 FirstName LastNameJonathan Bates
Bitmine Immersion Technologies, Inc.
March 1, 2024
Page 6
15.We note your response to comment 10 and your disclosure your payment mechanism is
FPPS and you fully constrain all variable consideration until you receive confirmation of
the amount, usually via settlement of the fractional share of block reward and transaction
fee in your digital wallet because the amount of consideration is highly susceptible to
factors outside of your control as defined by your customer’s payout methodology.   The
inputs of the standard block reward formula for a FPPS payment mechanism are pool
participant hash rate, network difficulty which adjusts every two weeks and block
subsidiary which halves about every four years.  Since the only formula input that can
change at contract inception is your hash rate, which you decide, please revise your
disclosure in future filings to clarify, if true, that only transaction fees are constrained until
the end of each transactional day or midnight UTC time.
Cryptocurrency, page F-11
16.You disclose that Cryptocurrencies held are accounted for as intangible assets with
indefinite useful lives and are not amortized but assessed for impairment quarterly, when
events or changes in circumstances occur indicating that it is more likely than not that the
indefinite-lived asset is impaired.  Please address the following:

•Confirm our understanding and revise your disclosure in future filings to clearly
indicate that you assess cryptocurrency impairment based on the lowest intraday price
each day.  Refer to ASC 350-30-35-18B; and
•Confirm that cryptocurrency impairment of $3,523 was determined based on the
lowest intraday price each day for your crypto holdings over the course and during
the year ended August 31, 2023.
Note 4. Property and Equipment, page F-14
17.We note your response to comment 14.  Please address the following:
•We note that purchases and disposition of property and equipment is recurring and
significant to the operation of your business.  We are unable to reconcile the change
in year-over-year balances to the activity disclosed.  Provide us and enhance future
filings to disclose purchases and dispositions separately in the table of property and
equipment as disclosed for the periods presented.  To the extent such activity does not
directly tie to related activity in your statement of cash flows, including supplemental
non-cash activity, include footnotes to explain any differences.  Refer to ASC 210-
10-S99 and Regulation S-X Rule 5-02.13(a);