Cost of Revenue

9 Months Ended

Sep. 30, 2023

Cost of Goods and Service, Excluding Depreciation, Depletion, and Amortization [Abstract]

(7) Cost of Revenue (Excluding Depreciation and Amortization)

Cost of Revenue (excluding depreciation and amortization) is comprised of expenses associated with the selling of cryptocurrencies and operating the Company’s BTM kiosks, excluding depreciation and amortization. The following table presents cost of revenue (excluding depreciation and amortization) by category (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cryptocurrency expenses	$	138,828	$	139,265	$	419,682	$	401,844
Floorspace lease expenses		8,489		9,998		26,270		30,365
Kiosk operations expenses		5,228		4,194		15,135		11,730
Total Cost of Revenue (excluding depreciation and amortization reported separately)	$	152,545	$	153,457	$	461,087	$	443,939

The following table presents the components of cryptocurrency expenses (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Cost of Cryptocurrency (1) - BTM Kiosk	$	138,551	$	138,229	$	418,425	$	396,992
Cost of Cryptocurrency (1) - OTC		—		—		—		1,958
Cost of Cryptocurrency (1) - BDCheckout		234		241		749		248
Software Processing Fees		8		697		267		2,424
Exchange Fees		1		31		21		89
Mining Fees		30		63		207		129
Software Processing Fee - BDCheckout		4		4		13		4
Total cryptocurrency expenses	$	138,828	$	139,265	$	419,682	$	401,844

(1)

Cost of Cryptocurrency includes impairment losses recognized on cryptocurrencies net of any gains recognized from sales of cryptocurrencies on an exchange. Impairment of $1.8 million and $1.7 million were offset by no gains from the sale of cryptocurrencies on exchange for the three months ended September 30, 2023 and 2022, respectively. Impairment of $6.4 million and $5.6 million were offset by gains from the sale of cryptocurrencies on exchange of $0.1 million and $1.0 million for the nine months ended September 30, 2023 and 2022, respectively.

The Company presents cost of revenue in the consolidated Statements of Income (Loss) and Comprehensive Income (Loss) exclusive of depreciation related to BTM kiosks and amortization of intangible assets related to software applications, tradenames and customer relationships.

The following table reconciles amounts excluded from the cost of revenue (excluding depreciation and amortization) caption in the consolidated Statements of Income (Loss) and Comprehensive Income (Loss) included in total depreciation and amortization expense in the consolidated Statements of Income (Loss) and Comprehensive Income (Loss) for the period presented (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Depreciation of owned BTM kiosks	$	919	$	661	$	1,794	$	2,125
Depreciation of leased BTM kiosks		1,862		3,687		6,375		11,062
Amortization of intangible assets		382		382		1,134		1,128
Total depreciation and amortization excluded from cost of revenue	$	3,163	$	4,730	$	9,303	$	14,315
Other depreciation and amortization included in operating expenses		97		33		251		50
Total depreciation and amortization	$	3,260	$	4,763	$	9,554	$	14,365