Non Reliance of Financial Report Form 425

On December 10, 2024, in connection with the Securities and Exchange Commission's (the "SEC") 14-month review process, Stronghold Digital Mining, Inc. (the "Company") determined that the Company's unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2024, included in the Company's Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2024, which was originally filed with the SEC on November 13, 2024 (the "Original Form 10-Q"), should be restated due to an error in the Company's revenue recognition policy with respect to the Bitcoin miner hosting contracts the Company had in place with two customers during those periods.

The Company previously corrected the error in the Original Form 10-Q, beginning on the first day of the third quarter of 2024, but did not record the cumulative impact of the correction from the first and second quarters of 2024. Instead of measuring the noncash (Bitcoin) consideration at the time of each hosting contract's inception, the Company measured the noncash (Bitcoin) consideration in prior periods on a daily basis, as each Bitcoin was awarded. The change in measurement had a $0 impact on the Company's net loss for all quarterly periods in 2024, and therefore, the Company initially determined the resulting impact was an immaterial classification error in the Company's condensed consolidated statements of operations. Subsequent to the filing of the Original Form 10-Q, the SEC communicated its disagreement with the Company's materiality assessment for the 2024 quarterly periods and, consequently, how the Company corrected the error in the Original Form 10-Q. The cumulative impact of correcting this error from the first and second quarters of 2024 is a decrease to cryptocurrency hosting revenues of $3,145,003 and equal and offsetting changes to realized gain on sale of digital currencies (increase of $3,257,827) and unrealized gain/loss on digital currencies (decrease of $112,824) for the three and nine months ended September 30, 2024. Accordingly, in connection with the SEC's review, the Company's management, in consultation with its advisors, reevaluated its materiality assessment for the 2024 quarterly periods and concluded that the Original Form 10-Q should no longer be relied upon due to the cumulative magnitude of the classification error identified. The error in the unaudited condensed consolidated financial statements will be corrected by filing an amended Quarterly Report on Form 10-Q/A (the "Amended Form 10-Q") contemporaneous with the filing of this Current Report on Form 8-K.

As a result of the error described above and the related restatement, the Company identified a material weakness in its internal control over financial reporting and concluded that its disclosure controls and procedures and internal control over financial reporting were not effective as of September 30, 2024. A discussion of the Company's actions taken and further plans to remediate this material weakness is set forth in Item 4 of Part I in the Amended Form 10-Q.