10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

x QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended December 31, 2018

¨ TRANSITION REPORT UNDER SECTION13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number: 333-174759

INTEGRATED VENTURES, INC.

(Exact Name of Registrant as Specified in Its charter)

Nevada	82-1725385
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer  Identification No.)

73 Buck Road, Suite 2, Huntingdon Valley, PA 19006

(Address of principal executive offices) (Zip Code)

(215) 613-1111

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	¨	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	x
Emerging growth company	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x

The number of shares outstanding of the issuer’s common stock, $0.001 par value per share, was 9,874,103 as of February 14, 2019.

INTEGRATED VENTURES, INC.

FORM 10-Q

DECEMBER 31, 2018

TABLE OF CONTENTS

 

PART I: FINANCIAL INFORMATION		Page No.
Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosure About Market Risk	36
Item 4.	Controls and Procedures	36
PART II: OTHER INFORMATION
Item 1.	Legal Proceedings	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	38
SIGNATURES		39

2

PART I – FINANCIAL INFORMATION

TABLE OF CONTENTS

Index to Financial Statements	Page
Condensed Balance Sheets as of December 31, 2018 (unaudited) and June 30, 2018	4
Condensed Statements of Operations for the Three Months and Six Months Ended December 31, 2018 and 2017 (restated) (unaudited)	5
Condensed Statements of Cash Flows for the Six Months Ended December 31, 2018 and 2017 (restated) (unaudited)	6
Notes to Condensed Financial Statements (unaudited)	7

3

Integrated Ventures, Inc.
Condensed Balance Sheets
	December 31, 2018			June 30, 2018
	(Unaudited)
ASSETS
Current assets:
Cash	$	51,627		$	749
Restricted cash		-			40,321
Prepaid expenses and other current assets		3,000			9,000
Inventories		114,851			114,851
Equipment deposits		-			3,896
Marketable securities		-			1,700
Total current assets		169,478			170,517
Non-current assets:
Property and equipment, net		1,337,944			633,105
Digital currencies		-			11,227
Deposits		14,673			14,673
Total assets	$	1,522,095		$	829,522
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	29,487		$	26,973
Accrued expenses		24,340			29,428
Due to related party		64,774			20,974
Derivative liabilities		1,002,993			2,886,965
Convertible notes payable, net of discounts		127,934			-
Total current liabilities		1,249,528			2,964,340
Total liabilities		1,249,528			2,964,340
Commitments and contingencies
Stockholders’ equity (deficit):
Series A preferred stock, $0.001 par value, (1,000,000 shares authorized, 500,000 shares issued and outstanding as of December 31, 2018 and June 30, 2018)		500			500
Series B preferred stock, $0.001 par value, (500,000 shares authorized, 350,384 and 309,166 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively)		350			309
Common stock, $0.001 par value, (40,000,000 shares authorized, 9,874,103 and 8,964,103 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively)		9,875			8,965
Additional paid-in capital		12,843,224			9,290,344
Stock subscriptions payable		60,000			35,000
Accumulated deficit		(12,641,382	)		(11,469,936	)
Total stockholders’ equity (deficit)		272,567			(2,134,818	)
Total liabilities and stockholders’ equity (deficit)	$	1,522,095		$	829,522

See notes to condensed financial statements

4

Integrated Ventures, Inc.
Condensed Statements of Operations
(Unaudited)
	Three Months Ended December 31,						Six Months Ended December 31,
	2018			2017			2018			2017
				(Restated)						(Restated)
Revenues:
Cryptocurrency mining	$	77,913		$	59,498		$	178,378		$	59,498
Sales of cryptocurrency mining equipment		9,557			45,590			24,337			45,590
Total revenues		87,470			105,088			202,715			105,088
Cost of revenues		232,896			50,256			434,156			50,256
Gross margin (loss)		(145,426	)		54,832			(231,441	)		54,832
Operating expenses:
General and administrative		173,512			498,228			730,434			659,586
Impairment of assets		-			-			2,097,930			-
Total operating expenses		173,512			498,228			2,828,364			659,586
Loss from operations		(318,938	)		(443,396	)		(3,059,805	)		(604,754	)
Other income (expense):
Interest and other income		-			1,304			-			1,402
Interest expense		(41,328	)		(56,827	)		(44,652	)		(143,707	)
Realized gain (loss) on investments		(25,266	)		7,193			(32,504	)		288,416
Unrealized loss on investments		-			(64,987	)		-			(3,876	)
Gain on extinguishment of debt		-			3,259			-			7,934
Change in fair value of derivative liabilities		914,308			(404,539	)		1,965,515			(416,288	)
Loss on settlement of warrants		-			(25,000	)		-			(25,000	)
Total other income (expense)		847,714			(539,597	)		1,888,359			(291,119	)
Income (loss) before income taxes		528,776			(982,993	)		(1,171,446	)		(895,873	)
Provision for income taxes		-			-			-			-
Net income (loss)	$	528,776		$	(982,993	)	$	(1,171,446	)	$	(895,873	)
Net income (loss) per common share:
Basic	$	0.05		$	(0.12	)	$	(0.12	)	$	(0.12	)
Diluted	$	0.01		$	(0.12	)	$	(0.12	)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		9,868,668			8,252,873			9,560,842			7,711,319
Diluted		46,817,888			8,252,873			9,560,842			7,711,319

See notes to condensed financial statements

5

Integrated Ventures, Inc.
Condensed Statements of Cash Flows
(Unaudited)
	Six Months Ended December 31,
	2018			2017
				(Restated)
Cash flows from operating activities:
Net loss	$	(1,171,446	)	$	(895,873	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense		246,996			8,702
Stock-based compensation – related party		417,000			409,000
Stock-based compensation		80,159			-
Amortization of debt discount		38,782			108,121
Amortization of original issue discount		-			1,347
Impairment of assets		2,097,930			-
Change in fair value of derivative liability		(1,965,515	)		416,288
Loss on settlement of warrants		-			25,000
Gain on extinguishment of debt		-			(7,934	)
Financing fees related to notes payable		-			32,358
Realized (gain) loss on sale of investments		32,504			(288,416	)
Unrealized loss on investments		-			3,876
Changes in assets and liabilities:
Digital currencies		(179,316	)		(71,543	)
Prepaid expenses and other current assets		6,000			5,000
Accrued interest receivable – related party		-			(98	)
Inventories		-			(17,730	)
Accounts payable		2,514			(827	)
Accrued expenses		(5,088	)		6,411
Due to related party		43,800			(7,060	)
Net cash used in operating activities		(355,680	)		(273,378	)
Cash flows from investing activities:
Net proceeds from the sale of investments		159,739			579,460
Increase in notes receivable – related party		-			(49,880	)
Purchase of property and equipment		(42,447	)		(310,832	)
Net cash provided by investing activities		117,292			218,748
Cash flows from financing activities:
Proceeds from convertible notes payable		223,945			-
Proceeds from sale of preferred stock		-			125,000
Proceeds from stock subscriptions payable		25,000			35,000
Net cash provided by financing activities		248,945			160,000
Net increase in cash		10,557			105,370
Cash, beginning of period		41,070			15,691
Cash, end of period	$	51,627		$	121,061
Supplemental disclosure of cash flow information:
Cash paid for interest	$	29,257		$	-
Cash paid for income taxes		-			-

Non-cash investing and financing activities:
Equipment deposits for property and equipment	$	3,896	$	-
Common shares issued for cashless exercise of warrants		560		188
Common shares issued for debt discount		53,250		-
Debt discount for derivative liability		81,543		72,617
Series B preferred shares for property and equipment		3,003,422		-
Series B preferred shares returned and cancelled		2		-
Settlement of derivative liabilities		-		405,970
Common shares issued for convertible notes payable		-		149,049
Common shares issued for accrued compensation		-		15,625
Accrued interest payable added to note payable		-		1,117
Note receivable and accrued interest receivable – related party for marketable securities		-		66,850

See notes to condensed financial statements

6

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited) 

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization

Integrated Ventures, Inc. (the “Company,” “we,” “our,” or “EMS Find”) was incorporated in the State of Nevada on March 22, 2011, under the name of Lightcollar, Inc. On March 20, 2015, the Company amended its articles of incorporation and changed its name from Lightcollar, Inc. to EMS Find, Inc. On May 30, 2017, Integrated Ventures, Inc. (“Integrated Ventures”), a Nevada corporation, was formed as a wholly owned subsidiary of the Company. Pursuant to an Agreement and Plan of Merger dated May 30, 2017, Integrated Ventures was merged into the Company, with the Company being the surviving corporation and changing its name to Integrated Ventures, Inc.

