SecProbe.io

<DOCUMENT>
<TYPE>TEXT-EXTRACT
<SEQUENCE>2
<FILENAME>filename2.txt
<TEXT>
 May 6, 2025

Wes Cummins
Chief Executive Officer
Applied Digital Corporation
3811 Turtle Creek Blvd.
Suite 2100
Dallas, TX 75219

 Re: Applied Digital Corporation
 Form 10-K for the Fiscal Year Ended May 31, 2024
 File No. 001-31968
Dear Wes Cummins:

 We have completed our review of your filing. 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.

 Sincerely,

 Division of Corporation
Finance
 Office of Technology
</TEXT>
</DOCUMENT>

CORRESP
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 Applied Digital Corporation
 3811 Turtle Creek Blvd., Suite 2100
 Dallas TX, 75219
 (214) 427-1704 |
 www.applieddigital.com

 April 16, 2025

 VIA EDGAR

 U.S. Securities and Exchange Commission

 Division of Corporation Finance

 Office of Technology

 100 F Street, N.E.

 Washington, D.C. 20549

 Attention:

 Lisa Etheredge
 Robert Littlepage

 Re:

 Applied Digital Corporation
 Form 10-K for the Fiscal Year Ended May 31, 2024
 Form 10-Q for the Period Ended November 30, 2024
 File No. 001-31968

 Dear Ms. Etheredge and Mr. Littlepage:

 Applied Digital Corporation (the "Company,"
"we," or "our") acknowledges receipt of your comment letter (the "Comment Letter") dated April 3,
2025 from the staff (the "Staff") of the U.S. Securities and Exchange Commission (the "SEC" or the "Commission")
regarding the above-referenced Form 10-K, as filed on August 30, 2024 and Form 10-Q, as filed on January 14, 2025. As such, set forth
below is the Company's response to the comments contained in the Comment Letter. To facilitate the Staff's review, the Company
has included the Staff's comment in bold italics below.

 Form 10-K for Fiscal Year Ended May 31, 2024

 Management's Discussion and Analysis of Financial
Condition and Results of Operations

 Commentary on Results of Operations for the fiscal
year ended May 31, 2024, page 55

 1. Please revise to explain, in sufficient detail, the reasons driving changes in your financial statement
line items. Your revised disclosures should also address relevant segment information as necessary to understand the business as a whole.
For example, you disclose two reasons for the $109.8 million increase in consolidated revenues during the year ended May 31, 2024 compared
to the previous year. However, you do not quantify the extent to which each factor contributed to the overall change. Additionally, you
attributed a portion of the change to increased capacity but did not quantify the extent to which capacity increased between periods and
specific reasons for that change. Refer to Item 303(a) and (b) of Regulation S-K.

 Response : The Company acknowledges the
Staff's comment. The Company respectfully advises the Staff that the Company intends to include additional disclosure regarding
the reasons driving changes in our financial statement line items, addressing relevant segment information when necessary, in the Management's
Discussion and Analysis of Financial Condition and Results of Operations of the Company's future Form 10-Q and Form 10-K filings,
in accordance with Item 303(a) and (b) of Regulation S-K.

 Specifically, the Company will also include disclosure
in its next Form 10-K filing, quantifying the extent to which each factor contributed to the $109.8 million increase in consolidated revenues
during the year ended May 31, 2024, compared to the previous year, including the extent to which hosting capacity increased between periods
and specific reasons for that change.

 Audited Financial Statements

 2. Basis of Presentation and Significant Accounting
Policies

 Recent Accounting Pronouncements, page 75

 2. We note your discussion about ASU 2023-07, Segment Reporting ("Topic 280"): Improvements
to Reportable Segment Disclosure. Please confirm that, based upon your fiscal year-end, the ASU is effective for the fiscal year that
began June 1, 2024 and for interim periods in the fiscal year beginning June 1, 2025.

 Response: The Company acknowledges the
Staff's comment and confirms that, based upon the Company's fiscal year-end, ASU 2023-07, Segment Reporting ("Topic
280"): Improvements to Reportable Segment Disclosure is effective for the Company's fiscal year that began June 1, 2024
and for interim periods in the fiscal year beginning June 1, 2025.

 Form 10-Q for the Period Ended November 30,
2024

 Management's Discussion and Analysis of Financial
Condition and Results of Operations

 Sources of Liquidity, page 43

 3. Please revise to provide a more fulsome discussion of material cash requirements from known contractual
obligations, including lease obligations, purchase obligations, minimum debt payments, and other liabilities reflected on your balance
sheet. Your discussion should also address any material commitments or obligations that are reasonably likely to have a material current
or future effect on your financial condition, results of operations, liquidity, or capital resources. Refer to Item 303(c) of Regulation
S-K.

 Response : The Company acknowledges the
Staff's comment. The Company respectfully advises the Staff that the Company intends to include more fulsome discussion of material
cash requirements from known contractual obligations, including lease obligations, purchase obligations, minimum debt payments, and other
liabilities reflected on its balance sheet, in the Management's Discussion and Analysis of Financial Condition and Results of Operations
of the Company's future Form 10-Q and Form 10-K filings, in accordance with Item 303(c) of Regulation S-K.

 4. As a related matter, please revise to explain how you determined that you had the ability to generate
and obtain sufficient amounts of cash to meet your requirements and plans both in the short and long term. We note your disclosure on
page 9 that you believe substantial doubt to continue as a going concern has been alleviated by your January 2025 Unit Purchase Agreement
with Macquarie Asset Management. However, on page 27, you indicate that closing for this agreement is conditioned upon several items,
including the execution of a lease with a hyperscaler. Please revise to clarify when closing of this agreement is expected to take place
and how your ability to continue as a going concern will be impacted if you are unable to meet the closing conditions for this agreement.

 Response : The Company acknowledges the
Staff's comment. The Company respectfully advises the Staff that the Company inadvertently referenced the subsequent events disclosed
in "Note 13 – Subsequent Events" rather than repeating the information contained in "Sources of Liquidity"
disclosed in the Management's Discussion and Analysis of Financial Condition and Results of Operations. In addition, the Company
intends to include expanded disclosure regarding the going concern assessment for the applicable reporting period in future Form 10-Q
and Form 10-K filings.

 Please contact the undersigned if you have any comments
or questions regarding the foregoing. Thank you in advance for your cooperation in connection with this matter.

 APPLIED DIGITAL CORPORATION

 /s/ Wes Cummins

 Wes Cummins
 Chief Executive Officer

 cc: Steven E. Siesser, Esq., Lowenstein Sandler LLP

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<TEXT>
 April 3, 2025

Wes Cummins
Chief Executive Officer
Applied Digital Corporation
3811 Turtle Creek Blvd.
Suite 2100
Dallas, TX 75219

 Re: Applied Digital Corporation
 Form 10-K for the Fiscal Year Ended May 31, 2024
 Form 10-Q for the Period Ended November 30, 2024
 File No. 001-31968
Dear Wes Cummins:

 We have limited our review of your filings to the financial statements
and related
disclosures 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.

Form 10-K for the Fiscal Year Ended May 31, 2024
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Commentary on Results of Operations for the fiscal year ended May 31, 2024,
page 55

1. Please revise to explain, in sufficient detail, the reasons driving
changes in your
 financial statement line items. Your revised disclosures should also
address relevant
 segment information as necessary to understand the business as a whole.
For example,
 you disclose two reasons for the $109.8 million increase in consolidated
revenues
 during the year ended May 31, 2024 compared to the previous year.
However, you do
 not quantify the extent to which each factor contributed to the overall
change.
 Additionally, you attributed a portion of the change to increased
capacity but did not
 quantify the extent to which capacity increased between periods and
specific reasons
 for that change. Refer to Item 303(a) and (b) of Regulation S-K.
 April 3, 2025
Page 2
Audited Financial Statements
2. Basis of Presentation and Significant Accounting Policies
Recent Accounting Pronouncements, page 75

2. We note your discussion about ASU 2023-07, Segment Reporting ("Topic
280"):
 Improvements to Reportable Segment Disclosure. Please confirm that,
based upon
 your fiscal year-end, the ASU is effective for the fiscal year that
began June 1, 2024
 and for interim periods in the fiscal year beginning June 1, 2025.
Form 10-Q for the Period Ended November 30, 2024
Management's Discussion and Analysis of Financial Condition and Results of
Operations
Sources of Liquidity, page 43

3. Please revise to provide a more fulsome discussion of material cash
requirements
 from known contractual obligations, including lease obligations,
purchase obligations,
 minimum debt payments, and other liabilities reflected on your balance
sheet. Your
 discussion should also address any material commitments or obligations
that are
 reasonably likely to have a material current or future effect on your
financial
 condition, results of operations, liquidity, or capital resources. Refer
to Item 303(c) of
 Regulation S-K.
4. As a related matter, please revise to explain how you determined that
you had the
 ability to generate and obtain sufficient amounts of cash to meet your
requirements
 and plans both in the short and long term. We note your disclosure on
page 9 that you
 believe substantial doubt to continue as a going concern has been
alleviated by your
 January 2025 Unit Purchase Agreement with Macquarie Asset Management.
 However, on page 27, you indicate that closing for this agreement is
conditioned upon
 several items, including the execution of a lease with a hyperscaler.
Please revise to
 clarify when closing of this agreement is expected to take place and how
your ability
 to continue as a going concern will be impacted if you are unable to
meet the closing
 conditions for this agreement.

 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.

 Please contact Lisa Etheredge at 202-551-3424 or Robert Littlepage at
202-551-3361
with any questions.

 Sincerely,

 Division of
Corporation Finance
 Office of
Technology
</TEXT>
</DOCUMENT>

CORRESP
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November
25, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
    Digital Corporation (the “Company”)

    Registration
    Statement on Form S-1 (File No. No. 333-282707)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 5:00 p.m. Eastern
Time on November 26, 2024, or as soon as practicable thereafter, or at such later time as the Company or its counsel may request via
telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    Saidal L. Mohmand

    Name:
    Saidal
    L. Mohmand

    Title:
    Chief
    Financial Officer

CORRESP
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October
31, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
    Digital Corporation (the “Company”)

    Registration
    Statement on Form S-1 (File No. No. 333-282293)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 4:15 p.m. Eastern
Time on November 4, 2024, or as soon as practicable thereafter, or at such later time as
the Company or its counsel may request via telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    Saidal Mohmand

    Name:
    Mohammad
    Saidal L. Mohmand

    Title:
    Chief
    Financial Officer

CORRESP
1
filename1.htm

October
31, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
    Digital Corporation (the “Company”)

    Registration
    Statement on Form S-1 (File No. No. 333-282782)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 4:15 p.m., Eastern
Time, on November 4, 2024, or as soon as practicable thereafter, or at such later time as
the Company or its counsel may request via telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    Saidal Mohmand

    Name:
    Mohammad Saidal
                                            L. Mohmand

    Title:
    Chief
    Financial Officer

October 29, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corporation
3811 Turtle Creek Blvd., Suite 2100
Dallas, Texas 75219
Re:Applied Digital Corporation
Registration Statement on Form S-1
Filed October 23, 2024
File No. 333-282782
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Alexandra Barone at 202-551-8816 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:Steven E. Siesser, Esq.

CORRESP
1
filename1.htm

October
11, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
    Digital Corporation (the “Company”)

    Registration
    Statement on Form S-1 (File No. No. 333-282518)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 4:15 p.m. Eastern
Time on October 15, 2024, or as soon as practicable thereafter, or at such later time as
the Company or its counsel may request via telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    David Rench

    Name:
    David
    Rench

    Title:
    Chief
    Financial Officer

October 8, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corporation
3811 Turtle Creek Blvd., Suite 2100
Dallas, Texas 75219
Re:Applied Digital Corporation
Registration Statement on Form S-1
Filed October 4, 2024
File No. 333-282518
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Alexandra Barone at 202-551-8816 or Matthew Derby at 202-551-
3334 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:Steven E. Siesser, Esq.

September 27, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corporation
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Digital Corporation
Registration Statement on Form S-1
Filed September 23, 2024
File No. 333-282293
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Alexandra Barone at 202-551-8816 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:Steven E. Siesser, Esq.

CORRESP
1
filename1.htm

September
19, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
Digital Corporation (the “Company”)

    Registration Statement on Form S-1 (File No. No. 333-282044)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 8:00 a.m.,
Eastern Time, on September 23, 2024, or as soon as practicable thereafter, or at such later
time as the Company or its counsel may request via telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    David Rench

    Name:
    David
    Rench

    Title:
    Chief
    Financial Officer

September 19, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corp.
3811 Turtle Creek Blvd., Suite 2100
Dallas, Texas 75219
Re:Applied Digital Corp.
Registration Statement on Form S-1
Filed September 11, 2024
File No. 333-282044
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Mitchell Austin at 202-551-3574 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:Steven E. Siesser, Esq.

CORRESP
1
filename1.htm

September
19, 2024

VIA
EDGAR

United
States Securities and Exchange Commission

Division
of Corporation Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    Applied
    Digital Corporation (the “Company”)

Registration
Statement on Form S-1 (File No. No. 333-282119)

Ladies
and Gentlemen:

In
accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration
Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 8:00 a.m.,
Eastern Time, on September 23, 2024, or as soon as practicable thereafter, or at such later
time as the Company or its counsel may request via telephone call to the staff.

Please
call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any
questions.

    Very
    truly yours,

    APPLIED
    DIGITAL CORPORATION

    By:
    /s/
    David Rench

    Name:
    David
    Rench

    Title:
    Chief
    Financial Officer

United States securities and exchange commission logo
June 10, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corp.
3811 Turtle Creek Blvd., Suite 2100
Dallas, Texas 75219
Re:Applied Digital Corp.
Registration Statement on Form S-1
Filed May 31, 2024
File No. 333-279884
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Kathleen Krebs at 202-551-3350 or Jan Woo at 202-551-3453 with any
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Steven E. Siesser, Esq.

