Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 22, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2023 | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | LMFA | ||
Entity Registrant Name | LM FUNDING AMERICA, INC. | ||
Entity Central Index Key | 0001640384 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 2,492,964 | ||
Entity Public Float | $ 9,165,600 | ||
Entity Interactive Data Current | Yes | ||
Security Exchange Name | NASDAQ | ||
Title of 12(b) Security | Common Stock par value $0.001 per share | ||
Entity File Number | 001-37605 | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 47-3844457 | ||
Entity Address, Address Line One | 1200 Platt Street | ||
Entity Address, Address Line Two | Suite 1000 | ||
Entity Address, City or Town | Tampa | ||
Entity Address, State or Province | FL | ||
Entity Address, Postal Zip Code | 33602 | ||
City Area Code | 813 | ||
Local Phone Number | 222-8996 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Financial Statement Error Correction [Flag] | false | ||
Auditor Name | MaloneBailey, LLP | ||
Auditor Location | Houston, Texas | ||
Auditor Firm ID | 206 | ||
Documents Incorporated by Reference | Documents Incorporated By Reference Information required by Part III is incorporated by reference from registrant’s Proxy Statement for its 2024 annual meeting of stockholders or an amendment to this Annual Report on Form 10-K, which will be filed with the Securities and Exchange Commission within 120 days after the end of its fiscal year ended December 31, 2023. |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Cash | $ 2,401,831 | $ 4,238,006 |
Digital Assets (Note 2) | 3,416,256 | 888,026 |
Finance receivables | 19,221 | 26,802 |
Marketable securities (Note 5) | 17,860 | 4,290 |
Notes receivable from Seastar Medical Holding Corporation (Note 5) | 3,807,749 | |
Receivable from sale of Symbiont assets | 200,000 | |
Prepaid expenses and other assets | 4,067,212 | 1,233,322 |
Income tax receivable | 31,187 | 293,466 |
Current assets | 10,153,567 | 10,491,661 |
Fixed assets, net (Note 3) | 24,519,610 | 27,272,374 |
Deposit on mining equipment (Note 4) | 20,837 | 525,219 |
Hosting services deposit (Note 4) | 2,200,452 | |
Notes receivable from Seastar Medical Holding Corporation (Note 5) | 1,440,498 | |
Long-term investments - debt security (Note 5) | 2,402,542 | |
Less: Allowance for losses on debt security (Note 5) | (1,052,542) | |
Long-term investments - debt security, net (Note 5) | 1,350,000 | |
Long-term investments - equity securities (Note 5) | 156,992 | 464,778 |
Investment in Seastar Medical Holding Corporation (Note 5) | $ 1,145,486 | $ 10,608,750 |
Investment, Issuer Affiliation [Extensible Enumeration] | us-gaap:InvestmentAffiliatedIssuerMember | us-gaap:InvestmentAffiliatedIssuerMember |
Operating lease - right of use assets (Note 7) | $ 189,009 | $ 265,658 |
Other assets | 86,798 | 10,726 |
Long-term assets | 27,559,230 | 42,697,957 |
Total assets | 37,712,797 | 53,189,618 |
Liabilities and stockholders' equity | ||
Accounts payable and accrued expenses | 2,064,909 | 1,570,906 |
Note payable - short-term (Note 6) | 567,586 | 475,775 |
Due to related parties (Note 9) | $ 22,845 | $ 75,488 |
Other Liability, Current, Related Party, Type [Extensible Enumeration] | Related Party [Member] | Related Party [Member] |
Current portion of lease liability (Note 7) | $ 110,384 | $ 90,823 |
Total current liabilities | 2,765,724 | 2,212,992 |
Lease liability - net of current portion (Note 7) | 85,775 | 179,397 |
Long-term liabilities | 85,775 | 179,397 |
Total liabilities | 2,851,499 | 2,392,389 |
Stockholders' equity (Note 10) | ||
Preferred stock, par value $.001; 150,000,000 shares authorized; no shares issued and outstanding as of December 31, 2023 and December 31, 2022 | ||
Common stock, par value $.001; 350,000,000 shares authorized; 2,492,964 shares issued and outstanding as of December 31, 2023 and 2,232,964 as of December 31, 2022 | 2,493 | 2,233 |
Additional paid-in capital | 95,145,376 | 92,206,200 |
Accumulated deficit | (58,961,461) | (43,017,207) |
Total LM Funding America stockholders' equity | 36,186,408 | 49,191,226 |
Non-controlling interest | (1,325,110) | 1,606,003 |
Total stockholders' equity | 34,861,298 | 50,797,229 |
Total liabilities and stockholders’ equity | $ 37,712,797 | $ 53,189,618 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 150,000,000 | 150,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 350,000,000 | 350,000,000 |
Common stock, shares issued | 2,492,964 | 2,232,964 |
Common stock, shares outstanding | 2,492,964 | 2,232,964 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenues | ||
Digital mining revenues | $ 12,289,131 | $ 945,560 |
Specialty finance revenue | 550,445 | 626,773 |
Rental revenue | 144,514 | 161,618 |
Total revenues | 12,984,090 | 1,733,951 |
Operating costs and expenses: | ||
Digital mining cost of revenues (exclusive of depreciation and amortization shown below) | 9,406,940 | 1,033,226 |
Professional fees | 1,863,038 | 3,158,446 |
Settlement costs with associations | 10,000 | 160 |
Selling, general and administrative | 851,806 | 635,268 |
Real estate management and disposal | 146,716 | 110,465 |
Depreciation and amortization | 4,983,480 | 478,020 |
Collection costs | 29,875 | (12,213) |
Impairment loss on mined digital assets | 965,967 | 79,794 |
Realized gain on sale of mined digital assets | (2,070,508) | |
Other operating costs | 999,959 | 1,504,047 |
Total operating costs and expenses | 23,046,009 | 26,409,936 |
Operating loss | (10,061,919) | (24,675,985) |
Realized gain (loss) on securities | 4,420 | (349,920) |
Realized gain on convertible debt securities | 287,778 | |
Unrealized gain (loss) on marketable securities | 13,570 | (56,830) |
Impairment loss on prepaid machine deposits | (36,691) | (3,150,000) |
Impairment loss on prepaid hosting deposits | (184,236) | (1,790,712) |
Impairment loss on Symbiont assets | (750,678) | (1,052,542) |
Unrealized gain (loss) on investment and equity securities | (9,771,050) | 4,423,985 |
Impairment loss on digital assets | 0 | (467,406) |
Realized gain on sale of purchased digital assets | 1,917 | 20,254 |
Loss on disposal of assets | (9,389) | (38,054) |
Digital assets other income | 5,658 | |
Other income - coupon sales | 639,472 | |
Gain on adjustment of note receivable allowance | 1,052,542 | |
Other income - finance revenue | 37,660 | |
Dividend income | 3,875 | |
Interest income, net | 249,586 | 394,678 |
Income (loss) before income taxes | (18,814,796) | (26,445,221) |
Income tax expense | (60,571) | (1,438,066) |
Net Loss | (18,875,367) | (27,883,287) |
Less: loss (income) attributable to non-controlling interest | 2,931,113 | (1,356,914) |
Net loss attributable to LM Funding America Inc. | $ (15,944,254) | $ (29,240,201) |
Basic loss per common share | $ (6.98) | $ (13.1) |
Diluted loss per common share | $ (6.98) | $ (13.1) |
Weighted average number of common shares outstanding | ||
Basic | 2,283,836 | 2,231,681 |
Diluted | 2,283,836 | 2,231,681 |
Service [Member] | ||
Operating costs and expenses: | ||
Staff costs and payroll | $ 5,858,736 | $ 19,422,723 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Stockholders' Equity - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Non-Controlling Interest [Member] |
Balance at Dec. 31, 2021 | $ 61,010,207 | $ 2,221 | $ 74,535,903 | $ (13,777,006) | $ 249,089 |
Balance, shares at Dec. 31, 2021 | 2,220,640 | ||||
Stock issued for services | $ 12 | (12) | |||
Stock issued for services, shares | 12,324 | ||||
Stock compensation | 1,098,331 | 1,098,331 | |||
Stock option expense | 16,571,978 | 16,571,978 | |||
Net income (loss) | (27,883,287) | (29,240,201) | 1,356,914 | ||
Balance at Dec. 31, 2022 | 50,797,229 | $ 2,233 | 92,206,200 | (43,017,207) | 1,606,003 |
Balance, shares at Dec. 31, 2022 | 2,232,964 | ||||
Stock compensation | 1,095,705 | $ 260 | 1,095,445 | ||
Stock compensation, shares | 260,000 | ||||
Stock option expense | 1,843,731 | 1,843,731 | |||
Net income (loss) | (18,875,367) | (15,944,254) | (2,931,113) | ||
Balance at Dec. 31, 2023 | $ 34,861,298 | $ 2,493 | $ 95,145,376 | $ (58,961,461) | $ (1,325,110) |
Balance, shares at Dec. 31, 2023 | 2,492,964 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ (18,875,367) | $ (27,883,287) |
Adjustments to reconcile net loss to net cash used in operating activities | ||
Depreciation and amortization | 4,983,480 | 478,020 |
Noncash lease expense | 98,536 | 95,098 |
Stock compensation | 1,095,705 | 1,098,331 |
Stock option expense | 1,843,731 | 16,571,978 |
Accrued investment income | (159,692) | (392,412) |
Accrued recovery of legal fees | (55,364) | |
Impairment loss on digital assets | 965,967 | 547,200 |
Impairment loss on mining machine deposits | 36,691 | 3,150,000 |
Impairment loss on hosting deposits | 184,236 | 1,790,712 |
Impairment loss on Symbiont assets | 750,678 | |
Unrealized loss (gain) on marketable securities | (13,570) | 56,830 |
Unrealized loss (gain) on investment and equity securities | 9,771,050 | (4,423,985) |
Loss on disposal of fixed assets | 9,389 | 38,054 |
Realized loss (gain) on securities | (4,420) | 349,920 |
Realized gain on convertible note receivable | (287,778) | |
Realized gain on sale of digital assets | (2,072,425) | (20,254) |
Proceeds from securities | 744,036 | 2,565,893 |
Convertible debt and interest converted into marketable securities | 844,882 | |
Investments in marketable securities | (739,616) | (844,882) |
Reversal of allowance loss on debt security | (1,052,542) | 1,052,542 |
Change in operating assets and liabilities: | ||
Prepaid expenses and other assets | 189,407 | 651,472 |
Hosting deposits | (36,691) | (3,202,764) |
Repayments to related party | (52,643) | (45,732) |
Accounts payable and accrued expenses | 177,478 | 393,260 |
Mining of digital assets | (12,289,131) | (945,560) |
Proceeds from sale of digital assets | 10,874,701 | |
Lease liability payments | (95,948) | (98,569) |
Income taxes receivable | 262,279 | (293,466) |
Deferred taxes and taxes payable | (326,178) | |
Net cash used in operating activities | (3,404,681) | (9,136,039) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (1,625,284) | (15,382) |
Investment in notes receivable - Seastar Medical Holding Corporation | (125,000) | (3,753,090) |
Collection of notes receivable | 2,651,943 | |
Investment in digital assets | (35,157) | (988,343) |
Proceeds from sale of purchased digital assets | 27,815 | 518,931 |
Financing activities for Symbiont asset acquisition | (402,361) | |
Symbiont asset sale | 1,800,000 | |
Deposits for mining equipment | (14,649,614) | |
Net cash from (used in) investing activities | 2,299,537 | (18,886,107) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Loan principal and insurance financing repayments | (624,481) | (299,033) |
Issue costs from the issuance of common stock | (106,550) | |
Net cash used in financing activities | (731,031) | (299,033) |
NET DECREASE IN CASH | (1,836,175) | (28,321,179) |
CASH - BEGINNING OF PERIOD | 4,238,006 | 32,559,185 |
CASH - END OF PERIOD | 2,401,831 | 4,238,006 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Insurance financing | 716,292 | 660,120 |
ROU assets and operating lease obligation recognized | 21,887 | 300,787 |
Reclassification of mining equipment deposit to fixed assets, net | 1,177,226 | 26,961,095 |
Capital expenditures in accrued liabilities | 1,035,374 | 718,416 |
Reclassification of Reverse stock split | 10,859 | 0 |
SUPPLEMENTAL DISCLOSURES OF CASHFLOW INFORMATION | ||
Cash paid for taxes | 2,057,710 | |
Original Product [Member] | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net collections of finance receivables | (6,428) | 13,993 |
Special Product [Member] | ||
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Net collections of finance receivables | $ 14,009 | $ (12,602) |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure | ||
Net Income (Loss) | $ (15,944,254) | $ (29,240,201) |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Dec. 31, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1. Summary of Significant Accounting Policies Nature of Operations LM Funding America, Inc. (“we”, “our”, “LMFA” or the “Company”) was formed as a Delaware corporation on April 20, 2015. LMFA is the sole member of several entities including LM Funding, LLC, which was organized in January 2008, US Digital Mining and Hosting Co. ("US Digital"), which was created on September 10, 2021; LMFA Financing LLC, created on November 21, 2020, and LMFAO Sponsor LLC, created on October 29, 2020. US Digital has created various 100 % owned subsidiaries to engage in business in various states. LMFAO Sponsor LLC created a majority owned subsidiary LMF Acquisition Opportunities Inc. on October 29, 2020. LMF Acquisition Opportunities Inc was merged with Seastar Medical Holding Corporation on October 28, 2022. The Company also from time to time organizes other subsidiaries to serve a specific purpose or hold a specific asset. Lines of Business On September 15, 2021, the Company announced its plan to operate in the Bitcoin mining ecosystem, and we commenced Bitcoin mining operations in late September 2022. This business operation deploys our computing power to mine Bitcoin on the Bitcoin network. We conduct this business through our wholly owned subsidiary, US Digital, a Florida limited liability company, which we formed in 2021 to develop and operate our cryptocurrency mining business. With respect to our specialty finance business, the Company has historically engaged in the business of providing funding to nonprofit community associations primarily located in the state of Florida. We offer incorporated nonprofit community associations, which we refer to as “Associations,” a variety of financial products customized to each Association’s financial needs. Our original product offering consists of providing funding to Associations by purchasing their rights under delinquent accounts that are selected by the Associations arising from unpaid Association assessments. Historically, we provided funding against such delinquent accounts, which we refer to as “Accounts,” in exchange for a portion of the proceeds collected by the Associations from the account debtors on the Accounts. In addition to our original product offering, we also purchase Accounts on varying terms tailored to suit each Association’s financial needs, including under our New Neighbor Guaranty program. Cryptocurrency Mining Business Bitcoin was introduced in 2008 with the goal of serving as a digital means of exchanging and storing value. Bitcoin is a form of digital currency that depends upon a consensus-based network and a public ledger called a “blockchain”, which contains a record of every Bitcoin transaction ever processed. The Bitcoin network is the first decentralized peer-to-peer payment network, powered by users participating in the consensus protocol, with no central authority or middlemen, that has wide network participation. The authenticity of each Bitcoin transaction is protected through digital signatures that correspond with addresses of users that send and receive Bitcoin. Users have full control over remitting Bitcoin from their own sending addresses. All transactions on the Bitcoin blockchain are transparent, allowing those running the appropriate software to confirm the validity of each transaction. To be recorded on the blockchain, each Bitcoin transaction is validated through a proof-of-work consensus method, which entails solving complex mathematical problems to validate transactions and post them on the blockchain. This process is called mining. Miners are rewarded with Bitcoins, both in the form of newly-created Bitcoins and transaction fees in Bitcoin, for successfully solving the mathematical problems and providing computing power to the network. Factors such as access to computer processing capacity, interconnectivity, electricity cost, environmental factors (such as cooling capacity) and location play important roles in mining. In Bitcoin mining, “hashrate” is a measure of the computing and processing power and speed by which a mining computer mines and processes transactions on the Bitcoin network. We expect to continue increasing our computing power through 2024 and beyond as we expand the number of active mining machines. A company’s computing power measured in hashrate is generally considered to be one of the most important metrics for evaluating Bitcoin mining companies. We obtain Bitcoin as a result of our mining operations, and we sell Bitcoin from time to time, to support our operations and strategic growth. We plan to convert our Bitcoin to U.S. dollars. We may engage in regular trading of Bitcoin or engage in hedging activities related to our holding of Bitcoin. However, our decisions to hold or sell Bitcoin at any given time may be impacted by the Bitcoin market, which has been historically characterized by significant volatility. Currently, we do not use a formula or specific methodology to determine whether or when we will sell Bitcoin that we hold, or the number of Bitcoins we will sell. Rather, decisions to hold or sell Bitcoins are currently determined by management by monitoring the market in real time. Specialty Finance Company In our specialty finance business, we purchase an Association’s right to receive a portion of the Association’s collected proceeds from owners that are not paying their assessments. After taking assignment of an Association’s right to receive a portion of the Association’s proceeds from the collection of delinquent assessments, we engage law firms to perform collection work on a deferred billing basis wherein the law firms receive payment upon collection from the account debtors or a predetermined contracted amount if payment from account debtors is less than legal fees and costs owed. Under this business model, we typically fund an amount equal to or less than the statutory minimum an Association could recover on a delinquent account for each Account, which we refer to as the “Super Lien Amount”. Upon collection of an Account, the law firm working on the Account, on behalf of the Association, generally distributes to us the funded amount, interest, and administrative late fees, with the law firm retaining legal fees and costs collected, and the Association retaining the balance of the collection. In connection with this line of business, we have developed proprietary software for servicing Accounts, which we believe enables law firms to service Accounts efficiently and profitably. Under our New Neighbor Guaranty program, an Association will generally assign substantially all of its outstanding indebtedness and accruals on its delinquent units to us in exchange for payment by us of monthly dues on each delinquent unit. This simultaneously eliminates a substantial portion of the Association’s balance sheet bad debts and assists the Association to meet its budget by receiving guaranteed monthly payments on its delinquent units and relieving the Association from paying legal fees and costs to collect its bad debts. We believe that the combined features of the program enhance the value of the underlying real estate in an Association and the value of an Association’s delinquent receivables. Because we acquire and collect on the delinquent receivables of Associations, the Account debtors are third parties about whom we have little or no information. Therefore, we cannot predict when any given Account will be paid off or how much it will yield. In assessing the risk of purchasing Accounts, we review the property values of the underlying units, the governing documents of the relevant Association, and the total number of delinquent receivables held by the Association. Principles of Consolidation The consolidated financial statements include the accounts of LMFA and its wholly-owned subsidiaries: LM Funding, LLC; LMF October 2010 Fund, LLC; REO Management Holdings, LLC (including all 100 % owned subsidiary limited liability companies); LM Funding of Colorado, LLC; LM Funding of Washington, LLC; LM Funding of Illinois, LLC; US Digital Mining and Hosting Co., LLC (includes all 100 % owned subsidiary limited liability companies) and LMF SPE #2, LLC and various single purpose limited liability corporations owned by REO Management Holdings, LLC which own various properties. It also includes LMFA Sponsor LLC (a 69.5 % owned subsidiary). All significant intercompany balances have been eliminated in consolidation. Basis of Presentation The consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The Company prepares its consolidated financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). Reclassification Certain prior period immaterial amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. Liquidity The accompanying consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The evaluation of going concern under the accounting guidance requires significant judgment which involves the Company to consider that it has historically incurred losses in recent years as it has prepared to grow its business through expansion and acquisition opportunities. The Company must also consider its current liquidity as well as future market and economic conditions that may be deemed outside the control of the Company as it relates to obtaining financing and generating future profits. As of December 31, 2023, the Company had $ 2.4 million available cash on-hand and bitcoin with a fair market value of $ 3.4 million. After considering its current liquidity and future market and economic conditions, the Company has concluded there is no substantial doubt about the Company’s ability to continue as a going concern. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates include the evaluation of probable losses on balances due from a related party, the realization of deferred tax assets, the evaluation of contingent losses related to litigation and reserves on notes receivables. We consider our critical accounting estimates to be those related to long-lived asset impairment assessments. Our estimates may change, however, as new events occur and additional information is obtained, and any such changes will be recognized in the consolidated financial statements. Segment and Reporting Unit Information Operating segments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Chief Executive Officer and Chief Financial Officer of the Company are determined to comprise the CODM, as a group. The Company has two operating segments as of December 31, 2023, which we refer to as Specialty Finance and Mining Operations. Our corporate oversight function and other components that may earn revenues that are only incidental to the activities of the Company are aggregated and included in the “All Other” category. See Note 11, “Segment Information”. Cash The Company maintains cash balances at several financial institutions that are insured under the Federal Deposit Insurance Corporation’s (“FDIC”) Transition Account Guarantee Program. Balances with the financial institutions may exceed federally insured limits. We have approximately $ 2.2 million of cash in various institutions that exceed the FDIC or SIPC insurance coverage limit of $ 250,000 . Digital Assets Bitcoin are included in current assets in the consolidated balance sheets due to the Company’s ability to sell them in a highly liquid marketplace and its intent to liquidate its bitcoin to support operations when needed. Bitcoin are accounted for under the Company’s revenue recognition policy detailed in Note 1 – Summary of Significant Accounting Policies. Bitcoin are classified as indefinite-lived intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other, and are recorded at cost less impairment. We have ownership of and control over our digital assets and use cold storage wallets and third-party custodial services to secure them. Digital assets that are purchased are initially recorded at cost and bitcoin that is earned is measured at fair value on the date earned at the daily closing price, which is not materially different from the fair value at contract inception, which is the daily opening price (refer to Revenue Recognition policy). Digital assets are measured on the consolidated balance sheet at cost, net of any impairment losses incurred since acquisition. When applicable, we account for stablecoin as financial assets in accordance with ASC 310, Receivables. The stablecoin are recorded at cost less impairment, which approximates their fair value. We determine the fair value of our digital assets that are accounted for as intangible assets in accordance with ASC 820, Fair Value Measurement , based on quoted prices from our principal market for such assets (Level 1 inputs). We perform an analysis each month to identify whether events or changes in circumstances indicate that it is more likely than not that our digital assets are impaired. If the current carrying value of a digital asset exceeds the fair value so determined, an impairment loss has occurred with respect to those digital assets in the amount equal to the difference between their carrying values and the fair value. The fair value of digital assets is determined on a nonrecurring basis based on the lowest intraday quoted price as reported in the digital assets’ principal market. The impaired digital assets are written down to their fair value at the time of impairment and this new cost basis will not be adjusted upward for any subsequent increase in fair value. When applicable, any impairment loss on digital assets held for investment would be recognized during the period incurred within "Impairment loss on digital assets" in other income/expense in the consolidated statements of operations. Impairment loss on mined digital assets would be recognized during the period incurred within "Impairment loss on mined digital assets" in operating costs and expenses in the consolidated statements of operations. Gains are not recorded until realized upon sale, at which point they are presented separately from any impairment losses. Any realized gain or loss from the sale of digital assets that were purchased as an investment is recorded in other income (loss), while any realized gain or loss from the sale of digital assets that were earned through mining operations would be recognized within operating costs and expenses. The Company accounts for its gains or losses in accordance with the first in first out (“FIFO”) method of accounting. Digital assets earned by the Company through its mining activities, proceeds from the sale of mined digital assets, realized gain (loss) from the sale of digital assets and the loss on impairment of digital assets are included within operating activities on the consolidated statements of cash flows, where applicable. Purchases of digital assets and proceeds from the sale of purchased digital assets and included within investing activities in the consolidated statements of cash flows. On December 13, 2023, the FASB issued ASU 2023-08, which addresses the accounting and disclosure requirements for certain crypto assets. The standard will be adopted by the Company effective January 1, 2024. Refer to Recently issued accounting pronouncements in this Annual Report on Form 10-K for a description of the expected effect on the Company’s consolidated financial position and results from operations upon adoption of the standard. Investment in Securities Investment in Securities includes investments in common stocks and convertible notes receivables. Investments in securities are reported at fair value with changes in unrecognized gains or losses included in other income on the income statement. The Symbiont convertible note receivable is reported at amortized costs less impairment. Investments in Unconsolidated Entities We account for investments in less than 50 % owned and more than 20 % owned entities using the equity method of accounting. Because we have elected the fair value option for these securities, unrealized holding gains and losses during the period are included in other income within the Consolidated Statements of Operation. Finance Receivables Finance receivables are recorded at the amount funded or cost (by unit). The Company evaluates its finance receivables at each period end for losses that are considered probable and can be reasonably estimated in accordance with ASC 450-20. As discussed above, recoverability of funded amounts under the Company’s original product is generally assured because of the protection of the Super Lien Amount. However, the Company did have an accrual at December 31, 2023 and 2022, respectively for an allowance for credit losses for this program of approximately $ 44 thousand and $ 48 thousand. Under the New Neighbor Guaranty program (special product), the Company funds amounts in excess of the Super Lien Amount. When evaluating the carrying value of its finance receivables, the Company looks at the likelihood of future cash flows based on historical payoffs, the fair value of the underlying real estate, the general condition of the Association in which the unit exists, and the general economic real estate environment in the local area. The Company estimated an allowance for credit losses for this program of approximately $ 8 thousand and $ 9 thousand as of December 31, 2023 and December 31, 2022, respectively under ASC 450-20 related to its New Neighbor Guaranty program. The Company will charge any receivable against the allowance for credit losses when management believes the uncollectability of the receivable is confirmed. The Company considers writing off a receivable when (i) a first mortgage holder who names the association in a foreclosure suit takes title and satisfies an estoppel letter for amounts owed which are less than amounts the Company funded to the association; (ii) a tax deed is issued with insufficient excess proceeds to pay amounts the Company funded to the Association; (iii) an association settles an account for less than amounts the Company funded to the Association or (iv) the Association terminates its relationship with the Company’s designated legal counsel. Upon the occurrence of any of these events, the Company evaluates the potential recovery via a deficiency judgment against the prior owner and the ability to collect upon the deficiency judgment within the statute of limitations period or whether the deficiency judgment can be sold. If the Company determines that collection through a deficiency judgment or sale of a deficiency judgment is not feasible, the Company writes off the unrecoverable receivable amount. Any losses greater than the recorded allowance will be recognized as expenses. Under the Company’s revenue recognition policies, all finance receivables (original product and special product) are classified as nonaccrual. Fair Value of Financial Instruments FASB ASC 825-10, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet. Fixed Assets The Company capitalizes all acquisitions of fixed assets in excess of $ 500 . Fixed assets are stated at cost, net of accumulated depreciation. State and local use tax for equipment shipped from overseas is generally accrued on a quarterly basis at the time equipment is placed in service and is paid to the state in which the equipment is being utilized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets and commences once the assets are ready for their intended use. Fixed assets are comprised of furniture, computer, office equipment, buildings and mining machines with assigned useful lives of 3 to 30 years. The Company classifies mining machine deposit payments within "Deposits on mining equipment" in the consolidated balance sheets. As mining machines are received, the respective cost of the mining machines plus the related shipping and customs fees are reclassified from "Deposits on mining equipment" to "Fixed assets, net" in the consolidated balance sheet. Refer to Note 4. In addition, as part of its periodic review of its fixed asset groups during the fourth quarter of 2023, the Company changed the estimated useful life for its mining machines from 5 years to 4 years . The change is accounted for on a prospective basis. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of mining machines. To the extent that any of the assumptions underlying management’s estimate of useful life of its mining machines are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets. Equipment Purchases During 2021, we purchased an aggregate of 5,046 Bitcoin S19J Pro Antminer cryptocurrency mining machines for an aggregate purchase price of $ 24.4 million (the “Mining Machines”) from Bitmain after certain credits. We received all of the Mining Machines purchased during 2021 from August 2022 through November 2022. During the year ended December 31, 2022, the Company purchased an additional 400 Bitcoin Miner S19J Pro machines from Bitmain for an aggregate purchase price of approximately $ 1.3 million which were delivered in December 2022. Additionally, during the year ended December 31, 2022, the Company purchased 200 Bitcoin S19 XP Antminer cryptocurrency mining machines ("XP Machin es") from Bitmain for an aggregate purchase price of approximately $ 1.3 million. which were delivered in January 2023. We used various Bitmain credits and coupons totaling approximately $ 1.0 million to pay for the machines and we paid the remaining $ 0.3 million non-refundable payment in cash. We purchased an additional 65 S19 XP machines on December 20, 2022 and another 125 S19 XP machines on January 15, 2023 from Bitmain for an aggregate purchase price of approximately $ 1.1 million. We used various Bitmain credits and coupons totaling approximately $ 0.6 million to pay for the 65 S19 XP machines that were ordered in December 2022, and in January 2023 we paid the remaining $ 0.5 million non-refundable payment relating to the 125 S19 XP machines in cash. All 190 XP machines were delivered in April 2023. We also paid $ 0.3 million to acquire an additional 101 S19 XP machines from Bitmain which were delivered in May 2023. Since the inception of our contracts with Bitmain, we have paid an aggregate of approxi mately $ 29.0 million to Bitmain and related vendors relating to the purchase of these machines through December 31, 2023. As of March 8, 2024, we had approximately 5,900 active machines with hashing capacity of approximately 0.61 EH/s. Right to Use Assets The Company capitalizes all leased assets pursuant to ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize right-of-use assets and lease liability, initially measured at present value of the lease payments, on its balance sheet for leases with terms longer than 12 months and classified as either financing or operating leases. As of December 31, 2023 and 2022, right to use assets, net of accumulated amortization, was approximately $ 189 thousand and $ 266 thousand. Impairment of Long-Lived Assets Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment amount is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. There was no impairment of long-lived assets for the years ended December 31, 2023 and 2022. Revenue Recognition - Digital Mining We recognize revenue in accordance with generally accepted accounting principles as outlined in the Financial Accounting Standard Board's (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts with Customers, which requires that five steps be followed in evaluating revenue recognition: (i) identify the contract with the customer; (ii) identity the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue when or as the entity satisfied a performance obligation. Our accounting policy on revenue recognition for our bitcoin mining segment is provided below. Step 1: The Company enters into a contract with a bitcoin mining pool operator (i.e., the customer) to provide computing power to the mining pools. The contracts are terminable at any time by either party and the Company’s enforceable right to compensation only begins when the Company starts providing computing power to the mining pool operator (which occurs daily at midnight Universal Time Coordinated (UTC)). When participating in ratable share pools, in exchange for providing computing power the Company is entitled to a fractional share of the Bitcoin award the mining pool operator receives for successfully adding a block to the blockchain, plus a fractional share of the transaction fees attached to that blockchain. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. When participating in a Full Pay Per Share (“FPPS”) mining pool, in exchange for providing computing power to the pool the Company is entitled to compensation, calculated on a daily basis, at an amount that approximates the total Bitcoin that could have been mined using the Company’s computing power, calculated on a look-back basis across previous blocks using the pools hash rate index. Applying the criteria per ASC 606-10-25-1, the contract arises at the point that the Company provides computing power to the mining pool operator, which is beginning contract day at midnight UTC (contract inception), because customer consumption is in tandem with daily earnings of delivery of the computing power. Step 2: In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). Based on these criteria, the Company has a single performance obligation in providing computing power services (i.e., hashrate) to the mining pool operator (i.e., customer). The performance obligation of computing power services is fulfilled daily over-time, as opposed to a point in time, because the Company provides the hashrate throughout the day and the customer simultaneously obtains control of it and uses the asset to produce bitcoin. The Company has full control of the mining equipment utilized in the mining pool and if the Company determines it will increase or decrease the processing power of its machines and/or fleet (i.e., for repairs or when power costs are excessive) the computing power provided to the customer will be reduced. Step 3: The transaction consideration the Company earns is non-cash digital consideration in the form of bitcoin, which the Company measures at fair value on the date earned at the daily closing price, which is not materially different from the fair value at contract inception, which is the daily opening price. The transaction consideration the Company earns is all variable since it is dependent on the daily computing power provided by the Company under the FPPS model and total bitcoin earned by the under the ratable share model. The Company’s bitcoins earned through the contractual payout formula is not known until the Company’s computational hashrate contributed over the daily measurement period is fulfilled over-time daily between midnight-to-midnight UTC time. The Company’s proportionate amount of the global network transaction fee rewards earned are calculated at the end of each transactional day (midnight to midnight). There are no other forms of variable considerations, such as discounts, rebates, refunds, credits, price concessions, incentives, performance bonuses, penalties, or other similar items. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the noncash consideration on the same day that control is transferred, which is the same day as contract inception. Step 4: The transaction price is allocated to the single performance obligation upon verification for the provision of computing power to the mining pool operator, and total Bitcoin rewards earned by the pool, when applicable under a ratable share model. There is a single performance obligation (i.e., computing power or (hashrate) for the contract; therefore, all consideration from the mining pool operator is allocated to this single performance obligation. Step 5: The Company’s performance is complete in transferring the hashrate service over-time (midnight to midnight) to the customer and the customer obtains control of that asset. In exchange for providing computing power, the Company is entitled to a pro-rata share of the fixed bitcoin awards earned over the measurement period, plus a pro-rata fractional share of the global transaction fee rewards for the respective measurement period, less net digital asset fees due to the mining pool operator over the measurement period, as applicable. The transaction consideration the Company receives is non-cash consideration, in the form of bitcoin. The Company measures the bitcoin at fair value on the date earned using the closing price of bitcoin on the date earned (midnight UTC), which is not materially different from the fair value at contract inception, which is the daily opening price. There are no deferred revenues or other liability obligations recorded by the Company since there are no payments in advance of the performance. At the end of the 24 hour “midnight-to-midnight” period, there are no remaining performance obligations. Bitcoin earned by the Company through its mining activities are included within operating activities on the accompanying consolidated statements of cash flows. The sale of bitcoin are included within operating activities as the Company sells its bitcoin to fund operations in the normal course of business. The Company will evaluate time periods when the Company holds bitcoin for a longer period of time and sale so such would be recorded as investing activities. F |
Digital Assets
Digital Assets | 12 Months Ended |
Dec. 31, 2023 | |
Digital Assets [Abstract] | |
Digital Assets | Note 2. Digital Assets Digital assets (Bitcoin and Tether) consisted of the following: December 31, 2023 December 31, 2022 Bitcoin $ 3,406,096 $ 888,026 Tether 10,160 - Total digital assets $ 3,416,256 $ 888,026 Bitcoin December 31, 2023 December 31, 2022 Beginning of Year $ 888,026 $ - Purchase of Bitcoin 35,157 988,343 Production of Bitcoin 12,289,131 945,560 Impairment loss on mined Bitcoin ( 965,967 ) ( 79,794 ) Impairment loss on purchased Bitcoin - ( 467,406 ) Carrying amount of Bitcoin sold ( 8,840,251 ) ( 498,677 ) End of Period $ 3,406,096 $ 888,026 Digital asset (Bitcoin) activity consisted of the following: December 31, 2023 December 31, 2022 Bitcoin Balance 95.1 54.9 December 31, 2023 December 31, 2022 Beginning of Year 54.9 - Production of Bitcoin 423.4 53.4 Purchase of Bitcoin 2.0 31.6 Sale of Bitcoin ( 385.0 ) ( 30.1 ) Fees ( 0.2 ) - End of Period 95.1 54.9 Digital asset activity (GUSD) consisted of the following: December 31, 2023 December 31, 2022 Beginning of Year $ - $ - Purchase of GUSD - 500,000 GUSD Earned on digital assets - 5,658 Sale of GUSD - ( 505,658 ) End of Period $ - $ - During the year ended December 31, 2023 the Company sold earned Bitcoin for proceeds of approximately $ 10.9 million which resulted in a realized gain of approximately $ 2.1 million. The realized gain was included within "Realized gain on digital assets" in the consolidated statements of operations. During the year ended December 31, 2022, the Company did no t sell any earned Bitcoin. During the years ended December 31, 2023 and 2022, the Company sold purchased Bitcoin for proceeds of approximately $ 28 thousand and $ 519 thousand, which resulted in a realized gain of approximately $ 2 thousand and $ 20 thousand. The realized gain was included within "Realized gain on sale of purchased digital assets" in the consolidated statements of operations. |
Fixed Assets and Intangible Ass
Fixed Assets and Intangible Assets, net | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets and Intangible Assets, net | Note 3. Fixed Assets and Intangible Assets, net The components of fixed assets as of December 31, 2023 and 2022 are as follows: Useful Life (Years) December 31, 2023 December 31, 2022 Mining machines 4 $ 29,799,782 $ 27,637,041 Real estate assets owned 30 80,057 80,057 Furniture, computer and office equipment 3 - 5 230,063 216,312 Gross fixed assets 30,109,902 27,933,410 Less: accumulated depreciation ( 5,590,292 ) ( 661,036 ) Fixed assets, net $ 24,519,610 $ 27,272,374 As of December 31, 2023, approximately 5,900 mining machines have been received and were placed into service at hosting locations. The Company’s depreciation expense recognized for the years ended December 31, 2023 and 2022 was approximately $ 4.9 million and $ 478 thousand, respectively. During the years ended December 31, 2023 and 2022 approximately $ 9 thousand and $ 38 thousand, respectively, of loss related to the write-off of mining machines was recorded within "Loss on disposal of assets" in the consolidated statements of operation. There was no impairment loss recorded on fixed assets during the years ended December 31, 2023 or 2022. Intangible assets activity for the years ended December 31, 2023 and 2022 is as follows: December 31, 2023 December 31, 2022 Beginning balance $ - $ - Symbiont intangible assets additions 2,804,902 - Impairment loss on Symbiont assets ( 750,678 ) - Accumulated amortization ( 54,224 ) - Sale of asset ( 2,000,000 ) - Total intangible assets, net $ - $ - On June 2, 2023, the United States Bankruptcy Court for the Southern District of New York entered an order (the “Symbiont Bankruptcy Order”) approving the sale of substantially all of the assets of Symbiont.io, LLC, as debtor in possession (“Symbiont”), to LM Funding America, Inc. (the “Company”) pursuant to a form of Asset Purchase Agreement attached to the Symbiont Bankruptcy Sale Order (the “Asset Purchase Agreement”) free and clear of all liens, claims and encumbrances. The Company and Symbiont signed the Asset Purchase Agreement on June 5, 2023, and the purchase and sale of the Symbiont assets pursuant to the Asset Purchase Agreement closed on June 5, 2023. Pursuant to the Asset Purchase Agreement, the Company purchased substantially all of the assets of Symbiont for a purchase price of $ 2.6 million, which was paid by means of a credit bid of the full amount of the note payable owed by Symbiont to the Company. The $ 2.6 million comprises of $ 2.0 million of principal, $ 425 thousand of accrued interest, and $ 164 thousand of legal fees. The Company did not assume any liabilities of Symbiont in the transaction. The Company incurred an additional $ 238 thousand of expenses acquiring these assets which was accounted for as an asset acquisition. The Company capitalized $ 2.8 million for the Symbiont assets (the “Symbiont Assets”) which consist principally of intellectual property, customer contracts, customer base and software code relating to Symbiont’s financial services blockchain enterprise platform . During the third quarter of 2023 management received offers related to the sale of the Symbiont assets which was considered a triggering event for potential impairment. Based on the assessment performed, management concluded an impairment of approximately $ 0.8 million on the Symbiont assets was necessary. On December 26, 2023, the Company entered into an Asset Purchase Agreement ("APA") with Platonic Holdings Inc. ("Platonic") pursuant to which the Company agreed to sell to Platonic the technology assets of Symbiont.io, LLC that the Company previously acquired on June 5, 2023. The sale of the Symbiont Assets closed on December 27, 2023. The sales price for the Symbiont Assets was $ 2.0 million, of which $ 200 thousand is being held in a customary indemnity escrow until December 26, 2024. The APA also contains customary representations, warranties, indemnification provisions and covenants. The amounts held in escrow are recorded within "Receivable from sale of Symbiont assets" on the consolidated balance sheets. The Company recognized $ 54 thousand and nil of amortization expense during the year ended December 31, 2023 and 2022. |
Deposit on Mining Equipment and
Deposit on Mining Equipment and Hosting Services | 12 Months Ended |
Dec. 31, 2023 | |
Deposit On Mining Equipment [Abstract] | |
Deposits on Mining Equipment and Hosting Services | Note 4. Deposit on Mining Equipment and Hosting Services As further described in Note 1, the Company has entered into a series of mining machine purchase agreements, hosting and colocation service agreements in association with our cryptocurrency mining operations which required deposits to be paid in advance of the respective asset or service being received. As further described in Note 7, as of December 31, 2022 management determined that approximately $ 3.15 million of deposits previously paid to Uptime Armory LLC were not probable of recovery and the deposits were impaired. During the year ended December 31, 2023 and 2022, nil and approximately $ 3.15 million, respectively, were recorded as "Impairment loss on prepaid mining machine deposits" in the consolidated statements of operations. As of December 31, 2023 and 2022, the Company has a total of approximately $ 20 thousand and $ 500 thousand, respectively, classified as "Deposits on mining equipment". The Company classifies hosting deposit payments within "Hosting services deposits" in the consolidated balance sheets. As further described in Note 7, as of December 31, 2022 management determined that approximately $ 0.8 million of deposits previously paid to Uptime Hosting LLC during 2021 and approximately $ 1.0 million of deposits paid to Compute North LLC during the year ended December 31, 2022 were not probable of recovery and the deposits were impaired. During the years ended December 31, 2023 and 2022, nil and approximately $ 1.8 million, respectively, were recorded as "Impairment loss on prepaid hosting deposits" within the consolidated statements of operations. As of December 31, 2023 and 2022 the Company has a total of approximately $ 3.1 million and nil in hosting deposits, respectively, classified as "Prepaid expenses and Other assets" as these assets are associated with hosting contracts that expire in 2024. As of December 31, 2023 and 2022 the Company has a total of approximately nil and $ 2.2 million, respectively, classified as "Hosting services deposits" as a long-term assets due to expected timing of the recovery or application of deposits extending beyond twelve months from the reporting date. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2023 | |
Investments [Abstract] | |
Investments | Note 5. Investments Marketable Securities Our marketable equity securities are publicly traded stocks measured at fair value using quoted prices for identical assets in active markets and classified as Level 1 within the fair value hierarchy. Marketable equity securities as of December 31, 2023 and December 31, 2022 are as follows: Cost Cost of Shares Sold Gross Unrealized Gain (Loss) Fair Value Marketable equity securities, December 31, 2023 $ 743,906 $ ( 739,616 ) $ 13,570 $ 17,860 Marketable equity securities, December 31, 2022 $ 2,976,933 $ ( 2,915,813 ) $ ( 56,830 ) $ 4,290 During the year ended December 31, 2023 and 2022, the Company sold nil shares and 8,759,094 shares, respectively, of Borqs shares for approximately nil and $ 2.3 million, respectively. The Company realized a net loss of $ 0 thousand and $ 350 thousand related to the sale of marketable securities for the years ended December 31, 2023 and 2022, respectively. The net loss is included within "Realized gain (loss) on securities" within our consolidated statements of operations. Short-term Investments – convertible debt securities The Company entered into an agreement with BORQS Technologies Inc. (“Borqs”) (Nasdaq: BRQS) in February 2021 under which the Company agreed to purchase Senior Secured Convertible Promissory Notes (“Notes”) of Borqs up to an aggregate principal amount of $ 5 million. The Company’s purchase of the Notes was a part of a larger transaction in which an aggregate of $ 20 million in Notes were sold by Borqs in a private transaction to several institutional and individual investors, including the Company. The Notes became due in February 2023 , had an annual interest rate of 8 %, were convertible into ordinary shares of Borqs at a 10 % discount from the market price, and had 90 % warrant coverage (with the warrants exercisable at 110 % of the conversion price). The Company received 2,922,078 warrants which had a nominal value on the grant date. One-third of the Notes ($ 1,666,667 ) were funded by the Company at the execution of definitive agreements for the transaction, and two-thirds of the Notes ($ 3,333,333 ) were purchased and funded upon the satisfaction of certain conditions, including effectiveness of a registration statement that was deemed effective on May 3, 2021. The Company sold 4,895,894 of Borqs shares during the first quarter of 2022 which resulted in a realized loss of $ 395 thousand which is reflected in ‘ Realized gain (loss) on securities ’ in the Consolidated Statements of Operations for the year ended December 31, 2022. The remaining principal amount of the Notes plus accrued interest through the date of conversion ($ 965,096 ) was converted into common shares of Borqs at a conversion price of $ 0.25 per share or 3,863,200 shares. A gain of approximately $ 288 thousand was recognized on the conversion of the convertible debt to common shares and is included within “Realized gain on convertible debt securities” in the Consolidated Statements of Operations for the year ended December 31, 2022. Subsequent to the conversion, the 3,863,200 shares were sold which resulted in a realized gain of $ 45 thousand which is included within "Realized gain on securities" in the Consolidated Statements of Operations for the year ended December 31, 2022. December 31, 2023 December 31, 2022 Convertible note $ - $ - End of period $ - $ - December 31, 2023 December 31, 2022 Beginning of year $ - $ 539,351 Accrued interest income on convertible debt security - 17,753 Convertible debt and interest converted into marketable shares - ( 844,882 ) Realized gain on conversion into marketable shares - 287,778 End of period $ - $ - Notes receivable from Seastar Medical Holding Corporation. LMFAO and SeaStar Medical On February 1, 2022, LMAO issued an unsecured promissory note to LMFAO Sponsor LLC ("Sponsor"), pursuant to which LMAO may borrow up to an aggregate principal amount of $ 500,000 to be used for a portion of LMAO’s expenses. As of September 30, 2022, LMAO had drawn down $ 310,000 under the promissory note with LMFAO Sponsor LLC to pay for offering expenses. On July 28, 2022 (effective as of September 30, 2022), the aggregate principal limit was increased to $ 1,750,000 . The loan was non-interest bearing, unsecured and due at the earlier of the 24-month anniversary of LMAO’s initial public offering or the closing of its initial business combination. On April 21, 2022, LMAO entered into an Agreement and Plan of Merger (the “Merger Agreement”) by and among LMAO, LMF Merger Sub, Inc., a Delaware corporation and direct, wholly owned subsidiary of LMAO (“Merger Sub”), and SeaStar Medical, Inc., a Delaware corporation (“SeaStar Medical”). On July 29, 2022, LMAO issued a press release announcing that its board of directors elected to extend the date by which LMAO has to consummate a business combination from July 29, 2022 to October 29, 2022 (the “Extension”), as permitted under LMAO’s Amended and Restated Certificate of Incorporation. In connection with the Extension, LMFAO Sponsor deposited an aggregate of $ 1,035,000 (representing $ 0.10 per public share of LMAO) into LMAO’s trust account on July 29, 2022. This deposit was made in respect of a non-interest bearing loan to LMAO (the “Extension Loan”). On October 28, 2022, LMAO through the Sponsor, consummated the previously announced business combination transaction (the “LMAO Business Combination”) contemplated by the Merger Agreement. Pursuant to the Merger Agreement, upon the closing of the LMAO Business Combination, SeaStar Medical was merged with and into Merger Sub, with SeaStar Medical continuing as the surviving entity in the merger as a wholly-owned subsidiary of LMAO and with LMAO subsequently changing its name in connection with the merger to SeaStar Medical Holding Corporation (“SMHC”). In connection with the closing of the LMAO Business Combination, on October 28, 2022, Sponsor and SMHC amended, restated, and consolidated (i) the original Promissory Note, dated July 29, 2022, issued by LMAO to Sponsor in the principal amount of $ 1,035,000 and (ii) the original Amended and Restated Promissory Note, effective June 30, 2022, issued by LMAO to Sponsor in the principal amount of $ 1,750,000 (collectively, the “Original Sponsor Notes”), by entering into one consolidated amended and restated pr omissory note with an aggregate principal amount of $ 2,785,000 (the “Amended Sponsor Note”). As of December 31, 2023, there was $ 1,127 thousand of principal and $ 13 thousand of accrued interest and as of December 31, 2022, there was $ 2,785 thousand of principal and $ 35 thousand of accrued interest on the Amended Sponsor Note included in Short-term investments – "Note receivable from Seastar Medical Holding Corporation." on the consolidated balance sheets. On September 9, 2022, the Company entered into a Credit Agreement with SeaStar Medical pursuant to which the Company agreed to make advances to SeaStar Medical of up to $ 700,000 for general corporate purposes at an interest rate equal to 15 % per annum. All advances made to SeaStar Medical under the Credit Agreement ("Original LMFA Note) and accrued interest were due and payable to LMFA on the maturity date. The agreement was modified on October 28, 2022 to reduce the interest rate to 7 % per annum and the maturity date of the loan to October 30, 2023 ("amended LMFA Note"). During the year ended December 31, 2022, $ 700 thousand was loaned to Seastar Medical under the Credit Agreement. During the year ended December 31, 2023, repayments of approximately $ 529 thousand of principal was received from Seastar and approximately $ 125 thousand was loaned to Seastar Medical under the Credit Agreement. A s of December 31, 2023 there was $ 296 thousand of principal and $ 3 thousand of accrued interest in Long-term investments – "Notes receivable from Seastar Medical Holding Corporation" and as of December 31, 2022 there was $ 700 thousand of principal and $ 19 thousand of accrued interest on the amended LMFA Note in Short-term investments – "Notes receivable from Seastar Medical Holding Corporation." on the consolidated balance sheets. The Amended Sponsor Note and the Amended LMFA Note (collectively, the “Notes”) extended the maturity date of the Original Sponsor Notes and Original LMFA Note, respectively, from the closing date of the Business Combination to October 30, 2023 , subject to mandatory prepayments equal to a specified percentage of funds raised by SMHC prior to maturity. The Notes both bear interest at a per annum rate equal to seven percent ( 7 %), simple interest, and pursuant to Security Agreements entered into by the parties (the “Security Agreements”), are secured by all of the assets of SMHC and SeaStar Medical (excluding certain intellectual property rights). During 2023 the Company entered into a series of amendments to the Notes which extended the maturity date of the Notes to June 10, 2025 as part of agreements that