The Company has discontinued its prior operations and changed its business focus from its prior technologies relating to the EMS Find platform to acquiring, launching and operating companies in the cryptocurrency sector, mainly in digital currency mining, equipment manufacturing, and sales of branded mining rigs, as well as blockchain software development.

The Company is developing and acquiring a diverse portfolio of digital currency assets and block chain technologies, and now operates cryptocurrency mining operations in two facilities located in Pennsylvania and New Jersey. Cryptocurrency mining revenues commenced in November 2017. Crypto-currencies are a medium of exchange that uses decentralized control (a block chain) as opposed to a central bank to track and validate transactions. The Company, through its wholly owned subsidiary, BitcoLab, Inc., is currently mining Bitcoin, Litecoin and Ethereum, whereby the Company earns revenue by solving “blocks” to be added to the block chain.

The Company expanded its cryptocurrency mining operations in April 2018 by acquiring the operations of digiMine LLC (“digiMine”) (Note 6) and by purchasing 182 cryptocurrency mining machines from Secure Hosting LLC (“Secure Hosting”) in August 2018 (see Note 5).

Basis of Presentation

The accompanying unaudited condensed financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. The results of operations for the interim periods ended December 31, 2018 shown in this report are not necessarily indicative of results to be expected for the full fiscal year ending June 30, 2019. In the opinion of the Company’s management, the information contained herein reflects all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the Company’s results of operations, financial position and cash flows. The unaudited interim financial statements should be read in conjunction with the audited financial statements in the Company’s Annual Report on Form 10-K for the year ended June 30, 2018 filed on December 27, 2018 and Management’s Discussion and Analysis of Financial Condition and Results of Operations.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies of the Company are disclosed in Notes to Financial Statements included in the Company’s Annual Report on Form 10-K. The following summary of significant accounting policies of the Company is presented to assist in understanding the Company’s interim financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

7

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Restatement

The Company is restating its condensed financial statements for the three months and six months ended December 31, 2017 to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Because of the use of estimates inherent in the financial reporting process, actual results could differ significantly from those estimates.

Digital Currencies

Digital currencies consist of Bitcoin, Litecoin and Ethereum, generally received for the Company’s own account as compensation for cryptocurrency mining services. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies under current Generally Accepted Accounting Principles (“GAAP”), the Company has determined to account for these digital currencies as indefinite-lived intangible assets in accordance with Accounting Standards Update (“ASU”) No. 350, Intangibles – Goodwill and Other, for the period covered by this report and in future reports unless and until further guidance is issued by the Financial Accounting Standards Board (“FASB”). An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not than an impairment exists. If it is determined that it is more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Realized gains on the sale of digital currencies are included in other income (expense) in the statements of operations.

Inventories

Inventories at December 31 and June 30, 2018 consist of cryptocurrency mining units held for sale or deployment in mining operatons, and are stated at the lower of cost or estimated realizable value. Payments to equipment suppliers prior to shipment of the equipment are recorded as equipment deposits.

Property and Equipment

Property and equipment, consisting primarily of computer and other cryptocurrency mining equipment (transaction verification servers) and leasehold improvements, is stated at the lower of cost or estimated realizable value and is depreciated when placed into service using the straight-line method over estimated useful lives. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management has assessed the basis of depreciation of these assets and believes they should be depreciated over a three-year period due to technological obsolescence reflecting rapid development of hardware that has faster processing capacity and other factors. Additionally, during the six months ended December 31, 2018, the Company wrote down cryptocurrency mining equipment by $2,097,930 to estimated net realizable value. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal.

Management has determined that the three-year diminishing value best reflects the current expected useful life of transaction verification servers. This assessment takes into consideration the availability of historical data and management’s expectations regarding the direction of the industry including potential changes in technology. Management will review this estimate annually and will revise such estimates as and when data becomes available.

To the extent that any of the assumptions underlying management’s estimate of useful life of its transaction verification servers are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets.

8

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Derivatives

The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liability at the fair value of the instrument on the reclassification date.

Where the number of warrants or common shares to be issued under these agreements is indeterminate, the Company has concluded that the equity environment is tainted, and all additional warrants and convertible debt are included in the value of the derivatives.

We estimate the fair value of the derivatives associated with our convertible notes payable, warrants and put-back rights associated with two asset purchase agreements using, as applicable, either the Black-Scholes pricing model or multinomial lattice models that value the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, and, in the case of our convertible notes payable, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, additional paid-in capital and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs are subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

Impairment of Long-Lived Assets

All assets, including intangible assets subject to amortization, are reviewed for impairment when changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 350 and ASC 360. If the carrying amount of the asset exceeds the expected undiscounted cash flows of the asset, an impairment charge is recognized equal to the amount by which the carrying amount exceeds fair value or net realizable value. The testing of these intangibles under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operations and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations. Total impairment expense, consisting of write downs for cryptocurrency mining equipment totaled $2,097,930 for the six months ended December 31, 2018.

Fair Value of Financial Instruments

Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2018 and June 30, 2018, the amounts reported for cash, prepaid expenses and other current assets, accounts payable, accrued expenses and due to related party approximate fair value because of their short maturities.

9

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:

· Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

· Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

· Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

At December 31, 2018, we had no financial instrument assets measured at fair value. Our marketable securities as of June 30, 2018 are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
Marketable securities	$	1,700	$	1,700	$	-	$	-
Total assets measured at fair value	$	1,700	$	1,700	$	-	$	-

Our derivative liabilities are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
December 31, 2018:
Derivative liabilities	$	1,002,993	$	-	$	-	$	1,002,993
Total liabilities measured at fair value	$	1,002,993	$	-	$	-	$	1,002,993
June 30, 2018:
Derivative liabilities	$	2,886,965	$	-	$	-	$	2,886,965
Total liabilities measured at fair value	$	2,886,965	$	-	$	-	$	2,886,965

During the six months ended December 31, 2018, the Company had the following activity in its derivative liabilities:

	Convertible Notes Payable			Warrants		Put Back Rights			Total
Derivative liabilities at June 30, 2018	$	-		$	-	$	2,886,965		$	2,886,965
Addition to liabilities for new debt/warrants		81,543			-		-			81,543
Change in fair value		(385	)		47,528		(2,012,658	)		(1,965,515	)
Derivative liabilities at December 31, 2018	$	81,158		$	47,528	$	874,307		$	1,002,993

10

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Stock-Based Compensation

The Company accounts for all equity-based payments in accordance with ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock awards, stock options, warrants and other equity-based compensation issued to employees. The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The fair value of a stock award is recorded at the fair market value of a share of the Company’s stock on the grant date. The Company estimates the fair value of stock options and warrants at the grant date by using an appropriate fair value model such as the Black-Scholes option pricing model or multinomial lattice models.

The Company accounts for non-employee share-based awards based upon ASC 505-50, Equity-Based Payments to Non-Employees. ASC 505-50 requires the costs of goods and services received in exchange for an award of equity instruments to be recognized using the fair value of the goods and services or the fair value of the equity award, whichever is more reliably measurable. The fair value of the equity award is determined on the measurement date, which is the earlier of the date that a performance commitment is reached or the date that performance is complete. Generally, our awards do not entail performance commitments. When an award vests over time such that performance occurs over multiple reporting periods, we estimate the fair value of the award as of the end of each reporting period and recognize an appropriate portion of the cost based on the fair value on that date. When the award vests, we adjust the cost previously recognized so that the cost ultimately recognized is equivalent to the fair value on the date the performance is complete.