CORRESP
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Document

June 10, 2024

VIA EDGAR

United States Securities and Exchange Commission

Division of Corporation Finance

100 F Street, N.E.

Washington, D.C. 20549

 Re:  Applied Digital Corporation (the “Company”)

Registration Statement on Form S-1 (File No. No. 333-279884)

Ladies and Gentlemen:

In accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 4:15 p.m., Eastern Time, on June 12, 2024, or as soon as practicable thereafter, or at such later time as the Company or its counsel may request via telephone call to the staff.

Please call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any questions.

  Very truly yours,

  APPLIED DIGITAL CORPORATION

  By: /s/ David Rench

  Name: David Rench

  Title: Chief Financial Officer

United States securities and exchange commission logo
May 13, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corp.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Digital Corp.
Registration Statement on Form S-3
Filed May 6, 2024
File No. 333-279155
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Uwem Bassey at 202-551-3433 or Matthew Derby at 202-551-3334 with
any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
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Document

Applied Digital Corporation
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219

May 13, 2024

VIA EDGAR

United States Securities and
Exchange Commission
100 F Street, NE
Washington, DC 20549

Re:    Applied Digital Corporation

Registration Statement on Form S-3

File No. 333-279155
Acceleration Request

Dear Ladies and Gentlemen:

Pursuant to Rule 461 promulgated under the Securities Act of 1933, as amended, Applied Digital Corporation, hereby requests that the effectiveness of its Registration Statement on Form S-3, file No. 33-279155, be accelerated so that it will become effective at 9:00 a.m. (eastern time) on May 16, 2024, or as soon thereafter as practicable.

Very truly yours,

APPLIED DIGITAL CORPORATION

   /s/ David Rench

David Rench

Chief Financial Officer

CORRESP
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Document

April 19, 2024

VIA EDGAR

United States Securities and Exchange Commission

Division of Corporation Finance

100 F Street, N.E.

Washington, D.C. 20549

 Re:  Applied Digital Corporation (the “Company”)

Registration Statement on Form S-3 (File No. No. 333-278699)

Ladies and Gentlemen:

In accordance with Rule 461 under the Securities Act of 1933, as amended, the Company hereby requests that the above-referenced Registration Statement (the “Registration Statement”) be declared effective by the Securities and Exchange Commission at 4:15 p.m., Eastern Time, on April 23, 2024, or as soon as practicable thereafter, or at such later time as the Company or its counsel may request via telephone call to the staff.

Please call Steven Siesser of Lowenstein Sandler LLP at (212) 204-8688 to confirm the effectiveness of the Registration Statement or with any questions.

  Very truly yours,

  APPLIED DIGITAL CORPORATION

  By: /s/ David Rench

  Name: David Rench

  Title: Chief Financial Officer

United States securities and exchange commission logo
April 19, 2024
Wes Cummins
Chief Executive Officer
Applied Digital Corp.
1301 East Broward Boulevard, 3rd Floor
Dallas, Texas 75219
Re:Applied Digital Corp.
Registration Statement on Form S-3
Filed April 15, 2024
File No. 333-278699
Dear Wes Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration. 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.
            Please contact Lauren Pierce at 202-551-3887 or Matthew Derby at 202-551-3334 with
any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Steven Siesser

CORRESP
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Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 21125
Dallas, TX 75219

October 6, 2022

VIA EDGAR

United States Securities and
Exchange Commission
100 F Street, NE
Washington, DC 20549

Re:    Applied Blockchain, Inc.

Registration Statement on Form S-1

File No. 333-267478
Acceleration Request

Dear Ladies and Gentlemen:

Pursuant to Rule 461 under the Securities Act of 1933, as amended, Applied Blockchain, Inc., a Nevada corporation (the “Company”), hereby requests that the effectiveness of its Registration Statement on Form S-1, File No. 333-267478, be accelerated so that it will become effective at 9:00 a.m. (eastern time), on October 11, 2022, or as soon thereafter as practicable.

Very truly yours,

APPLIED BLOCKCHAIN, INC.

/s/ David Rench

David Rench

Chief Financial Officer

United States securities and exchange commission logo
September 23, 2022
Wes Cummins
Chief Executive Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Registration Statement on Form S-1
Filed September 16, 2022
File No. 333-267478
Dear Mr. Cummins:
            This is to advise you that we have not reviewed and will not review your registration
statement.
            Please refer to Rules 460 and 461 regarding requests for acceleration.  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.
            Please contact Mitchell Austin, Staff Attorney, at (202) 551-3574 or, in his absence, Jan
Woo, Legal Branch Chief, at (202) 551-3453 with any questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol W. Sherman, Esq.

CORRESP
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Applied Blockchain, Inc.

3811 Turtle Creek Blvd., Suite 2100

Dallas, TX 75219

April 8, 2022

VIA EDGAR

United States Securities and

Exchange Commission

100 F Street, NE

Washington, DC 20549

    Re:

    Applied Blockchain, Inc.

    Registration Statement on Form S-1

    File No. 333-258818

    Acceleration Request

Dear Ladies and Gentlemen:

Pursuant
to Rule 461 under the Securities Act of 1933, as amended, Applied Blockchain, Inc., a Nevada corporation (the “Company”),
hereby requests that the effectiveness of its Registration Statement on Form S-1, File No. 333-258818, be accelerated so that
it will become effective at 4:01 p.m. (eastern time), on April 12, 2022, or as soon thereafter as practicable.

    Very truly yours,

    APPLIED BLOCKCHAIN, INC.

    /s/ David Rench

    David Rench

    Chief Financial Officer

CORRESP
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March 28, 2022

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch
Chief

Larry Spirgel, Office Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance Office
of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Amendment No. 8 to Registration Statement on Form S-1

Filed March 21, 2022

File No. 333-258818

Dear Messrs. Kempf, Littlepage and Spirgel and Ms. Dao:

In response to your letter
dated March 24, 2022, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see below our responses
to your comments and revisions in connection therewith to be included in Amendment No. 9 to our Registration Statement on Form S-1, as
filed with the Securities and Exchange Commission on March 28, 2022 (“S-1 Amendment No. 9”). We have included your comments
in italics for reference.

Amendment No.
8 to Registration Statement on Form S-1

Mining Operation,
page 2

 1. We note your response to comment 3 and the related disclosures provided
in response to comment 1. Provide pro forma financial statements prepared in accordance with Article 11 of Regulation S-X to give effect
to your exit of the crypto mining business and the sale of the equipment. We refer you to Rule 11-01(a)(4) of Regulation S-X.

RESPONSE:
The pro forma financial statements have been added to page F-34 of the S-1 Amendment No. 9.

If you require any further
information or have additional questions, please contact me at (214) 402-5399 or Carol Sherman at (212) 808-5038.

    Sincerely,

    /s/ David Rench

    David Rench, Chief Financial Officer

 cc: Carol Sherman

United States securities and exchange commission logo
March 24, 2022
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Amendment No. 8 to Registration Statement on Form S-1
Filed March 21, 2022
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your amended registration statement and have the following
comment.  In our comment, we may ask you to provide us with information so we may better
understand your disclosure.
            Please respond to this letter by amending your registration statement and providing the
requested information.  If you do not believe our comment applies to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to this comment, we may have additional comments.  Unless we note
otherwise, our references to prior comments are to comments in our March 16, 2022 letter.
Amendment No. 8 to Registration Statement on Form S-1
Mining Operation, page 2
1.We note your response to comment 3 and the related disclosures provided in response to
comment 1.  Provide pro forma financial statements prepared in accordance with Article
11 of Regulation S-X to give effect to your exit of the crypto mining business and the sale
of the equipment.  We refer you to Rule 11-01(a)(4) of Regulation S-X.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 March 24, 2022 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
March 24, 2022
Page 2
            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters. Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
1
filename1.htm

March 21, 2022

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch
Chief

Larry Spirgel, Office Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance Office
of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Amendment No. 7 to Registration Statement on Form S-1

Filed February 28, 2022

File No. 333-258818

Dear Messrs Kempf, Littlepage and Spirgel and Ms. Dao:

In response to your letter
dated March 16, 2022, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see below our responses
to your comments and revisions in connection there with to be included in Amendment No. 8 to our Registration Statement on Form S-1, as
filed with the Securities and Exchange Commission on March 21, 2022 (“S-1 Amendment No. 8”). We have included your comments
in italics for reference.

Amendment No.
7 to Registration Statement on Form S-1

Management's
Discussion and Analysis of Financial Condition and Results of Operations

Trends and Uncertainties,
page 41

 1. Please revise your discussion of trends and uncertainties as required
by Items 303(b)(1)(i) and (ii)(B) and Item 303(b)(2)(ii) of Regulation S-K. Discuss your decision to discontinue all crypto mining operations
and address:

 · how you plan to account for the cessation of your crypto mining operations;

 · the expected impact of the sale of your crypto mining operations; and

 · how cessation of your crypto mining operations may affect your future liquidity and capital resources.

RESPONSE:
The following disclosure is included in S-1 Amendment No. 8 on page 39:

“Sale of
Crypto Mining Equipment

On March 9, 2022,
we ceased all crypto mining operations and completed the sale of all crypto mining equipment in service. Total proceeds from the sale
of the equipment were $1.6 million. We will recognize a loss of $2.9 million in the sale of the equipment during the quarter ended May
31, 2022. We have no plans to return to crypto mining operations in the future as we grow our co-hosting operations. The results of our
crypto mining operations will be accounted for as discontinued operations in our consolidated financial statements as of and for the period
ended February 28, 2022. This decision may decrease liquidity and our available capital resources, which may adversely affect us.

Securities and Exchange Commission

Applied Blockchain, Inc.

 March 21, 2022

 Page 2

Accounting Matters,
page 42

 2. We note that you plan to account for your co-hosting arrangements as
a single performance obligation. We also note on page 46 that you will lease space and provide access to electricity, and that you will
 "provide full operations and maintenance services for a fixed fee". Explain the contractual terms under which you will be compensated
for leased space, the provision of electricity and other services. Explain to us why your provision of leased space and electricity and
other services should be accounted for as a single performance obligation under ASC 842. Also explain how you plan to measure satisfaction
of your co-hosting performance obligations and how such methodologies are appropriate under ASC 842.

RESPONSE:
The Company considered whether the co-hosting arrangements were subject to ASC 842. In order to be considered a lease in accordance with
ASC 842-10-15-1, there must be “a contract, or part of a contract, that conveys the right to control the use of identified property,
plant, or equipment (an identified asset) for a period of time in exchange for consideration.” The asset must also be physically
distinct, which could include an entire asset or a portion of an asset. The services provided by the Company cannot be physically separated
from other services within its colocation hosting facilities (e.g., electrical power, ambient air cooling, internet connectivity). In
addition, the space provided to customers to place their own hardware into the Company’s facilities is not explicitly or implicitly
specified. Rather, customers contract with the Company for access to power and do not have the right to control specific space within
the Company’s colocation hosting facilities, and their only decision-making rights relate to deciding on the level of computing
power before the period of use (and the level of computing power cannot be changed during the period of use without modifying the contract,
as noted above). Therefore, the Company’s contracts with its customers will be accounted for under ASC 606.

The Company’s
hosting agreements with its customers requires that the Company provide a cryptocurrency mining facility, including rack space, electrical
power, ambient air cooling, internet connectivity and physical security, and maintenance services (i.e., automated and manual rebooting
of non-responsive machines). While all of these are distinct services, we have considered these to be a single performance obligation
in accordance with ASC 606-10-25-15 as each service in the series of services meets the criteria to be a performance obligation satisfied
over time, and the same method would be used to measure the Company’s progress toward complete satisfaction of the performance obligation
to transfer each distinct service in the series to the customer. As a result, revenue is not allocated to each distinct service based
on relative standalone selling price. Instead, we will recognize revenue evenly over the related contractual period, and our customers
will be charged a monthly service fee equal to a price per megawatt per month whereby the number of megawatts of power available to our
customers will be outlined within the customer contract and any change would be considered a contract modification. This compensation
structure will also be outlined within the customer contracts and will consider all services to be a single obligation to the customer.

Securities and Exchange Commission

Applied Blockchain, Inc.

March 21, 2022

Page 3

Financial Statements

Consolidated
Statements of Operations (Unaudited), page F-17

 3. We note your intent to exit your mining operations and the sale of your
Bitcoin mining equipment. Please explain to us your consideration of presenting your mining business as a discontinued operation. Specifically,
tell us when you met each of the criteria in ASC 205-20-2-45-1E.

RESPONSE: For the quarter
ended November 30, 2021, the Company did not meet each of the criteria in ASC 205-20-45-1E. Specifically, the Company had not committed
to a plan to sell the mining business as of November 30, 2021, as the mining business was the only operating segment as of that date,
and the Company had no other material revenue-generating operations as of that date. Under ASC 205-20-45-1E, all six of the criteria must
be met in order for the component to meet held-for-sale classification. Given that the Company had not committed to a plan to sell the
mining business, the mining business does not meet the held-for-sale criteria in ASC 205-20-45-1E. Further, the mining business was not
disposed of by sale or by other than sale during the period ended November 30, 2021. Therefore, none of the activities listed within ASC
205-20-45-1B that require discontinued operations reporting for a component of an entity where the disposal represents a strategic shift
were present for the quarter ended November 30, 2021.

Under ASC 360-10-45-13, the Company
must make a determination of the classification of assets as held and used, or held-for-sale as of the balance sheet date. Circumstances
that occur after the balance sheet date but before the financial statement issuance are not considered in that assessment. Given the Company’s
exit of the mining operations and sale of the mining equipment took place after the balance sheet date of November 30, 2021, but the mining
business did not meet the held-for-sale and discontinued operations criteria as of the balance sheet date, the Company will be presenting
the mining equipment as held and used, and the results of the mining business within continuing operations for the quarter ended November
30, 2021.

