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Deposit, Property and Equipment and Intangible Assets
 6 Months Ended
Jun. 30, 2021
Property, Plant and Equipment [Abstract]  
DEPOSIT, PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS

NOTE 3 – DEPOSIT, PROPERTY AND EQUIPMENT AND INTANGIBLE ASSETS

 

On February 5, 2021, the Company entered into a Long-Term Purchase Contract with Canaan Convey Co Ltd (“Canaan”) for the purchase of 11,760 next generation Avalon A1246 ASIC Miners (Avalon). The purchase price per unit is $2,889 for a total purchase price of $33,974,640 (the “Canaan Transaction”). There will be a final adjustment to the purchase price in the last delivery due in March 2022 based on the actual tera hash delivered, based on the agreed price per tera hash under the terms of the contract.

 

The details of the Canaan Transaction were set out in our Form 10Q filed on May 19, 2021. During the period, the Company paid:

 

  a) $1,058,000 during March, 2021 for 588 miners

 

  b) $1,058,000 during April, 2021 for 588 miners

 

  c) $1,905,120 during June, 2021 for 1,176 miners

 

As a result of payments pursuant to the transaction, Canaan delivered 1,764 Miners in the 3 months ended June 30, 2021. The Company recognized these delivered assets as Property and Equipment on the consolidated balance sheet when the transfer of risk and title occurs for each shipment (i.e., the Miners have been delivered by Canaan to the agreed-upon port of loading in China).

 

On March 26, 2021, the Company acquired 1,000 Canaan A1166, and resold 200 units, as set out in our Form 10Q filed on May 19, 2021. The Company recognized these 800 delivered assets as Property and Equipment on the consolidated balance sheet during May 2021.

 

As of June 30, 2021, approximately $13.02 million cash paid for Miners was recorded as a deposit on the balance sheet.

 

The Company’s depreciation and amortization expense for the three months ended 30 June 2021 and 2020 were $2.53m and $1.10m respectively. The Company’s depreciation and amortization expense for the six months ended June 30, 2021 and 2020 were $3.85 million and $2.46 million respectively.