Revenue Recognition

Effective July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, as amended, using the modified retrospective method, which requires the cumulative effect of adoption to be recognized as an adjustment to opening retained earnings in the period of adoption.. There was no cumulative effect of adopting the new standard and no impact on our financial statements. The new standard provides a single comprehensive model to be used in the accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, ASC 606 includes provisions within a five-step model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance obligation.

Our revenues currently consist of cryptocurrency mining revenues and revenues from the sale of cryptocurrency mining equipment recognized in accordance with ASC 606 as discussed above. Amounts collected from customers prior to shipment of products are recorded as deferred revenue.

The Company earns its cryptocurrency mining revenues by providing transaction verification services within the digital currency networks of crypto-currencies, such as Bitcoin, Litecoin and Ethereum. The Company satisfies its performance obligation at the point in time that the Company is awarded a unit of digital currency through its participation in the applicable network and network participants benefit from the Company’s verification service. In consideration for these services, the Company receives digital currencies, which are recorded as revenue using the closing U.S. dollar price of the related cryptocurrency on the date of receipt. Expenses associated with running the cryptocurrency mining operations, such as equipment depreciation, rent, operating supplies, rent, utilities and monitoring services are recorded as cost of revenues.

There is currently no specific definitive guidance in GAAP or alternative accounting frameworks for the accounting for the production and mining of digital currencies and management has exercised significant judgment in determining appropriate accounting treatment for the recognition of revenue for mining of digital currencies. Management has examined various factors surrounding the substance of the Company’s operations and the guidance in ASC 606, including identifying the transaction price, when performance obligations are satisfied, and collectability is reasonably assured being the completion and addition of a block to a blockchain and the award of a unit of digital currency to the Company. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies which could result in a change in the Company’s financial statements.

11

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Income Taxes

The Company adopted the provisions of ASC 740-10, Accounting for Uncertain Income Tax Positions. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded an asset for unrecognized tax benefits. As of December 31, 2018, tax years 2018, 2017, 2016 and 2015 remain open for IRS audit. The Company has received no notice of audit from the IRS for any of the open tax years.

The Company adopted ASC 740-10, Definition of Settlement in FASB Interpretation No. 48, (“ASC 740-10”), which was issued on May 2, 2007. ASC 740-10 amends FIN 48 to provide guidance on how an entity should determine whether a tax position is effectively settled for the purpose of recognizing previously unrecognized tax benefits. The term “effectively settled” replaces the term “ultimately settled” when used to describe recognition, and the terms “settlement” or “settled” replace the terms “ultimate settlement” or “ultimately settled” when used to describe measurement of a tax position under ASC 740-10. ASC 740-10 clarifies that a tax position can be effectively settled upon the completion of an examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The adoption of ASC 740-10 did not have an impact on the accompanying financial statements.

Income (Loss) Per Share

Basic net income or loss per share is calculated by dividing net income or loss by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as “in-the-money” stock options and warrants, convertible debt and convertible preferred stock, were exercised or converted into common stock. Equivalent shares are not utilized when the effect is anti-dilutive.

The common shares used in the computation of basic and diluted net income (loss) per share are reconciled as follows:

	Three Months Ended December 31,				Six Months Ended December 31,
	2018		2017		2018		2017
Weighted average number of shares outstanding – basic		9,868,668		8,252,873		9,560,842		7,711,319
Dilutive effect of convertible debt		1,910,820		-		-		-
Dilutive effect of Series B convertible preferred stock		35,038,400		-		-		-
Weighted average number of shares outstanding – diluted		46,817,888		8,252,873		9,560,842		7,711,319

12

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. This new pronouncement, as amended, is effective January 1, 2019 for calendar-year-end public companies, or July 1, 2019 for the Company. Early adoption is permitted. The Company is unable to determine the impact on its financial statements for the adoption of the new pronouncement.

There were no new accounting pronouncements issued or proposed by the FASB during the six months ended December 31, 2018 and through the date of filing this report which the Company believes will have a material impact on its financial financial statements.

Reclassifications

Certain amounts in the condensed financial statements for the prior-year periods have been reclassified to conform to the presentation for the current-year periods.

3. GOING CONCERN

The Company has reported recurring net losses since its inception and used net cash in operating activities of $355,680 in the six months ended December 31, 2018. As of December 31, 2018, the Company had an accumulated deficit of $12,641,382. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The accompanying financial statements have been prepared in conformity with U.S. GAAP, which contemplate continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The ability of the Company to reach a successful level of operations is dependent on the execution of management’s plans, which include the raising of capital through the debt and/or equity markets, until such time that funds provided by operations are sufficient to fund working capital requirements. If the Company were not to continue as a going concern, it would likely not be able to realize its assets at values comparable to the carrying value or the fair value estimates reflected in the balances set out in the preparation of the financial statements.

There can be no assurances that the Company will be successful in attaining a profitable level of operations or in generating additional cash from the equity/debt markets or other sources fund its operations. The financial statements do not include any adjustments relating to the recoverability of assets and classification of assets and liabilities that might be necessary. Should the Company not be successful in its business plan or in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all operational activities and/or contemplate the sale of its assets, if necessary.

4. PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at:

	December 31, 2018			June 30, 2018
Cryptocurrency mining equipment	$	1,483,194		$	573,806
Furniture and equipment		16,366			14,427
Leasehold improvements		143,440			102,932
Total		1,643,000			691,165
Less accumulated depreciation and amortization		(305,056	)		(58,060	)
Net	$	1,337,944		$	633,105

Depreciation and amortization expense, included in cost of revenues, for the three months ended December 31, 2018 and 2017 was $136,778 and $8,702, respectively. Depreciation and amortization expense, included in cost of revenues, for the six months ended December 31, 2018 and 2017 was $246,996 and $8,702, respectively.

13

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

5. ASSET PURCHASE AGREEMENT

On August 2, 2018, the Company entered into an Asset Purchase Agreement with Secure Hosting LLC, a Florida limited liability, for the purchase of 182 Ethereum mining machines.

As consideration for the purchase of the machines, the Company issued 38,018 restricted shares of its Series B convertible preferred stock, valued on an “as converted to common” basis at an aggregate of $3,801,800, based on the market value of the Company’s common stock on the date of the transaction.

Of the 182 machines purchased, 152 were placed into operations, and 30 units deemed to be under-performing will be utilized by the Company as repair parts or sold as repair parts. The Company performed a lower of cost or market impairment analysis on the machines purchased, including writing off the purchase price allocated to the defective machines, and recorded an impairment expense of $2,097,930, which amount is included in operating expenses for the six months ended December 31, 2018.

The Agreement contains customary representations and warranties and covenants as of the Closing Date, including, without limitation, that the Equipment is (i) in good condition, (ii) free of all liens, (iii) not subject to any intellectual property rights other than software used in the Equipment and (iv) covered by certain manufacturer warranties. Because a portion of the machines were defective, certain shares of the Series B preferred stock issued in the transaction were subsequently returned to the Company and cancelled.

6. DIGIMINE ACQUISITION

In April 2018, the Company acquired the digital currency mining operations of digiMine LLC (“digiMine”) through two Asset Purchase Agreements (the “digiMine Acquisition”) in a transaction recorded as a business combination.

On April 16, 2018, the Company entered into an Asset Purchase Agreement with digiMine for the purchase of digiMine’s digital currency mining assets located in Marlboro, New Jersey, the principal assets consisting of: 150 cryptocurrency mining machines; all right, title and interest in, the lease and leasehold improvements for the premises on which digiMine’s business operates; all books and records pertaining to ownership of digiMine’s business as applicable; and restricted cash of $175,000. The Company issued 16,666 shares of its Series B preferred stock to digiMine.

The Company also entered into a separate Security and Pledge Agreement, dated as of April 13, 2018, securing its obligations to digiMine under the Asset Purchase Agreement.

digiMine has the right (the “Put-Back Right”), at any time commencing April 1, 2019, to require that the Company redeem for cash any of Seller’s then-outstanding Shares at a redemption price equal to 72% of the Shares. The Conversion Amount on execution is equal to $1,200,000 (the “Put-Back Price”) of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share.