allowed Seastar Medical to incur certain debt to accelerate the partial repayment of the Notes. Due to the extension of the maturity date, the Notes were included in long-term investments – “Notes receivable from Seastar Medical Holding Corporation” as of December 31, 2023 on the consolidated balance sheets. On November 2, 2022 the Company advanced $ 268 thousand to SeaStar Medical for working capital needs, which was repaid on January 18, 2023. As of December 31, 2023 and 2022 there was nil and $ 268 thousand of the advance included in "Notes receivable from Seastar Medical Holding Corporation" on the consolidated balance sheets. As of December 31, 2023 and 2022 there was also approximately nil and $ 12 thousand in amounts payable from the Company to Seastar Medical included in "Due to related parties" on the consolidated balance sheets. December 31, 2023 December 31, 2022 Notes receivable from Seastar Medical Holding Corporation $ 1,440,498 $ 3,807,749 End of period $ 1,440,498 $ 3,807,749 December 31, 2023 December 31, 2022 Beginning of year $ 3,807,749 $ - Investment in Seastar Medical Holding Corporation notes receivable 125,000 3,753,090 Repayment of Seastar Medical Holding Corporation notes receivable ( 2,651,943 ) - Accrued interest income 159,692 54,659 End of period $ 1,440,498 $ 3,807,749 Long-term investments Symbiont.IO The Company entered into a secured promissory note and loan agreement with Symbiont.IO, Inc. (“Symbiont”) on December 1, 2021 under which the Company agreed to lend Symbiont an aggregate principal amount of up to $ 3.0 million, of which $ 2.0 million was drawn. The outstanding principal amount under the note bears interest at a rate of 16 % per annum. The outstanding principal, plus any accrued and unpaid interest, became due and payable on December 1, 2022. The Symbiont note is secured by a first priority perfected security interest in the assets of Symbiont. Symbiont filed for bankruptcy on December 1, 2022. On January 13, 2023 Symbiont entered into a stipulation agreement with LMF confirming their intent and ability to pay all amounts owed to LMFA under the previously filed motion, in addition to interest and legal fees accrued through the payoff date of January 24, 2023. There was approximately $ 0.3 million of cash collected since December 2022 into a Symbiont bank account which would provide the funds necessary to partially repay the amounts owed to the Company in full. We anticipated acquiring substantially all of the assets of Symbiont for $ 2.4 million. A $ 1.1 million loss allowance was recorded against the Symbiont debt security which was included within "Credit loss on debt securities" in the consolidated statements of operation for the year ended December 31, 2023. The $ 1.1 million loss allowance was subsequently reversed upon the purchase of the Symbiont assets for total consideration of $ 2.8 million, which approximates the fair value of such assets. As of December 31, 2021 due to the original terms for repayment of the Symbiont debt security, the amounts due from Symbiont were classified as Short-term investments - debt securities. As of a result of the bankruptcy filing of Symbiont, there is uncertainty around the expected duration of legal proceedings and timing of repayment of amounts due to the Company, therefore the Symbiont debt security was reclassified to "Long-term investments - debt security" as of December 31, 2022. As of December 31, 2023 and December 31, 2022, there was nil and $ 347 thousand of accrued interest on the Symbiont security and nil and $ 55 of accrued reimbursement of legal fees incurred by the Company included in "Long-term investments - debt security" and "Short-term investments – debt security", respectively. As part of the $ 2.0 million loan to Symbiont in December 2021, the Company received 700,000 warrants. Each warrant was immediately exercisable at a purchase price of $ 3.0642 per share of Common Stock, subject to adjustment in certain circumstances, with an expiration of December 1, 2026 . The Company determined the warrants had a nominal value at inception and thereafter due to lack of marketability and subsequent bankruptcy. The Symbiont debt security consisted of the following: December 31, 2023 December 31, 2022 Symbiont.IO Note Receivable $ - $ 1,350,000 End of period $ - $ 1,350,000 December 31, 2023 December 31, 2022 Beginning of year $ 1,350,000 $ 2,027,178 Accrued interest income on debt securities - 320,000 Reclassification to intangible assets (Note 3) ( 2,402,542 ) - Accrued recovery of legal fees - 55,364 Allowance for losses on debt security - ( 1,052,542 ) Reversal of allowance for losses on debt security 1,052,542 - End of period $ - $ 1,350,000 SeaStar Medical Holding Corporation - Warrants In connection with LMF Acquisition Opportunities Inc (“LMAO”) initial public offering in January 2021, the Company’s affiliate LMFA Sponsor LLC ("Sponsor") purchased an aggregate 5,738,000 private placement warrants from LMAO (“Private Placement Warrants”) at a price of $ 1.00 per whole warrant. Each Private Placement Warrant is exercisable for one share of LMAO’s Class A common stock at a price of $ 11.50 per share, and as such meets the definition of a derivative as outlined within ASC 815, Derivatives and Hedging. On October 28, 2022, the LMAO Business Combination was consummated and these warrants were assumed by SeaStar Medical. The warrants are recorded at fair value and are classified as long term investments in "Long-term investments - equity securities" on the consolidated balance sheets. The fair value of the private placement warrants is classified as Level 3 in the fair value hierarchy as the calculation is dependent upon company specific adjustments to the observable trading price of Seastar’s public warrants for lack of marketability. Prior to the consummation of the LMAO Business Combination, the fair value determination of the private placement warrants also included specific adjustments related to the risk of forfeiture if a business combination did not occur. Subsequent changes in fair value will be recorded in the income statement during the period of the change. As of December 31, 2023 and 2022, our re-measurement of the fair value of the private placement warrants resulted in an unrealized loss of approximately $ 0.3 million and $ 1.5 million, respectively. The unrealized loss is included within "Unrealized gain on investment and equity securities" within the consolidated statements of operations. Long-term investments for the SMHC (formerly LMAO) warrants consist of the following: December 31, 2023 December 31, 2022 Seastar Medical Holding Corporation (formerly LMAO) warrants $ 156,992 $ 464,778 End of period $ 156,992 $ 464,778 December 31, 2023 December 31, 2022 Beginning of year $ 464,778 $ 1,973,413 Unrealized loss on equity securities ( 307,786 ) ( 1,508,635 ) End of period $ 156,992 $ 464,778 SeaStar Medical Holding Corporation - Common Stock Pursuant to the Merger Agreement, the 2,587,500 shares of Class B common stock of LMAO held by Sponsor automatically converted into 2,587,500 shares of LMAO’s Class A common stock on a one-for-one basis and the Class A Common Stock and Class B Common Stock of LMAO was reclassified as Common Stock of SMHC at the time of the LMAO business combination and are subject to certain transfer restrictions. As of December 31, 2023, Sponsor holds 2,587,500 shares, or approximately 5.4 % of the total common shares of SMHC, along with 5,738,000 private placement warrants. Taking into consideration the approximately 30 % minority interest in Sponsor, the percentage of ownership in the total common shares of SMHC that is attributable to the Company is approximately 4 %. Our investment in SMHC (formerly LMAO) common stock qualifies for equity-method accounting, for which we have elected the fair value option which requires the Company to remeasure our retained interest in SMHC (formerly LMAO) at fair value and include any resulting adjustments as part of a gain or loss on investment. Prior to the closing of the LMAO business combination, the calculation of fair value of our retained interest in LMAO included company-specific adjustments applied to the observable trading price of LMAO’s Class A common stock related risk of forfeiture should LMAO not consummate a business combination. Subsequent to the LMAO business combination, the fair value calculation related to our retained interest in SMHC is based upon the observable trading price of SMHC's Class A common stock. As part of the merger, Sponsor agreed that it will not transfer its shares of SMHC common stock until the date that is the earlier of (1) the twelve month anniversary of the closing of the merger and (2) the last sale price of the Common Stock equals or exceeds $ 12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the close of the merger. The Company evaluated the impact of the LMAO Business Combination and determined that our investment in SeaStar Medical continues to meet the criteria for the equity method of accounting, for which we have elected the fair value option. We remeasure our retained interest in SeaStar Medical's common stock at fair value and include any resulting adjustments as part of our gain or loss on investments. The fair value of our retained interest in SeaStar Medical's common stock is classified as Level 1 in the fair value hierarchy as the fair value is based upon the observable trading price of ICU common stock. The trading price of ICU common stock as of December 31, 2023 and 2022 was $ 0.44 a nd $ 4.10 per share, respectively. Subsequent changes in fair value will be recorded in the income statement during the period of change. As of December 31, 2023 and 2022, our re-measurement of the fair value of ICU (formerly LMAO) common stock resulted in an unrealized loss of approximately $ 9.5 million and unrealized gain of approximately $ 5.9 million, respectively. The unrealized gain is included within "Unrealized gain (loss) on investment and equity securities" within the consolidated statements of operations. December 31, 2023 December 31, 2022 Seastar Medical Holding Corporation common stock $ 1,145,486 $ 10,608,750 End of period $ 1,145,486 $ 10,608,750 December 31, 2023 December 31, 2022 Beginning of year $ 10,608,750 $ 4,676,130 Unrealized gain (loss) on equity investment ( 9,463,264 ) 5,932,620 End of period $ 1,145,486 $ 10,608,750 The net unrealized gain (loss) on securities from the Company’s investment in SMHC's (formerly LMAO) common stock and warrants totaled ($ 9.8 ) million and $ 4.4 million for the years ended December 31, 2023 and 2022, respectively. |
Debt and Other Financing Arrang
Debt and Other Financing Arrangements | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Debt and Other Financing Arrangements | Note 6. Debt and Other Financing Arrangements Debt of the Company consisted of the following at December 31, 2023 and 2022: December 31, 2023 December 31, 2022 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 78,000 was required upfront and equal installment payments of $ 45,672 to be made over a 10 month period. The note matured on August 1, 2023 . Annualized interest is 7.35 %. $ - $ 365,379 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 15,000 was required upfront and equal installment payments of $ 13,799 to be made over an 8 month period. The note matured on August 1, 2023 . Annualized interest is 7.35 %. - 110,396 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 3,438 was required upfront and equal installment payments of $ 3,658 to be made over a 11 month period. The note matures on July 1, 2024 . Annualized interest is 12.05 %. 21,945 - Financing agreement with Imperial PFS that is unsecured. Down payment of $ 36,544 was required upfront and equal installment payments of $ 41,879 to be made over an 10 month period. The note matures on August 1, 2024 . Annualized interest is 9.6 %. 335,022 - Financing agreement with Imperial PFS that is unsecured. Down payment of $ 30,000 was required upfront and equal installment payments of $ 35,103 to be made over a 6 month period. The note matures on June 1, 2024 . Annualized interest is 12.05 %. 210,619 $ 567,586 $ 475,775 Minimum required principal payments on the Company’s debt as of December 31, 2023 are as follows : Maturity Amount 2024 $ 567,586 $ 567,586 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 7. Commitments and Contingencies Leases The Company leases certain office space and office equipment under non-cancelable operating leases. Leases with an initial term of one year or less are not recorded on the balance sheet, and the Company generally recognizes lease expense for these leases on a straight-line basis over the lease term. As of December 31, 2023, the Company’s long term operating lease has a remaining lease term of 20 months and includes options to renew the leases. The exercise of lease renewal options is generally at the Company’s sole discretion. The Company’s leases do not contain any material residual value guarantees or material restrictive covenants. The Company does not have any material financing leases. The Company determines if an arrangement is a lease at inception. Operating lease ROU assets and current and long-term operating lease liabilities are separately stated on the Consolidated Balance Sheet. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. The present value of future lease payments are discounted using either the implicit rate in the lease, if known, or the Company’s incremental borrowing rate for the specific lease as of the lease commencement date. The ROU asset is also adjusted for any prepayments made or incentives received. The lease terms include options to extend or terminate the lease only to the extent it is reasonably certain any of those options will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company accounts for lease components (e.g., fixed payments) separate from the non-lease components (e.g., common-area maintenance costs). The Company’s office lease began July 15, 2019 and was due to expire on July 31, 2022 . During the first quarter of 2022 the Company exercised its option to extend its office lease to July 31, 2025 . The Company accounted for the lease extension as a lease modification under ASC 842. Due to the lease extension, the Company remeasured the lease liability and ROU asset associated with the lease. As of the effective date of modification, the Company recorded an adjustment to the right-of-use asset and lease liability in the amount of $ 300,787 based on the net present value of lease payments discounted using an estimated incremental borrowing rate of 7.5 %. Subsequent renewal options were not considered probable of being exercised as of December 31, 2023. This office space is in a building owned by a board member. The Company shares this space and the related costs associated with this operating lease with a related party (see Note 9) that also performs legal services associated with the collection of delinquent assessments. The related party has a sub-lease for approximately $ 4.8 thousand p er month plus operating expenses. Lease expense recognized for the years ended December 31, 2023 and 2022 was approximately $ 109 thousand and $ 108 thousand, respectively. Sublease income recognized for the years ended December 31, 2023 and 2022 was approximately $ 58 thousand and $ 59.5 thousand, respectively. On February 27, 2023, the Company executed a lease for office equipment which has been classified as an operating lease. The lease term is 39 months. As of the effective date of the lease, the Company recorded an adjustment to the right-of-use asset and lease liability in the amount of approximately $ 22 thousand based on the net present value of lease payments discounted using an estimated incremental borrowing rate of 7.35 %. The following table presents supplemental balance sheet information related to operating leases as of December 31, 2023 and 2022: Balance Sheet Line Item December 31, 2023 December 31, 2022 Assets ROU assets Right of use asset, net $ 189,009 $ 265,658 Total lease assets $ 189,009 $ 265,658 Liabilities Current lease liabilities Lease liability $ 110,384 $ 90,823 Long-term lease liabilities Lease liability 85,775 179,397 Total lease liabilities $ 196,159 $ 270,220 Weighted-average remaining lease term (in years) 1.7 2.7 Weighted-average discount rate 7.49 % 7.50 % The following table presents supplemental cash flow information and non-cash activity related to operating leases for the years ended December 31, 2023 and 2022: For the year ended December 31, 2023 2022 Operating cash flow information Cash paid for amounts included in the measurement of lease liabilities $ ( 95,948 ) $ ( 98,569 ) Non-cashflow information ROU assets and operating lease obligation recognized $ 21,887 $ 300,787 The following table presents maturities of operating lease liabilities on an undiscounted basis as of December 31, 2023: Lease Maturity Table Operating Leases 2024 121,385 2025 85,324 2026 3,163 (less: imputed interest) ( 13,713 ) $ 196,159 Legal Proceedings Except as described below, we are not currently a party to material pending or known threatened litigation proceedings. However, we frequently become party to litigation in the ordinary course of business, including either the prosecution or defense of claims arising from contracts by and between us and client Associations. Regardless of the outcome, litigation can have an adverse impact on us because of prosecution, defense, and settlement costs, diversion of management resources and other factors. The Company accrues for contingent obligations, including estimated legal costs, when the obligation is probable and the amount is reasonably estimable. As facts concerning contingencies become known, the Company reassesses its position and makes appropriate adjustments to the consolidated financial statements. Estimates that are particularly sensitive to future changes include those related to tax, legal, and other regulatory matters. On March 9, 2022, legal counsel to a purported stockholder of the Company threatened to file a direct and derivative complaint alleging breaches of fiduciary duty by the Company’s officers and directors, primarily with respect to (i) the Amended and Restated Employment Agreements entered into by the Company with each of Mr. Rodgers and Mr. Russell in October 2021; (ii) the approval of actions taken at our 2021 annual meeting of stockholders in December 2021; (iii) payments made to Business Law Group, P.A. in exchange for services provided pursuant to the Services Agreement between the Company and Business Law Group; and (iv) strategic advisory agreements entered into by us in connection with our planned cryptocurrency mining business. On May 20, 2022, the Company and the purported stockholder agreed to a settlement of the stockholder’s alleged claims under which the Company is required to seek a new independent director to replace Joel Rodgers within six months of the settlement date, engage a compensation consultant to review certain sections of the Company’s executive employment agreements within ninety days of the settlement date, make changes in response to the consultant’s recommendation within six months of the settlement date and pay the attorney fees and other related legal costs incurred by the counterparty in an amount of $ 275 thousand. The settlement payment is included within "Professional Fees" within our consolidated statements of operations for the year ended December 31, 2022. The Company satisfied the other settlement terms in a timely matter. In October 2021, we entered into a sale and purchase agreement (the “Uptime Purchase Agreement”) with Uptime Armory LLC (“Uptime”) pursuant to which US Digital agreed to purchase, and Uptime agreed to supply to US Digital, an aggregate of 18 modified 40-foot cargo containers (“POD5ive containers”) that will be designed to hold and operate 280 S19 Pro Antminers manufactured by Bitmain. The purchase price of the POD5ive containers totals $ 3.15 million, of which $ 2.4 million or 75 % was paid in 2021 as a non-refundable down payment and the remaining 25 % was paid after Uptime delivered a “notice of completion” of the equipment in 2022. However, no containers have been delivered as of December 31, 2023. On November 8, 2022, LMFA filed an action in Florida circuit court against Uptime Armory, LLC and Bit5ive, LLC in a case styled US Digital Mining and Hosting Co. LLC v. Uptime Amory, LLC and Bit5ive, LLC (Fla. 11thCir. Ct., November 8, 2022). In that action, we alleged breach of contract and violation of the Florida Deceptive and Unfair Trade Practices Act and are seeking, among other things, damages of $ 3.15 million for non-delivery of the 18 POD5ive containers. The Defendants in this action filed a motion to compel confidential arbitration action. The court has now stayed the action in the Florida Circuit Court, and ordered the parties to confidential arbitration governed by the American Arbitration Association and the case is proceeding to arbitration. We recorded an impairment charge of $ 3.15 million on our mining machine deposit in the fourth quarter of 2022 and is reported on our Consolidated Statements of Operations as Impairment loss on prepaid mining machine deposits. The arbitrator has ruled in favor of US Digital’s dispositive motions against Uptime Armory and Bit5ive. Entities Uptime Armory, LLC, Uptime Hosting, LLC, and Bit5ive, LLC have filed for Assignment for the Benefit of Creditors. LMFA US Digital’s Proof of Claim against entities is due April 3, 2024. In October 2021, US Digital also entered into a hosting agreement with Uptime Hosting LLC (the “Hosting Agreement”) to host the Company’s 18 POD5ive containers at a secure location and provide power, maintenance and other services specified in the contract for 6 cents per kilowatt with a term of one year. Under the Hosting Agreement we paid a deposit of $ 0.8 million in 2021 and were required to pay an additional deposit for each container three months prior to delivery at the hosting site of $ 44 thousand and a final deposit for each container one month prior to arrival at the hosting site of $ 44 thousand. The deposits paid for hosting services under the Hosting Agreement are refundable. On June 29, 2022, the Company and Uptime Hosting LLC entered into a Release and Termination Agreement in which the Hosting Agreement was terminated and Uptime Hosting LLC agreed to pay the $ 0.8 million. We recorded an impairment charge of $ 0.8 million on our prepaid hosting deposit in the fourth quarter of 2022 which is reported on our Consolidated Statements of Operations as Impairment loss on prepaid hosting deposits. On September 2, 2022 , LMFA filed in Florida circuit court a legal action against Uptime Hosting LLC in an action styled US Digital Mining and Hosting Co, LLC v. Uptime Hosting, LLC (Fla. 13thCir. Ct. Sept. 2, 2022) for the return of the deposit and other damages, alleging breach of contract and violation of the Florida Deceptive and Unfair Trade Practices Act. LMFA has amended its complaint. This is now an action for (i) breach of contract against Uptime and Bit5ive, (ii) violation of Florida’s Uniform Fraudulent Transfer Act against Uptime; (iii) violation of Florida’s Uniform Fraudulent Transfer Act against Bit5ive; (iv) violation of Florida’s Uniform Fraudulent Transfer Act against Block Consulting and Robert Collazo (v) violation of Florida Fraudulent Asset Conversion against Block Consulting Services, 6301 Southwest Ranches, LLC, Robert D Collazo, Jr. and Elyam Moral-Collazo; (vi) violation of Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”) against all Defendants, (vii) equitable lien against Robert D Collazo, Jr., Elyam Moral-Collazo and 6301 Southwest Ranches, LLC., and (viii) equitable lien against Defendants Robert D Collazo, Jr., Elyam Moral-Collazo and 6301 Southwest Ranches, LLC. Currently the proceedings have been stayed by the court while defendants seek new counsel. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 8. Income Taxes Prior to the Company’s initial public offering in October 2015, the earnings of the Predecessor, which was a limited liability company taxed as a partnership, were taxable to its members. In connection with the contribution of membership interests to the Company (a C-Corporation formed in 2015), the net income or loss of the Company after the initial public offering is taxable to the Company and reflected in the accompanying consolidated financial statements. The Company performs an evaluation of the realizability of its deferred tax assets on a quarterly basis. The Company considers all positive and negative evidence available in determining the potential of realizing deferred tax assets, including the scheduled reversal of temporary differences, recent and projected future taxable income and prudent and feasible tax planning strategies. The estimates and assumptions used by the Company in computing the income taxes reflected in the accompanying consolidated financial statements could differ from the actual results reflected in the income tax returns filed during the subsequent year. Adjustments are recorded based on filed returns when finalized or the related adjustments are identified. Under ASC 740-10-30-5, Income Taxes , deferred tax assets should be reduced by a valuation allowance if, based on the weight of available evidence, it is more-likely-than-not (i.e., a likelihood of more than 50%) that some portion or all of the deferred tax assets will not be realized. The Company considers all positive and negative evidence available in determining the potential realization of deferred tax assets including, primarily, the recent history of taxable earnings or losses. Based on operating losses reported by the Company during 2022, 2020 and 2019, the Company concluded there was not sufficient positive evidence to overcome this recent operating history. As a result, the Company believed that a valuation allowance was necessary based on the more-likely-than-not threshold noted above. The Company has recorded a valuation allowance of approximately $ 14.1 million as of December 31, 2023 and $ 8.5 million as of December 31, 2022. Significant components of the tax expense (benefit) recognized in the accompanying Consolidated Statements of Operations for the years ended December 31, 2023 and December 31, 2022 are as follows: Years Ended December 31, 2023 2022 Current tax benefit Federal $ 60,571 $ 1,196,415 State - 241,651 Total current tax expense 60,571 1,438,066 Deferred tax expense - Federal ( 4,540,213 ) ( 4,181,816 ) Deferred tax expense - State ( 1,091,907 ) ( 1,041,813 ) Valuation allowance 5,632,121 5,223,629 Income tax expense $ 60,571 $ 1,438,066 The reconciliation of the income tax computed at the combined federal and state statutory rate of ( 0.3 )% for the year ended December 31, 2023 and ( 5.4 )% for the year ended December 31, 2022 to the income tax benefit is as follows: Years Ended December 31, Years Ended December 31, 2023 2022 Income tax provision at the US federal statutory rate $ ( 3,951,107 ) 21.0 % $ ( 5,553,496 ) 21.0 % Nondeductible expenses 20,847 - 0.1 % - 0.0 % Stock based compensation - 0.0 % 3,222,271 - 12.2 % State income taxes, net of federal benefit ( 852,967 ) 4.5 % ( 470,684 ) 1.8 % True-up ( 681,760 ) 3.6 % ( 786,165 ) 3.0 % Change in valuation allowance 5,632,122 - 29.9 % 5,223,627 - 19.8 % Change in Rate ( 106,564 ) 0.6 % ( 197,487 ) 0.7 % Tax expense/effective rate $ 60,571 - 0.3 % $ 1,438,066 - 5.4 % The significant components of the Company’s deferred tax liabilities and assets as of December 31, 2023 and December 31, 2022 are as follows: As of December 31, As of December 31, 2023 2022 Deferred tax liabilities: Depreciation $ 877,838 $ 538,866 Right to use assets 48,306 67,052 Other 316,331 - Total deferred tax liabilities 1,242,475 605,918 Deferred tax assets: Loss carryforwards - Federal 7,045,561 5,922,644 Loss carryforwards - State 1,529,067 1,195,806 Stock option expense 1,916,270 490,892 Amortization 362,918 395,272 Allowance for credit losses 13,541 14,555 Right to use liability 50,133 68,203 Unrealized loss on securities 4,424,536 986,639 Charitable contributions 2,664 2,000 Total deferred tax asset 15,344,690 9,076,011 Valuation allowance ( 14,102,215 ) ( 8,470,093 ) Net deferred tax asset $ - $ - As a result of various equity transactions prior to the incorporation, the former members of the Predecessor recognized taxable gains associated with redemption consideration and/or deficit capital accounts totaling approximately $ 5.25 million. In accordance with ASC 740-20-45-11, the Company accounted for the tax effect of the step up in income tax basis related to these transactions with or among shareholders and recognized a deferred tax asset and corresponding increase in equity of approximately $ 1.91 million. Federal net operating loss carryforwards of approximately $ 512 thousand related to 2015, $ 3.96 million related to 2016, $ 2.98 million related to 2017, $ 1.41 million related to 2018, $ 1.95 million related to 2019, and $ 5.1 million related to 2020 will expire in 2035 , 2036 , 2037 , 2038 , respectively and net operating loss generated after January 1, 2018 will not expire. The Company's federal and state tax returns for the 2018 through 2022 tax years generally remain subject to examination by U.S. and various state authorities. Pursuant to IRC § 382 of the Internal Revenue Code , the utilization of net operating loss carryforwards and tax credits may be limited as a result of a cumulative change in stock ownership of more than 50 % over a three year period. The Company underwent such a change and consequently, the utilization of a portion of the net operating loss carryforwards is subject to certain limitations. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 9. Related Party Transactions Legal services for the Company associated with the collection of delinquent assessments from property owners was performed by a law firm (Business Law Group “BLG”) which was owned solely by Bruce M. Rodgers, the chairman and CEO of the Company, until and through the date of its initial public offering in 2015. Following the initial public offering, Mr. Rodgers transferred his interest in BLG to other attorneys at the firm through a redemption of his interest in the firm, and BLG is now under control of those lawyers. The law firm has historically performed collection work primarily on a deferred billing basis wherein the law firm receives payment for services rendered upon collection from the property owners or at amounts ultimately subject to negotiations with the Company. Under the agreement, the Company paid BLG a fixed monthly fee of $ 82 thousand per month for services rendered. The Company paid BLG a minimum per unit fee of $ 700 in any case where there is a collection event and BLG received no payment from the property owner. This provision was expanded to also include any unit where the Company has taken title to the unit or where the Association has terminated its contract with either BLG or the Company. On February 1, 2022, the Company consented to the assignment by BLG to the law firm BLG Association Law, PLLC (“BLGAL”) of the Services Agreement, dated April 15, 2015, previously entered into by the Company and Business Law Group, P.A. (the “Services Agreement”). The Services Agreement had set forth the terms under which Business Law Group, P.A. would act as the primary law firm used by the Company and its association clients for the servicing and collection of association accounts. The assignment of the Services Agreement was necessitated by the death of the principal attorney and owner of Business Law Group, P.A. In connection with the assignment, BLGAL agreed to amend the Services Agreement on February 1, 2022, to reduce the monthly compensation payable to the law firm from $ 82 thousand to $ 53 thousand (the “Amendment”). Bruce M. Rodgers is a 50 % owner of BLGAL, and the assignment and Amendment was approved by the independent directors of the Company. A $ 150 thousand termination fee was also paid to BLG in association with the assignment. On March 28, 2024, BLGAL and the Company reduced the monthly compensation payable to the law firm from $ 53 thousand to $ 43 thousand. The Company had originally engaged BLG on behalf of many of its Association clients to service and collect the Accounts and to distribute the proceeds as required by Florida law and the provisions of the purchase agreements between LMF and the Associations. This engagement was subsequently assigned to BLGAL as described above. Ms. Gould, who is a Director of the Company, worked as the General Manager of BLG and works as the General Manager of BLGAL. Amounts paid to BLG or BLGAL for the years ended December 31, 2023 and 2022 were approximately $ 637 thousand and $ 665 thousand, respectively. Under the Services Agreement in effect during the years ended December 31, 2023 and 2022, the Company pays all costs (lien filing fees, process and serve costs) incurred in connection with the collection of amounts due from property owners. Any recovery of these collection costs are accounted for as a reduction in expense incurred. The Company incurred expenses related to these types of costs of $ 37 thousand and $ 63 thousand, during 2023 and 2022, respectively. Recoveries during the years ended December 31, 2023 and 2022 related to those costs were approximately $ 66 thousand and $ 75 thousand, respectively. The Company also shares office space, personnel and related common expenses with BLGAL (previously BLG). All shared expenses, including rent, are charged to BLGAL based on an estimate of actual usage. Any expenses of BLGAL or BLG paid by the Company that have not been reimbursed or settled against other amounts are reflected as due from related parties in the accompanying consolidated balance sheet. BLGAL and BLG, as applicable were charged a total of approximately $ 58 thousand and $ 60 thousand for the office sub-lease during the years ended December 31, 2023 and 2022, respectively. The charges for certain shared personnel totaled approximately $ 54 thousand and $ 172 thousand for the years ended December 31, 2023 and 2022, respectively. Amounts payable to BLGAL and BLG in aggregate as of December 31, 2023 and 2022 were approximately $ 24 thousand and $ 63 thousand, respectively. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Note 10. Stockholders’ Equity Reverse Stock Split On November 9, 2023, our shareholders voted in favor of the approval of an amendment to our Certificate of Incorporation, in the event it is deemed advisable by our Board of Directors, to effect a reverse stock split of the Company’s issued and outstanding common stock at a ratio within the range of one-for-two ( 1:2 ) and one-for-ten ( 1:10 ), as determined by the Board of Directors. On February 23, 2024, the Board approved a one-for-six ( 1:6 ) reverse split of the Company’s issued and outstanding common stock, par value $ 0.001 per share, pursuant to which every six outstanding shares of common stock was converted into one share of common stock (the “Reverse Stock Split”). The Reverse Stock Split was effected by the filing of an amendment to our Certificate of Incorporation on March 7, 2024 which provided that the Reverse Stock Split become effective at 12:01 a.m. eastern time on March 12, 2024. The amendment provides that no fractional shares shall be issued and, in lieu thereof, any person who would otherwise be entitled to a fractional share of common stock as a result of the Reverse Stock Split will be entitled to receive one share of common stock. The Company’s common stock began trading on The Nasdaq Capital Market on a split-adjusted basis on March 12, 2024. The Company has retroactively adjusted all share amounts and per share data herein to give effect to the Reverse Stock Split. Stock Issuance In the year ended December 31, 2021, the Company issued 12,323 shares to management as part of their employment contracts of which $ 229,500 was expensed. The shares were physically issued in February 2022. On April 20, 2023 (the “Grant Date”), the board of directors of the Company approved the grant of 260,000 shares of restricted stock (“Restricted Shares”) to management and employees. The Restricted Shares vest in twelve substantially equal installments on each monthly anniversary of the Grant Date for twelve months following the Grant Date (subject to accelerated vesting upon a change of control of the Company), provided that the employee is in continuous employment or service to the Company through the applicable vesting date. The total fair value of the stock at the time of issuance was approximately $ 1.2 million which was based on the closing market price on the Grant Date of $ 4.51 . The Company expensed approximately $ 1,096 thousand for the year December 31, 2023. There was approximately $ 76 thousand of unrecognized compensation cost associated with unvested restricted stock as of December 31, 2023. The following is a summary of the restricted share activity during the year ended December 21, 2023 and 2022: 2023 2022 Number of Weighted Average Number of Weighted Average Restricted Shares Award Price Restricted Shares Award Price Restricted Shares outstanding at beginning of the year - $ - - $ - Granted 260,000 4.51 - - Vested ( 173,333 ) 4.51 - - Restricted Shares outstanding at December 31, 86,667 $ 4.51 - $ - Stock Warrants The following is a summary of the stock warrant plan activity during the years ended December 31, 2023 and 2022: 2023 2022 Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Warrants outstanding at beginning of the year 1,279,573 $ 30.00 1,283,740 $ 30.00 Granted - - - - Exercised - - - - Forfeited ( 4,766 ) 20.16 ( 4,167 ) 27.00 Warrants outstanding and exercisable at December 31, 1,274,807 $ 30.04 1,279,573 $ 30.00 The aggregate intrinsic value of the outstanding common stock warrants as of December 31, 2023 and 2022 was approximately $ 0 and $ 0 , respectively. On October 18, 2021, the Company issued warrants as part of its secondary offering that allowed for the right to purchase 1,052,630 shares of common stock at an exercise price of $ 30.00 per share. These warrants have an average remaining life of 2.8 years as of December 31, 2023 and expire in the year 2026 . No warrants were exercised during the year ended December 31, 2023 and 2022. On October 19, 2021, the Company issued warrants as part of its secondary offering that allowed for the right to purchase 157,895 shares of common stock at an exercise price of $ 30.00 per share. These warrants have an average remaining life of 2.8 years as of December 31, 2023 and expire in the year 2026 . No warrants were exercised during the year ended December 31, 2023 and 2022. On October 20, 2021, the Company issued warrants as part of its secondary offering that allowed for the right to purchase 36,316 shares of common stock at an exercise price of $ 35.64 per share. These warrants have an average remaining life of 1.3 years as of December 31, 2023 and expire in the year 2025 . No warrants were exercised during the year ended December 31, 2023 and 2022. On August 18, 2020, the Company issued warrants as part of its secondary offering that allowed for the right to purchase 373,333 shares of common stock at an exercise price of $ 27.00 per share. After exercises in the year 2021, there are 51,383 remaining shares available to be exercised under these warrants. These warrants have an average remaining life of 1.63 years as of December 31, 2023 and expire in the year 2025 . No warrants were exercised during the year ended December 31, 2023 and 2022. On October 31, 2018, the Company issued warrants as part of its secondary offering that allowed for the right to purchase 83,333 shares of common stock at an exercise price of $ 12.00 per share which were subsequently adjusted due to an issuance of shares in August 2020 to $ 3.35 per share. During the year ended December 31, 2021 warrants for 299,000 shares were exercised for approximately $ 1,004,000 . No warrants were exercised during the year ended December 31, 2023 or 2022. These warrants expired on October 31, 2023 . As part of its underwriting agreement dated, October 31, 2018, the Company issued additional warrants, effective May 1, 2019, to its underwriter as part of its secondary offering that allowed for the right to purchase 4,167 shares of common stock at an exercise price of $ 27.00 per share on or after May 1, 2019. These warrants expired on May 2, 2022 . No warrants were exercised during the year ended December 31, 2022 Stock Options The following is a summary of the stock option plan activity during the years ended December 31, 2023 and 2022: 2023 2022 Number of Weighted Average Number of Weighted Average Options Exercise Price Options Exercise Price Options outstanding at beginning of the year 186,877 $ 19.56 659,471 $ 37.20 Granted 414,417 4.51 127,406 3.54 Cancelled - - ( 600,000 ) 35.70 Forfeited ( 1,697 ) 72.18 - - Options outstanding at December 31, 599,597 $ 9.00 186,877 $ 19.56 Options exercisable at December 31, 379,194 $ 10.55 30,443 $ 71.28 The 2015 Omnibus Incentive Plan provided for the issuance of stock options, stock appreciation rights, performance shares, performance units, restricted stock, restricted stock units, shares of our common stock, dividend equivalent units, incentive cash awards or other awards based on our common stock. This plan was reconstituted into a new 2021 Omnibus Plan. The 2021 Omnibus Plan is intended to allow us to continue to use equity awards as part of our ongoing compensation strategy for our key employees. Awards under the Plan will support the creation of long-term value and returns for our stockholders. Awards may be granted alone or in addition to, in tandem with, or (subject to the 2021 Omnibus Incentive Plan’s prohibitions on repricing) in substitution for any other award (or any other award granted under another plan of ours or of any of our affiliates). The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions. The model requires the use of subjective assumptions. Expected volatility for each award was based on the historical and expected volatility of the Company. The expected life (in years) is determined using historical data to estimate options exercise patterns. The Company does not expect to pay any dividends for the foreseeable future thus a value of zero was used in the calculations. The risk-free interest rate was based on the rate for US Treasury bonds commensurate with the expected term of the granted options. The Company recognizes the determined value as an expense over the period in which the stock options vest. The maximum term of an option is 10 years from the date of grant. Option Awards – Fiscal Year 2023 On April 20, 2023 (the “Grant Date”), the board of directors of the Company approved the grant of options to purchase 414,417 shares of common stock of the Company (“Options”) to management and employees. The Options grant each recipient the right to purchase shares of Company common stock at a price of $ 4.50 per share, the fair market value of the Company’s common stock on the Grant Date. The Options vest as to 50 % of the total amount of the award on the one-year anniversary of the Grant Date and 50 % of the total amount of the award on the two-year anniversary of the Grant Date (subject to accelerated vesting upon a change of control of the Company), provided that the executive is in continuous employment or service to the Company through the applicable vesting date. The Options are subject to accelerated vesting as follows: (a) the portion of the Options that are scheduled to vest during the first year after the Grant Date vest instead as of June 30, 2023, if the Company’s Bitcoin mining operations achieve 500 petahash of computing power as of June 30, 2023, and (b) the portion of the Options that are scheduled to vest during the second year after the Grant Date will vest as of June 30, 2024, if the Company’s Bitcoin mining operations achieve 1,000 petahash of computing power as of June 30, 2024. As of June 30, 2023, the Company's Bitcoin mining operations achieved 500 petahash of computing power therefore the 207,208 options scheduled to vest during the first year vested as of June 30, 2023. The stock based compensation expense attributable to the portion of options that were scheduled to vest during the first year was recognized during the year ended December 31, 2023 as a result of the accelerated vesting of such options. The options awarded to the employees were valued using the Black-Scholes option pricing model. Total expense to be recognized after adjusting for forfeitures for the employee options for these 2023 awards is approximately $ 1.8 million. Significant assumptions used in the option-pricing model to fair value options granted were as follows: 2023 Risk-free rate 3.54 % Expected volatility 118 % Expected life 10 years Expected dividend — Option Awards – Fiscal Year 2022 In December 2022 the Company granted to a director a total of 6,219 stock options at an exercise price of $ 4.02 per share that expire after 10 years. In December 2022 the Company also granted to its directors a total of 121,187 stock options at an exercise price of $ 3.54 per share that expire after 10 years. Both of these awards will vest over a twelve month period with 50% after 6 months and the remaining 50% at end of twelve months. The grant date fair value of the options was $ 3.48 and $ 3.00 , respectively. The options awarded to the directors were valued using the Black-Scholes option pricing model. Total expense to be recognized after adjusting for forfeitures for the director options for these 2022 awards is approximately $ 409 thousand. Significant assumptions used in the option-pricing model to fair value options granted were as follows: 2022 Risk-free rate 3.53 % - 3.83 % Expected volatility 119 % Expected life 10 years Expected dividend — Compensation expense recognized for stock options for the years ended December 31, 2023 and 2022 was approximately $ 1.8 million and $ 16.6 million, respectively. The remaining unrecognized compensation cost associated with unvested stock options as of December 31, 2023 and 2022 is approximately $ 0.6 million and $ 0.6 million, respectively. At December 31, 2023 and 2022, the stock options had a remaining life of approximately 9.1 years and 9.6 years, respectively. The aggregate intrinsic value of the outstanding common stock options as of December 31, 2023 and 2022 was $ 0 and $ 0 respectively. At the Market Program On June 26, 2023, the Company entered into an Equity Distribution Agreement (the “Distribution Agreement”) with Maxim Group LLC (the “Agent”), pursuant to which the Company may, from time to time, at the Company's discretion, offer and sell shares of the Company’s common stock, having an aggregate offering price of up to $ 4,700,000 (the “Shares”), through the Agent, acting as sales agent. The Shares to be sold under the Distribution Agreement, if any, will be issued and sold pursuant to the Company’s shelf registration statement which was filed with the Securities and Exchange Commission (“SEC”) on July 30, 2021 (the “Registration Statement”) and was declared effective on August 16, 2021. A prospectus supplement related to the Company’s at the market offering ("ATM") program with the Agent under the Distribution Agreement was filed with the SEC on June 26, 2023. The ATM program is expected to remain in effect until June 26, 2024. As of December 31, 2023, an aggregate gross sales limit of $ 4,700,000 remains available for issuance under the ATM program. Approximately $ 119 thousand of legal and professional fees incurred related to the establishment of the ATM program as of December 31, 2023 were deferred and recorded within "Prepaid expenses and other assets" on the Consolidated Balance Sheets and will be amortized ratably as stock is issued under the program. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Note 11. Segment Information The Company applies ASC 280, Segment Reporting, in determining its reportable segments. The Company has two reportable segments: Specialty Finance and Mining Operations. The guidance requires that segment disclosures present the measure(s) used by the CODM to decide how to allocate resources and for purposes of assessing such segments’ performance. The Company’s CODM uses revenue, income from operations and income before taxes of our reporting segments to assess the performance of the business of our reportable operating segments. No operating segments have been aggregated to form the reportable segments. The corporate oversight function, and other components that may earn revenues that are only incidental to the activities of the Company are aggregated and included in the “All Other” category. The Specialty Finance segment generates revenue from providing funding to nonprofit community associations. The Mining Operations segment generates revenue from the Bitcoin the Company earns through its mining activities. Year Ended December 31, 2023 Specialty Finance Mining Operations All Other Total Revenue, net $ 694,959 $ 12,289,131 $ - $ 12,984,090 Depreciation and amortization 5,364 4,918,332 59,784 4,983,480 Operating loss ( 934,807 ) ( 2,020,112 ) ( 7,107,000 ) ( 10,061,919 ) Realized gain on securities - - 4,420 4,420 Unrealized gain on marketable securities - - 13,570 13,570 Impairment loss on prepaid machine deposits - ( 36,691 ) - ( 36,691 ) Impairment loss on prepaid hosting deposits - ( 184,236 ) - ( 184,236 ) Impairment loss on Symbiont assets - - ( 750,678 ) ( 750,678 ) Unrealized loss on investment and equity securities - - ( 9,771,050 ) ( 9,771,050 ) Realized gain on sale of purchased digital assets - - 1,917 1,917 Loss on disposal of assets ( 9,389 ) - ( 9,389 ) Other income - coupon sales - 639,472 - 639,472 Gain on adjustment of note receivable allowance 1,052,542 1,052,542 Other income - finance revenue - - 37,660 37,660 Interest income, net - - 249,586 249,586 Loss before income taxes ( 934,807 ) ( 1,610,956 ) ( 16,269,033 ) ( 18,814,796 ) Fixed Asset Additions 2,938 2,162,741 10,812 2,176,491 Year Ended December 31, 2022 Specialty Finance Mining Operations All Other Total Revenue, net $ 788,391 945,560 $ - $ 1,733,951 Depreciation and amortization 3,348 471,049 3,623 478,020 Operating loss ( 1,122,872 ) ( 1,014,327 ) ( 22,538,786 ) ( 24,675,985 ) Realized loss on securities - - ( 349,920 ) ( 349,920 ) Realized gain on convertible debt securities - - 287,778 287,778 Unrealized loss on marketable securities - - ( 56,830 ) ( 56,830 ) Impairment loss on prepaid machine deposits ( 3,150,000 ) - ( 3,150,000 ) Impairment loss on prepaid hosting deposits ( 1,790,712 ) - ( 1,790,712 ) Impairment loss on Symbiont assets - ( 1,052,542 ) ( 1,052,542 ) Unrealized gain on investment and equity securities - - 4,423,985 4,423,985 Impairment loss on digital assets - - ( 467,406 ) ( 467,406 ) Realized gain on sale of purchased digital assets - 20,254 20,254 Loss on disposal of fixed asset - - ( 38,054 ) ( 38,054 ) Digital assets other income - - 5,658 5,658 Dividend income - - 3,875 3,875 Interest income, net - - 399,094 399,094 Income (loss) before income taxes ( 1,122,872 ) ( 5,993,094 ) ( 19,329,255 ) ( 26,445,221 ) Fixed Asset Additions 1,612 27,683,559 5,304 27,690,475 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 12. Subsequent Events On January 31, 2024, SeaStar Medical repaid $ 1.4 million of its outstanding note receivable. On February 23, 2024, the Board approved a one-for-six ( 1:6 ) reverse split of the Company’s issued and outstanding common stock, par value $ 0.001 per share, pursuant to which every six outstanding shares of common stock was converted into one share of common stock (the “Reverse Stock Split”). The Reverse Stock Split was effected by the filing of an amendment to our Certificate of Incorporation on March 7, 2024 which provided that the Reverse Stock Split become effective at 12:01 a.m. eastern time on March 12, 2024. The amendment provides that no fractional shares shall be issued and, in lieu thereof, any person who would otherwise be entitled to a fractional share of common stock as a result of the Reverse Stock Split will be entitled to receive one share of common stock. The Company’s common stock began trading on The Nasdaq Capital Market on a split-adjusted basis on March 12, 2024. The Company has retroactively adjusted all share amounts and per share data herein to give effect to the Reverse Stock Split. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Nature of Operations | Nature of Operations LM Funding America, Inc. (“we”, “our”, “LMFA” or the “Company”) was formed as a Delaware corporation on April 20, 2015. LMFA is the sole member of several entities including LM Funding, LLC, which was organized in January 2008, US Digital Mining and Hosting Co. ("US Digital"), which was created on September 10, 2021; LMFA Financing LLC, created on November 21, 2020, and LMFAO Sponsor LLC, created on October 29, 2020. US Digital has created various 100 % owned subsidiaries to engage in business in various states. LMFAO Sponsor LLC created a majority owned subsidiary LMF Acquisition Opportunities Inc. on October 29, 2020. LMF Acquisition Opportunities Inc was merged with Seastar Medical Holding Corporation on October 28, 2022. The Company also from time to time organizes other subsidiaries to serve a specific purpose or hold a specific asset. Lines of Business On September 15, 2021, the Company announced its plan to operate in the Bitcoin mining ecosystem, and we commenced Bitcoin mining operations in late September 2022. This business operation deploys our computing power to mine Bitcoin on the Bitcoin network. We conduct this business through our wholly owned subsidiary, US Digital, a Florida limited liability company, which we formed in 2021 to develop and operate our cryptocurrency mining business. With respect to our specialty finance business, the Company has historically engaged in the business of providing funding to nonprofit community associations primarily located in the state of Florida. We offer incorporated nonprofit community associations, which we refer to as “Associations,” a variety of financial products customized to each Association’s financial needs. Our original product offering consists of providing funding to Associations by purchasing their rights under delinquent accounts that are selected by the Associations arising from unpaid Association assessments. Historically, we provided funding against such delinquent accounts, which we refer to as “Accounts,” in exchange for a portion of the proceeds collected by the Associations from the account debtors on the Accounts. In addition to our original product offering, we also purchase Accounts on varying terms tailored to suit each Association’s financial needs, including under our New Neighbor Guaranty program. Cryptocurrency Mining Business Bitcoin was introduced in 2008 with the goal of serving as a digital means of exchanging and storing value. Bitcoin is a form of digital currency that depends upon a consensus-based network and a public ledger called a “blockchain”, which contains a record of every Bitcoin transaction ever processed. The Bitcoin network is the first decentralized peer-to-peer payment network, powered by users participating in the consensus protocol, with no central authority or middlemen, that has wide network participation. The authenticity of each Bitcoin transaction is protected through digital signatures that correspond with addresses of users that send and receive Bitcoin. Users have full control over remitting Bitcoin from their own sending addresses. All transactions on the Bitcoin blockchain are transparent, allowing those running the appropriate software to confirm the validity of each transaction. To be recorded on the blockchain, each Bitcoin transaction is validated through a proof-of-work consensus method, which entails solving complex mathematical problems to validate transactions and post them on the blockchain. This process is called mining. Miners are rewarded with Bitcoins, both in the form of newly-created Bitcoins and transaction fees in Bitcoin, for successfully solving the mathematical problems and providing computing power to the network. Factors such as access to computer processing capacity, interconnectivity, electricity cost, environmental factors (such as cooling capacity) and location play important roles in mining. In Bitcoin mining, “hashrate” is a measure of the computing and processing power and speed by which a mining computer mines and processes transactions on the Bitcoin network. We expect to continue increasing our computing power through 2024 and beyond as we expand the number of active mining machines. A company’s computing power measured in hashrate is generally considered to be one of the most important metrics for evaluating Bitcoin mining companies. We obtain Bitcoin as a result of our mining operations, and we sell Bitcoin from time to time, to support our operations and strategic growth. We plan to convert our Bitcoin to U.S. dollars. We may engage in regular trading of Bitcoin or engage in hedging activities related to our holding of Bitcoin. However, our decisions to hold or sell Bitcoin at any given time may be impacted by the Bitcoin market, which has been historically characterized by significant volatility. Currently, we do not use a formula or specific methodology to determine whether or when we will sell Bitcoin that we hold, or the number of Bitcoins we will sell. Rather, decisions to hold or sell Bitcoins are currently determined by management by monitoring the market in real time. Specialty Finance Company In our specialty finance business, we purchase an Association’s right to receive a portion of the Association’s collected proceeds from owners that are not paying their assessments. After taking assignment of an Association’s right to receive a portion of the Association’s proceeds from the collection of delinquent assessments, we engage law firms to perform collection work on a deferred billing basis wherein the law firms receive payment upon collection from the account debtors or a predetermined contracted amount if payment from account debtors is less than legal fees and costs owed. Under this business model, we typically fund an amount equal to or less than the statutory minimum an Association could recover on a delinquent account for each Account, which we refer to as the “Super Lien Amount”. Upon collection of an Account, the law firm working on the Account, on behalf of the Association, generally distributes to us the funded amount, interest, and administrative late fees, with the law firm retaining legal fees and costs collected, and the Association retaining the balance of the collection. In connection with this line of business, we have developed proprietary software for servicing Accounts, which we believe enables law firms to service Accounts efficiently and profitably. Under our New Neighbor Guaranty program, an Association will generally assign substantially all of its outstanding indebtedness and accruals on its delinquent units to us in exchange for payment by us of monthly dues on each delinquent unit. This simultaneously eliminates a substantial portion of the Association’s balance sheet bad debts and assists the Association to meet its budget by receiving guaranteed monthly payments on its delinquent units and relieving the Association from paying legal fees and costs to collect its bad debts. We believe that the combined features of the program enhance the value of the underlying real estate in an Association and the value of an Association’s delinquent receivables. Because we acquire and collect on the delinquent receivables of Associations, the Account debtors are third parties about whom we have little or no information. Therefore, we cannot predict when any given Account will be paid off or how much it will yield. In assessing the risk of purchasing Accounts, we review the property values of the underlying units, the governing documents of the relevant Association, and the total number of delinquent receivables held by the Association. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the accounts of LMFA and its wholly-owned subsidiaries: LM Funding, LLC; LMF October 2010 Fund, LLC; REO Management Holdings, LLC (including all 100 % owned subsidiary limited liability companies); LM Funding of Colorado, LLC; LM Funding of Washington, LLC; LM Funding of Illinois, LLC; US Digital Mining and Hosting Co., LLC (includes all 100 % owned subsidiary limited liability companies) and LMF SPE #2, LLC and various single purpose limited liability corporations owned by REO Management Holdings, LLC which own various properties. It also includes LMFA Sponsor LLC (a 69.5 % owned subsidiary). All significant intercompany balances have been eliminated in consolidation. |