For the quarter ended February 28, 2022,
the Company determined the mining business met each of the criteria under ASC 205-20-45-1E. Therefore, the mining equipment will be classified
as held-for-sale and measured at the lower of the asset carrying amount or fair value less cost to sell, in accordance with ASC 360-10-45-43.
Furthermore, the Company determined that the mining business met the definition of a “component of an entity” in the ASC 205-20
glossary as the mining business represents an operating segment as of February 28, 2022. In addition, the Company determined that the
disposal of the mining business met the definition of a “strategic shift” as outlined in ASC 205-20-45-1c, as the disposal
will have a major effect on a major line of business, given the mining business has historically represented a significant line of business
for the Company. Therefore, the disposal of the mining business meets the criteria for discontinued operations presentation in ASC 205-20-45-1B,
and the Company will present results of the mining business as discontinued operations for the quarter ended February 28, 2022.

If you require any further
information or have additional questions, please contact me at (214) 402-5399 or Carol Sherman at (212) 808-5038.

  Sincerely,

  /s/ David Rench

  David Rench, Chief Financial Officer

 cc: Carol Sherman

United States securities and exchange commission logo
March 16, 2022
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Amendment No. 7 to Registration Statement on Form S-1
Filed February 28, 2022
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your amended registration statement 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 this letter by amending your registration statement and providing the
requested information.  If you do not believe our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to these comments, we may have additional comments.  Unless we note
otherwise, our references to prior comments are to comments in our February 18, 2022 letter.
Amendment No. 7 to Registration Statement on Form S-1
Management's Discussion and Analysis of Financial Condition and Results of Operations
Trends and Uncertainties, page 41
1.Please revise your discussion of trends and uncertainties as required by Items 303(b)(1)(i)
and (ii)(B) and Item 303(b)(2)(ii) of Regulation S-K.  Discuss your decision to
discontinue all crypto mining operations and address:
•how you plan to account for the cessation of your crypto mining operations;
•the expected impact of the sale of your crypto mining equipment; and
•how cessation of your crypto mining operations may affect your future liquidity and
capital resources.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 March 16, 2022 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
March 16, 2022
Page 2
Accounting Matters, page 42
2.We note that you plan to account for your co-hosting arrangements as a single
performance obligation.  We also note on page 46 that you will lease space and provide
access to electricity, and that you will "provide full operations and maintenance services
for a fixed fee".  Explain the contractual terms under which you will be compensated for
leased space, the provision of electricity and other services.  Explain to us why your
provision of leased space and electricity and other services should be accounted for as a
single performance obligation under ASC 842.  Also explain how you plan to measure
satisfaction of your co-hosting performance obligations and how such methodologies are
appropriate under ASC 842.
Financial Statements
Consolidated Statements of Operations (Unaudited), page F-17
3.We note your intent to exit your mining operations and the sale of your Bitcoin mining
equipment.  Please explain to us your consideration of presenting your mining business as
a discontinued operation.  Specifically, tell us when you met each of the criteria in ASC
205-20-2-45-1E.

            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters. Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
1
filename1.htm

February 28, 2022

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch
Chief

Larry Spirgel, Office Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance

Office of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Amendment No. 6 to Registration Statement on Form S-1

Filed February 1, 2022

File No. 333-258818

Dear Messrs. Kempf, Littlepage and Spirgel and Ms. Dao:

In response to your letter
dated February 18, 2022, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see below
our responses to your comments and revisions in connection therewith to be included in Amendment No. 7 to our Registration Statement
on Form S-1, as filed with the Securities and Exchange Commission on February 23, 2022 (“S-1 Amendment No. 7”).
We have included your comments in italics for reference.

Amendment No. 6
to Registration Statement on Form S-1

Management's
Discussion and Analysis

Components of
Results of Operations, page 42

 1. We note your response to prior comment 4. With a view towards disclosure, please tell us how you valued
the 8,200,000 shares of restricted common stock issued to non-employee directors and senior officers on January 18, 2022. Tell us
if these shares were valued similarly to the 10,750,000 restricted stock units granted to certain of your consultants. Also, revise your
discussion of results of operations, in accordance with Item 303(b)(2)(ii) of Regulation S-K, to disclose and to quantify the unfavorable
impact of the issuance of the restricted common stock on your future income from continuing operations.

RESPONSE:
The disclosure set forth in “15. Subsequent Events” beginning on page F-32 of S-1 Amendment No. 7 indicates the
valuation techniques that were used to value the 8,200,000 shares of restricted common stock issued to non-employee directors and
senior officers, and the 10,750,000 shares of restricted stock units granted to certain of our consultants. The valuation techniques
used to value these shares were consistent amongst both fair value determinations on the respective grant dates. The following
disclosure is included in S-1 Amendment No. 7 beginning on page 42.

Future Expense of RSUs and Restricted Stock

We granted an aggregate of 10,750,000 restricted
stock units (“RSUs”) (or 1,791,666 RSUs after giving effect to the Reverse Stock Split) to certain of our consultants with
different vesting schedules based on occurrence of certain events which we cannot predict. Assuming that such RSUs vest in the amounts
and during the quarters set forth in the table below, such table details the vesting shares and implied expenses in each relevant fiscal
quarter.

Securities and Exchange Commission

Applied Blockchain, Inc.

February 28, 2022

Page 2

    ​
    Before the Reverse Stock Split
    After Giving Effect to the Reverse Stock Split

    Fiscal Quarter End
      RSUs

Vested
      Implied  Expense
      RSUs

Vested
      Implied  Expense

    May 31, 2022
      2,650,000
    $ 3,551,000
      441,666
    $ 3,551,000

    August 31, 2022
      4,800,000
    $ 6,432,000
      800,000
    $ 6,432,000

    November 30, 2022
      3,300,000
    $ 4,422,000
      550,000
    $ 4,422,000

We granted an aggregate
of 3,600,000 shares of restricted stock (“Restricted Stock”) (or 600,000 after giving effect to the Reverse Stock Split)
to our non-employee directors. The Restricted Stock vests one half on April 1, 2022, or the date, if later, on which the SEC declares
effective a registration statement covering the resale of the shares of Restricted Stock (the “Later Date”) and April 1,
2023. The following table details the vesting shares and implied expenses in each relevant fiscal quarter.

    ​
    Before the Reverse Stock Split
    After Giving Effect to the Reverse Stock Split

    Fiscal Quarter End
      Vesting  Restricted  Stock
      Implied  Expense
      Vesting  Restricted  Stock
      Implied  Expense

    May 31, 2022
      1,800,000
    $ 2,412,000
      300,000
    $ 2,412,000

    August 31, 2022
    $ 450,000
    $ 603,000
      75,000
    $ 603,000

    November 30, 2022
    $ 450,000
    $ 603,000
      75,000
    $ 603,000

    February 28, 2023
    $ 450,000
    $ 603,000
      75,000
    $ 603,000

    May 31, 2023
    $ 450,000
    $ 603,000
      75,000
    $ 603,000

We granted an aggregate
of 4,600,000 shares of restricted stock (“Restricted Stock”) (or 766,666 after giving effect to the Reverse Stock Split) to
three of our employees. The Restricted Stock vests one half on April 1, 2022, or, if later, the Later Date, and one-quarter of the
remaining unvested shares vest on each of July 1, 2022, October 1, 2022, January 1, 2023 and April 1, 2023, or, in
each case, if later, the Later Date. The following table details the vesting shares and implied expenses in each relevant fiscal quarter.

    ​
    Before the Reverse Stock Split
    After Giving Effect to the Reverse Stock Split

    Fiscal Quarter End
      Vesting  Restricted  Stock
      Implied  Expense
      Vesting  Restricted  Stock
      Implied  Expense

    May 31, 2022
      2,300,000
    $ 3,082,000
      383,334
    $ 3,082,000

    August 31, 2022
      575,000
    $ 770,500
      95,833
    $ 770,500

    November 30, 2022
      575,000
    $ 770,500
      95,833
    $ 770,500

    February 28, 2023
      575,000
    $ 770,500
      95,833
    $ 770,500

    May 31, 2023
      575,000
    $ 770,500
      95,833
    $ 770,500

Securities and Exchange Commission

Applied Blockchain, Inc.

February 28, 2022

Page 3

Consolidated
Statements of Cash Flows, page F-20

 2. We note from page F-26 that you earned over $2 million in cryptoassets through mining. Transactions
such as these appear to be non-cash revenue transactions and should be reflected as a reconciling item between net/income (loss) to cash
flows from operations in accordance with ASC 230.

RESPONSE:
Page F-20 of S-1 Amendment No. 7 includes revisions to our statement of cash flows responsive to this comment.

Financial Statements

5. Revenue From
Contracts With Customers, page F-25

 3. We note that you are entitled to theoretical fractional shares of cryptoasset awards less fees to the
mining operator. Tell us whether you receive consideration net of these fees or if you make separate payments to the mining pool operator.
Clarify how these revenues and fees are accounted for and whether they are reported on a gross or a net basis. Provide your support for
accounting for these fees. We refer you to ASC 606-10-32-25.

RESPONSE:
The Company’s arrangement with the mining pool represents a contract with a customer under ASC 606. As part of this contract, the
Company’s only performance obligation is to provide computing power to the mining pool. In return, the Company is entitled to receive
a reward in the form of a cryptoasset. The amount of the cryptoasset reward is determined based on the Company’s share of the computing
power provided to the mining pool for a successfully mined block and the reward received by the mining pool by successfully mining a block.
The Company receives its reward net of the portion (fee) of the cryptoasset retained by the mining pool. No separate payments are made
to the mining pool by the Company. The amount of cryptoasset retained by the mining pool is recorded as a reduction of revenue and presented
on a “net basis” in the financial statements. This is disclosed in the financial statements as: “… , the Company
is entitled to a theoretical fractional share of the cryptoasset award the mining pool operator receives (less service fees to the mining
pool operator which are recorded as a reduction of revenue) for successfully adding a block to the blockchain”.

In accordance with ASC 606-10-32-25,
consideration payable to a customer should generally be accounted for as a reduction of the transaction price (and, therefore, of revenue).
However, ASC 606-10-32-26 provides that if the payment to the customer is in exchange for a distinct good or service that the
customer transfers to the entity, the entity should “account for the purchase of the good or service in the same way that it accounts
for other purchases from suppliers.”

ASC 606-10-32-25 refers to ASC 606-10-25-18
through 25-22 for guidance on the identification of distinct goods or services. Specifically, in the context of consideration
payable to a customer, application of ASC 606-10-25-19 would lead to a determination that goods or services are distinct if both of the
following criteria are met:

 a) The Company can benefit from the service supplied by the mining pool (either on its own or together with other resources that are
readily available to the Company).

Securities and Exchange Commission

Applied Blockchain, Inc.

February 28, 2022

Page 4

 b) The mining pool’s promise to transfer the service to the Company is separately identifiable from other promises in the Company’s
contract with the mining pool (i.e., the mining pool’s promise to transfer the service to the Company is distinct within the context
of the contract, and the benefit to be received by the Company is separable from the sale of the service by the Company to the
mining pool).

It is our conclusion that criteria
b) from the above is not met because the Company would not enter into an exchange transaction with a party other than the mining
pool (i.e., it would not pay for the services provided by the mining pool unless it is also providing computing power to the mining
pool and therefore not separately identifiable). Accordingly, these revenues and fees are reported on a net basis.

 4. We note that you recognize cryptocurrency revenue, measured at fair value on the date received, which
is not materially different than the fair value at contract inception or the time you earn the award. In light of the volatile nature
of cryptocurrency prices, tell us and disclose how you constrain variable consideration. Further, provide us with your analysis supporting
your assertion that the differences between recording fair value at the date the cryptocurrency is received is not materially different
than the estimated fair value at contract inception.

RESPONSE:
Revenue is constrained and not recorded until rewards are received from the mining pool. The contract term is indefinite, and the Company
may withdraw from the mining pool at any time without cause or penalty. As the Company chooses to participate in the mining pool for each
new block, each new block constitutes a contract based on the terms of the service agreement. The Company receives a reward from the pool
only if it contributed computing power to a successfully mined block.

The pool, on average, successfully mines a block every 60
seconds. As a result of the short time period between the successfully mined blocks by the mining pool and the Company providing a consistent
amount of computing power to the mining pool throughout the day, the revenue earning process is effectively continuous. Consequently,
revenue is recorded at the average price for the day as the best approximation for the price when the awards are earned.

Nevertheless, we have performed analysis between revenue
recorded based on the average price for the day and revenue determined based on the low and high spot price during the day. Revenue based
on the low and high spot price represents the theoretical (and only theoretical as it is not practically possible, given the considerations
above, to earn all rewards at a single point in time that also corresponds to the low/high point in the price of the cryptoasset and to
achieve that every day) outer limits of the potential revenue band. The analysis yielded a maximum revenue variance (aggregate daily difference
in revenue based on low and high spot price) of approximately $60,000. Given the only theoretical possibility of such variance and average price
representing a significantly more precise measure, we concluded that any reasonably possible variance would not be material to the financial
statements.

We have clarified the financial statement disclosure in S-1
Amendment No. 7 beginning on page F-25.

Securities and Exchange Commission

Applied Blockchain, Inc.

February 28, 2022

Page 5

 5. We note that the provision of providing computing power is the only performance obligation in your
contracts with mining pool operators. Clarify whether you satisfy this performance obligation over time or at a point in time. Please
provide us with your analysis of how you considered ASC 606-10-25-24.

RESPONSE:
In accordance with ASC 606-10-25-24, we have evaluated whether the performance obligation is satisfied over time or at a point in
time. The performance obligation is satisfied over the time it takes to mine each block, which is approximately 60 seconds. We have
clarified the financial statement disclosure in S-1 Amendment No. 7 beginning on page F-25.