On April 30, 2018, the Company entered into a second Asset Purchase Agreement with digiMine for the purchase of digiMine’s digital currency mining assets located in Marlboro, New Jersey, the principal assets consisting of: 97 cryptocurrency mining machines and computer workstation; digital currency portfolio with an estimated value of $15,487; all right, title and interest in, the lease and leasehold improvements for the premises on which digiMine’s business operates; all books and records pertaining to ownership of digiMine’s business as applicable; and restricted cash of $200,000. The Company issued 20,000 shares of its Series B preferred stock to digiMine.

14

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

The Company also entered into a separate Security and Pledge Agreement, dated as of April 30, 2018, securing its obligations to digiMine under the Agreement.

digiMine has the right (the “Put-Back Right”), at any time commencing May 1, 2019, to require that the Company redeem for cash any of Seller’s then-outstanding Shares at a redemption price equal to 72% of the Shares. The Conversion Amount on execution is equal to $1,440,000 (the “Put-Back Price”) of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share.

The Company has identified the Put-Back Rights associated with the two Asset Purchase Agreements as derivatives.

The Company engaged an independent valuation firm to estimate the fair value of the Series B preferred stock issued in the two Asset Purchase Agreements, to estimate the value of the derivative liabilities associated with the Put-Back Rights, and allocate the total consideration paid to the assets acquired. The valuation firm developed multinomial lattice models that valued the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes.

The total consideration paid in the Acquisition is summarized as follows:

Value of 36,667 total Series B preferred shares	$	1,163,806
Derivative liabilities associated with Put-Back Rights		3,729,109
Total consideration paid	$	4,892,915

The total consideration paid was allocated to the fair value of the assets acquired as follows:

Restricted cash	$	375,000
Property and equipment		350,349
Digital currencies		14,056
Goodwill		4,153,510
Total consideration allocated	$	4,892,915

No liabilities of digiMine were assumed by the Company in the Acquisition. The excess of consideration paid over fair value of assets acquired was recorded as goodwill.

The Company performed an impairment analysis on the goodwill at June 30, 2018 and recorded an impairment expense of $4,153,510, which amount is included in operating expenses for the year ended June 30, 2018. The total cash acquired of $375,000 was restricted to fund digital mining operations. As of December 31, 2018, the restricted cash had been fully utilized in digital mining operations.

15

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

7. RELATED PARTY TRANSACTIONS

We have one executive officer, Steve Rubakh, who is currently our only full-time employee and sole member of our Board of Directors. Mr. Rubakh is paid an annual salary established by the Board of Directors and is issued shares of Series B Preferred Stock for additional compensation. The number of shares issued, generally on a quarterly basis, is at the discretion of the Board of Directors.

On March 18, 2018, the Board of Directors of the Company modified the annual compensation for Steve Rubakh, effective April 1, 2018 to include annual salary of $150,000 per year and the issuance on a quarterly basis of 5,000 shares of Series B preferred stock.

On July 1, 2018, the Company issued to Mr. Rubakh 5,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $417,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2018.

On August 1, 2017, the Company issued to Mr. Rubakh 30,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $9,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

On August 31, 2017, Steve Rubakh converted accrued compensation of $15,625 into 347,222 common shares of the Company.

Amounts due to related party, including accrued salary to Mr. Rubakh, totaled $64,774 and $20,974 as of December 31, 2018 and June 30, 2018, respectively.

16

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

8. CONVERTIBLE NOTES PAYABLE

Convertible notes payable, all classified as current, consist of the following at December 31, 2018:

			Debt
	Principal		Discount		Net
Geneva Roth Remark Holdings, Inc.	$	128,000	$	35,025	$	92,975
BHP Capital NY, Inc.		52,000		34,520		17,480
Armada Investment Fund, LLC		52,000		34,521		17,479
Total	$	232,000	$	104,066	$	127,934

On September 17, 2018, the Company entered into a convertible promissory note with Geneva Roth Remark Holdings, Inc. (“Geneva”) in the principal amount of $128,000. The note matures on September 26, 2019 and bears interest at 10%. A debt discount of $49,169 was recorded, including a derivative liability of $46,169. Geneva has the right beginning on the date that is 170 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $14,144 of the debt discount had been amortized and there was accrued interest payable of $3,682. The Company recorded a derivative liability of $45,046 as of December 31, 2018.

On September 26, 2018, the Company entered into a convertible promissory note with with BHP Capital NY, Inc. (“BHP”) in the principal amount of $52,000, with an original issue discount of $2,000. The note matures on September 17, 2019 and bears interest at 8%. BHP was issued 75,000 shares of the Company’s common stock valued at $26,625 as a fee. A debt discount of $46,840 was recorded, including a derivative liability of $17,687. BHP has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $12,320 of the debt discount had been amortized and there was accrued interest payable of $1,094. The Company recorded a derivative liability of $18,056 as of December 31, 2018.

On September 26, 2018, the Company entered into a convertible promissory note with with Armada Investment Fund, LLC (“Armada”) in the principal amount of $52,000, with an original issue discount of $2,000. The note matures on September 17, 2019 and bears interest at 8%. Armada was issued 75,000 shares of the Company’s common stock valued at $26,625 as a fee. A debt discount of $46,840 was recorded, including a derivative liability of $17,687. Armada has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $12,319 of the debt discount had been amortized and there was accrued interest payable of $1,094. The Company recorded a derivative liability of $18,056 as of December 31, 2018.

17

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

9. STOCKHOLDERS’ DEFICIT

Preferred Stock

Series A Preferred Stock

In March 2015, the Company filed with the State of Nevada a Certificate of Designation establishing the designations, preferences, limitations and relative rights of 1,000,000 shares of the Company’s Series A preferred stock (“Series A Preferred Stock”). Holders of the Series A Preferred Stock have the right to vote in aggregate, on all shareholder matters equal to 1,000 votes per share of Series A Preferred Stock. The shares of Series A Preferred Stock are not convertible into shares of common stock.

The Company has 1,000,000 shares of Series A Preferred Stock authorized, with 500,000 shares issued and outstanding as of December 31, 2018 and June 30, 2018, which were issued in March 2015 in consideration for services to members of the Company’s Board of Directors.

Series B Preferred Stock

On December 21, 2015, the Company filed a Certificate of Designation for a new Series B Convertible Preferred Stock with the State of Nevada following approval by the board of directors of the Company. Five Hundred (500,000) Thousand shares of the Company’s authorized preferred stock are designated as the Series B Convertible Preferred Stock (the “Series B Preferred Stock”), par value of $0.001 per share and with a stated value of $0.001 per share (the “Stated Value”). Holders of Series B Preferred Stock shall be entitled to receive dividends, when and as declared by the Board of Directors out of funds legally available therefor. At any time and from time to time after the issuance of shares of the Series B Preferred Stock, each issued share of Series B Preferred Stock is convertible into One (100) Hundred shares of Common Stock (“Conversion Ratio”). The holders of the Series B Preferred Stock shall have the right to vote together with holders of Common Stock, on an as “converted basis”, on any matter that the Company’s shareholders may be entitled to vote on, either by written consent or by proxy. Upon any liquidation, dissolution or winding-up of the Company, the holders of the Series B Preferred Stock shall be entitled to receive out of the assets of the Company, whether such assets are capital or surplus, for each share of Series B Preferred Stock an amount equal to the Stated Value, and all other amounts in respect thereof then due and payable prior to any distribution or payment shall be made to the holders of any junior securities.

The Company has 500,000 shares of Series B Preferred Stock authorized, with 350,384 and 309,166 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively.

On March 18, 2018, the Board of Directors of the Company modified the annual compensation for Steve Rubakh, effective April 1, 2018 to include annual salary of $150,000 per year and the issuance on a quarterly basis of 5,000 shares of Series B preferred stock. On July 1, 2018, the Company issued to Mr. Rubakh 5,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $417,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2018.