Basis of Presentation | Basis of Presentation The consolidated financial statements have been prepared pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). The Company prepares its consolidated financial statements in conformity with generally accepted accounting principles in the United States (“GAAP”). |
Reclassification | Reclassification Certain prior period immaterial amounts have been reclassified to conform to the current period presentation. These reclassifications had no effect on the reported results of operations. |
Liquidity | Liquidity The accompanying consolidated financial statements of the Company have been prepared assuming the Company will continue as a going concern. The going concern basis of presentation assumes that the Company will continue in operation one year after the date these financial statements are issued and will be able to realize its assets and discharge its liabilities and commitments in the normal course of business. The evaluation of going concern under the accounting guidance requires significant judgment which involves the Company to consider that it has historically incurred losses in recent years as it has prepared to grow its business through expansion and acquisition opportunities. The Company must also consider its current liquidity as well as future market and economic conditions that may be deemed outside the control of the Company as it relates to obtaining financing and generating future profits. As of December 31, 2023, the Company had $ 2.4 million available cash on-hand and bitcoin with a fair market value of $ 3.4 million. After considering its current liquidity and future market and economic conditions, the Company has concluded there is no substantial doubt about the Company’s ability to continue as a going concern. |
Use of Estimates | Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Estimates include the evaluation of probable losses on balances due from a related party, the realization of deferred tax assets, the evaluation of contingent losses related to litigation and reserves on notes receivables. We consider our critical accounting estimates to be those related to long-lived asset impairment assessments. Our estimates may change, however, as new events occur and additional information is obtained, and any such changes will be recognized in the consolidated financial statements. |
Segment and Reporting Unit Information | Segment and Reporting Unit Information Operating segments are defined as components of an entity for which discrete financial information is available that is regularly reviewed by the Chief Operating Decision Maker (“CODM”) in deciding how to allocate resources to an individual segment and in assessing performance. The Chief Executive Officer and Chief Financial Officer of the Company are determined to comprise the CODM, as a group. The Company has two operating segments as of December 31, 2023, which we refer to as Specialty Finance and Mining Operations. Our corporate oversight function and other components that may earn revenues that are only incidental to the activities of the Company are aggregated and included in the “All Other” category. See Note 11, “Segment Information”. |
Cash | Cash The Company maintains cash balances at several financial institutions that are insured under the Federal Deposit Insurance Corporation’s (“FDIC”) Transition Account Guarantee Program. Balances with the financial institutions may exceed federally insured limits. We have approximately $ 2.2 million of cash in various institutions that exceed the FDIC or SIPC insurance coverage limit of $ 250,000 . |
Digital Assets | Digital Assets Bitcoin are included in current assets in the consolidated balance sheets due to the Company’s ability to sell them in a highly liquid marketplace and its intent to liquidate its bitcoin to support operations when needed. Bitcoin are accounted for under the Company’s revenue recognition policy detailed in Note 1 – Summary of Significant Accounting Policies. Bitcoin are classified as indefinite-lived intangible assets in accordance with ASC 350, Intangibles – Goodwill and Other, and are recorded at cost less impairment. We have ownership of and control over our digital assets and use cold storage wallets and third-party custodial services to secure them. Digital assets that are purchased are initially recorded at cost and bitcoin that is earned is measured at fair value on the date earned at the daily closing price, which is not materially different from the fair value at contract inception, which is the daily opening price (refer to Revenue Recognition policy). Digital assets are measured on the consolidated balance sheet at cost, net of any impairment losses incurred since acquisition. When applicable, we account for stablecoin as financial assets in accordance with ASC 310, Receivables. The stablecoin are recorded at cost less impairment, which approximates their fair value. We determine the fair value of our digital assets that are accounted for as intangible assets in accordance with ASC 820, Fair Value Measurement , based on quoted prices from our principal market for such assets (Level 1 inputs). We perform an analysis each month to identify whether events or changes in circumstances indicate that it is more likely than not that our digital assets are impaired. If the current carrying value of a digital asset exceeds the fair value so determined, an impairment loss has occurred with respect to those digital assets in the amount equal to the difference between their carrying values and the fair value. The fair value of digital assets is determined on a nonrecurring basis based on the lowest intraday quoted price as reported in the digital assets’ principal market. The impaired digital assets are written down to their fair value at the time of impairment and this new cost basis will not be adjusted upward for any subsequent increase in fair value. When applicable, any impairment loss on digital assets held for investment would be recognized during the period incurred within "Impairment loss on digital assets" in other income/expense in the consolidated statements of operations. Impairment loss on mined digital assets would be recognized during the period incurred within "Impairment loss on mined digital assets" in operating costs and expenses in the consolidated statements of operations. Gains are not recorded until realized upon sale, at which point they are presented separately from any impairment losses. Any realized gain or loss from the sale of digital assets that were purchased as an investment is recorded in other income (loss), while any realized gain or loss from the sale of digital assets that were earned through mining operations would be recognized within operating costs and expenses. The Company accounts for its gains or losses in accordance with the first in first out (“FIFO”) method of accounting. Digital assets earned by the Company through its mining activities, proceeds from the sale of mined digital assets, realized gain (loss) from the sale of digital assets and the loss on impairment of digital assets are included within operating activities on the consolidated statements of cash flows, where applicable. Purchases of digital assets and proceeds from the sale of purchased digital assets and included within investing activities in the consolidated statements of cash flows. On December 13, 2023, the FASB issued ASU 2023-08, which addresses the accounting and disclosure requirements for certain crypto assets. The standard will be adopted by the Company effective January 1, 2024. Refer to Recently issued accounting pronouncements in this Annual Report on Form 10-K for a description of the expected effect on the Company’s consolidated financial position and results from operations upon adoption of the standard. |
Investment in Securities | Investment in Securities Investment in Securities includes investments in common stocks and convertible notes receivables. Investments in securities are reported at fair value with changes in unrecognized gains or losses included in other income on the income statement. The Symbiont convertible note receivable is reported at amortized costs less impairment. |
Investments in Unconsolidated Entities | Investments in Unconsolidated Entities We account for investments in less than 50 % owned and more than 20 % owned entities using the equity method of accounting. Because we have elected the fair value option for these securities, unrealized holding gains and losses during the period are included in other income within the Consolidated Statements of Operation. |
Financing Receivables | Finance Receivables Finance receivables are recorded at the amount funded or cost (by unit). The Company evaluates its finance receivables at each period end for losses that are considered probable and can be reasonably estimated in accordance with ASC 450-20. As discussed above, recoverability of funded amounts under the Company’s original product is generally assured because of the protection of the Super Lien Amount. However, the Company did have an accrual at December 31, 2023 and 2022, respectively for an allowance for credit losses for this program of approximately $ 44 thousand and $ 48 thousand. Under the New Neighbor Guaranty program (special product), the Company funds amounts in excess of the Super Lien Amount. When evaluating the carrying value of its finance receivables, the Company looks at the likelihood of future cash flows based on historical payoffs, the fair value of the underlying real estate, the general condition of the Association in which the unit exists, and the general economic real estate environment in the local area. The Company estimated an allowance for credit losses for this program of approximately $ 8 thousand and $ 9 thousand as of December 31, 2023 and December 31, 2022, respectively under ASC 450-20 related to its New Neighbor Guaranty program. The Company will charge any receivable against the allowance for credit losses when management believes the uncollectability of the receivable is confirmed. The Company considers writing off a receivable when (i) a first mortgage holder who names the association in a foreclosure suit takes title and satisfies an estoppel letter for amounts owed which are less than amounts the Company funded to the association; (ii) a tax deed is issued with insufficient excess proceeds to pay amounts the Company funded to the Association; (iii) an association settles an account for less than amounts the Company funded to the Association or (iv) the Association terminates its relationship with the Company’s designated legal counsel. Upon the occurrence of any of these events, the Company evaluates the potential recovery via a deficiency judgment against the prior owner and the ability to collect upon the deficiency judgment within the statute of limitations period or whether the deficiency judgment can be sold. If the Company determines that collection through a deficiency judgment or sale of a deficiency judgment is not feasible, the Company writes off the unrecoverable receivable amount. Any losses greater than the recorded allowance will be recognized as expenses. Under the Company’s revenue recognition policies, all finance receivables (original product and special product) are classified as nonaccrual. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments FASB ASC 825-10, Financial Instruments, requires disclosure of fair value information about financial instruments, whether or not recognized in the balance sheet. |
Fixed Assets | Fixed Assets The Company capitalizes all acquisitions of fixed assets in excess of $ 500 . Fixed assets are stated at cost, net of accumulated depreciation. State and local use tax for equipment shipped from overseas is generally accrued on a quarterly basis at the time equipment is placed in service and is paid to the state in which the equipment is being utilized. Depreciation is computed using the straight-line method over the estimated useful lives of the assets and commences once the assets are ready for their intended use. Fixed assets are comprised of furniture, computer, office equipment, buildings and mining machines with assigned useful lives of 3 to 30 years. The Company classifies mining machine deposit payments within "Deposits on mining equipment" in the consolidated balance sheets. As mining machines are received, the respective cost of the mining machines plus the related shipping and customs fees are reclassified from "Deposits on mining equipment" to "Fixed assets, net" in the consolidated balance sheet. Refer to Note 4. In addition, as part of its periodic review of its fixed asset groups during the fourth quarter of 2023, the Company changed the estimated useful life for its mining machines from 5 years to 4 years . The change is accounted for on a prospective basis. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of mining machines. To the extent that any of the assumptions underlying management’s estimate of useful life of its mining machines are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets. |
Equipment Purchases | Equipment Purchases During 2021, we purchased an aggregate of 5,046 Bitcoin S19J Pro Antminer cryptocurrency mining machines for an aggregate purchase price of $ 24.4 million (the “Mining Machines”) from Bitmain after certain credits. We received all of the Mining Machines purchased during 2021 from August 2022 through November 2022. During the year ended December 31, 2022, the Company purchased an additional 400 Bitcoin Miner S19J Pro machines from Bitmain for an aggregate purchase price of approximately $ 1.3 million which were delivered in December 2022. Additionally, during the year ended December 31, 2022, the Company purchased 200 Bitcoin S19 XP Antminer cryptocurrency mining machines ("XP Machin es") from Bitmain for an aggregate purchase price of approximately $ 1.3 million. which were delivered in January 2023. We used various Bitmain credits and coupons totaling approximately $ 1.0 million to pay for the machines and we paid the remaining $ 0.3 million non-refundable payment in cash. We purchased an additional 65 S19 XP machines on December 20, 2022 and another 125 S19 XP machines on January 15, 2023 from Bitmain for an aggregate purchase price of approximately $ 1.1 million. We used various Bitmain credits and coupons totaling approximately $ 0.6 million to pay for the 65 S19 XP machines that were ordered in December 2022, and in January 2023 we paid the remaining $ 0.5 million non-refundable payment relating to the 125 S19 XP machines in cash. All 190 XP machines were delivered in April 2023. We also paid $ 0.3 million to acquire an additional 101 S19 XP machines from Bitmain which were delivered in May 2023. Since the inception of our contracts with Bitmain, we have paid an aggregate of approxi mately $ 29.0 million to Bitmain and related vendors relating to the purchase of these machines through December 31, 2023. As of March 8, 2024, we had approximately 5,900 active machines with hashing capacity of approximately 0.61 EH/s. |
Right to Use Assets | Right to Use Assets The Company capitalizes all leased assets pursuant to ASU 2016-02, "Leases (Topic 842)," which requires lessees to recognize right-of-use assets and lease liability, initially measured at present value of the lease payments, on its balance sheet for leases with terms longer than 12 months and classified as either financing or operating leases. As of December 31, 2023 and 2022, right to use assets, net of accumulated amortization, was approximately $ 189 thousand and $ 266 thousand. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets Management reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to undiscounted future cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment amount is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. There was no impairment of long-lived assets for the years ended December 31, 2023 and 2022. |
Revenue Recognition | Revenue Recognition - Digital Mining We recognize revenue in accordance with generally accepted accounting principles as outlined in the Financial Accounting Standard Board's (“FASB”) Accounting Standards Codification (“ASC”) 606, Revenue From Contracts with Customers, which requires that five steps be followed in evaluating revenue recognition: (i) identify the contract with the customer; (ii) identity the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price; and (v) recognize revenue when or as the entity satisfied a performance obligation. Our accounting policy on revenue recognition for our bitcoin mining segment is provided below. Step 1: The Company enters into a contract with a bitcoin mining pool operator (i.e., the customer) to provide computing power to the mining pools. The contracts are terminable at any time by either party and the Company’s enforceable right to compensation only begins when the Company starts providing computing power to the mining pool operator (which occurs daily at midnight Universal Time Coordinated (UTC)). When participating in ratable share pools, in exchange for providing computing power the Company is entitled to a fractional share of the Bitcoin award the mining pool operator receives for successfully adding a block to the blockchain, plus a fractional share of the transaction fees attached to that blockchain. The Company’s fractional share is based on the proportion of computing power the Company contributed to the mining pool operator to the total computing power contributed by all mining pool participants in solving the current algorithm. When participating in a Full Pay Per Share (“FPPS”) mining pool, in exchange for providing computing power to the pool the Company is entitled to compensation, calculated on a daily basis, at an amount that approximates the total Bitcoin that could have been mined using the Company’s computing power, calculated on a look-back basis across previous blocks using the pools hash rate index. Applying the criteria per ASC 606-10-25-1, the contract arises at the point that the Company provides computing power to the mining pool operator, which is beginning contract day at midnight UTC (contract inception), because customer consumption is in tandem with daily earnings of delivery of the computing power. Step 2: In order to identify the performance obligations in a contract with a customer, a company must assess the promised goods or services in the contract and identify each promised good or service that is distinct. A performance obligation meets ASC 606’s definition of a “distinct” good or service (or bundle of goods or services) if both of the following criteria are met: The customer can benefit from the good or service either on its own or together with other resources that are readily available to the customer (i.e., the good or service is capable of being distinct); and The entity’s promise to transfer the good or service to the customer is separately identifiable from other promises in the contract (i.e., the promise to transfer the good or service is distinct within the context of the contract). Based on these criteria, the Company has a single performance obligation in providing computing power services (i.e., hashrate) to the mining pool operator (i.e., customer). The performance obligation of computing power services is fulfilled daily over-time, as opposed to a point in time, because the Company provides the hashrate throughout the day and the customer simultaneously obtains control of it and uses the asset to produce bitcoin. The Company has full control of the mining equipment utilized in the mining pool and if the Company determines it will increase or decrease the processing power of its machines and/or fleet (i.e., for repairs or when power costs are excessive) the computing power provided to the customer will be reduced. Step 3: The transaction consideration the Company earns is non-cash digital consideration in the form of bitcoin, which the Company measures at fair value on the date earned at the daily closing price, which is not materially different from the fair value at contract inception, which is the daily opening price. The transaction consideration the Company earns is all variable since it is dependent on the daily computing power provided by the Company under the FPPS model and total bitcoin earned by the under the ratable share model. The Company’s bitcoins earned through the contractual payout formula is not known until the Company’s computational hashrate contributed over the daily measurement period is fulfilled over-time daily between midnight-to-midnight UTC time. The Company’s proportionate amount of the global network transaction fee rewards earned are calculated at the end of each transactional day (midnight to midnight). There are no other forms of variable considerations, such as discounts, rebates, refunds, credits, price concessions, incentives, performance bonuses, penalties, or other similar items. The Company does not constrain this variable consideration because it is probable that a significant reversal in the amount of revenue recognized from the contract will not occur when the uncertainty is subsequently resolved and recognizes the noncash consideration on the same day that control is transferred, which is the same day as contract inception. Step 4: The transaction price is allocated to the single performance obligation upon verification for the provision of computing power to the mining pool operator, and total Bitcoin rewards earned by the pool, when applicable under a ratable share model. There is a single performance obligation (i.e., computing power or (hashrate) for the contract; therefore, all consideration from the mining pool operator is allocated to this single performance obligation. Step 5: The Company’s performance is complete in transferring the hashrate service over-time (midnight to midnight) to the customer and the customer obtains control of that asset. In exchange for providing computing power, the Company is entitled to a pro-rata share of the fixed bitcoin awards earned over the measurement period, plus a pro-rata fractional share of the global transaction fee rewards for the respective measurement period, less net digital asset fees due to the mining pool operator over the measurement period, as applicable. The transaction consideration the Company receives is non-cash consideration, in the form of bitcoin. The Company measures the bitcoin at fair value on the date earned using the closing price of bitcoin on the date earned (midnight UTC), which is not materially different from the fair value at contract inception, which is the daily opening price. There are no deferred revenues or other liability obligations recorded by the Company since there are no payments in advance of the performance. At the end of the 24 hour “midnight-to-midnight” period, there are no remaining performance obligations. Bitcoin earned by the Company through its mining activities are included within operating activities on the accompanying consolidated statements of cash flows. The sale of bitcoin are included within operating activities as the Company sells its bitcoin to fund operations in the normal course of business. The Company will evaluate time periods when the Company holds bitcoin for a longer period of time and sale so such would be recorded as investing activities. For the fiscal years ended December 31, 2023 and 2022, all cash proceeds received from sale of bitcoin were classified as operating cash flows in the accompanying consolidated statements of cash flows. Revenue Recognition - Specialty Finance Accounting Standards Codification (“ASC”) 606 of the Financial Accounting Standards Board (“FASB”) states an entity needs to conclude at the inception of the contract that collectability of the consideration to which it will be entitled in exchange for the goods and services that will be transferred to the customer is probable. That is, in some circumstances, an entity may not need to assess its ability to collect all of the consideration in the contract. The Company provides funding to Associations by purchasing their rights under delinquent accounts from unpaid assessments due from property owners. Collections on the Accounts may vary greatly in both the timing and amount ultimately recovered compared with the total revenues earned on the Accounts because of a variety of economic and social factors affecting the real estate environment in general . The Company’s contracts with its specialty finance customers have very specific performance obligations. The Company has determined that the known amount of cash to be realized or realizable on its revenue generating activities cannot be reasonably estimate and as such, classifies its finance receivables as nonaccrual and recognizes revenues in the accompanying statements of income on the cash basis or cost recovery method in accordance with ASC 310-10, Receivables . The Company’s operations also consist of rental revenue earned from tenants under leasing arrangements which provide for rent income. The leases have been accounted for as operating leases. For operating leases, revenue is recorded based on cash rental payments was collected during the period. The Company analyzed its remaining revenue streams and concluded there were no changes in revenue recognition with the adoption of the new standard. Under ASC 606, the Company applies the cash basis method to its original product and the cost recovery method to its special product as follows: Finance Receivables—Original Product : Under the Company’s original product, delinquent assessments are funded only up to the Super Lien Amount as discussed above. Recoverability of funded amounts is generally assured because of the protection of the Super Lien Amount. As such, payments by unit owners on the Company’s original product are recorded to income when received in accordance with the provisions of the Florida Statute (718.116(3)) and the provisions of the purchase agreements entered into between the Company and Associations. Those provisions require that all payments be applied in the following order: first to interest, then to late fees, then to costs of collection, then to legal fees expended by the Company and then to assessments owed. In accordance with the cash basis method of recognizing revenue and the provisions of the statute, the Company records revenues for interest and late fees when cash is received. In the event the Company determines the ultimate collectability of amounts funded under its original product are in doubt, payments are applied to first reduce the funded or principal amount. Finance Receivables—Special Product (New Neighbor Guaranty program) : During 2012, the Company began offering associations an alternative product under the New Neighbor Guaranty program whereby the Company will fund amounts in excess of the Super Lien Amount. Under this special product, the Company purchases substantially all of the delinquent assessments owed to the association, in addition to all accrued interest and late fees, in exchange for payment by the Company of (i) a negotiated amount or (ii) on a going forward basis, all monthly assessments due for a period up to 48 months. Under these arrangements, the Company considers the collection of amounts funded is not assured and under the cost recovery method, cash collected is applied to first reduce the carrying value of the funded or principal amount with any remaining proceeds applied next to interest, late fees, legal fees, collection costs and any amounts due to the Association. Any excess proceeds still remaining are recognized as revenues. If the future proceeds collected are lower than the Company’s funded or principal amount, then a loss is recognized. Net Commission Revenue: The Company acts as an agent in providing health travel insurance policies. As a result, the Company revenue is recorded at net. The Company has determined that the known amount of cash to be realized or realizable on its revenue generating activities can be reasonably estimated and as such, classifies its receivables as accrual and recognizes revenues in the accompanying statements of income on the accrual basis. If a policy is not effective as of the end of a period, then the associated revenue and underwriting costs are deferred until the effective date. The majority of the commission revenue is underwritten by two policy underwriters who pays the Company commissions. |