 6. Please clarify for us the period during which each party to your contract has enforceable rights and
obligations and the basis for your conclusion. In your reply, please clarify whether your right or the pool operator’s right to
terminate the contract governing your participation in the pool is conditional. Please also summarize the material rights and obligations
of each party to your pool participation contracts.

RESPONSE:
The contract is evergreen and both parties may terminate the contract without cause at their discretion. The Company has an enforceable
right to receive its portion of rewards when computing power has been provided that results in a successfully mined block. The mining
pool has an enforceable obligation to distribute the Company’s allocated rewards once a block to which the Company participated
in contributing computing power has been successfully mined. The frequency of the receipt of rewards from the mining pool is at the Company’s
discretion. The Company has elected to receive the rewards on a daily basis.

 7. Please clarify for us what computing power you are compensated for. For example, are you only compensated
for successful block placement by the pool operator; that is, are you entitled to any compensation for computing power provided for a
block that the pool operator is not successful in placing?

RESPONSE:
The Company is compensated only when its provided computing power participates in a successfully mined block. The Company provides
consistent amount of computing power to the mining pool throughout the day and the mining pool, on average, successfully mines a block
every 60 seconds.

 8. Tell us the span of time between successful placements of a block on the blockchain by the pool operator,
receipt of confirmation, and receipt of consideration.

RESPONSE:
The mining pool, on average, successfully mines a block every 60 seconds and operates continually. Confirmation from the mining pool
of rewards earned is effectively simultaneous with successful mining of a block by the pool. The Company, at its discretion and election,
receives rewards on a daily basis.

 9. We note that you state that "[t]here is currently no specific definitive guidance under GAAP"
and that there is no "alternative accounting framework for the accounting for cryptoassets recognized..." Please help us understand
the basis for these statements and your accounting policies. Consider whether these statements need to be revised or removed.

RESPONSE:
We have revised the disclosure in S-1 Amendment No. 7 to remove the referenced sentences and include the disclosure below in
 “5. Revenue from Contracts with Customers” beginning on page F-25.

Securities and Exchange Commission

Applied Blockchain, Inc.

February 28, 2022

Page 6

Cryptoasset mining revenue

The Company has entered into cryptoasset
mining pools by executing contracts with the mining pool operators to provide computing power to the

United States securities and exchange commission logo
February 18, 2022
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Amendment No. 6 to Registration Statement on Form S-1
Filed February 1, 2022
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your amended registration statement 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 this letter by amending your registration statement and providing the
requested information.  If you do not believe our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to these comments, we may have additional comments.  Unless we note
otherwise, our references to prior comments are to comments in our January 28, 2022 letter.
Amendment No. 6 to Registration Statement on Form S-1
Management's Discussion and Analysis
Components of Results of Operations, page 42
1.We note your response to prior comment 4.  With a view towards disclosure, please tell us
how you valued the 8,200,000 shares of restricted common stock issued to non-employee
directors and senior officers on January 18, 2022.  Tell us if these shares were
valued similarly to the 10,750,000 restricted stock units granted to certain of your
consultants.  Also, revise your discussion of results of operations, in accordance with Item
303(b)(2)(ii) of Regulation S-K, to disclose and to quantify the unfavorable impact of the
issuance of the restricted common stock on your future income from continuing
operations.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 February 18, 2022 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
February 18, 2022
Page 2
Consolidated Statements of Cash Flows, page F-20
2.We note from page F-26 that you earned over $2 million in cryptoassets through mining.
Transactions such as these appear to be non-cash revenue transactions and should be
reflected as a reconciling item between net/income (loss) to cash flows from operations in
accordance with ASC 230.
Financial Statements
5. Revenue From Contracts With Customers, page F-25
3.We note that you are entitled to theoretical fractional shares of cryptoasset awards less
fees to the mining operator.  Tell us whether you receive consideration net of these fees or
if you make separate payments to the mining pool operator.  Clarify how these revenues
and fees are accounted for and whether they are reported on a gross or a net basis.
Provide your support for accounting for these fees.  We refer you to ASC 606-10-32-25.
4.We note that you recognize cryptocurrency revenue, measured at fair value on the date
received, which is not materially different than the fair value at contract inception or the
time you earn the award.  In light of the volatile nature of cryptocurrency prices, tell us
and disclose how you constrain variable consideration.  Further, provide us with your
analysis supporting your assertion that the differences between recording fair value at the
date the cryptocurrency is received is not materially different than the estimated fair value
at contract inception.
5.We note that the provision of providing computing power is the only performance
obligation in your contracts with mining pool operators.  Clarify whether you satisfy
this performance obligation over time or at a point in time.  Please provide us with your
analysis of how you considered ASC 606-10-25-24.
6.Please clarify for us the period during which each party to your contract has enforceable
rights and obligations and the basis for your conclusion.  In your reply, please clarify
whether your right or the pool operator’s right to terminate the contract governing your
participation in the pool is conditional.  Please also summarize the material rights and
obligations of each party to your pool participation contracts.
7.Please clarify for us what computing power you are compensated for.  For example, are
you only compensated for successful block placement by the pool operator; that is, are
you entitled to any compensation for computing power provided for a block that the pool
operator is not successful in placing?
8.Tell us the span of time between successful placements of a block on the blockchain by
the pool operator, receipt of confirmation, and receipt of consideration.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 February 18, 2022 Page 3
 FirstName LastName
David Rench
Applied Blockchain, Inc.
February 18, 2022
Page 3
9.We note that you state that "[t]here is currently no specific definitive guidance under
GAAP" and that there is no "alternative accounting framework for the accounting for
cryptoassets recognized..."  Please help us understand the basis for these statements and
your accounting policies.  Consider whether these statements need to be revised or
removed.
15. Subsequent Events
Equity Compensation, page F-32
10.Please disclose how you account for and determine the value of share-based compensation
as required by ASC 718-10-50.
General
11.We note that the newly filed consent of Marcum LLP refers to the fifth amendment of this
Form S-1, File No. 333-258818, filed on January 24, 2022.  Please amend to file an
updated consent that refers to the appropriate amendment.
            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters. Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
1
filename1.htm

February 1, 2022

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch
Chief

Larry Spirgel, Office Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance Office
of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Amendment No. 5 to Registration Statement on Form S-1

Filed January 24, 2022

File No. 333-258818

Dear Messrs. Kempf, Littlepage and Spirgel and Ms. Dao:

In response to your letter
dated January 28, 2022, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see below our responses
to your comments and revisions in connection therewith to be included in Amendment No. 6 to our Registration Statement on Form S-1, as
filed with the Securities and Exchange Commission on January 31, 2022 (“S-1 Amendment No. 6”). We have included your comments
in italics for reference.

Amendment No. 5 to Registration Statement on Form S-1

Reverse Stock Split, page 36

 1. It appears the reverse stock split is contingent upon your listing on
the Nasdaq Global Select Market and has not been given retroactive effect in the document. Please clarify how this reverse split is being
handled throughout the filing. Provide in the MD&A, and as appropriate throughout the forepart of the filing, pro forma presentations
giving effect to the contingent reverse split and its impact on the number of outstanding common shares and loss per share.

RESPONSE:
S-1 Amendment No. 6 has been revised to include the requested disclosure.

Capitalization, page 38

 2. Give effect to the reverse stock split in
                                            the pro forma capitalization information and the disclosure regarding the number of shares
                                            of common stock to be outstanding following the effectiveness of the registration statement.

RESPONSE:
The Capitalization section on page 38 of S-1 Amendment No. 6 has been revised to include the requested disclosure.

Securities and Exchange Commission

 Applied Blockchain, Inc.

February 1, 2022

Page 2

Management’s Discussion and Analysis Components of Results
of Operations, Page 40

 3. We note that you began to sell Bitcoin mining equipment in December 2021.
We also note that your revenues and margins have improved substantially during the quarter ended December 31, 2021.

In this regard, please discuss such
material changes in revenues and margins as required by Item 303(c)(2) of Regulation S-K. Separately, address and quantify revenues and
margins from equipment sales and from revenues and margins derived from mining operations. Describe any known trends or uncertainties,
such as these that have had, or that are reasonably likely to have, a material impact on net sales or revenues or income from continuing
operations, as required by Item 303(b)(2)(ii) of Regulation S-K. As required by Instruction 2 to Item 303(c) of Regulation S-K, identify
any significant elements of your income or loss from continuing operations which do not arise from, or are not necessarily representative
of, your ongoing business.

RESPONSE:
We have inserted the following disclosure on pages 40 and 42 of our S-1 Amendment No. 6.

Page 40

“Our revenues from
cryptomining are subject to volatility. If the price of Ether declines, we could incur future losses and these losses could be
significant as we incur costs and expenses associated with our investments, hosting our Nvidia GPU miners at Coinmint and legal and
administrative related expenses. We closely monitor our cash balances, cash needs and expense levels. Our mining operations are
costly and required substantial investment prior to generation of any revenue. Any expense increase may not be offset by a
corresponding increase in revenue. Our expenses may be greater than we anticipate. Increases in our costs without a corresponding
increase in our revenue would increase our losses and could seriously harm our business and financial performance. We no longer
intend to grow our mining operations. From time to time, we may decide to sell equipment we have already purchased, but it is not
our business model to sell equipment.”

Page 42

“In the
quarter ended August 31, 2021, we placed into operation our Nvidia GPU miners, which are hosted at Coinmint. The quarter ended
November 30, 2021, was our first full quarter of cryptocurrency mining revenues. Cryptocurrency mining revenues, net totaled $1.4
million for the quarter ending November 30, 2021 compared with $0 for the prior year period. Revenues were derived from the mining
of 368 ethereum coins. Revenues for the six months ended November 30, 2021 totaled $2 million compared to $0 for the comparable
prior year period. Revenues were derived from the mining of 586 ethereum coins.

Cost of our cryptocurrency
mining revenues for the quarter ending November 30, 2021 consist of depreciation related to our GPU miners as well as hosting fees paid
to Coinmint.

We generated $933
thousand and $1.3 million of gross profit for the three and six months ended November 30, 2021, driven by our mining operations. No
revenues for the three and six months ended November 30, 2021 are related to equipment sales. We no longer intend to grow our mining
operations. From time to time, we may decide to sell equipment we have already purchased, but it is not our business model to sell
equipment.”

Securities and Exchange Commission

Applied Blockchain, Inc.

 February 1, 2022

Page 3

 4. We note from Item 15 that on January 18, 2022 you issued 18.95 million
restricted stock units (RSUs) to non-employee directors, senior officers, and others. Please revise your discussion of results of operations,
in accordance with Item 303(b)(2)(ii) of Regulation S-K, to disclose and to quantify the unfavorable impact of the issuance of these
RSUs on future income from continuing operations.

RESPONSE:
We did not issue 18.95 million RSUs to non-employee directors, senior officers and others. We issued an aggregate of 8,200,000
shares of restricted common stock to non-employee directors and senior officers, all of which are issued and outstanding and
included in the share calculations as issued and outstanding. We have also granted an aggregate of 10,750,000 restricted stock units
to certain consultants. Accordingly, we have provided the following disclosure with respect to the 10,750,000 restricted stock units
beginning on page 41 of S-1 Amendment No. 6.

“We granted
an aggregate of 10,750,000 restricted stock units (“RSUs”) (or 1,791,666 after giving effect to the Reverse Stock Split)
to certain of our consultants with different vesting schedules based on occurrence of certain events which we cannot predict.
Assuming that all such RSUs vest 50% on April 1, 2022 and one quarter of the remainder vest on each of July 1, 2022, October 1,
2022, January 1, 2023 and April 1, 2023, the following table details the vesting shares and implied expenses in each relevant fiscal
quarter.

      Before the Reverse Stock

Split
      After Giving Effect to the

Reverse Stock Split

    Fiscal Quarter End
      RSUs Vested
      Implied Expense
      RSUs Vested
      Implied Expense

    May 31, 2022
      5,375,500
    $ 10,212,500
      895,833
    $ 10,212,500

    August 31, 2022
      1,343,750
    $ 2,553,125
      223,958
    $ 2,553,125

    November 30, 2022
      1,343,750
    $ 2,553,125
      223,958
    $ 2,553,125

    February 28, 2023
      1,343,750
    $ 2,553,125
      223,958
    $ 2,553,125

    May 31, 2023
      1,343,750
    $ 2,553,125
      223,958
    $ 2,553,125

APPLIED BLOCKCHAIN, INC and Subsidiaries

Unaudited Consolidated Financial Statements, page 102

 5. Please clarify in the caption here and throughout the interim financial
statements, as appropriate, that you are also presenting the financial statements for the six months ended November 30, 2021.

RESPONSE:
The requested changes have been made in S-1 Amendment No. 6

Consolidated Balance Sheets
(Unaudited), page F-16

 6. Here and elsewhere as appropriate, please revise the line item descriptions
Total Shareholders' Equity and Total Mezzanine and Shareholders' Equity to reflect deficit positions in shareholders' equity at each balance
sheet date.

RESPONSE:
The requested changes have been made in S-1 Amendment No. 6.

Securities and Exchange Commission

Applied Blockchain, Inc.

February 1, 2022

Page 4

Note 6. Cryptoassets,
page F-26

 7. Disclose the nature of the consideration received for the "Cryptoassets
sold or converted" and advise us.

RESPONSE:
The following disclosure has been added to page F-26 of S-1 Amendment No. 6:

“We recognize
revenue at the spot price of the cryptoasset when mined. We then track any gain or loss from the time the cryptoasset was mined to the
time when it was ultimately sold or converted. The sale or conversion generally results in a realized gain or loss at the time of sale
or conversion. The sale or conversion of cryptoassets results in the receipt of cash consideration.”