As discussed in Note 5, on August 2, 2018, the Company entered into an Asset Purchase Agreement for the purchase of 182 cryptocurrency mining machines. As consideration for the purchase of the machines, the Company issued 38,018 shares of its Series B convertible preferred stock, valued on an “as converted to common” basis at an aggregate of $3,801,800. In December 2018, a total of 1,800 shares of Series B preferred stock originally issued pursuant to the Asset Purchase Agreement were returned to the Company and cancelled.

On August 1, 2017, the Company issued to Mr. Rubakh 30,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $9,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

On October 25, 2017, four investors entered into subscription agreements for the purchase of a total of 16,000 shares of Series B Preferred stock for cash at $10 per share. Through December 31, 2017, 12,500 of the shares had been issued for an investment of $125,000. As of December 31, 2018 and June 30, 2018, a stock subscription payable of $35,000 was recorded for unissued shares.

On November 1, 2017, the Company issued to Mr. Rubakh 40,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $400,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

18

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Common Stock

The Company has 40,000,000 shares of common stock authorized, with 9,874,103 and 8,964,103 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively.

During the six months ended December 31, 2018, the Company issued a total of 910,000 shares of its common stock.

On August 14, 2018, 100,000 shares of common stock valued at $55,000, based on the closing market price of stock on the date of grant, were issued to a consultant.

On August 23, 2018, 560,000 shares of common stock were issued to a lender in the cashless exercise of warrants recorded at par value of $560. See Note 10.

On September 26, 2018, a total of 150,000 shares of common stock valued at $53,250, based on the closing market price of stock on the date of grant, were issued to two lenders as loan fees. See Note 8.

On October 5, 2018, 100,000 shares of common stock valued at $25,160, based on the closing market price of stock on the date of grant, were issued to a consultant.

During the six months ended December 31, 2017, the Company issued a total of 3,175,774 shares of its common stock.

A total of 2,640,017 shares of the Company’s common stock, valued at $149,049, were issued in conversion of $55,760 note principal, $2,715 accrued interest payable, $58,216 in derivative liabilities, $2,449 in fees and $29,909 in penalties.

On July 6, 2017, 188,240 shares of common stock were issued to a lender in the cashless exercise of warrants recorded at par value of $188.

On August 31, 2017, 347,222 shares of common stock valued at $15,625 were issued to Steve Rubakh for accrued compensation.

On September 30, 2017, the Company increased the number of outstanding common shares by 114 shares due to rounding of shares in the reverse stock split.

19

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

10. WARRANTS

The Company has granted warrants to non-employee lenders in connection with the issuance of certain convertible promissory notes and to an investor in connection with the purchase of common shares of the Company. The Company has also granted warrants to officers and directors. Certain of the warrants have been subsequently surrendered to the Company and cancelled.

Warrant activity for the six months ended December 31, 2018 is as follows:

	Number of Warrants			Weighted Average Exercise  Price		Weighted Average Remaining Contract Term (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2018		348,375		$	2.20		2.55	$	-
Granted		-		$	-
Exercised		(34,333	)	$	2.16
Forfeited or expired		-		$	-
Outstanding and exercisable at December 31, 2018		314,042		$	2.20		2.05	$	-

Because the number of common shares to be issued under convertible notes payable is indeterminate, the Company concluded that the equity environment was tainted as of December 31, 2018. Therefore, all warrants issued prior to that date were included in the Company’s calculations of derivative liabilities.

11. COMMITMENTS AND CONTINGENCIES

Legal Matters

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of the date of filing of this report, there were no pending or threatened lawsuits.

Operating Leases

During the year ended June 30, 2018, the Company consolidated its cryptocurrency mining operations in two locations, Huntingdon Valley, Pennsylvania and Marlboro, New Jersey, where facilities are leased under operating leases. The lease for the Pennsylvania location is on a month-to-month basis at $850 per month. The lease for the New Jersey location was effective April 1, 2018 for a period of one year at a monthly rental of $6,986, with an automatic one-year renewal period with a 5% increase in the monthly rent. We have negotiated reductions in the monthly rental at the New Jersey location for certain months in fiscal year 2019.

20

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

12. RESTATEMENT

The Company has restated its financial statements as of December 31, 2017 and for the three months and six months then ended to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections.

The following adjustments were made to the December 31, 2017 Restated Balance Sheet:

Integrated Ventures, Inc.
Balance Sheet
	As Originally Reported on December 31, 2017		Adjustments			As Restated December 31, 2017
ASSETS
Current assets:
Cash	$	121,061	$	-		$	121,061
Accounts receivable		15,000		-			15,000
Digital currencies		43,786		(43,786	)(a)		-
Prepaid expenses and other current assets		2,500		-			2,500
Inventories		17,730		-			17,730
Marketable securities		1,760		-			1,760
Total current assets		201,837		(43,786	)		158,051
Non-current assets:
Property and equipment		305,568		(3,438	)(c)		302,130
Digital currencies		-		43,786	(a)		43,786
Deposits		700		-			700
Total assets	$	508,105	$	(3,438	)	$	504,667

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	23,331		$	-		$	23,331
Accrued expenses		29,745			8,468	(b)		38,213
Due to related party		993			(993	)(b)		-
Derivative liabilities		21,419			63,404	(d)		84,823
Convertible notes payable, net of discounts		14,458			-			14,458
Note payable		125,000			-			125,000
Total current liabilities		214,946			70,879			285,825
Total liabilities		214,946			70,879			285,825
Commitments and contingencies
Stockholders’ equity (deficit):
Series A preferred stock, $0.001 par value, (1,000,000 shares authorized, 500,000 shares issued and outstanding)		500			-			500
Series B preferred stock, $0.001 par value, (500,000 shares authorized, 232,500 shares issued and outstanding)		233			-			233
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)		8,388			-			8,388
Additional paid-in capital		5,538,477			1,424,603	(d)(f)		6,963,080
Stock subscription payable		35,000			-			35,000
Accumulated deficit		(5,289,439	)		(1,498,920	)(b)(c)(d)(e)		(6,788,359	)
Total stockholders’ equity (deficit)		293,159			(74,317	)		218,842
Total liabilities and stockholders’ equity (deficit)	$	508,105		$	(3,438	)	$	504,667

21

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

The following adjustments were made to the Restated Statement of Operations for the three months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Three Months Ended December 31, 2017			Adjustments			As Restated for the Three Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		494,247			3,981	(e)		498,228
Total operating expenses		494,247			3,981			498,228
Loss from operations		(435,977	)		(7,419	)		(443,396	)
Other income (expense):
Interest and other income		1,304			-			1,304
Interest expense		(34,738	)		(22,089	)(b)(d)		(56,827	)
Realized gain on sale of investments		85,911			(78,718	)(f)		7,193
Unrealized loss on investments		(64,987	)		-			(64,987	)
Gain on extinguishment of debt		3,259			-			3,259
Change in fair value of derivative liabilities		273,032			(677,571	)(d)		(404,539	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		200,016			(739,613	)		(539,597	)
Loss before income taxes		(235,961	)		(747,032	)		(982,993	)
Provision for income taxes		-			-			-
Net loss	$	(235,961	)	$	(747,032	)	$	(982,993	)
Net loss per common share:
Basic	$	(0.03	)	$	(0.09	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		8,252,873			-			8,252,873

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Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

The following adjustments were made to the Restated Statement of Operations for the six months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		634,124			25,462	(e)		659,586
Total operating expenses		634,124			25,462			659,586
Loss from operations		(575,854	)		(28,900	)		(604,754	)
Other income (expense):
Interest and other income		1,402			-			1,402
Interest expense		(120,319	)		(23,388	)(b)(d)		(143,707	)
Realized gain on sale of investments		367,134			(78,718	)(f)		288,416
Unrealized loss on investments		(3,876	)		-			(3,876	)
Gain (loss) on extinguishment of debt		(268,476	)		276,410	(d)		7,934
Change in fair value of derivative liabilities		201,197			(617,485	)(d)		(416,288	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		113,297			(404,416	)		(291,119	)
Loss before income taxes		(462,557	)		(433,316	)		(895,873	)
Provision for income taxes		-			-			-
Net loss	$	(462,557	)	$	(433,316	)	$	(895,873	)
Net loss per common share:
Basic	$	(0.06	)	$	(0.06	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		7,711,319			-			7,711,319

