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United States securities and exchange commission logo
September 21, 2023
Matthew J. Smith
Chief Financial Officer
Stronghold Digital Mining, Inc.
595 Madison Avenue, 28th Floor
New York, NY 10022
Re:Stronghold Digital Mining, Inc.
Form 10-K for the Fiscal Year Ended December 31, 2022
Filed April 3, 2023
Form 10-Q for the Quarterly Period Ended June 30, 2023
Filed August 11, 2023
Form 8-K, Furnished August 10, 2023
File No. 001-40931
Dear Matthew J. Smith:
            We have limited our review of your filings to the financial statements and related
disclosures and have the following comments.  In some of our comments, we may ask you to
provide us with information so we may better understand your disclosure.
            Please respond to these comments 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 our
comments apply to your facts and circumstances, please tell us why in your response.
            After reviewing your response to these comments, we may have additional comments.
Form 10-K For the Fiscal Year Ended December 31, 2022
Management's Discussion and Analysis of Financial Condition and Results of Operations
Results of Operations, page 71
1.We note the disclosure in your September 6, 2023 press release of your hashrate capacity
and the items impacting the changes in your hashrate. In future filings, please expand your
discussion to explain the interrelationships between the bitcoin price, the size of the
computing power on the bitcoin network (hash rate), the difficulty, halvening, and the
mining rewards and fees and revenues. Consider including, if applicable, a discussion
regarding your daily average GPUs and their average hashrate and difficulty for each of
the periods presented. Refer to Item 303(a) of Regulation S-K and SEC Release No. 33-
10751.

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Consolidated Statements of Cash Flows, page 87
2.You have reported mining revenues and net proceeds from sales of digital
currencies within cash flows from operating activities on your Statements of Cash Flows.
Please provide your accounting analysis supporting your conclusion that this activity is
properly classified within cash flow from operating activities, instead of cash flows from
investing activities.  Specifically include for any revenue stream, if you use your own
crypto at any point during the lifecycle of the transaction. Refer to specific accounting
guidance in your response.
Notes to Consolidated Financial Statements
Note 2 - Nature of Operations and Significant Accounting Policies
Digital Currencies, page 90
3.Please tell us how your classification of digital currencies as current assets is consistent
with the definition of current assets in ASC 201-10-20. Further, clarify for us how you
determined digital assets should be classified as current assets when indefinite-lived
intangible assets are generally considered "other assets" under Rule 5-02.17 of Regulation
S-X. Tell us the average length of time the digital currencies have been held before sale
and how frequently they turn over, explaining how you calculated this turnover.
4.You disclose that the fair value of your digital currencies is measured using the quoted
price of the digital currency.  Please tell us where you obtain the quoted price, whether the
quoted price represents your principal market under ASC 820, and how you determined
the principal market.
5.In testing for impairment of your digital currencies, you disclose that in most cases,
your qualitative assessment indicates impairment when the quoted price of the
cryptocurrency subsequently falls below its carrying amount.  Please tell us the following
information and reference for us the authoritative literature you rely upon to support your
accounting:
•Explain to us when the digital currency would not be impaired if the quoted price fell
below the carrying amount, and the period of time included in your assessment of
impairment.
•Tell us whether or not you evaluate multiple units (or fractional units) of digital
currencies.
•Tell us in detail how often you assess impairment and the timing of the quoted price
used in your assessment.
•Explain how you consider a qualitative assessment given the existence of a quoted
price on apparently active markets.
Fair Value Measurements, page 92
6.You report various balance sheet items that are accounted for at fair value on either a
recurring or non-recurring basis.  Tell us your consideration of including a separate note to