If you require any further
information or have additional questions, please contact me at (214) 402-5399 or Carol Sherman at (212) 808-5038.

    Sincerely,

    /s/ David Rench

    David Rench, Chief Financial Officer

 cc: Carol Sherman

United States securities and exchange commission logo
January 28, 2022
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Amendment No. 5 to Registration Statement on Form S-1
Filed January 24, 2022
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your amended registration statement 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 this letter by amending your registration statement and providing the
requested information.  If you do not believe our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to these comments, we may have additional comments.
Amendment No. 5 to Registration Statement on Form S-1
Reverse Stock Split, page 36
1.It appears the reverse stock split is contingent upon your listing on the Nasdaq Global
Select Market and has not been given retroactive effect in the document.  Please clarify
how this reverse split is being handled throughout the filing.  Provide in the MD&A, and
as appropriate throughout the forepart of the filing, pro forma presentations giving effect
to the contingent reverse split and its impact on the number of outstanding common shares
and loss per share.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 January 28, 2022 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
January 28, 2022
Page 2
Capitalization, page 38
2.Give effect to the reverse stock split in the pro forma capitalization information and the
disclosure regarding the number of shares of common stock to be outstanding following
the effectiveness of the registration statement.
Management's Discussion and Analysis
Components of Results of Operations, page 40
3.We note that you began to sell Bitcoin mining equipment in December 2021.  We also
note that your revenues and margins have improved substantially during the quarter ended
December 31, 2021.  In this regard, please discuss such material changes in revenues and
margins as required by Item 303(c)(2) of Regulation S-K. Separately, address and
quantify revenues and margins from equipment sales and from revenues and margins
derived from mining operations.  Describe any known trends or uncertainties, such as
these that have had, or that are reasonably likely to have, a material impact on net sales or
revenues or income from continuing operations, as required by Item 303(b)(2)(ii) of
Regulation S-K.  As required by Instruction 2 to Item 303(c) of Regulation S-K, identify
any significant elements of your income or loss from continuing operations which do not
arise from, or are not necessarily representative of, your ongoing business.
4.We note from Item 15 that on January 18, 2022 you issued 18.95 million restricted stock
units (RSUs) to non-employee directors, senior officers, and others.  Please revise your
discussion of results of operations, in accordance with Item 303(b)(2)(ii) of Regulation S-
K, to disclose and to quantify the unfavorable impact of the issuance of these RSUs on
future income from continuing operations.
APPLIED BLOCKCHAIN, INC and Subsidiaries
Unaudited Consolidated Financial Statements, page 102
5.Please clarify in the caption here and throughout the interim financial statements,
as appropriate, that you are also presenting the financial statements for the six months
ended November 30, 2021.
Consolidated Balance Sheets (Unaudited), page F-16
6.Here and elsewhere as appropriate, please revise the line item descriptions Total
Shareholders' Equity and Total Mezzanine and Shareholders' Equity to reflect deficit
positions in shareholders' equity at each balance sheet date.
Note 6. Cryptoassets, page F-26
7.Disclose the nature of the consideration received for the "Cryptoassets sold or converted"
and advise us.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 January 28, 2022 Page 3
 FirstName LastName
David Rench
Applied Blockchain, Inc.
January 28, 2022
Page 3
            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters. Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
1
filename1.htm

December 1, 2021

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch
Chief

Larry Spirgel, Office Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance Office
of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Amendment No. 1 to Registration Statement on Form S-1

Filed November 2, 2021

File No. 333-258818

Dear Mr. Rench:

In response to your letter
dated November 16, 2021, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see below
our responses to your comments and Amendment No. 2 to our Registration Statement on Form S-1, as filed with the Securities and
Exchange Commission on December 1, 2021 (“S-1 Amendment No. 2”).

Please respond to this letter
by amending your registration statement and providing the requested information. If you do not believe our comments apply to your facts
and circumstances or do not believe an amendment is appropriate, please tell us why in your response.

Amendment No. 1 to Registration Statement on Form S-1

Risk Factors, page 7

 1. We note your added disclosure in response to prior comment 11. Please include an additional risk factor
highlighting this related party transaction (and any others), highlighting the potential for conflicts of interests and self dealing that
could result from such transactions.

RESPONSE:
The following language has been added on page 10 of our S-1 Amendment No. 2:

“Various
actual and potential conflicts of interest may be detrimental to shareholders.

Certain
conflicts of interest may exist, or be perceived to exit, between certain of our directors or officers and us, including, direct and
indirect relationships between certain of our officers and directors with entities that are, or are under common control with, B.
Riley Securities, Inc., representative of the underwriters for the offering contemplated in our Primary Issuance Registration Statement. Mr. Cummins and certain of our directors have other business
interests to which they also must devote time, resources and attention. These other interests may conflict with such officer’s
or director’s interest in us, including conflicting with interests in allocating resources, time and attention to our business
and impacting decisions made on our behalf with respect to such entitites, their affiliates or competitors.

Our Service
Providers, and Bitmain, operate businesses related to crypto mining. Specifically, GMR and Bitmain actively mine cryptoassets.
Although SparkPool ceased its operations as a result of China’s ban on cryptoasset mining, SparkPool is moving its mining
business outside of China. SparkPool and Valuefinder each consult with and advise other cryptoasset-related companies. Our Service
Providers' and Bitmain's interest in their own business and that of entities they advise may conflict with our interests and may
impact the advice provided to us or our competitors such that our business, operations and financial results may be be negatively
impacted.

Securities and Exchange Commission

Applied Blockchain, Inc.

December 1, 2021

Page 2

We do not have
specific procedures in place with respect to potential conflicts of interest, however, in determining to engage with potential
competitors and entities with whom our officers or directors may have relationships, we considered the risks and risk mitigation
factors, including requiring that transactions with entities that are related to our officers and directors be approved or ratified
by our Audit Committee and recognizing that Mr. Cummins holds over 24% of our common stock, calculated as if the Series C
Preferred Stock and Series D Preferred Stock were converted, and our Service Providers, on an as-if converted basis, hold
between between 1.3% and 9% of our common stock. All of them therefore have a financial interest in the success of our operations.
Additionally, none of our Service Providers or Bitmain operate in the co-hosting business. We have also included more than a
majority of independent directors on our Board in order to ensure that there are limitations on the risks of conflicts of interest
impacting Board level decisions. Because we are not expanding our crypto mining business at this time and focusing on expanding our
co-hosting business, the effects of any such risks of conflicts of interest are limited in scope. We expect that as our co-hosting
business continues to grow, the risks of conflicts of interest will become more limited over time. We cannot, however, guarantee
that the conflicts of interest described above, or other future conflicts of interest, will not manifest in advice or decisions that
negatively impact our financial results and our operations.”

Any disruption of service experienced by certain of our third-party
service providers..., page 9

 2. We note your response to prior comment 4; however, your added disclosure does not address the potential
for conflicts of interest between your service providers and the company if your service providers are also competitors of the company.
Please revise.

RESPONSE:
Please see the risk factor set forth in response to comment 1 above.

Cryptoassets’ assets status as a “security,” a
 “commodity” or as a financial instrument..., page 12

 3. Please delete the first sentence of this risk factor because without additional clarifying language
it is potentially misleading.

RESPONSE:
The first line of this risk factor has been deleted on page 14 of our S-1 Amendment No. 2.

Management, page 52

Securities and Exchange Commission

Applied Blockchain, Inc.

December 1, 2021

Page 3

 4. We note your response to prior comment 12. For each director and executive officer, please state the
period of service for each position such person holds at the company (for example, please provide the date on which such person joined
the company). Please refer to Item 401(a) of Regulation S-K.

RESPONSE:
A column was added to the table set forth on Page 54 of the S-1 Amendment No. 2 to set forth the periods of terms of service.
The full table is set forth below.

    Name
    ​
    ​
    Age
    ​
    ​
    Position(s)
    ​
    ​
    Period of Service
    ​

    Executive Officers
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    Wes Cummins
    ​
    ​
    44
    ​
    ​
    Chief Executive Officer, Secretary, Treasurer, Chairman of the Board
    ​
    ​
    Director
    from February 2007 to December 2020 and March 2021 to Present and sole officer from March 2012 to
    December 2020 and CEO, Secretary and Treasurer from March 2021 to Present
    ​

    David Rench
    ​
    ​
    44
    ​
    ​
    Chief Financial Officer
    ​
    ​
    March 2021 to Present
    ​

    Regina Ingel
    ​
    ​
    34
    ​
    ​
    Executive Vice President of Operations
    ​
    ​
    April 2021 to Present
    ​

    Non-Employee Directors
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    Chuck Hastings(1)(3)
    ​
    ​
    43
    ​
    ​
    Director
    ​
    ​
    April 2021 to Present
    ​

    Kelli McDonald(2)(3)
    ​
    ​
    43
    ​
    ​
    Director
    ​
    ​
    April 2021 to Present
    ​

    Douglas Miller(1)(2)
    ​
    ​
    64
    ​
    ​
    Director
    ​
    ​
    April 2021 to Present
    ​

    Virginia Moore(2)(3)
    ​
    ​
    48
    ​
    ​
    Director
    ​
    ​
    April 2021 to Present
    ​

    Richard Nottenburg (1)(2)
    ​
    ​
    67
    ​
    ​
    Director
    ​
    ​
    June 2021 to Present
    ​

    Jason Zhang
    ​
    ​
    28
    ​
    ​
    Director
    ​
    ​
    April 2021 to Present
    ​

(1) Member of the audit committee.

(2) Member of the compensation committee.

(3) Member of the nominating and  governance
committee.

Security Ownership of Certain Beneficial Owners and Management,
page 69

 5. We note your response to prior comment 13. Please further revise the table to identify the two individuals
who have voting power and dispositive power over the shares held by the entities in the body of the table. You may include the identification
of the entities that hold the shares and the statements disclaiming beneficial ownership by each individual in the accompanying footnotes.

RESPONSE:
The individuals’ names have been included in the body of the table on page 71 of the S-1 Amendment No. 2 as set forth
below.

    ​
    ​
    ​
    Before Offering
    ​
    ​
    After Offering
    ​

    Name and Address(a)
    ​
    ​
    Total Common
(As-if Preferred
was Converted)
    ​
    ​
    Percentage
Beneficially
Owned
    ​
    ​
    Total
Common
    ​
    ​
    Percentage
Beneficially
Owned
    ​

    Directors and Officers:
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    Wes Cummins
    ​
    ​
    ​
    ​
    124,272,414(b)
    ​
    ​
    ​
    ​
    ​
    23.41%
    ​
    ​
    ​
    ​
    ​
    124,272,414
    ​
    ​
    ​
    23.41%
    ​

    David Rench
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    *​
    ​

    Chuck Hastings
    ​
    ​
    ​
    ​
    2,007,000
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    2,007,008
    ​
    ​
    ​
    *​
    ​

    Kelli McDonald
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    *​
    ​

    Doug Miller
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​*
    ​

    Virginia Moore
    ​
    ​
    ​
    ​
    4,831,819(c)
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    930,000(f)
    ​
    ​
    ​
    ​*
    ​

    Richard Nottenburg
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​*
    ​

    Jason Zhang
    ​
    ​
    ​
    ​
    18,838,559
    ​
    ​
    ​
    ​
    ​
    3.57%
    ​
    ​
    ​
    ​
    ​
    18,838,559
    ​
    ​
    ​
    3.57%
    ​

    Regina Ingel
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​
    ​
     *
    ​
    ​
    ​
    ​
    ​
    —
    ​
    ​
    ​
    ​*
    ​

    Officers and Directors as a group (9 people)
    ​
    ​
    ​
    ​
    150,049,889(b)(c)
    ​
    ​
    ​
    ​
    ​
    28.27%
    ​
    ​
    ​
    ​
    ​
    146,147,973(b)(f)
    ​
    ​
    ​
    27.53%
    ​

    5% Holders:
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    Xin Xu
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    c/o Xsquared Holding Limited
c/o Vistra Corporate Services Center
Wikhams Cay II
Tortola
British Virgin Islands
    ​
    ​
    ​
    ​
    44,640,889(d)
    ​
    ​
    ​
    ​
    ​
    8.41%
    ​
    ​
    ​
    ​
    ​
    44,640,889
    ​
    ​
    ​
    8.41%
    ​

    ​
    ​
    ​
    Before Offering
    ​
    ​
    After Offering
    ​

    Name and Address(a)
    ​
    ​
    Total Common
(As-if Preferred
was Converted)
    ​
    ​
    Percentage
Beneficially
Owned
    ​
    ​
    Total
Common
    ​
    ​
    Percentage
Beneficially
Owned
    ​

    Guo Chen
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​
    ​

    c/o GMR Limited
Trinity Chamber
PO BOX 4301
Tortola
British Virgin Islands
    ​
    ​
    ​
    ​
    44,640,889(e)
    ​
    ​
    ​
    ​
    ​
    8.41%
    ​
    ​
    ​
    ​
    ​
    44,640,889
    ​
    ​
    ​
    ​
    ​
         8.41%
    ​
    ​

* Less than 1%.

 (a) Unless otherwise indicated, the business address of each person
or entity named in the table is c/o Applied Blockchain, Inc., 3811 Turtle Creek Blvd., Suite 2100, Dallas, TX 75219.

 (b) Includes (i) 105,541,428 shares of common stock held by
Cummins Family Ltd, of which Mr. Cummins is the CEO and (ii) 4,453,000 shares of common stock held by Wesley Cummins IRA Account.

 (c) Includes (i) 930,000 shares of common stock, and 2,645,455
shares of common stock issuable upon conversion of 46,560 shares of our series D Preferred Stock, held by B. Riley Securities, Inc.,
of which Andrew Moore, Ms. Moore’s spouse, is the Chief Executive Officer, (ii) 136,364 shares of common stock issuable
upon the conversion of 2,400 shares of Series D Preferred Stock held directly by Mr. Moore and (iii) 1,120,000 shares
of common stock issuable upon conversion of 5,600 shares of Series C Preferred Stock held directly by Mr. Moore.