23

Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

The Following adjustments were made to the Restated Statement of Cash Flows for the six months ended December 31, 2017: 

Integrated Ventures, Inc.
Statement of Cash Flows
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Cash flows from operating activities:
Net loss	$	(462,557	)	$	(433,316	)(b)(c)(d)(e)(f)		(895,873	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		5,264			3,438	(c)		8,702
Stock-based compensation – related party		409,000			-			409,000
Amortization of debt discount		79,631			28,490	(d)		108,121
Amortization of original issue discount		1,347			-			1,347
Change in fair value of derivative liabilities		(201,197	)		617,485	(d)		416,288
(Gain) loss on extinguishment of debt		268,476			(276,410	)(d)		(7,934	)
Financing fees related to notes payable		32,358			-			32,358
Realized gain on sale of investments		(367,134	)		78,718	(f)		(288,416	)
Unrealized loss on investments		3,876			-			3,876
Loss on settlement of warrants		63,765			(38,765	)(d)		25,000
Changes in assets and liabilities:
Digital currencies		(61,892	)		(9,651	)(b)		(71,543	)
Prepaid expenses and other current assets		5,000			-			5,000
Inventories		(17,730	)		-			(17,730	)
Accrued interest receivable – related party		(98	)		-			(98	)
Accounts payable		(827	)		-			(827	)
Accrued expenses		(1,786	)		8,197	(b)		6,411
Due to related party		(19,223	)		12,163	(b)		(7,060	)
Net cash used in operating activities		(263,727	)		(9,651	)		(273,378	)
Cash flows from investing activities:
Net proceeds from the sale of investments		579,460			-			579,460
Purchase of investments		(9,651	)		9,651	(b)		-
Increase in notes receivable – related party		(49,880	)		-			(49,880	)
Purchase of property and equipment		(310,832	)		-			(310,832	)
Net cash provided by investing activities		209,097			9,651			218,748
Cash flows from financing activities:
Proceeds from sale of preferred stock		125,000			-			125,000
Proceeds from stock subscriptions payable		35,000			-			35,000
Net cash provided by financing activities		160,000			-			160,000
Net increase in cash		105,370			-			105,370
Cash, beginning of period		15,691			-			15,691
Cash, end of period	$	121,061		$	-			121,061

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Integrated Ventures, Inc.

Notes to Condensed Financial Statements

Three Months and Six Months Ended December 31, 2018 and 2017 (Restated)

(Unaudited)

Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-		$	-
Cash paid for income taxes		-			-			-
Non-cash investing and financing activities:
Common shares issued for convertible notes payable	$	379,021			(229,972	)(d)		149,049
Common shares issued for due to related party		15,625			-			15,625
Common shares issued for cashless exercise of warrants		188			-			188
Debt discount for derivative liability		47,617			25,000	(d)		72,617
Accrued interest added to convertible notes payable		1,117			-			1,117
Settlement of derivative liabilities		-			405,970	(d)		405,970
Marketable securities for conversion of notes receivable		66,850			-			66,850
Marketable securities exchanged for note payable		(37,074	)		37,074	(d)		-
Marketable securities exchanged for accrued expenses		(1,370	)		1,370	(d)		-
Marketable securities exchanged for derivative liabilities		(78,718	)		78,718	(d)		-
Marketable securities exchanged for accounts receivable		(15,000	)		15,000	(d)		-
Note payable issued in settlement of warrants		25,000			(25,000	)(d)		-
Derivative liabilities extinguished in settlement of warrants		67,064			(67,064	)(d)		-

_________________ 

(a)	Reclassified digital currencies from current to long-term asset.
(b)	Accrued officer compensation was reclassified from accrued expenses to due to related party and subsequently reduced. Accrued interest payable was increased.
(c)	Reduced useful life for depreciation from 5 years to 3 years.
(d)	The Company engaged an outside consultant to revise derivative liabilities associated with convertible notes payable and to add derivative liabilities associated with warrants. The calculations were made for each issuance of new debt and warrants and for each conversion, exchange or exercise of debt and warrants. As a result, total derivative liabilities increased, and modifications were made to the calculation of debt discount, interest expense for the amortization of debt discount, and change in fair value of derivative liabilities. In addition, convertible notes payable, net of discounts, increased, interest expense increased, and change in fair value of derivative liabilities decreased. Additionally, no loss on extinguishment of debt for note conversions was recorded, resulting in a decrease in the loss and an increase in additional paid-in capital.
(e)	Total general and administrative expenses decreased as a result of corrections to certain operating expenses.
(f)	Adjusted realized gain on sale of investments, including recording gain on sale of related party investment to capital.
(g)	As a result of the adjustments discussed above, net loss and net loss per share increased.

13. SUBSEQUENT EVENTS

Management has evaluated subsequent events according to the requirements of ASC TOPIC 855, and has reported the following:

Increase in Authorized Shares

On January 25, 2019, the Board of Directors of the Company approved a resolution to increase the number of authorized common shares to 250,000,000 shares and the number of authorized preferred shares to 20,000,000 shares.

Issuance of Series B Preferred Shares

On January 9, 2019, 3,500 shares of Series B preferred stock were issued for stock subscriptions payable of $35,000.

On January 24, 2019, 5,000 shares of Series B preferred stock were issued to Steve Rubakh for compensation valued on an “as converted to common” basis at $80,000.

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ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

SPECIAL NOTE CONCERNING FORWARD-LOOKING STATEMENTS

We believe that it is important to communicate our future expectations to our security holders and to the public. This report, therefore, contains statements about future events and expectations which are “forward-looking statements” within the meaning of Sections 27A of the Securities Act of 1933 and 21E of the Securities Exchange Act of 1934, including the statements about our plans, objectives, expectations and prospects under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” You can expect to identify these statements by forward-looking words such as “may,” “might,” “could,” “would,” “will,” “anticipate,” “believe,” “plan,” “estimate,” “project,” “expect,” “intend,” “seek” and other similar expressions. Any statement contained in this report that is not a statement of historical fact may be deemed to be a forward-looking statement. Although we believe that the plans, objectives, expectations and prospects reflected in or suggested by our forward-looking statements are reasonable, those statements involve risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements, and we can give no assurance that our plans, objectives, expectations and prospects will be achieved.

Important factors that might cause our actual results to differ materially from the results contemplated by the forward-looking statements are contained in the “Risk Factors” section of and elsewhere in our Annual Report on Form 10-K for the fiscal year ended June 30, 2018 and in our subsequent filings with the Securities and Exchange Commission. The following discussion of our results of operations should be read together with our financial statements and related notes included elsewhere in this report.

GENERAL

We were incorporated in the State of Nevada on March 22, 2013 under the name Lightcollar, Inc. On March 22, 2015, we changed our name to EMS Find, Inc., and in May 2017, we changed our name to Integrated Ventures, Inc. We have licensed our Ems Find platform and related technologies to EpicMD, Inc. via a Licensing Agreement and management has determined to focus our business on developing and operating digital currency assets. Our offices are located at 73 Buck Road, Suite 2, Huntingdon Valley, Pennsylvania 19006.

We have discontinued our prior operations and changed our business focus, from our prior technologies relating to the EMS Find platform to acquiring, launching and operating companies in the cryptocurrency sector, mainly in digital currency mining, equipment manufacturing, and sales of branded mining rigs, as well as blockchain software development.

Financial

On November 22, 2017, we successfully launched our cryptocurrency operations. For the six months ended December 31, 2018, we had total revenues of $202,715, consisting of: (1) revenues from mining operations of $178,378 received primarily in digital currencies and (2) equipment and parts retail sales of $24,337.