Cost of Revenues - Digital Assets | Cost of Revenues - Digital Assets The Company includes energy costs and external co-location mining hosting fees in cost of revenues. Depreciation of mining machines is included within "Depreciation and amortization" in the Consolidated Statements of Operations. |
Hosting Contracts | Hosting Contracts The Company, through its wholly-owned subsidiary, US Digital, entered into a hosting agreement (the “Core Hosting Agreement”) with Core Scientific Inc. (“Core”) pursuant to which Core agreed to host approximately 4,870 of the Company's Bitcoin Miner S19J Pro or XP machines at a secure location and provide power, maintenance and other services specified in the contract with a term of one year, with automatic renewals unless we or Core notifies the other in writing not less than ninety ( 90 ) calendar days before such renewal of its desire for the order not to renew unless terminated sooner pursuant to the terms of the Core Hosting Agreement. These agreements mature in different tranches starting in May 2024 for approximately 4,380 machines and December 2024 for approximately 500 machines. As required under the Core Hosting Agreement, the Company has paid approximately $ 2.2 million as of December 31, 2023 as a deposit. As of March 8, 2024, Core has energized approximately 4,870 of our machines located at their sites with a hashing capacity of approximately 0.50 EH/s o n a daily basis. In December 2022, Core filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of Texas and exited bankruptcy in January 2024. Core's bankruptcy filing did not negatively impact our mining ability at their sites. On January 26, 2023, the Company entered into a hosting agreement (the “Phoenix Hosting Agreement”) with Phoenix Industries Inc. (“Phoenix”) pursuant to which Phoenix agreed to host 228 of the Company's Bitcoin Miner S19J Pro machines at a secure location and provide power, maintenance and other services specified in the contract with a term of two years. T his Phoenix Hosting Agreement would renew automatically for an additional two years if the Company were to provide written notice to Phoenix of our desire of renewal at least sixty ( 60 ) days in advance of the conclusion of the initial term of two years , unless terminated sooner pursuant to the terms of the Phoenix Hosting Agreement. As required under the Phoenix Hosting Agreement, the Company paid approximately $ 36 thousand as a deposit in January 2023. The Company and Phoenix mutually terminated this agreement effective April 18, 2023 and the Company's S19J Pro machines were returned to the Company in May 2023. The Company fully impaired the $ 36 thousand deposit during the year ended December 31, 2023. On March 9, 2023, the Company entered into a hosting agreement (the “Longbow Hosting Agreement”) with Longbow Host Co LLC (“Longbow”) pursuant to which Longbow agreed to host 500 of the Company's Bitcoin Miner S19J Pro machines at a secure location and provide power, maintenance and other services specified in the contract with a term of two years. Upon written request from the Company at least ninety ( 90 ) days prior to the conclusion of the then current term and approval by Longbow, the term shall renew for successive one year periods with a three percent ( 3 %) increase as of the commencement of each renewal term unless terminated sooner pursuant to the terms of the Longbow Hosting Agreement. As required under the Longbow Hosting Agreement, the Company paid approximately $ 157 thousand as a refundable deposit in March 2023. The Company had 500 machines installed at the Longbow site as of June 30, 2023. The Company terminated this agreement on August 1, 2023 and expensed 50 % of the $ 157 thousand deposit during the year ended December 31, 2023 and applied the remainder to outstanding invoices. The machines were returned to the Company in September 2023. On May 5, 2023, the Company entered into a hosting agreement (the “GIGA Hosting Agreement”) with GIGA Energy Inc. (“GIGA”) pursuant to which GIGA agreed to host 1,080 of the Company's Bitcoin Miner S19J Pro machines at a secure location and provide power, maintenance and other services specified in the contract with a term of one year. As required under the GIGA Hosting Agreement, the Company paid approximately $ 173 thousand as a pre-payment in May 2023, which was applied to subsequent invoices. The Company also paid a refundable deposit of $ 173 thousand in August 2023 of which $ 56 thousand was applied to subsequent invoices. The Company had 1,075 active machines installed at the GIGA site as of December 31, 2023. |
Coupon Sales | Coupon Sales From time to time the Company receives coupons from Bitmain to incentivize purchases of equipment. Coupons have a stated face value in dollars and can be applied against future invoices for purchased machines. Coupons are transferable and there are not restrictions on the sale to third parties. Occasionally, the Company sells coupons to third parties in exchange for cash consideration or digital assets. As there is currently no active market for the buying and selling of Bitmain coupons, the Company has determined that the fair value of coupons received is nil at the time of receipt therefore revenue associated with the sale of such coupons is not recognized until the sale transaction has been completed and consideration has been received from the third party. During the year ended December 31, 2023, the Company sold Bitmain coupons for approximately $ 639 thousand, which was recognized as other income within "Other income - coupon sales" in the Consolidated Statements of Operations. The coupons sold during the year ended December 31, 2023 were exchanged for digital assets (Tether) which had a fair value of approximately $ 10 thousand at the time of receipt. |
Stock-Based Compensation | Stock-Based Compensation The Company records all equity-based incentive grants to employees and non-employee members of the Company’s Board of Directors in operating expenses in the Company’s Consolidated Statements of Operations based on their fair values determined on the date of grant. Stock-based compensation expense, reduced for estimated forfeitures, is recognized over the requisite service period of the award, which is generally the vesting term of the outstanding equity awards. The expense attribution method is straight-line or accelerated graded-vesting depending on the nature of the award. |
Income Taxes | Income Taxes Income taxes are provided for the tax effects of transactions reported in the consolidated financial statements and consist of taxes currently due plus deferred taxes resulting primarily from the tax effects of temporary differences between financial and income tax reporting. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Under ASC 740-10-30-5, Income Taxes , deferred tax assets should be reduced by a valuation allowance if, based on the weight of available evidence, it is more-likely-than-not (i.e., a likelihood of more than 50%) that some portion or all of the deferred tax assets will not be realized. The Company considers all positive and negative evidence available in determining the potential realization of deferred tax assets including, primarily, the recent history of taxable earnings or losses. Based on operating losses reported by the Company during 2023, 2022, 2020 and 2019, the Company concluded there was not sufficient positive evidence to overcome this recent operating history. As a result, the Company believes that a valuation allowance is necessary based on the more-likely-than-not threshold noted abov e. During the year ended December 31, 2023, the Company increased the valuation allowance to approximately $ 14.1 million to reflect a change in deferred tax assets. During the year ended December 31, 2022, the Company increased the valuation allowance to $ 8.5 million to reflect a change in deferred tax assets. Prior to the Company’s initial public offering in October 2015, the taxable earnings of the Predecessor were included in the tax returns of its members (separate limited liability companies) and taxed depending on personal tax situations. In connection with the Company’s initial public offering, the members contributed ownership interests to the Company (a newly form C-Corporation) and all earnings subsequent to that date (October 23, 2015) are subject to taxes and reflected in the Company’s consolidated financial statements. |
Income (Loss) Per Share | Income (loss) Per Share Basic income (loss) per share is calculated as net income (loss) to common stockholders divided by the weighted average number of common shares outstanding during the period (as adjusted to give effect to the Reverse Stock Split). The Company has restated all share amounts to reflect the Reverse Stock Split. The Company issued approximately 260 thousand and nil restricted shares during the year ended December 31, 2023 and 2022. The weighted average shares used in calculating loss per share for the year ended December 31, 2023 includes 173,333 restricted shares that were fully vested as of December 31, 2023 based on their respective vesting date and excludes 86,667 restricted shares that were legally issued but not vested as of December 31, 2023. The Company issued nil and 12,324 of common stock at various times during 2023 and 2022, respectively. The Company has weighted average these new shares in calculating income (loss) per share for the relevant period. Diluted income (loss) per share for the period equals basic loss per share as the effect of any convertible notes, stock based compensation awards, cancellation of such awards or stock warrants would be anti-dilutive. The anti-dilutive stock based compensation awards and convertible notes consisted of: As of December 31, 2023 2022 Stock Options 599,597 186,877 Stock Warrants 1,274,807 1,279,573 Restricted Shares 86,667 - |
Contingencies | Contingencies The Company accrues for contingent obligations, including estimated legal costs, when the obligation is probable and the amount is reasonably estimable. As facts concerning contingencies become known, the Company reassesses its position and makes appropriate adjustments to the consolidated financial statements. Estimates that are particularly sensitive to future changes include those related to tax, legal and other regulatory matters. |
Related Party | Related Party ASC 850 - Related Party Disclosures requires disclosure of related party transactions and certain common control relationships. The Company disclosures related party transactions and such transactions are approved by the Company’s Board of Directors. See Note 9. |
Risks and Uncertainties | Risks and Uncertainties Funding amounts are secured by a priority lien position provided under Florida law (see discussion above regarding Florida Statute 718.116). However, in the event the first mortgage holder takes title to the property, the amount payable by the mortgagee to satisfy the priority lien is capped under this same statute and would generally only be sufficient to reimburse the Company for funding amounts noted above for delinquent assessments. Amounts paid by the mortgagee would not generally reimburse the Company for interest, administrative late fees and collection costs. Even though the Company does not recognize these charges as revenues until collected, its business model and long-term viability is dependent on its ability to collect these charges. In the event a delinquent unit owner files for bankruptcy protection, the Company may at its option be reimbursed by the Association for the amounts funded (i.e., purchase price) and all collection rights are re-assigned to the Association. |
Non-cash Financing and Investing Activities | Non-cash Financing and Investing Activities Financing of Insurance Premium – the Company financed the purchase of various insurance policies during the year ended December 31, 2023 and 2022 in the amount of approximately $ 716 thousand and $ 660 thousand, respectively, using a finance agreement. ROU assets and operating lease obligation recognized - Due to the extension of its office building operating lease during the year ended December 31, 2023, the Company remeasured its lease liability and ROU asset associated with the lease. The Company accounted for the lease extension as a lease modification under ASC 842. At the effective date of modification, the Company recorded an adjustment to the right-of-use asset and lease liability in the amount of approximately $ 301 thousand. Reclassification of mining equipment deposit to fixed assets, net - During the year ended December 31, 2023 and 2022 as mining machines were received, the Company reclassified approximately $ 1.2 million and $ 26.9 million of mining machine costs plus related shipping and customs fees from "Deposits on mining equipment" to "Fixed assets, net" in the consolidated balance sheets. Amount of capital expenditures in accounts payable and accrued expenditures - During the year ended December 31, 2023 and 2022, approximately $ 1.0 million and $ 718 thousand or accrued expenditures were capitalized as fixed assets, respectively. Reclassification of Reverse stock split - During the year ended December 31, 2023 and 2022, approximately $ 11 thousand and nil was reclassified from common stock to additional paid in capital, respectively, as a result of the reverse stock split. |
New Accounting Pronouncements | Recently adopted accounting pronouncements There were no new accounting pronouncements adopted during the year ended December 31, 2023 or 2022 that were determined to have a material effect on the Company's financial position, results of operations or cash flows. Recently issued accounting pronouncements The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs") issued the Financial Accounting Standards Board (“FASB”). ASUs issued by FASB, but which are not yet effective, were assessed and determined to be either not applicable to the Company or to have an insignificant impact on the consolidated financial statements. On December 13, 2023, the FASB issued ASU 2023-08, which addresses the accounting and disclosure requirements for certain crypto assets. The new guidance requires entities to subsequently measure certain crypto assets at fair value, with changes in fair value recorded in net income in each reporting period. In addition, entities are required to provide additional disclosures about the holdings of certain crypto assets. For all entities, the ASU’s amendments are effective for fiscal years beginning after December 15, 2024, including interim periods within those years. Early adoption is permitted. If an entity adopts the amendments in an interim period, it must adopt them as of the beginning of the fiscal year that includes that interim period. The Company will early adopt the standard as of January 1, 2024 which will result in an adjustment to increase opening retained earnings and digital assets by approximately $ 600 thousand. On December 14, 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures, which requires more detailed income tax disclosures. The standard is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The Company is currently evaluating the impact of adoption of the standard. On November 27, 2023, the FASB issued ASU 2023-07, which addresses improvements to reportable segment disclosures. The guidance is effective for annual periods beginning after December 15, 2023, and interim periods beginning after December 15, 2024, applied retrospectively with early adoption permitted. The Company is currently evaluating the impact of adoption of the standard. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Summary of Anti-dilutive Stock Based Compensation Awards and Convertible Notes | The anti-dilutive stock based compensation awards and convertible notes consisted of: As of December 31, 2023 2022 Stock Options 599,597 186,877 Stock Warrants 1,274,807 1,279,573 Restricted Shares 86,667 - |
Digital Assets (Tables)
Digital Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Digital Assets [Abstract] | |
Schedule of Digital Assets | Digital assets (Bitcoin and Tether) consisted of the following: December 31, 2023 December 31, 2022 Bitcoin $ 3,406,096 $ 888,026 Tether 10,160 - Total digital assets $ 3,416,256 $ 888,026 Bitcoin December 31, 2023 December 31, 2022 Beginning of Year $ 888,026 $ - Purchase of Bitcoin 35,157 988,343 Production of Bitcoin 12,289,131 945,560 Impairment loss on mined Bitcoin ( 965,967 ) ( 79,794 ) Impairment loss on purchased Bitcoin - ( 467,406 ) Carrying amount of Bitcoin sold ( 8,840,251 ) ( 498,677 ) End of Period $ 3,406,096 $ 888,026 Digital asset activity (GUSD) consisted of the following: December 31, 2023 December 31, 2022 Beginning of Year $ - $ - Purchase of GUSD - 500,000 GUSD Earned on digital assets - 5,658 Sale of GUSD - ( 505,658 ) End of Period $ - $ - |
Schedule of Bitcoin | Digital asset (Bitcoin) activity consisted of the following: December 31, 2023 December 31, 2022 Bitcoin Balance 95.1 54.9 December 31, 2023 December 31, 2022 Beginning of Year 54.9 - Production of Bitcoin 423.4 53.4 Purchase of Bitcoin 2.0 31.6 Sale of Bitcoin ( 385.0 ) ( 30.1 ) Fees ( 0.2 ) - End of Period 95.1 54.9 |
Fixed Assets and Intangible A_2
Fixed Assets and Intangible Assets, net (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Components of Fixed Assets | The components of fixed assets as of December 31, 2023 and 2022 are as follows: Useful Life (Years) December 31, 2023 December 31, 2022 Mining machines 4 $ 29,799,782 $ 27,637,041 Real estate assets owned 30 80,057 80,057 Furniture, computer and office equipment 3 - 5 230,063 216,312 Gross fixed assets 30,109,902 27,933,410 Less: accumulated depreciation ( 5,590,292 ) ( 661,036 ) Fixed assets, net $ 24,519,610 $ 27,272,374 |
Schedule of Intangible Assets Activity | Intangible assets activity for the years ended December 31, 2023 and 2022 is as follows: December 31, 2023 December 31, 2022 Beginning balance $ - $ - Symbiont intangible assets additions 2,804,902 - Impairment loss on Symbiont assets ( 750,678 ) - Accumulated amortization ( 54,224 ) - Sale of asset ( 2,000,000 ) - Total intangible assets, net $ - $ - |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Investments [Abstract] | |
Summary of Marketable Equity Securities | Marketable equity securities as of December 31, 2023 and December 31, 2022 are as follows: Cost Cost of Shares Sold Gross Unrealized Gain (Loss) Fair Value Marketable equity securities, December 31, 2023 $ 743,906 $ ( 739,616 ) $ 13,570 $ 17,860 Marketable equity securities, December 31, 2022 $ 2,976,933 $ ( 2,915,813 ) $ ( 56,830 ) $ 4,290 |
Schedule of Short-term Investment | December 31, 2023 December 31, 2022 Convertible note $ - $ - End of period $ - $ - December 31, 2023 December 31, 2022 Beginning of year $ - $ 539,351 Accrued interest income on convertible debt security - 17,753 Convertible debt and interest converted into marketable shares - ( 844,882 ) Realized gain on conversion into marketable shares - 287,778 End of period $ - $ - |
Schedule of Notes Receivable | December 31, 2023 December 31, 2022 Notes receivable from Seastar Medical Holding Corporation $ 1,440,498 $ 3,807,749 End of period $ 1,440,498 $ 3,807,749 December 31, 2023 December 31, 2022 Beginning of year $ 3,807,749 $ - Investment in Seastar Medical Holding Corporation notes receivable 125,000 3,753,090 Repayment of Seastar Medical Holding Corporation notes receivable ( 2,651,943 ) - Accrued interest income 159,692 54,659 End of period $ 1,440,498 $ 3,807,749 |
Schedule of Long-term Investment - Debt Securities | The Symbiont debt security consisted of the following: December 31, 2023 December 31, 2022 Symbiont.IO Note Receivable $ - $ 1,350,000 End of period $ - $ 1,350,000 December 31, 2023 December 31, 2022 Beginning of year $ 1,350,000 $ 2,027,178 Accrued interest income on debt securities - 320,000 Reclassification to intangible assets (Note 3) ( 2,402,542 ) - Accrued recovery of legal fees - 55,364 Allowance for losses on debt security - ( 1,052,542 ) Reversal of allowance for losses on debt security 1,052,542 - End of period $ - $ 1,350,000 |
Schedule of Long-term Investment - Equity Securities | Long-term investments for the SMHC (formerly LMAO) warrants consist of the following: December 31, 2023 December 31, 2022 Seastar Medical Holding Corporation (formerly LMAO) warrants $ 156,992 $ 464,778 End of period $ 156,992 $ 464,778 December 31, 2023 December 31, 2022 Beginning of year $ 464,778 $ 1,973,413 Unrealized loss on equity securities ( 307,786 ) ( 1,508,635 ) End of period $ 156,992 $ 464,778 |
Summary of Investment in Unconsolidated Affiliates | December 31, 2023 December 31, 2022 Seastar Medical Holding Corporation common stock $ 1,145,486 $ 10,608,750 End of period $ 1,145,486 $ 10,608,750 December 31, 2023 December 31, 2022 Beginning of year $ 10,608,750 $ 4,676,130 Unrealized gain (loss) on equity investment ( 9,463,264 ) 5,932,620 End of period $ 1,145,486 $ 10,608,750 |
Debt and Other Financing Arra_2
Debt and Other Financing Arrangements (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt of the Company consisted of the following at December 31, 2023 and 2022: December 31, 2023 December 31, 2022 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 78,000 was required upfront and equal installment payments of $ 45,672 to be made over a 10 month period. The note matured on August 1, 2023 . Annualized interest is 7.35 %. $ - $ 365,379 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 15,000 was required upfront and equal installment payments of $ 13,799 to be made over an 8 month period. The note matured on August 1, 2023 . Annualized interest is 7.35 %. - 110,396 Financing agreement with Imperial PFS that is unsecured. Down payment of $ 3,438 was required upfront and equal installment payments of $ 3,658 to be made over a 11 month period. The note matures on July 1, 2024 . Annualized interest is 12.05 %. 21,945 - Financing agreement with Imperial PFS that is unsecured. Down payment of $ 36,544 was required upfront and equal installment payments of $ 41,879 to be made over an 10 month period. The note matures on August 1, 2024 . Annualized interest is 9.6 %. 335,022 - Financing agreement with Imperial PFS that is unsecured. Down payment of $ 30,000 was required upfront and equal installment payments of $ 35,103 to be made over a 6 month period. The note matures on June 1, 2024 . Annualized interest is 12.05 %. 210,619 $ 567,586 $ 475,775 |
Schedule of Principal Payments of Debt | Minimum required principal payments on the Company’s debt as of December 31, 2023 are as follows : Maturity Amount 2024 $ 567,586 $ 567,586 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of Supplemental Balance Sheet Information Related to Operating Leases | The following table presents supplemental balance sheet information related to operating leases as of December 31, 2023 and 2022: Balance Sheet Line Item December 31, 2023 December 31, 2022 Assets ROU assets Right of use asset, net $ 189,009 $ 265,658 Total lease assets $ 189,009 $ 265,658 Liabilities Current lease liabilities Lease liability $ 110,384 $ 90,823 Long-term lease liabilities Lease liability 85,775 179,397 Total lease liabilities $ 196,159 $ 270,220 Weighted-average remaining lease term (in years) 1.7 2.7 Weighted-average discount rate 7.49 % 7.50 % |
Summary of Supplemental Cash Flow Information and Non-cash Activity Related to Operating Leases | The following table presents supplemental cash flow information and non-cash activity related to operating leases for the years ended December 31, 2023 and 2022: For the year ended December 31, 2023 2022 Operating cash flow information Cash paid for amounts included in the measurement of lease liabilities $ ( 95,948 ) $ ( 98,569 ) Non-cashflow information ROU assets and operating lease obligation recognized $ 21,887 $ 300,787 |
Schedule of Future Minimum Lease Payment Due | The following table presents maturities of operating lease liabilities on an undiscounted basis as of December 31, 2023: Lease Maturity Table Operating Leases 2024 121,385 2025 85,324 2026 3,163 (less: imputed interest) ( 13,713 ) $ 196,159 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Components of Provision for Income Taxes | Significant components of the tax expense (benefit) recognized in the accompanying Consolidated Statements of Operations for the years ended December 31, 2023 and December 31, 2022 are as follows: Years Ended December 31, 2023 2022 Current tax benefit Federal $ 60,571 $ 1,196,415 State - 241,651 Total current tax expense 60,571 1,438,066 Deferred tax expense - Federal ( 4,540,213 ) ( 4,181,816 ) Deferred tax expense - State ( 1,091,907 ) ( 1,041,813 ) Valuation allowance 5,632,121 5,223,629 Income tax expense $ 60,571 $ 1,438,066 |
Schedule of Reconciliation of Tax Provision with Expected Provision | The reconciliation of the income tax computed at the combined federal and state statutory rate of ( 0.3 )% for the year ended December 31, 2023 and ( 5.4 )% for the year ended December 31, 2022 to the income tax benefit is as follows: Years Ended December 31, Years Ended December 31, 2023 2022 Income tax provision at the US federal statutory rate $ ( 3,951,107 ) 21.0 % $ ( 5,553,496 ) 21.0 % Nondeductible expenses 20,847 - 0.1 % - 0.0 % Stock based compensation - 0.0 % 3,222,271 - 12.2 % State income taxes, net of federal benefit ( 852,967 ) 4.5 % ( 470,684 ) 1.8 % True-up ( 681,760 ) 3.6 % ( 786,165 ) 3.0 % Change in valuation allowance 5,632,122 - 29.9 % 5,223,627 - 19.8 % Change in Rate ( 106,564 ) 0.6 % ( 197,487 ) 0.7 % Tax expense/effective rate $ 60,571 - 0.3 % $ 1,438,066 - 5.4 % |
Components of Deferred Tax Assets and Liabilities | The significant components of the Company’s deferred tax liabilities and assets as of December 31, 2023 and December 31, 2022 are as follows: As of December 31, As of December 31, 2023 2022 Deferred tax liabilities: Depreciation $ 877,838 $ 538,866 Right to use assets 48,306 67,052 Other 316,331 - Total deferred tax liabilities 1,242,475 605,918 Deferred tax assets: Loss carryforwards - Federal 7,045,561 5,922,644 Loss carryforwards - State 1,529,067 1,195,806 Stock option expense 1,916,270 490,892 Amortization 362,918 395,272 Allowance for credit losses 13,541 14,555 Right to use liability 50,133 68,203 Unrealized loss on securities 4,424,536 986,639 Charitable contributions 2,664 2,000 Total deferred tax asset 15,344,690 9,076,011 Valuation allowance ( 14,102,215 ) ( 8,470,093 ) Net deferred tax asset $ - $ - |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Summary of Restricted Share Activity | The following is a summary of the restricted share activity during the year ended December 21, 2023 and 2022: 2023 2022 Number of Weighted Average Number of Weighted Average Restricted Shares Award Price Restricted Shares Award Price Restricted Shares outstanding at beginning of the year - $ - - $ - Granted 260,000 4.51 - - Vested ( 173,333 ) 4.51 - - Restricted Shares outstanding at December 31, 86,667 $ 4.51 - $ - |
Summary of Stock Warrants | The following is a summary of the stock warrant plan activity during the years ended December 31, 2023 and 2022: 2023 2022 Number of Warrants Weighted Average Exercise Price Number of Warrants Weighted Average Exercise Price Warrants outstanding at beginning of the year 1,279,573 $ 30.00 1,283,740 $ 30.00 Granted - - - - Exercised - - - - Forfeited ( 4,766 ) 20.16 ( 4,167 ) 27.00 Warrants outstanding and exercisable at December 31, 1,274,807 $ 30.04 1,279,573 $ 30.00 |
Summary of Stock Option Plan Activity | The following is a summary of the stock option plan activity during the years ended December 31, 2023 and 2022: 2023 2022 Number of Weighted Average Number of Weighted Average Options Exercise Price Options Exercise Price Options outstanding at beginning of the year 186,877 $ 19.56 659,471 $ 37.20 Granted 414,417 4.51 127,406 3.54 Cancelled - - ( 600,000 ) 35.70 Forfeited ( 1,697 ) 72.18 - - Options outstanding at December 31, 599,597 $ 9.00 186,877 $ 19.56 Options exercisable at December 31, 379,194 $ 10.55 30,443 $ 71.28 |
Schedule of Significant Assumptions Used in Option-pricing Model to Fair Value Options Granted | Significant assumptions used in the option-pricing model to fair value options granted were as follows: 2023 Risk-free rate 3.54 % Expected volatility 118 % Expected life 10 years Expected dividend — |
Employee Two [Member] | |