 (d) Xin Xu, as sole director of Xsquared Holding Limited, has voting
and dispositive power over the 44,640,889 shares of our common stock held by Xsquared Holding Limited. Mr. Xu disclaims beneficial
ownership of such shares.

 (e) Guo Chen, as sole director of GMR Limited, has voting and dispositive
power over the 44,640,889 shares of our common stock held by GMR Limited. Mr. Chen disclaims beneficial ownership of such shares.

 (f) Includes 930,000 shares of common stock held by B. Riley Securities, Inc.,
of which Mr. Moore, Ms. Moore’s spouse, is Chief Executive Officer.

3. Basis of Presentation and Significant Accounting Policies

Cryptoassets, page F-22

 6. With a view to expanded disclosure, tell us your considerations as to whether or not you will use industry
specific impairment testing triggers, such as an acquisition or sale of a crypto-asset for a price that is materially below the carrying
value of similar crypto-assets held. Similarly, tell us how you determine the principal or most advantageous market from which you obtain
the quoted price for your crypto-assets.

RESPONSE:
We will use industry specific impairment testing triggers and have clarified in the disclosure. We have also clarified in the disclosure
that the principal market is the active exchange in which the Company normally transacts. Coinbase is our principal market and we assess
for evidence to the contrary, such as decreased market activity.

Our disclosure
has been revised as follows on Page F-22 of our S-1 Amendment No. 2:

“Cryptoassets

Cryptoassets are included
in current assets in the accompanying consolidated balance sheets. Cryptoassets are classified as indefinite-lived intangible assets in
accordance with Accounting Standards Codification (“ASC”) 350, Intangibles — Goodwill and Other, and are accounted
for in connection with the Company’s revenue recognition policy detailed above and in Footnote 5. Management will assess for impairment
on an annual basis, 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. Events or circumstances that may trigger an impairment assessment other than annually include,
but are not limited to, material changes in the regulatory environment, potential technological changes in cryptoassets, changes in the
quoted price of cryptoassets below the carrying amount, and the acquisition or sale of cryptoassets for a price that is materially below
the carrying amount of similar cryptoassets held. Impairment, if any, is recognized for the difference between the fair value of the underlying
cryptoasset and the carrying amount of the cryptoasset. Fair value is measured in accordance with ASC 820, Fair Value Measurement, using
the quoted price of the cryptoasset at the time its fair value is being measured. Quoted prices are obtained from the principal market,
which is the active exchange in which the Company normally transacts.

Securities and Exchange Commission

Applied Blockchain, Inc.

December 1, 2021

Page 4

Cryptoassets awarded
to the Company through its mining activities are included within the operating activities in the accom

United States securities and exchange commission logo
November 16, 2021
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Amendment No. 1 to Registration Statement on Form S-1
Filed November 2, 2021
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your amended registration statement 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 this letter by amending your registration statement and providing the
requested information.  If you do not believe our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to these comments, we may have additional comments.  Unless we note
otherwise, our references to prior comments are to comments in our September 10, 2021 letter.
Amendment No. 1 to Registration Statement on Form S-1
Risk Factors, page 7
1.We note your added disclosure in response to prior comment 11.  Please include an
additional risk factor highlighting this related party transaction (and any others),
highlighting the potential for conflicts of interests and self dealing that could result from
such transactions.
Any disruption of service experienced by certain of our third-party service providers..., page 9
2.We note your response to prior comment 4; however, your added disclosure does not
address the potential for conflicts of interest between your service providers and the
company if your service providers are also competitors of the company.  Please revise.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 November 16, 2021 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
November 16, 2021
Page 2
Cryptoassets' assets status as a "security," a "commodity" or as a financial instrument..., page 12
3.Please delete the first sentence of this risk factor because without additional clarifying
language it is potentially misleading.
Management, page 52
4.We note your response to prior comment 12. For each director and executive officer,
please state the period of service for each position such person holds at the company (for
example, please provide the date on which such person joined the company). Please refer
to Item 401(a) of Regulation S-K.
Security Ownership of Certain Beneficial Owners and Management, page 69
5.We note your response to prior comment 13.  Please further revise the table to identify the
two individuals who have voting power and dispositive power over the shares held by the
entities in the body of the table.  You may include the identification of the entities that
hold the shares and the statements disclaiming beneficial ownership by each individual in
the accompanying footnotes.
3. Basis of Presentation and Significant Accounting Policies
Cryptoassets, page F-22
6.With a view to expanded disclosure, tell us your considerations as to whether or not you
will use industry specific impairment testing triggers, such as an acquisition or sale of a
crypto-asset for a price that is materially below the carrying value of similar crypto-assets
held.  Similarly, tell us how you determine the principal or most advantageous market
from which you obtain the quoted price for your crypto-assets.
            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters. Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

CORRESP
1
filename1.htm

November 2, 2021

Joseph Kempf, Senior Staff Accountant

Robert Littlepage, Accounting Branch Chief

Priscilla Dao, Staff Attorney

Division of Corporation Finance Office of Technology

Securities and Exchange Commission

100 F Street, NE

Washington, D.C. 20549

 Re: Applied Blockchain, Inc.

Registration Statement on Form S-1

Filed August 13, 2021

File No. 333-258818

Dear Mssrs. Kempf and Littlepage and Ms. Dao:

In response to your letter
dated September 10, 2021, pursuant to the Securities Act of 1933, as amended (the “Securities Act”), please see our responses
below to your comments and Amendment No. 1 to our Registration Statement on Form S-1, as filed with the Securities and Exchange
Commission on September 29, 2021 (“Amended S-1”).

Registration Statement on Form S-1 filed on August 13,
2021

Cover Page

 1. Please disclose your shell company status, as described on page 5.

RESPONSE:
We have added the following disclosure  on  the cover page of the prospectus included as part of the Amended S-1 as
follows:

“We are deemed
to be a shell company as defined under Rule 405 of the Securities Act of 1933, as amended. As such stockholders cannot rely on the
provisions of Rule 144 for the resale of their shares until certain conditions are met.”

About This Prospectus, page 1

 2. You state here that the prospectus is part of a registration statement on Form S-1 that you filed
using the “shelf” registration process. Please reconcile with the blank check box on the cover page which indicates that
none of the securities being registered are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities
Act.

    Securities and Exchange Commission

November 2, 2021

Page 2

RESPONSE:
We have checked the box on the cover page of the Amended S-1 to indicate that the securities being registered are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act.

Glossary for Cryptoassets, page 2

 3. Please disclose the consensus mechanisms used by each blockchain you plan to utilize.

RESPONSE:
We have included the following disclosure in the Glossary for Cryptoassets on page iii of the Amended S-1:

“Consensus
Mechanism: Each of Ethereum and Bitcoin uses Proof-of-work (POW) as the Consensus Mechanism.”

Risk Factors, page 9

 4. Given your reliance on the Service Providers, please discuss the risk that a Service Provider will
divert its efforts and/or rewards towards its own interest rather than the company’s interest.

RESPONSE:
The risk factor below has been included in the Amended S-1 on page 9.

“Any disruption of service
experienced by certain of our third-party service providers or our failure to manage and maintain existing relationships or identify and
engage or hire other qualified third-party service providers or employees to perform similar functions could harm our business, financial
condition, operating results, cash flows, and prospects.

We may depend upon outside advisors
who may not be available on reasonable terms as needed. To supplement the business experience of our officers and directors, we may be
required to employ technical experts, appraisers, attorneys, or other consultants or advisors. Our management, with approval of our board
of directors (“Board”) in certain cases, without any input from stockholders, will make the selection of any such advisors.
Furthermore, it is anticipated that such persons may be engaged on an “as needed” basis without a continuing fiduciary or
other obligation to us. In the event we consider it necessary to hire outside advisors, we may elect to hire persons who are affiliates,
if they are able to provide the required services.

On March 19, 2021, we entered into
the Services Agreement with GMR Limited, a British Virgin Islands limited liability company (“GMR”), Xsquared Holding Limited,
a British Virgin Islands limited liability company (“SparkPool”) and Valuefinder, a British Virgin Islands limited liability
company (“Valuefinder” and, together with GMR and SparkPool, each a “Service Provider” and collectively, the “Service
Providers”). Pursuant to the Services Agreement, we engaged the Service Providers to provide cryptoasset mining management and analysis
and to secure equipment to be purchased by us as consideration for 44,640,889 shares of common stock to be issued to GMR and SparkPool
or their designees and 18,938,559 shares of common stock to be issued to Valuefinder or its designee, in each case upon the occurrence
of certain events. On March 25, 2021, we filed a certificate of amendment to our Second Amended and Restated Articles of Incorporation
(as amended from time to time, our “Articles”) with the Secretary of State of the State of Nevada to change our name to Applied
Blockchain, Inc. By July 2021, we had purchased crypto mining equipment, taken delivery of such equipment, installed such equipment
at a cohosting location and began mining and generating revenue. In July 2021, we added a strategic partner, Bitmain Technologies
Limited (“Bitmain”), a producer of products for blockchain and artificial intelligence (AI) applications, to assist in the
operation and development of our mining and co-hosting business as well as the identification of other strategic business initiatives.

    Securities and Exchange Commission

November 2, 2021

Page 3

If these third parties or other outside
advisors experience difficulty providing the services we require, or if they experience disruptions or financial distress or cease operations
temporarily or permanently, it could make it difficult for us to operate our cryptoasset mining operations. If we are unsuccessful in
identifying or finding highly qualified third-party service providers or employees, if we fail to negotiate cost-effective relationships
with them or if we are ineffective in managing and maintaining these relationships, it could materially and adversely affect our cryptoasset
mining business and our financial condition, operating results, cash flows, and prospects.”

 5. We note your disclosure that you currently have two customers, which will account for greater than
50% of the available energy under the Energy Services Agreement. Please disclose the material terms of your agreements with each customer,
including the term, termination provisions and any minimum purchase requirements. Please also discuss the risks related to your business’s
reliance on these customers.

RESPONSE:
We have revised our existing risk factor relating to our co-hosting customers as follows. Please see page 14 of the Amended S-1:

“If our co-hosting customers
suffer from harm or loss as a result of risks relating to crypto mining operations or determine not to use our co-hosting facility, our
co-hosting operations may suffer from significant losses.

We have material customer concentration
in our co-hosting business. We have entered into contracts with four customers to utilize our first co-hosting facility which is currently
under construction. When our first co-hosting facility begins producing revenue, these four customers will account for 100% of the revenue
from our first co-hosting facility (100MW). These customers have also contracted for 85MW of power at our second co-hosting facility once
completed and operational. There are inherent risks whenever a large percentage of total revenues are concentrated with a limited number
of customers. Additionally, our co-hosting customers are crypto miners themselves and subject to the same risks as we are with respect
to their crypto mining businesses. It is not possible for us to predict the future level of demand for our services that will be generated
by these customers or the future demand for the products and services of these customers. Should some or all of our co-hosting customers
suffer from harm or loss due to a set of circumstances, their businesses could be negatively impacted or prevented. Further, our contracts
with these customers permit them to terminate our services at any time (subject to notice and certain other provisions).

    Securities and Exchange Commission

November 2, 2021

Page 4

If any of our customers experience declining
mining operations for any reason or determine to stop utilizing our co-hosting facilities, we could be pressured to reduce the prices
we charge for our services or we could lose a major customer. Any such development could have an adverse effect on our margins and financial
position, and would negatively affect our revenues and results of operations.”

We have added the
following disclosure to the Business section on page 47 of the Amended S-1:

“Customers

We have material customer concentration
in our co-hosting business. We have entered into contracts with JointHash Holding Limited (a subsidiary of GMR), Bitmain Technologies
Limited, F2Pool Mining, Inc. and Hashing LLC to utilize our first co-hosting facility which is currently under construction. When
construction of our first co-hosting facility is complete, JointHash has contracted to use 40% of the available power, Bitmain for 45%
a and F2Pool for 15%. Together these customers will account for 100% of our co-hosting facility revenue until our second facility is constructed
and operational. These 4 customers have agreed to use an additional 85 MW of power at our second facility, once it is constructed and
operational. We are currently exploring options with respect to property on which our second facility will be built as well as energy
services arrangements to provide power to the second facility.

Pursuant to our co-hosting contracts
with our all four customers we agree to provide an environment and electricity for normal operation, monitoring, reporting and maintenance
of equipment and the customers agree to pay service fees to us. Service fees are made up of hosting fees, operation fees and maintenance
fees. Hosting fees to be paid by JointHash, Bitmain and F2Pool are based on the cost of power consumption by the customer plus a surcharge
with F2Pool. Operation fees and maintenance fees are to be determined by the parties in each contract and on each purchase order. F2Pool
has agreed to pay a monthly minimum services fee determined in relation to then current hosting fees and Hashing agreed to pay a flat
fee per month for all services subject to certain additional fees for maintenance fees.

The agreements with JointHash and Bitmain
are effective until terminated. In addition to providing for termination for breaches or defaults (subject to certain cure periods) and
by mutual agreement of the relevant parties, JointHash and Bitmain may terminate their agreements with respect to all or part of their
equipment subject to the relevant agreement with payment of a termination fee calculated by reference to the equipment as to which the
agreement is being terminated and its forecasted energy usage.

    Securities and Exchange Commission

November 2, 2021

Page 5

The terms of the agreements with F2Pool
and Hashing are 60 calendar months from the date on which no less than a negotiated number of megawatts of power are available at our
first facility. The term may be extended for an additional 24 months without change to the fee structure by agreement of both parties.
Unilateral termination rights are only available upon defaults or breaches of the agreement (subject to cure periods), bankruptcy or similar
situations and certain assignment, sale or merger of F2Pool to or with a third party.”