In transactions on April 16 and April 30, 2018, the Company purchased a total of 247 Bitmain mining machines, together with associated assets, and restricted cash of $175,000 and $200,000 pursuant to two Asset Purchase Agreements. We assumed the lease obligation on one of the premises on which the business of digiMine operated in Marlboro, New Jersey.

On August 2, 2018, the Company entered into an Asset Purchase Agreement for the purchase of 182 Ethereum mining machines. Of the 182 machines purchased, 152 were placed into operations, and 30 units deemed to be under- performing will be utilized as repair parts by the Company or sold as repair parts.

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We have consolidated our digital currency mining operations in two locations, Huntingdon Valley, Pennsylvania and Marlboro, New Jersey. In connection with this consolidation, we closed our operations in two locations in Philadelphia, Pennsylvania.

In September 2018, we completed convertible debt financing with three lenders, receiving net proceeds of $223,945.

Reseller Agreement

 

We have signed an Authorized Reseller Agreement with Shenzhen Halley Cloud Technology Company, the exclusive manufacturer of PandaMiners. PandaMiner is a GPU integrated altcoin mining device which supports multiple hashing algorithms like ETH and other cryptocurrencies. It is assembled using a high configuration graphics card, customized and highly compatible case and other optimized accessories for the highest mining efficiency. As part of this Agreement, the Company agreed to purchase 50 PandaMiner B3 Pro mining rigs with total purchase price of $213,500.

The Digital Asset Market

The Company is focusing on the mining of digital assets, as well as blockchain applications (“blockchain”) and related technologies. A blockchain is a shared immutable ledger for recording the history of transactions of digital assets—a business blockchain provides a permissioned network with known identities. A Bitcoin is the most recognized type of a digital asset that is issued by, and transmitted through, an open source, math-based protocol platform using cryptographic security that is known as the “Bitcoin Network.” The Bitcoin Network is an online, peer-to-peer user network that hosts the public transaction ledger, known as the blockchain, and the source code that comprises the basis for the cryptography and math-based protocols governing the Bitcoin Network.

Bitcoins, for example, can be used to pay for goods and services or can be converted to fiat currencies, such as the US Dollar, at rates determined on Bitcoin exchanges or in individual end-user-to-end-user transactions under a barter system. The networks utilized by digital coins are designed to operate without any company or government in charge, governed by a collaboration of volunteer programmers and computers that maintain all the records. These blockchains are typically maintained by a network of participants which run servers while securing their blockchain. Third party service providers such as Bitcoin exchanges and bitcoin third party payment processing services may charge significant fees for processing transactions and for converting, or facilitating the conversion of, bitcoins to or from fiat currency.

This market is rapidly evolving and there can be no assurances that we will remain competitive with industry participants that have or may have greater resources or experience in in this industry than us, nor that the unproven digital assets that we mine will ever have any significant market value.

FINANCIAL OPERATIONS REVIEW

As discussed above, in November 2017 revenues commenced from our cryptocurrency mining operations and from sales of cryptocurrency mining equipment. Prior to that date, revenues were generated substantially from the now discontinued Ambulance services, which we have discontinued to focus on new revenue sources.

We are incurring increased costs as a result of being a publicly-traded company. As a public company, we incur significant legal, accounting and other expenses that we did not incur as a private company. We also have paid compensation through the issuance of shares of our common stock and warrants, the valuation of which has resulted in significant stock-based compensation. In addition, the Sarbanes-Oxley Act of 2002, as well as new rules subsequently implemented by the Securities and Exchange Commission, have required changes in corporate governance practices of public companies and will require us to comply with these rules. These new rules and regulations have will increase our legal and financial compliance costs and have made some activities more time-consuming and costlier. In addition, these new rules and regulations have made it more difficult and more expensive for us to obtain director and officer liability insurance, which we currently cannot afford to do. As a result of the new rules, it may become more difficult for us to attract and retain qualified persons to serve on our Board of Directors or as executive officers. We cannot predict or estimate the amount of additional costs we may incur as a result of being a public company or the timing of such costs.

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To operate our digital currency mining facilities and to fund future operations, we will need to raise additional capital. The amount and timing of future funding requirements will depend on many factors, including the timing and results of our ongoing development efforts, the potential expansion of our current development programs, potential new development programs and related general and administrative support. We anticipate that we will seek to fund our operations through further liquidation of our marketable securities, public or private equity or debt financings or other sources, such as potential collaboration agreements. We cannot be certain that anticipated additional financing will be available to us on favorable terms, or at all.

RESTATEMENT OF FINANCIAL STATEMENTS FOR THE YEAR ENDED JUNE 30, 2017

The Company has restated its financial statements as of December 31, 2017 and for the three months and six months then ended to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections. See Note 12 to the accompanying financial statements. Numbers used in the following financial analysis and discussion for the three months and six months ended December 31, 2017 are taken from the restated financial statements.

RESULTS OF OPERATIONS

THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2018 COMPARED TO THE THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 2017

Revenues

In November 2017 we commenced operations in our first cryptocurrency mining location. Our cryptocurrency mining revenues increased to $77,913 in the three months ended December 31, 2018 from $59,498 in the three months ended December 31, 2017, and increased to $178,378 in the six months ended December 31, 2018 from $59,498 in the six months ended December 31, 2017. As discussed above, we operated out of two locations during the first six months of the current fiscal year compared to only one location in the prior fiscal year with operations commencing in November 2017. In addition, the number of cryptocurrency mining units utilized in operation has significantly increased in the current fiscal year as a result of the digiMine acquisition in April 2018 and an Asset Purchase Agreement in August 2018.

We also had revenues from the sale of cryptocurrency mining units that we purchased or assembled for resale and parts totaling $9,557 in the three months ended December 31, 2018 compared to $45,590 in the three months ended December 31, 2017 and totaling $24,337 in the six months ended December 31, 2018 compared to $45,590 in the six months ended December 31, 2017. The decrease in these revenues in the current fiscal year resulted from a lower retail demand for our model of cryptocurrency mining units, partially offset by an increase in the sales of parts.

Cost of Revenues

Cost of revenues was $232,896 in the three months ended December 31, 2018 compared to $50,256 in the six months ended December 31, 2017, and $434,156 in the six months ended December 31, 2018 compared to $50,256 in the six months ended December 31, 2017. Expenses associated with running our cryptocurrency mining operations, such as equipment depreciation, rent, operating supplies, utilities and monitoring services are recorded as cost of revenues. Also included in cost of revenues are the costs of purchasing or assembling the cryptocurrency mining units sold. We are currently experiencing a gross loss on revenues during the current fiscal year primarily due to high utility costs and a conservative, short useful life for mining equipment depreciation. In addition, we currently operate in two fully equipped locations with substantially more cryptocurrency mining units utilized.

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Operating Expenses

General and administrative expenses decreased $324,716 to $173,512 for the three months ended December 31, 2018 from $498,228 for the three months ended December 31, 2017. The decrease in the second quarter of the current fiscal year was due primarily to a decrease in stock-based compensation, partially offset by increases in other expenses supporting our expanded cryptocurrency mining operations. General and administrative expenses increased $70,848 to $730,434 in the six months ended December 31, 2018 from $659,586 in the six months ended December 31, 2017. The increase on a year-to-date basis is due primarily to the increased expenses supporting our expanded cryptocurrency mining operations. Stock-based compensation in six months ended December 31, 2018 included 200,000 total common shares valued at $80,160 issued to a consultant where the Company is disputing whether the consultant earned the 200,000 common shares and the shares may be cancelled.

We performed a lower of cost or market impairment analysis on the cryptocurrency machines purchased in the August 2018 Asset Purchase Agreeement, including writing off the purchase price allocated to the defective machines, and recorded an impairment expense of $2,097,930 during the six months ended December 31, 2018. We reported no impairment expense for the three months ended December 31, 2018 and 2017 and the six months ended December 31, 2017.