Schedule of Significant Assumptions Used in Option-pricing Model to Fair Value Options Granted | Significant assumptions used in the option-pricing model to fair value options granted were as follows: 2022 Risk-free rate 3.53 % - 3.83 % Expected volatility 119 % Expected life 10 years Expected dividend — |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Year Ended December 31, 2023 Specialty Finance Mining Operations All Other Total Revenue, net $ 694,959 $ 12,289,131 $ - $ 12,984,090 Depreciation and amortization 5,364 4,918,332 59,784 4,983,480 Operating loss ( 934,807 ) ( 2,020,112 ) ( 7,107,000 ) ( 10,061,919 ) Realized gain on securities - - 4,420 4,420 Unrealized gain on marketable securities - - 13,570 13,570 Impairment loss on prepaid machine deposits - ( 36,691 ) - ( 36,691 ) Impairment loss on prepaid hosting deposits - ( 184,236 ) - ( 184,236 ) Impairment loss on Symbiont assets - - ( 750,678 ) ( 750,678 ) Unrealized loss on investment and equity securities - - ( 9,771,050 ) ( 9,771,050 ) Realized gain on sale of purchased digital assets - - 1,917 1,917 Loss on disposal of assets ( 9,389 ) - ( 9,389 ) Other income - coupon sales - 639,472 - 639,472 Gain on adjustment of note receivable allowance 1,052,542 1,052,542 Other income - finance revenue - - 37,660 37,660 Interest income, net - - 249,586 249,586 Loss before income taxes ( 934,807 ) ( 1,610,956 ) ( 16,269,033 ) ( 18,814,796 ) Fixed Asset Additions 2,938 2,162,741 10,812 2,176,491 Year Ended December 31, 2022 Specialty Finance Mining Operations All Other Total Revenue, net $ 788,391 945,560 $ - $ 1,733,951 Depreciation and amortization 3,348 471,049 3,623 478,020 Operating loss ( 1,122,872 ) ( 1,014,327 ) ( 22,538,786 ) ( 24,675,985 ) Realized loss on securities - - ( 349,920 ) ( 349,920 ) Realized gain on convertible debt securities - - 287,778 287,778 Unrealized loss on marketable securities - - ( 56,830 ) ( 56,830 ) Impairment loss on prepaid machine deposits ( 3,150,000 ) - ( 3,150,000 ) Impairment loss on prepaid hosting deposits ( 1,790,712 ) - ( 1,790,712 ) Impairment loss on Symbiont assets - ( 1,052,542 ) ( 1,052,542 ) Unrealized gain on investment and equity securities - - 4,423,985 4,423,985 Impairment loss on digital assets - - ( 467,406 ) ( 467,406 ) Realized gain on sale of purchased digital assets - 20,254 20,254 Loss on disposal of fixed asset - - ( 38,054 ) ( 38,054 ) Digital assets other income - - 5,658 5,658 Dividend income - - 3,875 3,875 Interest income, net - - 399,094 399,094 Income (loss) before income taxes ( 1,122,872 ) ( 5,993,094 ) ( 19,329,255 ) ( 26,445,221 ) Fixed Asset Additions 1,612 27,683,559 5,304 27,690,475 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional information (Detail) | 1 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||||||||
Mar. 08, 2024 Machine | May 05, 2023 Machine | Apr. 20, 2023 shares | Mar. 09, 2023 Machine | Jan. 26, 2023 Machine | Dec. 31, 2024 Machine | May 31, 2024 Machine | Aug. 31, 2023 USD ($) | May 31, 2023 USD ($) | Mar. 31, 2023 USD ($) | Jan. 31, 2023 USD ($) | Jan. 15, 2023 USD ($) | Dec. 31, 2022 USD ($) shares | Jun. 30, 2023 Machine | Dec. 31, 2023 USD ($) Segment Machine shares | Dec. 31, 2022 USD ($) BitcoinMachine shares | Dec. 31, 2021 USD ($) BitcoinMachine | Sep. 30, 2023 | |
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Operating segments | Segment | 2 | |||||||||||||||||
Available cash on-hand | $ 4,238,006 | $ 2,401,831 | $ 4,238,006 | |||||||||||||||
Bitcoin fair market value amount | 3,400,000 | |||||||||||||||||
Cash institutions exceed the FDIC | 2,200,000 | |||||||||||||||||
SIPC insurance coverage limit amount | 250,000 | |||||||||||||||||
Payments to purchase assets | $ 0.5 | |||||||||||||||||
Valuation allowance deferred tax assets | 8,470,093 | 14,102,215 | 8,470,093 | |||||||||||||||
Fixed assets | $ 27,272,374 | 24,519,610 | 27,272,374 | |||||||||||||||
Impairment of long-lived assets | $ 0 | $ 0 | ||||||||||||||||
Common stock, shares issued | shares | 2,232,964 | 2,492,964 | 2,232,964 | |||||||||||||||
Right to use assets, net of accumulated amortization | $ 265,658 | $ 189,009 | $ 265,658 | |||||||||||||||
Financing of Insurance Premium | 716,000 | 660,000 | ||||||||||||||||
Adjustment to right-of-use asset and lease liability | 301,000 | |||||||||||||||||
Reclassification of mining equipment deposit to fixed assets, net | 1,200,000 | 26,900,000 | ||||||||||||||||
Accrued expenditures capitalized | 1,000,000 | 718,000 | ||||||||||||||||
Bitmain credits and coupons | 600,000 | |||||||||||||||||
Other income - coupon sales | 639,000 | |||||||||||||||||
Digital assets fair value | $ 888,026 | 3,416,256 | 888,026 | |||||||||||||||
Adjustment to increase in opening retained earnings and digital assets | 600,000 | |||||||||||||||||
Reclassification of reverse stock split | 10,859 | $ 0 | ||||||||||||||||
Tether [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Digital assets fair value | 10,160 | |||||||||||||||||
Subsequent Event [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of machines with hashing capacity | Machine | 5,900 | |||||||||||||||||
Purchase Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Cryptocurrency mining machines | BitcoinMachine | 400 | 5,046 | ||||||||||||||||
Aggregate purchase price of asset | $ 1,100,000 | |||||||||||||||||
Payments to purchase assets | $ 300,000 | 29,000,000 | ||||||||||||||||
Core Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Payment for deposit | $ 2,200,000 | |||||||||||||||||
Number of hosting agreement contract machine | Machine | 4,870 | |||||||||||||||||
Renewal initial term | 90 days | |||||||||||||||||
Core Hosting Agreement [Member] | Subsequent Event [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of machines has energized | Machine | 4,870 | |||||||||||||||||
Phoenix Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Renewal period | 2 years | |||||||||||||||||
Payment for deposit | $ 36,000 | |||||||||||||||||
Impairment of deposit | $ 36,000 | |||||||||||||||||
Renewal initial term | 60 days | |||||||||||||||||
Longbow Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Percentage of commencement of renewal term | 3% | |||||||||||||||||
Renewal period | 1 year | |||||||||||||||||
Payment for deposit | $ 157,000 | $ 157,000 | ||||||||||||||||
Renewal initial term | 90 days | |||||||||||||||||
Expensed percentage of terminated agreement | 50% | |||||||||||||||||
GIGA Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of hosting agreement contract machine | Machine | 1,080 | |||||||||||||||||
Deposit prepayment | $ 173,000 | |||||||||||||||||
Refundable deposit amount paid | $ 173,000 | |||||||||||||||||
Refundable deposit applied to subsequent invoices | $ 56,000 | |||||||||||||||||
Common Share Consolidation Reverse Stock Split [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Common stock, shares issued | shares | 12,324 | 0 | 12,324 | |||||||||||||||
Forecast [Member] | Core Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of hosting agreement contract machine | Machine | 500 | 4,380 | ||||||||||||||||
In Excess of $500 [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Fixed assets | $ 500 | |||||||||||||||||
Mining Machine [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Payments to purchase assets | $ 0.3 | |||||||||||||||||
Estimated useful lives | 4 years | 5 years | ||||||||||||||||
Bitmain credits and coupons | $ 1,000,000 | |||||||||||||||||
Mining Machine [Member] | Purchase Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Cryptocurrency mining machines | BitcoinMachine | 200 | |||||||||||||||||
Payments to purchase assets | $ 1,300,000 | $ 24,400,000 | ||||||||||||||||
Mining Machine [Member] | Phoenix Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of hosting agreement contract machine | Machine | 228 | |||||||||||||||||
Mining Machine [Member] | Longbow Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of hosting agreement contract machine | Machine | 500 | 500 | ||||||||||||||||
Agreement terminated date | Aug. 01, 2023 | |||||||||||||||||
Mining Machine [Member] | GIGA Hosting Agreement [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of hosting agreement contract machine | Machine | 1,075 | |||||||||||||||||
Restricted Stock [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Number of restricted shares, granted | shares | 260,000 | 260,000 | 0 | |||||||||||||||
Number of restricted shares, vested | shares | 173,333 | 0 | ||||||||||||||||
Number of non vested stock | shares | 86,667 | |||||||||||||||||
Special Product [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Delinquent assessments maximum due period purchases basis | 48 months | |||||||||||||||||
Subsidiary Limited Liability [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Percentage of ownership in subsidiary limited liability companies | 100% | |||||||||||||||||
Maximum [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Furniture, computer, office equipment, buildings and mining machines, useful lives | 30 years | |||||||||||||||||
Maximum [Member] | Unconsolidated Entities [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Ownership percentage | 50% | |||||||||||||||||
Minimum [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Furniture, computer, office equipment, buildings and mining machines, useful lives | 3 years | |||||||||||||||||
Minimum [Member] | Unconsolidated Entities [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Ownership percentage | 20% | |||||||||||||||||
Subsidiaries [Member] | Special Product [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Allowance for credit losses | $ 9,000 | $ 8,000 | $ 9,000 | |||||||||||||||
Subsidiaries [Member] | Original Product [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Allowance for credit losses | $ 48,000 | $ 44,000 | $ 48,000 | |||||||||||||||
LMF Acquisition Opportunities Inc [Member] | Subsidiary Limited Liability [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Percentage of ownership in subsidiary limited liability companies | 69.50% | |||||||||||||||||
REO Management Holdings, LLC [Member] | Maximum [Member] | Subsidiary Limited Liability [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Percentage of ownership in subsidiary limited liability companies | 100% | |||||||||||||||||
US Digital Mining and Hosting Co., LLC [Member] | Subsidiary Limited Liability [Member] | ||||||||||||||||||
Summary Of Significant Accounting Policies [Line Items] | ||||||||||||||||||
Percentage of ownership in subsidiary limited liability companies | 100% |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Summary of Anti-dilutive Stock Based Compensation Awards and Convertible Notes (Detail) - shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Employee Stock Option | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive stock based compensation awards | 599,597 | 186,877 |
Stock Warrants [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive stock based compensation awards | 1,274,807 | 1,279,573 |
Restricted Stock [Member] | ||
Antidilutive Securities Excluded From Computation Of Earnings Per Share [Line Items] | ||
Anti-dilutive stock based compensation awards | 86,667 |
Digital Assets - Schedule of Di
Digital Assets - Schedule of Digital Assets (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Digital Assets [Line Items] | ||
Beginning of Year | $ 888,026 | |
End of period | 3,416,256 | $ 888,026 |
Bitcoin [Member] | ||
Digital Assets [Line Items] | ||
Beginning of Year | 888,026 | |
Purchase of digital assets | 35,157 | 988,343 |
Production of digital assets | 12,289,131 | 945,560 |
Impairment loss on mined digital assets | (965,967) | (79,794) |
Impairment loss on purchased Bitcoin | (467,406) | |
Carrying amount of Bitcoin sold | (8,840,251) | (498,677) |
End of period | 3,406,096 | 888,026 |
Tether [Member] | ||
Digital Assets [Line Items] | ||
End of period | $ 10,160 | |
Gemini Dollars [Member] | ||
Digital Assets [Line Items] | ||
Purchase of digital assets | 500,000 | |
GUSD Earned on digital assets | 5,658 | |
Sale of digital assets | $ (505,658) |
Digital Assets - Additional Inf
Digital Assets - Additional Information (Details) - Bitcoin [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Digital Assets [Line Items] | ||
Sale of earned digital assets | $ 10,900 | $ 0 |
Sale of purchased digital assets | 28 | 519 |
Gain on disposition of earned digital assets | 2,100 | |
Gain on disposition of purchased digital assets | $ 2 | $ 20 |
Digital Assets - Schedule of Bi
Digital Assets - Schedule of Bitcoin (Details) - Bitcoin | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Digital Assets [Line Items] | ||
Beginning of Year | 54.9 | |
End of Period | 95.1 | 54.9 |
Bitcoin [Member] | ||
Digital Assets [Line Items] | ||
Beginning of Year | 54.9 | |
Production of Bitcoin | 423.4 | 53.4 |
Purchase of Bitcoin | 2 | 31.6 |
Sale of Bitcoin | (385) | (30.1) |
Fees | (0.2) | |
End of Period | 95.1 | 54.9 |
Fixed Assets and Intangible A_3
Fixed Assets and Intangible Assets, net - Components of Fixed Assets (Details) - USD ($) | Dec. 31, 2023 | Sep. 30, 2023 | Dec. 31, 2022 |
Property Plant And Equipment [Line Items] | |||
Gross fixed assets | $ 30,109,902 | $ 27,933,410 | |
Less: accumulated depreciation | (5,590,292) | (661,036) | |
Fixed assets, net | $ 24,519,610 | 27,272,374 | |
Mining Machine [Member] | |||
Property Plant And Equipment [Line Items] | |||
Useful Life (Years) | 4 years | 5 years | |
Gross fixed assets | $ 29,799,782 | 27,637,041 | |
Real Estate Assets Owned [Member] | |||
Property Plant And Equipment [Line Items] | |||
Useful Life (Years) | 30 years | ||
Gross fixed assets | $ 80,057 | 80,057 | |
Furniture Computer And Office Equipment [Member] | |||
Property Plant And Equipment [Line Items] | |||
Gross fixed assets | $ 230,063 | $ 216,312 | |
Furniture Computer And Office Equipment [Member] | Minimum [Member] | |||
Property Plant And Equipment [Line Items] | |||
Useful Life (Years) | 3 years | ||
Furniture Computer And Office Equipment [Member] | Maximum [Member] | |||
Property Plant And Equipment [Line Items] | |||
Useful Life (Years) | 5 years |
Fixed Assets and Intangible A_4
Fixed Assets and Intangible Assets, net - Additional Information (Details) | 12 Months Ended | ||||
Dec. 26, 2023 USD ($) | Jun. 02, 2023 USD ($) | Dec. 26, 2024 USD ($) | Dec. 31, 2023 USD ($) Machine | Dec. 31, 2022 USD ($) | |
Property, Plant and Equipment [Line Items] | |||||
Impairment loss | $ 0 | $ 0 | |||
Mining Machine [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Number Of Machines into Service | Machine | 5,900 | ||||
Write-off of mining machines | $ 9,000 | 38,000 | |||
Furniture, Computer and Office Equipment [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Depreciation | 4,900,000 | 478,000 | |||
Symbiont Assets [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Aggregate purchase price of asset | $ 2,600,000 | ||||
Asset acquisition consideration principal amount | 2,000,000 | ||||
Asset acquisition consideration accrued interest | 425,000 | ||||
Asset acquisition consideration legal fees | 164,000 | ||||
Acquisition expenses incurred | 238,000 | ||||
Assets acquired capitalized | $ 2,800,000 | ||||
Impairment of intangible assets | 800,000 | ||||
Amortization expense | $ 54,000 | $ 0 | |||
Asset Purchase Agreement [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Aggregate sale price of asset | $ 2,000,000 | ||||
Asset Purchase Agreement [Member] | Forecast [Member] | |||||
Property, Plant and Equipment [Line Items] | |||||
Amount held in customary indemnity escrow | $ 200,000 |
Fixed Assets and Intangible A_5
Fixed Assets and Intangible Assets, net - Schedule of Intangible Assets Activity (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Beginning balance | $ 0 | |
Symbiont intangible assets additions | 2,804,902 | |
Impairment loss on Symbiont assets | (750,678) | $ (1,052,542) |
Accumulated amortization | (54,224) | |
Sale of asset | (2,000,000) | |
Total intangible assets, net | $ 0 | $ 0 |
Deposit on Mining Equipment a_2
Deposit on Mining Equipment and Hosting Services - Additional information (Detail) - USD ($) | 3 Months Ended | 12 Months Ended | |||
Oct. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Deposit [Line Items] | |||||
Impairment loss | $ 3,150,000 | ||||
Deposit on mining equipment | 525,219 | $ 20,837 | $ 525,219 | ||
Mining Machine [Member] | |||||
Deposit [Line Items] | |||||
Impairment loss | 0 | 3,150,000 | |||
Deposit on mining equipment | 500,000 | 20,000 | 500,000 | ||
Hosting Deposits [Member] | |||||
Deposit [Line Items] | |||||
Payment for deposit | 1,000,000 | ||||
Impairment loss | 0 | 1,800,000 | |||
Hosting fee deposits | 2,200,000 | 0 | 2,200,000 | ||
Uptime Purchase Agreement [Member] | Mining Machine [Member] | |||||
Deposit [Line Items] | |||||
Payment for deposit | 3,150,000 | ||||
Uptime Hosting Agreement [Member] | Hosting Deposits [Member] | |||||
Deposit [Line Items] | |||||
Payment for deposit | $ 800,000 | ||||
Hosting Agreement [Member] | |||||
Deposit [Line Items] | |||||
Payment for deposit | $ 800,000 | ||||
Impairment loss | 800,000 | ||||
Hosting Agreement [Member] | Prepaid Expenses and Other Assets [Member] | |||||
Deposit [Line Items] | |||||
Hosting fee deposits | $ 0 | $ 3,100,000 | $ 0 |
Investments - Summary of Market
Investments - Summary of Marketable Equity Securities (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Investments [Abstract] | ||
Marketable equity securities, Cost | $ 743,906 | $ 2,976,933 |
Marketable equity securities, Cost of Shares Sold | (739,616) | (2,915,813) |
Marketable equity securities, Gross Unrealized Gain (Loss) | 13,570 | (56,830) |
Marketable equity securities, Fair Value | $ 17,860 | $ 4,290 |
Investments - Additional Inform
Investments - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||||
Oct. 28, 2022 | Mar. 31, 2022 | Jun. 30, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Nov. 02, 2022 | Sep. 09, 2022 | Jul. 29, 2022 | Jul. 28, 2022 | Jul. 09, 2022 | Feb. 01, 2022 | |
Schedule of Investments [Line Items] | ||||||||||||
Marketable securities shares sold | 0 | 8,759,094 | ||||||||||
Proceeds from sale marketable securities | $ 0 | $ 2,300,000 | ||||||||||
Realized net gain (loss) related to sale of securities | 0 | 350,000 | ||||||||||
Debt instrument principal amount | 567,586 | |||||||||||
Annual interest rate | 7% | |||||||||||
Debt instrument amount funded for transaction | 1,666,667 | |||||||||||
Part of transaction purchased, amount | $ 3,333,333 | |||||||||||
Realized gain (loss) on convertible debt securities | $ 287,778 | |||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | ||||||||||
Debt instrument, maturity date | Oct. 30, 2023 | |||||||||||
Note payable - short-term | $ 567,586 | $ 475,775 | ||||||||||
Cash | 2,401,831 | 4,238,006 | ||||||||||
Symbiont IO [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Common stock, par value | $ 3.0642 | |||||||||||
Accrued interest income on debt securities | 0 | 347,000 | ||||||||||
Cash | 300,000 | |||||||||||
Asset acquiring for liability | 2,400,000 | |||||||||||
Reserve amount reducing the asset aquired for liability | 1,100,000 | |||||||||||
Asset acquired for total consideration | 2,800,000 | |||||||||||
Accrued reimbursement of legal fees | $ 0 | $ 55,000 | ||||||||||
Loan amount | $ 2,000,000 | |||||||||||
Number of warrants issued | 700,000 | |||||||||||
Investment expiry date | Dec. 01, 2026 | |||||||||||
Symbiont IO [Member] | ROFR Agreement {Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Annual interest rate | 16% | |||||||||||
Investment maturity date | Dec. 01, 2021 | |||||||||||
Drawn amount | $ 2,000,000 | |||||||||||
Symbiont IO [Member] | ROFR Agreement {Member] | Maximum [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Note payable - short-term | $ 3,000,000 | |||||||||||
LMF Acquisition Opportunities Inc [Member] | Class A Common Stock [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Common stock, par value | $ 0.1 | |||||||||||
Converted common stock | one-for-one | |||||||||||
Seastar Medical [Member] | Credit Agreement [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | $ 125,000 | $ 700,000 | ||||||||||
Accrued interest income on debt securities | 3,000 | 19,000 | ||||||||||
Percentage of interest rate on advances | 7% | 15% | ||||||||||
Investment maturity date | Oct. 30, 2023 | |||||||||||
Repayments received from related party | 529,000 | |||||||||||
Seastar Medical [Member] | Credit Agreement [Member] | Maximum [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Agreed amount of advances | $ 700,000 | |||||||||||
Seastar Medical [Member] | Related Party [Member] | Credit Agreement [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | 296,000 | 700,000 | ||||||||||
Convertible Debt Securities [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Marketable securities shares sold | 4,895,894 | |||||||||||
Realized gain (loss) on convertible debt securities | (395,000) | |||||||||||
Remaining Convertible debt with Accrued Interest income | $ 965,096 | |||||||||||
Common stock, par value | $ 0.25 | |||||||||||
Converted common stock | 3,863,200 | |||||||||||
Unrealized loss on equity securities | $ 288,000 | |||||||||||
Realized Gain On Securities | 45,000 | |||||||||||
Accrued interest income on debt securities | $ 17,753 | |||||||||||
Investment, Type [Extensible Enumeration] | Short-Term Investments [Member] | |||||||||||
Convertible Debt Securities [Member] | Remaining Borqs Convertible Note Plus Accrued Interest | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Converted common stock | 3,863,200 | |||||||||||
Investment, Type [Extensible Enumeration] | Short-Term Investments [Member] | |||||||||||
Note Receivable | Seastar Medical [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Agreed amount of advances | 0 | $ 268,000 | $ 268,000 | |||||||||
Note Receivable | Seastar Medical [Member] | Related Party [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Other Receivables | 0 | 12,000 | ||||||||||
Senior Convertible Promissory Notes [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Debt instrument principal amount | 5,000,000 | |||||||||||
Senior notes | $ 20,000,000 | |||||||||||
Debt instrument maturity month and year | 2023-02 | |||||||||||
Annual interest rate | 8% | |||||||||||
Debt instrument discount rate percentage | 10% | |||||||||||
Debt instrument warrant coverage rate | 90% | |||||||||||
Debt instrument convertible conversion price rate | 110% | |||||||||||
Stock issued for warrants exercised, shares | 2,922,078 | |||||||||||
Unsecured Promissory Note [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Debt instrument principal amount | $ 1,750,000 | $ 500,000 | ||||||||||
Drawn amount | $ 310,000 | |||||||||||
Unsecured Promissory Note [Member] | LMF Acquisition Opportunities Inc [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Aggregate amount deposited in trust account | $ 1,035,000 | |||||||||||
Unsecured Promissory Note [Member] | LMF Acquisition Opportunities Inc [Member] | Related Party [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | $ 1,035,000 | |||||||||||
Original Sponsor Notes [Member] | LMF Acquisition Opportunities Inc [Member] | Related Party [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | $ 1,750,000 | |||||||||||
Sponsor Notes [Member] | LMF Acquisition Opportunities Inc [Member] | Related Party [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | $ 2,785,000 | |||||||||||
Sponsor Notes [Member] | Seastar Medical [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Accrued interest income on debt securities | $ 13,000 | 35,000 | ||||||||||
Sponsor Notes [Member] | Seastar Medical [Member] | Related Party [Member] | ||||||||||||
Schedule of Investments [Line Items] | ||||||||||||
Amount loaned under credit agreement | $ 1,127,000 | $ 2,785,000 |
Investments - Schedule of Short
Investments - Schedule of Short Term Investment in Convertible Debt Securities (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Short-Term Debt [Line Items] | ||
Beginning of year | $ 10,608,750 | |
Realized gain on conversion into marketable shares | (9,771,050) | $ 4,423,985 |
End of period | 1,145,486 | 10,608,750 |
Convertible Debt Securities [Member] | ||
Short-Term Debt [Line Items] | ||
Beginning of year | $ 0 | 539,351 |
Accrued interest income on convertible debt security | 17,753 | |
Convertible debt and interest converted into marketable shares | (844,882) | |
Realized gain on conversion into marketable shares | 287,778 | |
End of period | $ 0 |
Investments - Schedule of Notes
Investments - Schedule of Notes Receivable (Details) - Long Term Investments - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Beginning of year | $ 3,807,749 | $ 0 |
Accrued interest income | 159,692 | 54,659 |
End of period | 1,440,498 | 3,807,749 |
Seastar Medical [Member] | ||
Notes receivable from Seastar Medical Holding Corporation | 1,440,498 | 3,807,749 |
Investment in Seastar Medical Holding Corporation notes receivable | 125,000 | 3,753,090 |
Repayment of Seastar Medical Holding Corporation notes receivable | $ (2,651,943) | $ 0 |
Investments - Schedule of Long
Investments - Schedule of Long Term Investment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2023 | |
Allowance for losses on debt security | $ (1,052,542) | |
Long Term Investments [Member] | ||
Accrued interest income on debt securities | 54,659 | $ 159,692 |
Note receivable | 1,350,000 | |
Long Term Investments [Member] | Symbiont IO [Member] | ||
Note receivable | 2,027,178 | |
Accrued interest income on debt securities | 320,000 | |
Reclassification to intangible assets (Note 3) | (2,402,542) | |
Accrued recovery of legal fees | 55,364 | |
Allowance for losses on debt security | (1,052,542) | |
Reversal of allowance for losses on debt security | $ 1,052,542 | |
Note receivable | $ 1,350,000 |
Investments - SMHC Warrants and
Investments - SMHC Warrants and Common Stock - Additional Information (Details) - USD ($) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Investments [Line Items] | |||
Share Price | $ 12 | ||
Unrealized gain (loss) on investment in affiliate | $ (9,771,050) | $ 4,423,985 | |
LMFA Sponser LLC [Member] | |||
Schedule of Investments [Line Items] | |||
Purchased aggregate of private placement warrants | 5,738,000 | ||
Investment warrants exercise price | $ 1 | ||
SeaStar Medical Corporation [Member] | |||
Schedule of Investments [Line Items] | |||
Percentage of ownership, common shares | 4% | ||
Merger related description | As part of the merger, Sponsor agreed that it will not transfer its shares of SMHC common stock until the date that is the earlier of (1) the twelve month anniversary of the closing of the merger and (2) the last sale price of the Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period commencing at least 150 days after the close of the merger. | ||
Class A Common Stock [Member] | LMFA Sponser LLC [Member] | |||
Schedule of Investments [Line Items] | |||
Investment warrants exercise price | $ 11.5 | ||
Class A Common Stock [Member] | SeaStar Medical Corporation [Member] | |||
Schedule of Investments [Line Items] | |||
Shares holds by sponsor | 2,587,500 | ||
Percentage of common stock hold by sponsors | 5.40% | ||
Class A Common Stock [Member] | LMF Acquisition Opportunities Inc [Member] | |||
Schedule of Investments [Line Items] | |||
Converted common stock | one-for-one | ||
Class B Common Stock [Member] | SeaStar Medical Corporation [Member] | |||
Schedule of Investments [Line Items] | |||
Shares holds by sponsor | 2,587,500 | ||
Seastar Medical [Member] | |||
Schedule of Investments [Line Items] | |||
Share Price | $ 0.44 | $ 4.1 | |
Gain or loss on equity investment in unconsolidated subsidiary | $ 9,500,000 | $ 5,900,000 | |
LMF Acquisition Opportunities Inc [Member] | SeaStar Medical Corporation [Member] | |||
Schedule of Investments [Line Items] | |||
Minority interest | 30% | ||
Private Placement Warrants [Member] | LMFA Sponser LLC [Member] | |||
Schedule of Investments [Line Items] | |||
Unrealized loss on equity securities | 300,000 | 1,500,000 | |
Warrant [Member] | Class A Common Stock [Member] | SeaStar Medical Corporation [Member] | |||
Schedule of Investments [Line Items] | |||
Private warrants hold by sponsors | 5,738,000 | ||
Common Stock And Warrants [Member] | |||
Schedule of Investments [Line Items] | |||
Unrealized gain (loss) on investment in affiliate | $ (9,800,000) | $ 4,400,000 |
Investments - Schedule of Lon_2
Investments - Schedule of Long Term Investment - Equity Securities (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Beginning of year | $ 10,608,750 | |
End of period | 1,145,486 | $ 10,608,750 |
Stock Warrants [Member] | ||
Beginning of year | 464,778 | |
End of period | 156,992 | 464,778 |
Long Term Investments [Member] | ||
Beginning of year | 464,778 | 1,973,413 |
Unrealized loss on equity securities | (307,786) | (1,508,635) |
End of period | $ 156,992 | $ 464,778 |
Investment - Summary of Investm
Investment - Summary of Investment in Unconsolidated Affiliates (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Investments [Line Items] | ||
Beginning of year | $ 10,608,750 | |
Unrealized gain (loss) on investment in affiliate | (9,771,050) | $ 4,423,985 |
End of period | 1,145,486 | 10,608,750 |
Seastar Medical Holdings, Inc [Member] | ||
Schedule of Investments [Line Items] | ||
Beginning of year | 10,608,750 | 4,676,130 |
Unrealized gain (loss) on investment in affiliate | (9,463,264) | 5,932,620 |
End of period | $ 1,145,486 | $ 10,608,750 |
Investments - Notes receivable