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include the disclosure requirements of ASC 820.
Revenue Recognition
Bitcoin Mining, page 95
7.Please remove your disclosure here and throughout the filing in future annual and periodic
reports that, "there is currently no specific definitive guidance under GAAP or alternative
accounting framework for the accounting for cryptocurrencies recognized as revenue or
held." We observe that the FASB codification is the source of authoritative generally
accepted accounting principles and that there is codification guidance whose scope applies
to your transactions.
8.Please provide us your analysis supporting your measurement of the non-cash
consideration (cryptocurrency) you receive for your mining pool participation activities.
In your response, where appropriate, reference for us the authoritative literature you relied
upon to support your accounting:
•You disclose that you measure the non-cash consideration at fair value on the date
received which is not materially different than the fair value at contract inception or
time you have earned the award from the mining pools. Explain to us how your
accounting policy complies with ASC 606-10-32-21 and 606-10-32-23.
•Tell us approximately how much time passes between the inception of the contract,
the time you have earned the award from the mining pools, and the date on which you
receive the award. Describe for us your process for determining that the fair value of
the award is not materially different during these periods.
•You disclose that fair value of the cryptocurrency award received is determined using
the quoted price of the related cryptocurrency at the time of receipt.  Tell us the
market(s) you use to determine the quoted price used to value the non-
cash consideration and how you identify these market(s). Refer to ASC Topic 820,
including ASC 820-10- 35-5A.
9.Please provide us your analysis supporting your bitcoin mining revenue recognition policy
for your mining pool participation activities. In your response, where appropriate,
reference for us the authoritative literature you relied upon to support your accounting:
•Step 1 of ASC 606oProvide us a representative sample contract and cross reference your analysis to
the specific provisions of that contract.
oTell us whether there are any penalties for contract termination by either party
and explain when a contract begins and describe its term for accounting
purposes. As it appears that you may cancel at any time, tell us what happens if
you cancel midterm. Also explain whether you can withdraw computing power
midterm and reinstitute it later that same day.
•Step 2 of ASC 606oSubstantiate how the provision of computing power to the mining pool is your
sole performance obligation.
•Step 3 of ASC 606

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oIdentify the consideration specified in the contract, how the amount of
consideration is determined and explain how you apply the variable
consideration constraint in ASC 606-10-32-11 through 32-13.
oTell us the payment terms for cryptocurrencies earned from the mining pool
operator and substantiate how valuing these assets upon receipt is not materially
different than the fair value at contract inception.
oTell us why it is appropriate to deduct transaction fees to the mining pool
operator from revenue. Clarify whether the single amount (i.e., the net fees
received) represents the transaction price paid to you in satisfaction of your
performance obligation to the pool operator and if the amounts retained by the
pool operator relate to the activities it must undertake to fulfill its contract with
you.
oProvide your analysis of the guidance for determining the transaction price
beginning at ASC 606-10-32-2; that is, based on your contract with the pool
operator, tell us the amount of consideration to which you are entitled for
providing computing power to the pool operator.

Note 5 - Property, Plant and Equipment, page 101
10.Please confirm to us that in future annual and periodic reports you will disclose the facts
and circumstances leading to the impairment of your miner assets disclosed here, as well
as the impairment of the MinerVa equipment deposit disclosed in Note 4, and the methods
used in determining fair value.  Refer to ASC 360-10-50-2.a through d.
Form 10-Q for the Quarterly Period Ended June 30, 2023
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Canaan Purchase Agreement and Amendment to Canaan Bitcoin Mining Agreement, page 30
11.Please describe for us your accounting treatment for the Canaan Bitcoin Mining
Agreement.  In your response, tell us the significant terms of the agreement, your revenue
recognition policies and where the revenues are recognized in your financial statements.
Form 8-K, Furnished August 10, 2023
Use and Reconciliation of Non-GAAP Financial Measures, page 8
12.You adjust for the impairment of digital currencies and the realized gain on sale of digital
currencies in your reconciliation of Adjusted EBITDA.  We note your disclosures on page
61 of your Form 10-K for the period ended December 31, 2023 of your significant bitcoin
price volatility, and on page 32 of your Form 10-Q for the period ended June 30, 2023,
that you liquidate mined Bitcoin often, and generally at multiple points every
week. Specifically, as a digital asset miner, you will continue to acquire, hold, and sell
these digital assets as part of your mining operations and these adjustments seem to be

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September 21, 2023
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recurring as the volatility of your crypto assets appear to be triggering frequent
impairment charges for these ASC 350 intangible assets. Please explain the following to
us:
•Tell us your consideration that the impairment and sale of digital currencies are
normal operating transactions that recur due to crypto price volatility, and excluding
these items from your non-GAAP financial measures may be misleading under
Regulation G, Rule 100 (b) and questions 100.01 and 102.03 of the Compliance and
Disclosure Interpretations for Non-GAAP Financial Measures.
•Clarify for us if you exclude any non-cash items, and if so, explain to us the nature
and amounts for all material non-cash items excluded. Refer to C&DI 100.04.
            In closing, we remind you that the company and its management are responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or
absence of action by the staff.
            You may contact Rolf Sundwall at 202-551-3105 or Bonnie Baynes at 202-551-4924
with any questions.
Sincerely,
Division of Corporation Finance
Office of Crypto Assets