Capitalization, page 33

 6. Disclose the pro forma adjustments underlying the $32.5 million increase to cash and cash equivalent
reflected in the Pro Forma As Adjusted column.

RESPONSE:
We added additional detail to the second bullet point in the opening paragraph of Capitalization on page 35.

“a pro forma
as adjusted basis, giving effect to the automatic conversions of all outstanding shares of our Series C Preferred Stock and Series D
Preferred Stock as of August 31, 2021 into 210,409,090 shares of our common stock, as if such conversions had occurred on August 31,
2021 and giving effect to this offering.”

Management's Discussion and Analysis

Trends and Uncertainties, page 35

 7. Please discuss the impact of the service agreements with Valuefinder, SparkPool and GMR on current
and future operating results. Also disclose any other known events that are reasonably likely to cause material changes in your reported
results in accordance with Item 303(a)(B)(ii) of Regulation S-K.

RESPONSE:
Disclosure under “Trends and Uncertainties” on page 36 of the Amended S-1 has been updated to include the following disclosure:

“In June 2021,
we began our crypto mining operations. Prior to that time, we had no operating business or revenues since 2014. As a result, we are currently
deemed to be a shell company. During June 2021, we also began planning and executing a strategy to develop co-hosting operations
to meet the changing challenges and needs of the cryptoasset industry. As our business operations continue or commence and grow, and because
of the rapidly changing nature of our industry, our business will continue to change. The regulatory framework in which we operate may
change. In the year ended May 31, 2021, we did not have cryptoasset related operations. In the future we will account for such operations
as set forth below. These accounting rules and regulations we follow are likely to change in the future as discussed below.

    Securities and Exchange Commission

November 2, 2021

Page 6

Regulatory Matters

Our business is
subject to extensive laws, rules, regulations, policies and legal and regulatory guidance, including those governing securities, commodities,
cryptoasset custody, exchange and transfer, data governance, data protection, cybersecurity and tax. Many of these legal and regulatory
regimes were adopted prior to the advent of the Internet, mobile technologies, cryptoassets and related technologies. As a result, they
do not contemplate or address unique issues associated with the crypto economy, are subject to significant uncertainty, and vary widely
across U.S. federal, state and local and international jurisdictions. These legal and regulatory regimes, including the laws, rules and
regulations thereunder, evolve frequently and may be modified, interpreted and applied in an inconsistent manner from one jurisdiction
to another, and may conflict with one another. Moreover, the complexity and evolving nature of our business and the significant uncertainty
surrounding the regulation of the crypto economy requires us to exercise our judgement as to whether certain laws, rules and regulations
apply to us, and it is possible that governmental bodies and regulators may disagree with our conclusions. To the extent we have not complied
with such laws, rules and regulations, we could be subject to significant fines and other regulatory consequences, which could adversely
affect our business, prospects or operations. As cryptoassets have grown in popularity and in market size, the Federal Reserve Board,
U.S. Congress and certain U.S. agencies (e.g., the Commodity Futures Trading Commission, the SEC, the Financial Crimes Enforcement Network
and the Federal Bureau of Investigation) have begun to examine the operations of cryptoasset networks, cryptoasset users and cryptoasset
exchange markets. Other countries around the world are likewise reviewing and, in some cases, increasing regulation of the cryptoasset
industry. For instance, on September 24, 2021, China imposed a ban on all crypto transactions and mining.

Ongoing and future
regulatory actions could effectively prevent our ongoing or planned crypto mining and co-hosting operations, limiting or preventing future
revenue generation by us and rendering our operations and crypto mining equipment obsolete. Such actions could severely impact our ability
to continue to operate and our ability to continue as a going concern or t

United States securities and exchange commission logo
September 10, 2021
David Rench
Chief Financial Officer
Applied Blockchain, Inc.
3811 Turtle Creek Blvd., Suite 2100
Dallas, TX 75219
Re:Applied Blockchain, Inc.
Registration Statement on Form S-1
Filed August 13, 2021
File No. 333-258818
Dear Mr. Rench:
            We have reviewed your registration statement 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 this letter by amending your registration statement and providing the
requested information.  If you do not believe our comments apply to your facts and
circumstances or do not believe an amendment is appropriate, please tell us why in your
response.
            After reviewing any amendment to your registration statement and the information you
provide in response to these comments, we may have additional comments.
Registration Statement on Form S-1 filed on August 13, 2021
Cover Page
1.Please disclose your shell company status, as described on page 5.
About This Prospectus, page 1
2.You state here that the prospectus is part of a registration statement on Form S-1 that you
filed using the “shelf” registration process. Please reconcile with the blank check box on
the cover page which indicates that none of the securities being registered are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 September 10, 2021 Page 2
 FirstName LastName
David Rench
Applied Blockchain, Inc.
September 10, 2021
Page 2
Glossary for Cryptoassets, page 2
3.Please disclose the consensus mechanisms used by each blockchain you plan to utilize.
Risk Factors, page 9
4.Given your reliance on the Service Providers, please discuss the risk that a Service
Provider will divert its efforts and/or rewards towards its own interest rather than the
company’s interest.
5.We note your disclosure that you currently have two customers, which will account for
greater than 50% of the available energy under the Energy Services Agreement. Please
disclose the material terms of your agreements with each customer, including the term,
termination provisions and any minimum purchase requirements. Please also discuss the
risks related to your business’s reliance on these customers.
Capitalization, page 33
6.Disclose the pro forma adjustments underlying the $32.5 million increase to cash and cash
equivalent reflected in the Pro Forma As Adjusted column.
Management's Discussion and Analysis
Trends and Uncertainties, page 35
7.Please discuss the impact of the service agreements with Valuefinder, SparkPool and
GMR on current and future operating results.  Also disclose any other known events that
are reasonably likely to cause material changes in your reported results in accordance with
Item 303(a)(B)(ii) of Regulation S-K.
Business, page 38
8.Please disclose whether you intend to accept digital assets as payment for services, hold
digital assets for investment or convert such digital assets into fiat currency. If you intend
to hold digital assets for investment, please describe your existing holdings as well as
storage and custodial practices. Please disclose whether any cryptoassets besides Bitcoin
and Ether are being mined or are being considered for mining, as well as the factors that
you deem to be important in making a decision to mine a particular cryptoasset. Provide a
detailed description of the process and framework that you will use to determine whether
any digital assets that you may hold or acquire are securities as defined in Section 2(a)(1)
of the Securities Act.
9.Please provide clear disclosure pursuant to Item 101(h) of Regulation S-K, including the
form and year of organization, the effect of existing or probable governmental regulations
on the business and the costs and effects of compliance with environmental laws (federal,
state and local).

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 September 10, 2021 Page 3
 FirstName LastName
David Rench
Applied Blockchain, Inc.
September 10, 2021
Page 3
10.Please disclose whether you are participating, or have participated, in any DeFi protocol
or offering of non-fungible tokens and how you evaluate the risks of engaging in such
activities from a business and regulatory perspective.
Strategic Relationships, page 39
11.Expand your disclosure relating to your partnerships with SparkPool, GMR and
ValueFinder to discuss all material terms of these arrangements.  Quantify any benefits
accruing to any of your executive officers, directors or significant investors as a result of
these arrangements.
Management, page 42
12.For each director and executive officer, please state the period of service for each position
such person holds at the company. Please briefly discuss the specific experience,
qualifications, attributes or skills that led to the conclusion that Mr. Zhang should serve as
a director. Please refer to Items 401(a), 401(b) and 401(e) of Regulation S-K.
Security Ownership of Certain Beneficial Owners and Management, page 49
13.Please disclose the natural persons who hold voting and/or dispositive power over the
shares beneficially owned by Xsquared Holding Limited and GMR Limited.
Consolidated Financial Statements
3. Basis of Presentation and Significant Accounting Policies, page F-6
14.Disclose in detail your policies for recognizing revenue from mining cryptoassets and
providing hosting services to other cryptoasset miners.
15.Disclose your accounting policies with respect to cryptoassets and advise us.
10. Commitments and Contingencies
Commitments
Service Agreement, page F-17
16.Please clarify the related party aspects of these transactions. Tell us and disclose the
nature of the services to be provided by each service provider. Indicate the reporting
periods in which each provider will provide services and how such services will be
accounted for.  Tell us and disclose how you plan to determine the value of common
shares to be issued as compensation and quantify the total amount assigned to the services.
17.Further, it appears from the disclosures in subsections 1 and 2 of Item 15 on page ii and
from Exhibit 10.1 that the consideration for these services, 108,220,337 common shares,
was issuable prior to your May 31, 2021 fiscal year-end.  Please either revise or
explain and disclose why the issuance of these common shares is not reflected in your
historical financial statement for the year ended May 31, 2021.

 FirstName LastNameDavid Rench
 Comapany NameApplied Blockchain, Inc.
 September 10, 2021 Page 4
 FirstName LastName
David Rench
Applied Blockchain, Inc.
September 10, 2021
Page 4
General
18.Please supplementally provide us with copies of all written communications, as defined in
Rule 405 under the Securities Act, that you, or anyone authorized to do so on your behalf,
present to potential investors in reliance on Section 5(d) of the Securities Act, whether or
not they retain copies of the communications.
            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.
            Refer to Rules 460 and 461 regarding requests for acceleration.  Please allow adequate
time for us to review any amendment prior to the requested effective date of the registration
statement.
            You may contact Joseph Kempf, Senior Staff Accountant, at (202) 551-3352 or Robert
Littlepage, Accounting Branch Chief, at (202) 551-3361 if you have questions regarding
comments on the financial statements and related matters.  Please contact Priscilla Dao, Staff
Attorney, at (202) 551-5997 or Larry Spirgel, Office Chief, at (202) 551-3815 with any other
questions.
Sincerely,
Division of Corporation Finance
Office of Technology
cc:       Carol Sherman

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>

								March 22, 2005
Zip+4 Code:  20549-0305

Via Fax & U.S. Mail
David D. Cryer
Chief Financial Officer, Treasurer, Secretary
28 Cottrell Street
Mystic, Connecticut 06355

RE: 	Flight Safety Technologies, Inc.
	Form 10-KSB for the year ended May 31, 2004
	File No. 0-15159

Dear Mr. Cryer:

	We have completed our review of your Form 10-KSB and related
filings and do not, at this time, have any further comments.

								Sincerely,

								Joseph Foti
      Senior Assistant Chief Accountant

</TEXT>
</DOCUMENT>

CORRESP
1
filename1.htm

February 24, 2005

Sent via Electronic Filing

Joseph Foti

Senior Assistant Chief Accountant

Division of Corporate Finance

Securities and Exchange Commission

450 Fifth Street, N.W., Mail Stop 3-3

Washington, D.C.  20549-0305

Re:     Flight Safety Technologies, Inc.

           Form 10-KSB for the year ended May 31, 2004

           File No. 0-15159

Dear Mr. Foti:

In response to your letter dated February 9, 2005, the Company offers the following responses to your comments.

Other

The Company acknowledges that:  (i) it is responsible for the adequacy and accuracy of the disclosure in its filings; (ii) staff comments or changes to disclosure in response to staff comments in the filings reviewed by the staff do not foreclose the Commission from taking any action with respect to the filings; and (iii) the Company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Joseph Foti

February 24, 2005

Page 2

Form 10-KSB for the fiscal year ended May 31, 2004

Item 6 - Management Discussion and Analysis or Plan of Operation

Critical Accounting Policies and Estimates, page 26

1.

Your critical accounting policies disclosures should be expanded to address each accounting policy that requires management's most difficult, subjective or complex judgments.  For example, you should provide disclosure addressing any uncertainties or significant judgments surrounding the revenue recognition process and your percentage of completion calculation.  Additionally, please ensure that you do not duplicate the accounting policy disclosures in the notes to the financial statements.  For further guidance refer to FRR 72.

Response:

The Company continuously reviews and will expand its critical accounting policies disclosures where required or appropriate in all subsequent filings.  With respect to the Company's revenue recognition process, the Company believes that, except as noted below, its percentage of completion calculations for work performed under its cost plus fixed fee contract with the federal government do not contain the uncertainties or significant judgments, which would otherwise be involved in a more typical application of the percentage of completion method of revenue recognition (e.g., construction contracts).  Pursuant to its contract with the federal government, the government "holds back" the last 15% of the Company's fee.  Based upon the Federal Acquisition Regulations ("FAR") and its past experience indicating a high probability of collection of this fee, the Company recognizes these held back amounts as revenue under the percentage of completion method.  Uncertainty and subjective judgment do impact certain adjustments to indirect expenses the government would classify as unallowable or unreasonable under the FAR.  The Company has discussed these adjustments where appropriate in the MD&A section of its filings, and, in particular, under the Critical Accounting Policy section of its MD&A in its Form 10-KSB for the year ended May 31, 2004 and its Form 10-QSB of the quarter ended November 30, 2004.  These adjustments also are relevant to and discussed under 2., immediately below.  The above 15% fee holdback represents approximately $56,000 of the total unbilled receivable as of May 31, 2004.

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Joseph Foti

February 24, 2005

Page 3

Liquidity and Capital Resources, page 30

2.

The difference between provisional and actual rates, for overhead as well as general administrative expenses, was recorded as $133,000 of unbilled receivables.  However, actual rates incurred have not been approved by the government.  Therefore, tell us how collectability was reasonably assured and persuasive evidence of an arrangement existed on May 31, 2004.  For future guidance refer to SAB 104.