Investments - Notes receivable from Seastar Medical Holdings Corporation - Additional Information (Details) - USD ($) | Oct. 28, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | Jul. 29, 2022 | Jul. 28, 2022 | Feb. 01, 2022 |
Accounts Notes And Loans Receivable [Line Items] | ||||||
Debt instrument principal amount | $ 567,586 | |||||
Share price | $ 0.001 | $ 0.001 | ||||
Debt instrument, maturity date | Oct. 30, 2023 | |||||
Debt Instrument Interest Rate Stated Percentage | 7% | |||||
LMF Acquisition Opportunities Inc [Member] | Class A Common Stock [Member] | ||||||
Accounts Notes And Loans Receivable [Line Items] | ||||||
Share price | $ 0.1 | |||||
Unsecured Promissory Note [Member] | ||||||
Accounts Notes And Loans Receivable [Line Items] | ||||||
Debt instrument principal amount | $ 1,750,000 | $ 500,000 | ||||
Unsecured Promissory Note [Member] | LMF Acquisition Opportunities Inc [Member] | ||||||
Accounts Notes And Loans Receivable [Line Items] | ||||||
Aggregate amount deposited in trust account | $ 1,035,000 |
Debt and Other Financing Arra_3
Debt and Other Financing Arrangements - Schedule of Debt (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Notes payable | $ 567,586 | $ 475,775 |
Financing agreement with Imperial PFS capital maturing in August 1, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 365,379 | |
Financing agreement with Imperial PFS capital maturing in August 1, 2023 [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 110,396 | |
Financing agreement with Imperial PFS capital maturing in July 1, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 21,945 | |
Financing agreement with Imperial PFS capital maturing in August 1, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | 335,022 | |
Financing agreement with Imperial PFS capital maturing in June 1, 2024 [Member] | ||
Debt Instrument [Line Items] | ||
Notes payable | $ 210,619 |
Debt and Other Financing Arra_4
Debt and Other Financing Arrangements - Schedule of Debt (Parenthetical) (Detail) - USD ($) | 12 Months Ended | ||
Oct. 28, 2022 | Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | |||
Debt instrument, maturity date | Oct. 30, 2023 | ||
Annual interest rate | 7% | ||
Financing agreement with Imperial PFS capital maturing in August 1, 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Down payment for note payable | $ 78,000 | ||
Debt instrument, maturity date | Aug. 01, 2023 | ||
Annual interest rate | 7.35% | ||
Debt instrument, periodic payment | $ 45,672 | ||
Debt instrument due period | 10 months | ||
Financing agreement with Imperial PFS capital maturing in August 1, 2023 [Member] | |||
Debt Instrument [Line Items] | |||
Down payment for note payable | $ 15,000 | ||
Debt instrument, maturity date | Aug. 01, 2023 | ||
Annual interest rate | 7.35% | ||
Debt instrument, periodic payment | $ 13,799 | ||
Debt instrument due period | 8 months | ||
Financing agreement with Imperial PFS capital maturing in July 1, 2024 [Member] | |||
Debt Instrument [Line Items] | |||
Down payment for note payable | $ 3,438 | ||
Debt instrument, maturity date | Jul. 01, 2024 | ||
Annual interest rate | 12.05% | ||
Debt instrument, periodic payment | $ 3,658 | ||
Debt instrument due period | 11 months | ||
Financing agreement with Imperial PFS capital maturing in August 1, 2024 [Member] | |||
Debt Instrument [Line Items] | |||
Down payment for note payable | $ 36,544 | ||
Debt instrument, maturity date | Aug. 01, 2024 | ||
Annual interest rate | 9.60% | ||
Debt instrument, periodic payment | $ 41,879 | ||
Debt instrument due period | 10 months | ||
Financing agreement with Imperial PFS capital maturing in June 1, 2024 [Member] | |||
Debt Instrument [Line Items] | |||
Down payment for note payable | $ 30,000 | ||
Debt instrument, maturity date | Jun. 01, 2024 | ||
Annual interest rate | 12.05% | ||
Debt instrument, periodic payment | $ 35,103 | ||
Debt instrument due period | 6 months |
Debt and Other Financing Arra_5
Debt and Other Financing Arrangements - Additional Information (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 | Oct. 28, 2022 |
Debt Instrument [Line Items] | |||
Notes payable | $ 567,586 | $ 475,775 | |
Annual interest rate | 7% |
Debt and Other Financing Arra_6
Debt and Other Financing Arrangements - Schedule of Principal Payments of Debt (Detail) | Dec. 31, 2023 USD ($) |
Debt Instruments [Abstract] | |
2024 | $ 567,586 |
Principal amount | $ 567,586 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |||||||
Feb. 27, 2023 USD ($) | Nov. 08, 2022 USD ($) Container | Sep. 02, 2022 | Oct. 31, 2021 USD ($) Container BitcoinMachine | Dec. 31, 2022 USD ($) | Mar. 31, 2022 | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Jun. 29, 2022 USD ($) | |
Loss Contingencies [Line Items] | |||||||||
Operating lease remaining lease term | 20 months | ||||||||
Operating lease discount rate | 7.35% | 7.50% | |||||||
Adjustments to right of use of assets and lease liabilities | $ 22,000 | $ 300,787 | |||||||
Sublease Income | 58,000 | $ 59,500 | |||||||
Lease expense | 109,000 | $ 108,000 | |||||||
Lessee operating lease term of contract | 39 months | ||||||||
Attorney fees and other related legal cost | $ 275,000 | ||||||||
Impairment charge | $ 3,150,000 | ||||||||
Hosting Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Number of manufacturing specialty containers | BitcoinMachine | 18 | ||||||||
Impairment charge | $ 800,000 | ||||||||
Payment for deposit | $ 800,000 | ||||||||
Additional deposit for each container three months prior to delivery at the hosting site | 44,000 | ||||||||
Final deposit for each container one month prior to arrival at the hosting site | $ 44,000 | ||||||||
Lawsuit filing date | September 2, 2022 | ||||||||
Name of defendant | Uptime Hosting LLC | ||||||||
Release And Termination Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Deposit receivable on termination | $ 800,000 | ||||||||
New Office Lease [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Operating lease beginning date | Jul. 15, 2019 | ||||||||
Operating lease expire date | Jul. 31, 2022 | ||||||||
Operating lease extended end date | Jul. 31, 2025 | ||||||||
Pod5ive Containers [Member] | Uptime Purchase Agreement [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Pod5ive cargo containers | Container | 18 | ||||||||
Aggregate purchase price of asset | $ 3,150,000 | ||||||||
Payment require to payable to acquire assets | $ 2.4 | ||||||||
Percentage of first payment require payable to acquire assets | 75% | ||||||||
Percentage of second payment require payable to acquire assets | 25% | ||||||||
Number of manufacturing specialty containers | Container | 18 | ||||||||
Legal action instituted, value | $ 3,150,000 | ||||||||
Business Law Group [Member] | |||||||||
Loss Contingencies [Line Items] | |||||||||
Sublease Income | $ 4,800 |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Supplemental Balance Sheet Information Related to Operating Leases (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Assets and Liabilities, Lessee [Abstract] | ||
ROU assets | $ 189,009 | $ 265,658 |
Current lease liabilities | 110,384 | 90,823 |
Long-term lease liabilities | 85,775 | 179,397 |
Total lease liabilities | $ 196,159 | $ 270,220 |
Weighted-average remaining lease term (in years) | 1 year 8 months 12 days | 2 years 8 months 12 days |
Weighted-average discount rate | 7.49% | 7.50% |
Commitments and Contingencies_3
Commitments and Contingencies - Summary of Supplemental Cash Flow Information and Non-cash Activity Related to Operating Leases (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Operating cash flow information | ||
Lease liability payments | $ (95,948) | $ (98,569) |
ROU assets and operating lease obligation recognized | $ 21,887 | $ 300,787 |
Commitments and Contingencies_4
Commitments and Contingencies - Schedule of Future Minimum Lease Payment Due (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
2024 | $ 121,385 | |
2025 | 85,324 | |
2026 | 3,163 | |
(less: imputed interest) | (13,713) | |
Total lease liabilities | $ 196,159 | $ 270,220 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |||||||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Loss Carryforwards [Line Items] | ||||||||
Valuation allowance | $ 14,100,000 | $ 8,500,000 | ||||||
Valuation allowance | $ 14,102,215 | $ 8,470,093 | ||||||
Combined federal and state statutory rate | (0.30%) | (5.40%) | ||||||
Fresh-start adjustment, increase in equity | $ 36,186,408 | $ 49,191,226 | ||||||
Cumulative change in stock ownership percentage | 50% | |||||||
Cumulative change in stock ownership period | 3 years | |||||||
U.S. and Various State Authorities [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Tax examination, year under examination | 2017 2018 2019 2020 | |||||||
Predecessor [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Redemption consideration, taxable gain | $ 5,250,000 | |||||||
Predecessor [Member] | Fresh-Start Adjustment [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Fresh-start adjustment, increase in equity | 1,910,000 | |||||||
Predecessor [Member] | Federal [Member] | ||||||||
Operating Loss Carryforwards [Line Items] | ||||||||
Net operating loss carryforwards | $ 1,410,000 | $ 2,980,000 | $ 3,960,000 | $ 512,000 | $ 5,100,000 | $ 1,950,000 | ||
Net operating loss carryforwards expiration period | 2038 | 2037 | 2036 | 2035 |
Income Taxes - Components of Pr
Income Taxes - Components of Provision for Income Taxes (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Current tax benefit | ||
Federal | $ 60,571 | $ 1,196,415 |
State | 241,651 | |
Total current tax expense | 60,571 | 1,438,066 |
Deferred tax expense - Federal | (4,540,213) | (4,181,816) |
Deferred tax expense - State | (1,091,907) | (1,041,813) |
Valuation allowance | 5,632,121 | 5,223,629 |
Income tax expense | $ 60,571 | $ 1,438,066 |
Income Taxes - Schedule of Reco
Income Taxes - Schedule of Reconciliation of Tax Provision with Expected Provision (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income tax provision at the US federal statutory rate | $ (3,951,107) | $ (5,553,496) |
Nondeductible expenses | 20,847 | |
Stock based compensation | 3,222,271 | |
State income taxes,net of federal benefit | (852,967) | (470,684) |
True-up | (681,760) | (786,165) |
Change in valuation allowance | 5,632,122 | 5,223,627 |
Change in rate | (106,564) | (197,487) |
Income tax expense | $ 60,571 | $ 1,438,066 |
Income tax provision at the US federal statutory rate | 21% | 21% |
Nondeductible expenses, percentage | (0.10%) | 0% |
Stock based compensation, percentage | 0% | (12.20%) |
State income taxes, net of federal benefit percentage | 4.50% | 1.80% |
True-up, Percentage | 3.60% | 3% |
Change in valuation allowance, percentage | (29.90%) | (19.80%) |
Change in rate percentage | 0.60% | 0.70% |
Tax expense/effective rate | (0.30%) | (5.40%) |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax liabilities: | ||
Depreciation | $ 877,838 | $ 538,866 |
Right to use assets | 48,306 | 67,052 |
Other | 316,331 | |
Total deferred tax liabilities | 1,242,475 | 605,918 |
Deferred tax assets: | ||
Loss carryforwards - Federal | 7,045,561 | 5,922,644 |
Loss carryforwards - State | 1,529,067 | 1,195,806 |
Stock option expense | 1,916,270 | 490,892 |
Amortization | 362,918 | 395,272 |
Allowance for credit losses | 13,541 | 14,555 |
Right to use liability | 50,133 | 68,203 |
Unrealized loss on securities | 4,424,536 | 986,639 |
Charitable contributions | 2,664 | 2,000 |
Total deferred tax asset | 15,344,690 | 9,076,011 |
Valuation allowance | (14,102,215) | (8,470,093) |
Net deferred tax asset | $ 0 | $ 0 |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |||||
Mar. 28, 2024 | Feb. 01, 2022 | Jan. 02, 2017 | Apr. 15, 2015 | Dec. 31, 2023 | Dec. 31, 2022 | |
Subsidiaries [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Recoveries incurred | $ 66 | $ 75 | ||||
Business Law Group Association Law [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Reduction in compensation payable | $ 53 | $ 82 | ||||
Ownership percentage | 50% | |||||
Termination fee | $ 150 | |||||
Business Law Group Association Law [Member] | Subsequent Event [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Reduction in compensation payable | $ 43 | |||||
Business Law Group [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Monthly payment for cases | $ 82 | |||||
Minimum fee paid per unit | $ 700 | |||||
Collection from property owners | 637 | 665 | ||||
Restructuring charges | 54 | 172 | ||||
Office sublease income | 58 | 60 | ||||
Receivable from related party | 24 | 63 | ||||
Business Law Group [Member] | Out of Pocket Collection Costs [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Expenses incurred by company | $ 37 | $ 63 |
Stockholders' Equity - Summary
Stockholders' Equity - Summary of Restricted Share Activity (Details) - Restricted Stock [Member] - $ / shares | 12 Months Ended | ||
Apr. 20, 2023 | Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Number of restricted shares outstanding at, beginning balance | 0 | 0 | |
Number of restricted shares, granted | 260,000 | 260,000 | 0 |
Number of restricted shares, vested | (173,333) | 0 | |
Number of restricted shares outstanding at, ending balance | 86,667 | 0 | |
Weighted Average, Outstanding at Beginning Balance | $ 0 | $ 0 | |
Weighted Average Award Price, granted | 4.51 | 0 | |
Weighted Average Award Price, vested | 4.51 | 0 | |
Weighted Average, Outstanding at ending balance | $ 4.51 | $ 0 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) | 1 Months Ended | 12 Months Ended | ||||||||||||||
Feb. 23, 2024 $ / shares | Nov. 09, 2023 | Apr. 20, 2023 $ / shares shares | Oct. 20, 2021 $ / shares shares | Oct. 19, 2021 $ / shares shares | Oct. 18, 2021 $ / shares shares | Aug. 18, 2020 $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2023 USD ($) $ / shares shares | Dec. 31, 2022 USD ($) $ / shares shares | Dec. 31, 2021 USD ($) shares | Jun. 30, 2024 Petahash | Jun. 30, 2023 Petahash shares | Jun. 26, 2023 USD ($) | Aug. 31, 2020 $ / shares | Oct. 31, 2018 $ / shares shares | |
Class Of Stock [Line Items] | ||||||||||||||||
Reverse stock split, description | On November 9, 2023, our shareholders voted in favor of the approval of an amendment to our Certificate of Incorporation, in the event it is deemed advisable by our Board of Directors, to effect a reverse stock split of the Company’s issued and outstanding common stock at a ratio within the range of one-for-two (1:2) and one-for-ten (1:10), as determined by the Board of Directors. | |||||||||||||||
Common stock, par value | $ / shares | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||||
Common stock, shares outstanding | shares | 2,232,964 | 2,492,964 | 2,232,964 | |||||||||||||
Stock compensation | $ 1,095,705 | $ 1,098,331 | ||||||||||||||
Common stock, aggregate offering price | $ 2,233 | 2,493 | 2,233 | |||||||||||||
Aggregate gross sales limit | $ 12,984,090 | $ 1,733,951 | ||||||||||||||
Number of options granted | shares | 414,417 | 127,406 | ||||||||||||||
Stock option exercise per share | $ / shares | $ 4.51 | $ 3.54 | ||||||||||||||
Number of bitcoin mining operations | Petahash | 500 | |||||||||||||||
Unrecognized compensation cost of stock options | 600,000 | $ 600,000 | $ 600,000 | |||||||||||||
Recognized compensation expense of stock options | $ 1,800,000 | $ 16,600,000 | ||||||||||||||
Stock options remaining life, years | 9 years 1 month 6 days | 9 years 7 months 6 days | ||||||||||||||
Aggregate intrinsic value of outstanding common stock options | 0 | $ 0 | $ 0 | |||||||||||||
Subsequent Event [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Reverse stock split, description | On February 23, 2024, the Board approved a one-for-six (1:6) reverse split of the Company’s issued and outstanding common stock, par value $0.001 per share, pursuant to which every six outstanding shares of common stock was converted into one share of common stock (the “Reverse Stock Split”). The Reverse Stock Split was effected by the filing of an amendment to our Certificate of Incorporation on March 7, 2024 which provided that the Reverse Stock Split become effective at 12:01 a.m. eastern time on March 12, 2024. | |||||||||||||||
Reverse stock split ratio | 0.1667 | |||||||||||||||
Common stock, par value | $ / shares | $ 0.001 | |||||||||||||||
Forecast [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of bitcoin mining operations | Petahash | 1,000 | |||||||||||||||
One-year Anniversary [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Options vesting, percentage | 50% | |||||||||||||||
Two-year Anniversary [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Options vesting, percentage | 50% | |||||||||||||||
Maximum [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Reverse stock split ratio | 0.5 | |||||||||||||||
Minimum [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Reverse stock split ratio | 0.1 | |||||||||||||||
Restricted Stock [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Stock option exercise per share | $ / shares | $ 4.51 | |||||||||||||||
Unrecognized compensation cost of stock options | $ 76,000 | |||||||||||||||
Stock Options [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of options granted | shares | 414,417 | |||||||||||||||
Stock option exercise per share | $ / shares | $ 4.5 | |||||||||||||||
Options scheduled to vest | shares | 207,208 | |||||||||||||||
Unrecognized compensation cost of stock options | $ 1,800,000 | |||||||||||||||
Director [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Awards vesting description | Both of these awards will vest over a twelve month period with 50% after 6 months and the remaining 50% at end of twelve months. | |||||||||||||||
Unrecognized compensation cost of stock options | 409,000 | 409,000 | ||||||||||||||
Equity Distribution Agreement [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, aggregate offering price | $ 4,700,000 | |||||||||||||||
Aggregate gross sales limit | $ 4,700,000 | |||||||||||||||
Legal and professional fees incurred related to ATM program | 119,000 | |||||||||||||||
Management Employment Contract | Management [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, shares issued | shares | 12,323 | |||||||||||||||
Stock compensation | $ 229,500 | |||||||||||||||
Consulting in Blockchain and Crypto Currency Field [Member] | Restricted Stock [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, aggregate offering price | 1,200,000 | |||||||||||||||
Consulting in Blockchain and Crypto Currency Field [Member] | Two Vendors [Member] | Restricted Stock [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Stock compensation | 1,096,000 | |||||||||||||||
Stock Warrants [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Warrants, aggregate intrinsic value outstanding | $ 0 | $ 0 | $ 0 | |||||||||||||
Number of warrants, exercised | shares | 0 | 0 | ||||||||||||||
Secondary Offering [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Proceeds from exercise of warrants | $ 0 | $ 0 | $ 1,004,000 | |||||||||||||
Warrants expiration date | Oct. 31, 2023 | |||||||||||||||
Secondary Offering [Member] | Stock Warrants [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Warrants issued to purchase of common stock | shares | 1,052,630 | 83,333 | ||||||||||||||
Warrants issued to purchase of common stock exercise price per share | $ / shares | $ 30 | $ 3.35 | $ 12 | |||||||||||||
Warrants, year of expiration | 2026 | |||||||||||||||
Warrants, weighted average remaining life | 2 years 9 months 18 days | |||||||||||||||
Number of warrants, exercised | shares | 299,000 | |||||||||||||||
Proceeds from exercise of warrants | 0 | 0 | ||||||||||||||
Secondary Offering [Member] | Additional Warrants [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Warrants issued to purchase of common stock | shares | 4,167 | |||||||||||||||
Warrants issued to purchase of common stock exercise price per share | $ / shares | $ 27 | |||||||||||||||
Proceeds from exercise of warrants | 0 | |||||||||||||||
Warrants expiration date | May 02, 2022 | |||||||||||||||
Secondary Offering 1 [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Proceeds from exercise of warrants | $ 0 | 0 | ||||||||||||||
Secondary Offering 1 [Member] | Stock Warrants [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Warrants issued to purchase of common stock | shares | 157,895 | 373,333 | ||||||||||||||
Warrants issued to purchase of common stock exercise price per share | $ / shares | $ 30 | $ 27 | ||||||||||||||
Remaining shares exercised warrants | shares | 51,383 | |||||||||||||||
Warrants, year of expiration | 2026 | 2025 | ||||||||||||||
Warrants, weighted average remaining life | 2 years 9 months 18 days | 1 year 7 months 17 days | ||||||||||||||
Proceeds from exercise of warrants | $ 0 | 0 | ||||||||||||||
Secondary Offering 2 [Member] | Stock Warrants [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Warrants issued to purchase of common stock | shares | 36,316 | |||||||||||||||
Warrants issued to purchase of common stock exercise price per share | $ / shares | $ 35.64 | |||||||||||||||
Warrants, year of expiration | 2025 | |||||||||||||||
Warrants, weighted average remaining life | 1 year 3 months 18 days | |||||||||||||||
Proceeds from exercise of warrants | $ 0 | $ 0 | ||||||||||||||
$4.02 Exercise Price Per Share [Member] | Director [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of options granted | shares | 6,219 | |||||||||||||||
Stock option exercise per share | $ / shares | $ 4.02 | |||||||||||||||
Minimum contractual term of options granted | 10 years | |||||||||||||||
Stock option exercise grant fair value | $ / shares | $ 3.48 | |||||||||||||||
$3.54 Exercise Price Per Share [Member] | Director [Member] | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of options granted | shares | 121,187 | |||||||||||||||
Stock option exercise per share | $ / shares | $ 3.54 | |||||||||||||||
Minimum contractual term of options granted | 10 years | |||||||||||||||
Stock option exercise grant fair value | $ / shares | $ 3 |
Stockholders' Equity - Summar_2
Stockholders' Equity - Summary of Stock Warrants (Detail) - Warrants [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | ||
Number of restricted shares outstanding at, beginning balance | 1,279,573 | 1,283,740 |
Number of warrants, granted | 0 | 0 |
Number of warrants, exercised | 0 | 0 |
Number of warrants, forfeited | (4,766) | (4,167) |
Number of restricted shares outstanding at, ending balance | 1,274,807 | 1,279,573 |
Weighted Average, Outstanding at Beginning Balance | $ 30 | $ 30 |
Weighted Average Exercise Price, granted | 0 | 0 |
Weighted Average Exercise Price, exercised | 0 | 0 |
Weighted Average Exercise Price, forfeited | 20.16 | 27 |
Weighted Average, Outstanding at ending balance | $ 30.04 | $ 30 |
Stockholders' Equity - Summar_3
Stockholders' Equity - Summary of Stock Option Plan Activity (Detail) | 12 Months Ended | |
Dec. 31, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | |
Number of Options | ||
Number of Options, Outstanding at Beginning of the year | shares | 186,877 | 659,471 |
Number of Options, Granted | shares | 414,417 | 127,406 |
Number of Options, Cancelled | shares | 0 | (600,000) |
Number of Options, Forfeited | shares | (1,697) | 0 |
Number of Options, Outstanding at End of Year | shares | 599,597 | 186,877 |
Number of Options, Exercisable at End of Year | shares | 379,194 | 30,443 |
Weighted Average Exercise Price | ||
Weighted Average Exercise Price, Outstanding at Beginning Balance | $ / shares | $ 19.56 | $ 37.2 |
Weighted Average Exercise Price, Granted | $ / shares | 4.51 | 3.54 |
Weighted Average Exercise Price, Cancelled | $ / shares | 0 | 35.7 |
Weighted Average Exercise Price, Forfeited | $ / shares | 72.18 | 0 |
Weighted Average Exercise Price, Outstanding at Ending Balance | $ / shares | 9 | 19.56 |
Weighted Average Exercise Price, Exercisable | $ / shares | $ 10.55 | $ 71.28 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Significant Assumptions Used in Option-pricing Model to Fair Value Options Granted (Detail) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free rate | 3.54% | |
Expected volatility | 118% | |
Expected life | 10 years | |
Price Hurdle | $ 12 | |
Director [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Risk-free rate, Minimum | 3.53% | |
Risk-free rate, Maximum | 3.83% | |
Expected volatility | 119% | |
Expected life | 10 years |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2023 Segment | |
Segment Reporting [Abstract] | |
Reportable segments | 2 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information, by Segment (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Revenue, net | $ 12,984,090 | $ 1,733,951 |
Depreciation and amortization | 4,983,480 | 478,020 |
Operating loss | (10,061,919) | (24,675,985) |
Realized gain (loss) on securities | 4,420 | (349,920) |
Realized gain on convertible debt securities | 287,778 | |
Unrealized gain (loss) on marketable securities | 13,570 | (56,830) |
Impairment loss on prepaid machine deposits | (36,691) | (3,150,000) |
Impairment loss on prepaid hosting deposits | (184,236) | (1,790,712) |
Impairment loss on Symbiont assets | (750,678) | (1,052,542) |
Unrealized gain (loss) on investment and equity securities | (9,771,050) | 4,423,985 |
Impairment loss on digital assets | 0 | (467,406) |
Realized gain on sale of purchased digital assets | 1,917 | 20,254 |
Loss on disposal of assets | (9,389) | (38,054) |
Other income - coupon sales | 639,472 | |
Gain on adjustment of note receivable allowance | 1,052,542 | |
Other income - finance revenue | 37,660 | |
Digital assets other income | 5,658 | |
Dividend income | 3,875 | |
Interest income, net | 249,586 | 399,094 |
Income (loss) before income taxes | (18,814,796) | (26,445,221) |
Fixed Asset Additions | 2,176,491 | 27,690,475 |
Operating Segments [Member] | Specialty Finance [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue, net | 694,959 | 788,391 |
Depreciation and amortization | 5,364 | 3,348 |
Operating loss | (934,807) | (1,122,872) |
Income (loss) before income taxes | (934,807) | (1,122,872) |
Fixed Asset Additions | 2,938 | 1,612 |
Operating Segments [Member] | Mining Operations [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenue, net | 12,289,131 | 945,560 |
Depreciation and amortization | 4,918,332 | 471,049 |
Operating loss | (2,020,112) | (1,014,327) |
Impairment loss on prepaid machine deposits | (36,691) | (3,150,000) |
Impairment loss on prepaid hosting deposits | (184,236) | (1,790,712) |
Loss on disposal of assets | (9,389) | |
Other income - coupon sales | 639,472 | |
Income (loss) before income taxes | (1,610,956) | (5,993,094) |
Fixed Asset Additions | 2,162,741 | 27,683,559 |
All Other [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation and amortization | 59,784 | 3,623 |
Operating loss | (7,107,000) | (22,538,786) |
Realized gain (loss) on securities | 4,420 | (349,920) |
Realized gain on convertible debt securities | 287,778 | |
Unrealized gain (loss) on marketable securities | 13,570 | (56,830) |
Impairment loss on Symbiont assets | (750,678) | (1,052,542) |
Unrealized gain (loss) on investment and equity securities | (9,771,050) | 4,423,985 |
Impairment loss on digital assets | (467,406) | |
Realized gain on sale of purchased digital assets | 1,917 | 20,254 |
Loss on disposal of assets | (38,054) | |
Gain on adjustment of note receivable allowance | 1,052,542 | |
Other income - finance revenue | 37,660 | |
Digital assets other income | 5,658 | |
Dividend income | 3,875 | |
Interest income, net | 249,586 | 399,094 |
Income (loss) before income taxes | (16,269,033) | (19,329,255) |
Fixed Asset Additions | $ 10,812 | $ 5,304 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Feb. 23, 2024 $ / shares | Jan. 31, 2024 USD ($) | Nov. 09, 2023 | Dec. 31, 2023 $ / shares shares | Dec. 31, 2022 $ / shares shares | |
Subsequent Event [Line Items] | |||||
Reverse stock split, description | On November 9, 2023, our shareholders voted in favor of the approval of an amendment to our Certificate of Incorporation, in the event it is deemed advisable by our Board of Directors, to effect a reverse stock split of the Company’s issued and outstanding common stock at a ratio within the range of one-for-two (1:2) and one-for-ten (1:10), as determined by the Board of Directors. | ||||
Common stock, par value | $ 0.001 | $ 0.001 | |||
Common stock, shares outstanding | shares | 2,492,964 | 2,232,964 | |||
Minimum [Member] | |||||
Subsequent Event [Line Items] | |||||
Reverse stock split ratio | 0.1 | ||||
Maximum [Member] | |||||
Subsequent Event [Line Items] | |||||
Reverse stock split ratio | 0.5 | ||||
Subsequent Event [Member] | |||||
Subsequent Event [Line Items] | |||||
Reverse stock split, description | On February 23, 2024, the Board approved a one-for-six (1:6) reverse split of the Company’s issued and outstanding common stock, par value $0.001 per share, pursuant to which every six outstanding shares of common stock was converted into one share of common stock (the “Reverse Stock Split”). The Reverse Stock Split was effected by the filing of an amendment to our Certificate of Incorporation on March 7, 2024 which provided that the Reverse Stock Split become effective at 12:01 a.m. eastern time on March 12, 2024. | ||||
Reverse stock split ratio | 0.1667 | ||||
Common stock, par value | $ 0.001 | ||||
Subsequent Event [Member] | Seastar Medical [Member] | |||||
Subsequent Event [Line Items] | |||||
Repayments of notes receivables | $ | $ 1.4 |