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United States securities and exchange commission logo
July 6, 2023
Bob Loughran
Chief Financial Officer
Greenidge Generation Holdings Inc.
135 Rennell Drive, 3rd Floor
Fairfield, CT 06890
Re: Greenidge
Generation Holdings Inc.
Form 10-K for the
Fiscal Year Ended December 31, 2022
Filed March 31,
2023
Form 10-Q for the
Period ending March 31, 2023
Filed May 15, 2023
File No. 001-40808
Dear Bob Loughran:
We have limited our review of your filing to the financial
statements and related
disclosures and have the following comments. In some of our comments, we
may ask you to
provide us with information so we may better understand your disclosure.
Please respond to these comments within ten business days by
providing the requested
information or advise us as soon as possible when you will respond. If
you do not believe our
comments apply to your facts and circumstances, please tell us why in
your response.
After reviewing your
response to these comments, we may have additional comments.
Form 10-K for the Fiscal Year Ended December 31, 2022
General, page 1
1. Please provide
disclosure of any significant crypto asset market developments material to
understanding or
assessing your business, financial condition and results of operations, or
share price.
Specifically, to the extent material, discuss in the appropriate sections of
future filings,
including risk factors, how recent disruptions in the crypto asset markets,
including the
bankruptcies of FTX and Blockfi, and the downstream effects of those
bankruptcies have
impacted or may impact your business, financial condition, customers,
and counterparties,
either directly or indirectly.
Bob Loughran
FirstName LastNameBob Loughran
Greenidge Generation Holdings Inc.
Comapany
July 6, 2023NameGreenidge Generation Holdings Inc.
July 6,2 2023 Page 2
Page
FirstName LastName
Key Metrics, page 52
2. You disclose the percent change in average hash rate and average
difficulty and then
reference these metrics in discussions of the change in revenue in the
periods presented.
You also disclose that you estimate that the change in average bitcoin
price and the
increase in the network difficulty reduced cryptocurrency datacenter
revenue by
approximately 62% and 33%, respectively, while the increase in the
average hash rate
benefited the cryptocurrency datacenter revenue by approximately 80%.
Please tell us, and
revise future filings, to disclose the following:
Quantify the metrics referenced above in the periods presented;
Specifically discuss how the metrics noted above are calculated;
and
Provide any estimates or assumptions underlying the metric or its
calculation.
Refer to Item 303 of Regulation S-K and SEC Release No. 33-10751.
Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Non-GAAP Measures and Reconciliations, page 55
3. Please tell us, and enhance future filings, to provide a statement
disclosing the reasons
why you believe the presentation of the Non-GAAP financial measures
"Adjusted
Operating (Loss) Income From Continuing Operations" and "Adjusted Net
Loss from
Continuing Operations" provides useful information to investors
regarding the registrant's
financial condition and results of operations. Refer to Item
10(e)(i)(3) or Regulation S-K.
Consolidated Statements of Cash Flows, page F-6
4. Please tell us, and revise future filings, to disclose how you
classify cash flows related to
digital asset activity in the Statement of Cash Flows.
5. Please tell us and enhance future filings to disclose of all non-cash
investing and financing
activities for the periods presented. Please also provide to us
non-cash activities for the
three months ended March 31, 2023. Refer to ASC 230-10-50-3.
Notes to Consolidated Financial Statements
Note 2. Summary of Significant Accounting Policies, page F-7
6. Please reconsider, in future filings, the appropriateness of your
statement that there is no
authoritative or definitive guidance for the accounting for digital
assets on pages 34, 60
and F-12. We observe that the FASB codification is the source of
authoritative generally
accepted accounting principles and that there is codification guidance
whose scope applies
to your transactions.
7. We note your disclosure that with regard to your cryptocurrency
datacenter revenue,
you measure consideration at fair value on the date received, which is
not materially
different than the fair value at the contract inception or the time
you earned the award
from the pools. Under ASC 606-10-32-21, you are required to measure
the estimated fair
value of the noncash consideration at contract inception (that is, the
date at which the
Bob Loughran
FirstName LastNameBob Loughran
Greenidge Generation Holdings Inc.
Comapany
July 6, 2023NameGreenidge Generation Holdings Inc.
July 6,3 2023 Page 3
Page
FirstName LastName
criteria in ASC 606-10-25-1 are met). Your disclosure that you measure
the consideration
at fair value when the mining pool operator successfully places a
block and you receive
confirmation does not appear to comply. Please address the following:
Tell us how you are able to determine that your policy is not
materially different than
the fair value at contract inception. Please provide quantitative
information
supporting this claim.
Explain to us at what point in time contract inception occurs and
explain how you
made the determination with appropriate reference to ASC 606.
Tell us the specific nature of your performance obligation under
the contract terms,
e.g. computing power or the performance of testing nonces,
including the
consideration for contract term and or if a series exist. Refer
to ASC 606-10-25,
paragraphs 14 and 15.
You disclose that you convert substantially all of the bitcoin
earned into U.S.
dollars. Explain to us in sufficient detail how you account for
these exchanges
(including how this impacts your revenue recognition) and where
you disclose these
exchange transactions.
8. Please tell us, and revise future filings, to include a rollforward of
Digital Assets in the
periods presented.
9. Please tell us, and revise future filings, to disclose how you
determine the quoted price of
your digital assets and the market(s) used. Tell us how you identify
these market(s). Refer
to ASC Topic 820 and ASC 820-10-35-5A.
Note 5. Property and Equipment, Net, page F-20
10. Please tell us, and revise future filings, to expand your disclosures
related to the
impairment of long-lived assets to include all of the disclosure
requirements of ASC 360-
10-50-2. Specifically, make sure your response and future filing
disclosures address the
following:
The specific categories within property and equipment (i.e.
miners, miner facility
infrastructure, construction-in-progress, and miner deposits)
that were impaired and
the specific facts and circumstances that lead to the impairment;
A more fulsome discussion of the fair value technique used (i.e.
market approach) to
determine fair value; and
Enhance your disclosure within Critical Accounting Estimates to
provide quantitative
and qualitative information necessary to understand the
estimation uncertainty and
the impact the critical accounting estimate has had on financial
condition and results
of operations. This information should include critical methods,
assumptions, and
estimates, how each estimate and/or assumption has changed over
the periods, and
the sensitivity of the reported amount to the methods,
assumptions and estimates
underlying your calculation.
Bob Loughran
Greenidge Generation Holdings Inc.
July 6, 2023
Page 4
Form 10-Q for the period ending March 31, 2023
Note 4. Property and Equipment, page 11
11. You disclose that as part of the debt restructuring agreement with
NYDIG, you sold and
transferred $1.1 million bitcoin miner manufacturer coupons. Please
tell us whether you
have any additional coupons for use or sale, including how you account
for these coupons,
both upon receipt and then upon sale or transfer. Reference
authoritative guidance to
support your accounting.
In closing, we remind you that the company and its management are
responsible for the
accuracy and adequacy of their disclosures, notwithstanding any review,
comments, action or
absence of action by the staff.
You may contact Dave Irving at (202) 551-3321 or Michelle Miller at (202)
551-
3368 with any questions.
FirstName LastNameBob Loughran Sincerely,
Comapany NameGreenidge Generation Holdings Inc.
Division of
Corporation Finance
July 6, 2023 Page 4 Office of Crypto
Assets
FirstName LastName