Response:

Pursuant to its contract with the federal government, the government generally has agreed to pay the Company its direct and indirect costs plus a fixed fee.  The contract has no cost caps and allows for adjustments to estimated costs.  The Company calculated and the government approved a provisional, i.e. estimated, general and administrative rate of 28% and expects the actual rate to be approximately 35%, which it believes is reasonable for a company of its size.  The difference between these rates is $133,000 as of May 31, 2004 and is part of the Company's unbilled receivable.  The Company believes that it will recover this unbilled receivable from the government and that its actual rate will pass government review and audit because it has screened those costs which are unallowable or unreasonable in the judgment of the Company.  The Company disclosed this process under "Critical Accounting Policies" and elsewhere in its MD&A in its Form 10-KSB for year ended May 31, 2004 and Form 10-QSB for its quarter ended November 30, 2004.

An arrangement existed on May 31, 2004 in the form and nature of the procedures under the FAR that enable the Company to recover its actual costs that are allowable and reasonable.  The Company has provided written notice to the government required by the FAR of the revised total cost of performing the contract.  Under its contract, the Company is entitled to receive the revised amounts if they are allowable and reasonable and the contracting officer approves the cost growth due to rate adjustments.  Based on the experience of the Company's management under these procedures, the Company reasonably believes that it will receive these amounts upon government review and audit and therefore has recognized them as revenue.  This topic was discussed in more detail on the top of page 27 of the filing, in the second paragraph under the heading "Critical Accounting Policies and Estimates."

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Joseph Foti

February 24, 2005

Page 4

Item 7 - Financial Statements

Auditors Report, page F-2

3.

Your audit report does not contain the name of the audit firm that performed your year end audit.  As such, please provide us an audit report with the name of the audit firm.

Response:

The audit report for our fiscal year ended as of May 31, 2004 is attached hereto as Exhibit 1, and includes the name of the audit firm.

Note 2 - Contracts Receivable and Other Receivables, page F-12

4.

We note that you have reflected a receivable for amounts not billed.  Furthermore, the amounts not billed in you most recent quarterly period (November 30, 2004) have materially increased since the fiscal year end.  Please expand your notes to specifically include a description of the prerequisites for billing these amounts not billed.  In addition, for billed and unbilled receivables, please disclose (i) amounts representing claims or other similar items subject to uncertainty concerning their determination or ultimate realization including the nature and status of these principal items; and (ii) any billed or unbilled receivables expected to be collected after one year or a statement that all receivable amounts will be collected within one year.

Response:

The Company will expand the notes and provide disclosure of the above recommended items in all subsequent filings.

Note 7 - Stockholders Equity, page F-15

5.

Please revise to include disclosures relating to outstanding options and warrants, as required by paragraphs 47 and 48 of SFAS No. 123.

Response:

The Company will revise its disclosures relating to outstanding options and warrants in all subsequent filings.

6.

Please expand the first paragraph on page F-16 to provide pro forma net income (loss) and related pro forma per share data for all periods (i.e. both fiscal years) and not solely for the most recent fiscal year.  Refer to the guidance in paragraph 45 of SFAS No. 123.

Response:

The Company will provide pro forma net income (loss) and related pro forma per share data for all periods (i.e. both fiscal years) and not solely for the most recent fiscal year in all subsequent filings.

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Joseph Foti

February 24, 2005

Page 5

May 2004 Quarterly Newsletter

7.

Your newsletter discloses that you entered into an agreement with Sanders Design International (SDI) to help in the development of the commercial aviation missile countermeasures project.  Please tell us the term of the agreement and why this information was not in your filing.

Response:

The filing did not include any other information on our agreement with SDI because the agreement had no material impact on our fiscal year ended May 31, 2004 financials or operations.  Our agreement with SDI is for a term of ten (10) years.  As prime contractor under our teaming agreement with SDI to develop missile countermeasures, we also are seeking federal funding for research and development of this technology.  Although there are ongoing discussions among the Company, the federal government and airlines, there can be no assurances that any contracts will result from these efforts or that the technology will prove effective.  We also recently agreed to provide up to $100,000 of independent research and development funding to SDI.  These funds are recoverable as allowable overhead under the FAR.  As of the filing date of our Form 10-KSB, we did not expect the teaming agreement or related activities to have a material effect on our operations or financial condition during our fiscal year ending May 31, 2005.  Despite our subsequent agreement to SDI to facilitate research and development, our SDI related activities still have not had a material impact on our operations or financial condition.  However, because of the potential for such impact, we have kept the market and our shareholders generally informed of our efforts in this area, subject to appropriate cautionary language.

August 2004 Quarterly Newsletter

8.

In June 2004, you repurchased 250,000 shares at an average price of $1.72.  Tell us the business purpose of this transaction and provide disclosure of all significant transactions in the subsequent event note.

Response:

The Company repurchased shares of its common stock pursuant to a 10b5-1 plan (attached hereto as Exhibit 2) in order to enhance shareholder value.  Company management believed that this was a prudent use of capital reserves.  The Company will provide disclosure of all significant transactions in the subsequent event note of its subsequent filings.

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Joseph Foti

February 24, 2005

Page 6

Please do not hesitate to call me at (860) 443-7768 if you have any further questions regarding the Company's filings.

Sincerely

David D. Cryer

Chief Financial Officer

Flight Safety Technologies, Inc.

28 Cottrell Street ·
 Mystic, CT  06355 ·
 Phone 860-245-0191 ·
 Fax 860-536-6607

Exhibit 1

FLIGHT SAFETY TECHNOLOGIES, INC.

Financial Statements

May 31, 2004

To The Board of Directors

Flight Safety Technologies, Inc.

INDEPENDENT AUDITORS' REPORT

We have audited the accompanying balance sheet of Flight Safety Technologies, Inc. as of May 31, 2004, and the related statements of operations and comprehensive loss, changes in stockholders' equity, and cash flows for the years ended May 31, 2004 and 2003.  These financial statements are the responsibility of the Company's management.  Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.  We believe that our audits provide a reasonable basis for our opinions.

In our opinion, the financial statements referred to above present fairly, in all materials respects, the financial position of Flight Safety Technologies, Inc. as of May 31, 2004, and the results of its operations and its cash flows for the years ended May 31, 2004 and 2003, in conformity with accounting principles generally accepted in the United States of America.

Farmington, Connecticut

July 7, 2004, except for Note 12 as to

          which the date is August 12, 2004

FLIGHT SAFETY TECHNOLOGIES, INC.

Balance Sheet

May 31, 2004

Assets

Current assets:

     Cash and cash equivalents

$  2,180,863

     Contract receivables

532,043

     Other receivables

194,479

     Investments

6,871,424

     Other current assets

     28,840

          Total current assets

9,807,649

Property and equipment, net of accumulated depreciation

     of $216,356

   259,252

Other assets:

     Intangible assets, net of accumulated amortization

          of $33,969

   149,990

     Investments

   500,002

   649,992

$10,716,893

Liabilities and Stockholders' Equity

Current liabilities:

     Accounts payable

$     615,911

     Accrued expenses

    141,259

          Total current liabilities

   757,170

Stockholders' equity

     Preferred Stock, $0.001 par value, 5,000,000 shares authorized

--

     Common stock, $0.001 par value, 50,000,000 shares authorized,

          8,331,410 shares issued and outstanding

8,331

     Additional paid-in-capital

13,105,863

     Accumulated other comprehensive loss

(119,501)

     Unearned stock compensation

(150,733)

     Accumulated deficit

(2,844,237)

9,959,723

$10,716,893

The accompanying notes are an integral part of these financial statements

FLIGHT SAFETY TECHNOLOGIES, INC.

Statements of Operations and Comprehensive Loss

For The Years Ended May 31, 2004 and 2003

2004

2003

Contract revenues

$

3,593,784

$

1,093,097

Costs and expenses:

Costs of revenues

2,392,166

799,259

Research and development

170,832

40,444

Selling, general and administrative

1,390,801

1,142,112

Depreciation and amortization

     88,053

     59,083

4,041,852

  2,040,898

Loss from operations

(448,068)

  (947,801)

Other income (expense):

Interest income

39,749

7,868

Interest expense

           --

    (2,232)

   39,749

     5,636

Loss before provision for income taxes

(408,319)

(942,165)

Provision for income taxes

   15,895

      1,809

Net loss

(424,214)

$

(943,974)

Other comprehensive loss:

Unrealized holding loss arising

     during the period

(119,501)

           --

Comprehensive loss

$

(543,715)

$

(943,974)

Net loss per share - basic

$

       (.07)

$

       (.24)

Weighted average number of shares - basic

6,194,059

3,948,067

The accompanying notes are an integral part of these consolidated financial statements

FLIGHT SAFETY TECHNOLOGIES, INC.

Statements of Changes in Stockholders' Equity

For The Years Ended May 31, 2004 and 2003

Common Stock

Convertible Redeemable

Preferred Stock

Additional

Paid-In

Capital

Shares

Amount

Shares

Amount

Balance at May 31, 2002

2,796,000

$        27,960

606,343

$        6,063

$  2,033,230

Issuance of common stock

850,000

850

--

--

1,528,793

Issuance of stock options

--

--

--

--

63,250

Amortization of unearned stock compensation

--

--

--

--

--

Net share exchange

11,111,104

(14,053)

(606,343)

(6,063)

62,350

Net loss

               --

               --

               --

               --

               --

Balance at May 31, 2003

14,757,104

14,757

--

--

3,687,623

Is

<DOCUMENT>
<TYPE>LETTER
<SEQUENCE>1
<FILENAME>filename1.txt
<TEXT>

								February 9, 2003
Zip+4 Code:  20549-0305

Via Fax & U.S. Mail

David D. Cryer
Chief Financial Officer, Treasurer, Secretary
28 Cottrell Street
Mystic, Connecticut 06355

RE:	Flight Safety Technologies, Inc.
	Form 10-KSB for the year ended May 31, 2004
	File No. 0-15159

Dear Mr. Cryer:

      Based upon an examination restricted solely to
considerations
of the Financial Statements and Management`s Discussion and
Analysis,
the staff has the following comments on the above-referenced
document.  We think you should revise all future filings in
response
to these comments.  If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your response.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may or may not raise
additional
comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.

      Please respond to confirm that such comments will be
complied
with, or, if certain of the comments are deemed inappropriate by
the
Company, advise the staff of the reason thereof.

      Pursuant to Rule 101(a)(3) of Regulation S-T, your response
should be submitted in electronic form, under the label "corresp"
with a copy to the staff.  Please respond within fifteen (15)
business days.

Form 10-KSB for the fiscal year ended May 31, 2004

Item 6- Management Discussion and Analysis or Plan of Operation
Critical Accounting Policies and Estimates, page 26

1. Your critical accounting policies disclosures should be
expanded
to address each accounting policy that requires management`s most
difficult, subjective or complex judgments.  For example, you
should
provide disclosure addressing any uncertainties or significant
judgments surrounding the revenue recognition process and your
percentage of completion calculation.  Additionally, please ensure
that you do not duplicate the accounting policy disclosures in the
notes to the financial statements.  For further guidance refer to
FRR
72.

Liquidity and Capital Resources, page 30

2. The difference between provisional and actual rates, for
overhead
as well as general administrative expenses, was recorded as
$133,000
of unbilled receivables.  However, actual rates incurred have not
been approved by the government.  Therefore, tell us how
collectability was reasonably assured and persuasive evidence of
an
arrangement existed on May 31, 2004.  For further guidance refer
to
SAB 104.

Item 7- Financial Statements
Auditors Report, page F-2

3. Your audit report does not contain the name of the audit firm
that
performed your year end audit.  As such, please provide us an
audit
report with the name of the audit firm.

Note 2 - Contracts Receivable and Other Receivables, page F-12

4. We note that you have reflected a receivable for amounts not
billed.   Furthermore, the amounts not billed in you most recent
quarterly period (November 30, 2004) have materially increased
since
the fiscal year end.    Please expand your notes to specifically
include a description of the prerequisites for billing these
amounts
not billed.   In addition, for billed and unbilled receivables,
please disclose (i) amounts representing claims or other similar
items subject to uncertainty concerning their determination or
ultimate realization including the nature and status of these
principal items; and (ii) any billed or unbilled receivables
expected
to be collected after one year or a statement that all receivable
amounts will be collected within one year.

Note 7- Stockholders Equity, page F-15

5. Please revise to include disclosures relating to outstanding
options and warrants, as required by paragraphs 47 and 48 of SFAS
No.
123.

6. Please expand the first paragraph on page F-16 to provide pro
forma net income (loss) and related pro forma per share data for
all
periods (i.e. both fiscal years) and not solely for the most
recent
fiscal year.   Refer to the guidance in paragraph 45 of SFAS No.
123.

May 2004 Quarterly Newsletter

7. Your newsletter discloses that you entered into an agreement
with
Sanders Design International (SDI) to help in the development of
the
commercial aviation missile countermeasures project.  Please tell
us
the term of the agreement and why this information was not in your
filing.

August 2004 Quarterly Newsletter

8. In June 2004, you repurchased 250,000 shares at an average
price
of $1.72.  Tell us the business purpose of this transaction and
provide disclosure of all significant transactions in the
subsequent
event note.

Other

      We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filings reviewed by the staff to
be
certain that they have provided all information investors require.
Since the company and its management are in possession of all
facts
relating to a company`s disclosure, they are responsible for the
accuracy and adequacy of the disclosures they have made.

	In connection with responding to our comments, please
provide,
in writing, a statement from the company acknowledging that

* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.

   In addition, please be advised that the Division of Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.

   You may contact Juan Migone at (202) 942-1771 if you have
questions regarding comments on the financial statements and
related
matters.  Please contact the undersigned at (202) 942-1952 with
any
other questions.

								Sincerely,

								Joseph Foti
								Senior Assistant Chief
Accountant

Via facsimile:  David D. Cryer, CFO, Treasurer, and Secretary
		(860) 437-4587
??

??

??

??

David D. Cryer
Flight Safety Technologies, Inc.
February 9, 2005
Page 4

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