Quarterly report pursuant to Section 13 or 15(d)

Consolidated Condensed Statements of Cash Flows (Unaudited)

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Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($)
3 Months Ended
Mar. 31, 2018
Mar. 31, 2017
CASH FLOWS FROM OPERATING ACTIVITIES    
Net loss $ (2,402,820) $ (3,606,646)
Adjustments to reconcile net loss to net cash (used in) operating activities:    
Depreciation 232,006 471
Amortization of patents and website 12,120 705,958
Realized loss on sale of digital currencies 1,510
Change in fair value of warrant liability (1,453,257)
Stock based compensation 329,525 41,424
Amortization of debt discount 1,944,772
Bad debt allowance 6,826
Non-cash interest, discount, and financing costs 52,733
Change in fair value of digital currency 9,557
Change in fair value of Clouding earnout (13,879)
Non-controlling interest (70,636)
Other non-cash adjustments 67,164
Changes in operating assets and liabilities:    
Accounts receivables (8,328)
Digital currencies (199,582)
Litigation liability (2,150,000)
Bonds posted with courts (351,647)
Prepaid expenses and other assets (91,183) (386,903)
Other non current assets 1,203
Accounts payable and accrued expenses 110,104 (1,099,415)
Net cash (used in) operating activities (3,650,422) (4,668,501)
CASH FLOWS FROM INVESTING ACTIVITIES    
Acquisition of patents (250,000)
Purchase of property and equipment (5,800,629) (2,097)
Net cash (used in) investing activities (6,050,629) (2,097)
CASH FLOWS FROM FINANCING ACTIVITIES    
Payment on note payable (5,728,000)
Proceeds from sale of digital currencies 120,470
Proceeds received on issuance of notes payable 4,500,000
Proceeds received on private placement 1,262,865
Proceeds received on exercise of warrants 132,427
Net cash provided by financing activities 120,470 167,292
Effect of foreign exchange rate changes 15 (1,556)
Net decrease in cash and cash equivalents (9,580,566) (4,504,862)
Cash and cash equivalents - beginning of period 14,948,529 4,998,314
Cash and cash equivalents - end of period 5,367,963 493,452
SUPPLEMENTAL CASH FLOW INFORMATION    
Cash paid for interest expense 333,608
Cash paid during the year for income taxes
Supplemental schedule of non-cash investing and financing activities:    
Common stock issued for acquisition of patents 960,000
Conversion of Series E Preferred Stock to common stock 357
Common stock issued for note conversion 2,095,588
Restricted stock issuance 39
Warrants exercised into common shares $ 55,791