Other Income (Expense)

Our other income (expense) was comprised of the following:

	Three Months Ended December 31,						Six Months Ended December 31,
	2018			2017			2018			2017
Interest and other income	$	-		$	1,304		$	-		$	1,402
Interest expense		(41,328	)		(56,827	)		(44,652	)		(143,707	)
Realized gain (loss) on investments		(25,266	)		7,193			(32,504	)		288,416
Unrealized loss on investments		-			(64,987	)		-			(3,876	)
Gain on extinguishment of debt		-			3,259			-			7,934
Change in fair value of derivative liabilities		914,308			(404,539	)		1,965,515			(416,288	)
Loss on settlement of warrants		-			(25,000	)		-			(25,000	)
Total other income (expense)	$	847,714		$	(539,597	)	$	1,888,359		$	(291,119	)

Interest and other income are not currently material to our operations.

The decrease in our interest expense, which includes the amortization of debt discount and original issue discount, resulted from the extinguishment of our convertible notes payable that were outstanding during the the prior fiscal year, partially offset by interest expense on our new convertible debt closed in September 2018.

The realized loss on investments in the three months and six months ended December 31, 2018 resulted from losses recorded on our digital currencies. The realized gain on investments in the three months and six months ended December 31, 2017 resulted from sales of common shares of Viva Entertainment Group, Inc. (“Viva Entertainment), a former subsidiary.

In recording the market value of the Viva Entertainment common shares as of December 31, 2017, the Company recorded an unrealized loss on investments of $64,987 in the three months ended December 31, 2017 and $3,876 in the six months ended December 31, 2017. The Viva Entertainment shares were subsequently sold and no unrealized gain on investments was recorded at December 31, 2018.

29

We incurred no gain or loss on extinguishment of debt in the three months and six months ended December 31, 2018. We incurred a gain on extinguishment of debt of $3,259 in the three months ended December 31, 2017 and $7,934 in the six months ended December 31, 2017 resulting from the overall decrease in our indebtedness.

We estimate the fair value of the derivatives associated with our convertible notes payable, warrants, and put back rights associated with certain Series B preferred stock using the Black-Scholes pricing model and multinomial lattice models that value the derivative liabilities based on a probability weighted discounted cash flow model using future projections of the various potential outcomes. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, and, in the case of our convertible notes payable, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, additional paid-in capital and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs are subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

In December 2017, the Company and Global Opportunity Group LLC (“Global”), a lender, entered into an Exchange Agreement pursuant to which warrants held by Global to purchase a total of 11,115 shares of the Company’s common stock were cancelled in exchange for a convertible promissory note payable to Global in the principal amount of $25,000, which amount was recorded as a loss on settlement of warrants in the three months and six months ended December 31, 2017. There was no gain or loss on settlement of warrants in three months and six months ended December 31, 2018.

Net Loss

As a result, we reported net income of $528,776 for the three moths ended December 31, 2018, primarly due to the positive change in the fair value of our derivative liabilities, and net losses of $982,993 for the three months ended December 31, 2017, $1,171,446 for the six months ended December 31, 2018 and $895,873 for the six months ended December 31, 2017.

LIQUIDITY AND CAPITAL RESOURCES

Overview

We have substantially improved our financial condition as of December 31, 2018 compared to June 30, 2018 primarily as a result of the decrease in our derivative liabilities, partially offset by the increase in our convertible notes payable, net of discounts. As of December 31, 2018, the Company had total current assets of $169,478, including $51,627 in cash, and total current liabilities of $1,249,528, resulting in negative working capital of $1,080,050. Included in total current liabilities are derivative liabilities totaling $1,002,993, which we do not believe will require cash to settle.

In September 2018, we entered into three convertible promissory notes that provided us net proceeds of $223,945. The notes mature one year from issuance and bear interest at rates ranging from 8% to 10%. The lenders have the right beginning on dates defined in the note agreements to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion.

Sources and Uses of Cash

We used net cash in operations of $355,680 in the six months ended December 31, 2018 as a result of our net loss of $1,171,446, non-cash gain of $1,965,515, increase in digital currencies of $179,316 and decrease in accrued expenses of $5,088, partially offset by non-cash expenses totaling $2,913,371, decrease in prepaid expenses and other current assets of $6,000, and increases in accounts payable of $2,514 and due to related party of $43,800.

30

By comparison, we used net cash in operations of $273,378 in the six months ended December 31, 2017 as a result of our net loss of $895,873, non-cash gains totaling $296,350, increases in digital currencies of $71,543, accrued interest receivable – related party of $98 and inventories of $17,730, and decreases in accounts payable of $827 and due to related party of $7,060, partially offset by non-cash expenses totaling $1,004,692, decrease in prepaid expenses and other current assets of $5,000 and increase in accrued expenses of $6,411.

During the six months ended December 31, 2018, we had net cash provided by investing activities of $117,292, comprised of net proeeeds from the sale of investments of $159,739, partially offset by the purchase of property and equipment of $42,447.

During the six months ended December 31, 2017, we had net cash provided by investing activities of $218,748, comprised of net proceeds from the sale of investments of $579,460, partially offset by increase in notes receivable – related party of $49,880 and purchase of property and equipment of $310,832.

During the six months ended December 31, 2018, we had net cash provided by financing activities of $248,945, comprised of proceeds from convertible notes payable of $223,945 and stock subscriptions receivable of $25,000.

During the six months ended December 31, 2017, we had net cash provided by financing activities of $160,000, comprised of proceeds from the sale of preferred stock of $125,000 and proceeds from stock subscriptions payable of $25,000.

We will have to raise funds to complete and successfully deploy our digital mining assets and to fund our operating expenses. We may have to borrow money from shareholders or issue debt or equity or enter into a strategic arrangement with a third party. There can be no assurance that additional capital will be available to us. We currently have no arrangements or understandings with any person to obtain funds through bank loans, lines of credit or any other sources. Since we have no such arrangements or plans currently in effect, our inability to raise funds for our operations will have a severe negative impact on our ability to remain a viable company.

Going Concern

The Company has reported recurring net losses since its inception and used net cash in operating activities of $355,680 in the six months ended December 31, 2018. As of December 31, 2018, the Company had an accumulated deficit of $12,641,382. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The accompanying financial statements have been prepared in conformity with U.S. GAAP, which contemplate continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The ability of the Company to reach a successful level of operations is dependent on the execution of management’s plans, which include the raising of capital through the debt and/or equity markets, until such time that funds provided by operations are sufficient to fund working capital requirements. If the Company were not to continue as a going concern, it would likely not be able to realize its assets at values comparable to the carrying value or the fair value estimates reflected in the balances set out in the preparation of the financial statements.

There can be no assurances that the Company will be successful in attaining a profitable level of operations or in generating additional cash from the equity/debt markets or other sources fund its operations. The financial statements do not include any adjustments relating to the recoverability of assets and classification of assets and liabilities that might be necessary. Should the Company not be successful in its business plan or in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all operational activities and/or contemplate the sale of its assets, if necessary.

31

SIGNIFICANT ACCOUNTING POLICIES

Our significant accounting policies are disclosed in Note 2 to our condensed financial statements and in the notes to our audited financial statements included in our Annual Report on Form 10-K for the year ended June 30, 2018. The following is a summary of those accounting policies that involve significant estimates and judgment of management.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Because of the use of estimates inherent in the financial reporting process, actual results could differ significantly from those estimates.

Digital Currencies

Digital currencies consist of Bitcoin, Litecoin and Ethereum, generally received for the Company’s own account as compensation for cryptocurrency mining services. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies under current Generally Accepted Accounting Principles (“GAAP”), the Company has determined to account for these digital currencies as indefinite-lived intangible assets in accordance with Accounting Standards Update (“ASU”) No. 350, Intangibles – Goodwill and Other, for the period covered by this report and in future reports unless and until further guidance is issued by the Financial Accounting Standards Board (“FASB”). An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not than an impairment exists. If it is determined that it is more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Realized gains on the sale of digital currencies are included in other income (expense) in the statements of operations.

Inventories

Inventories at December 31, 2018 and June 30, 2018 consist of cryptocurrency mining units held for sale or deployment in mining operations, and are stated at the lower of cost or estimated realizable value. Payments to equipment suppliers prior to shipment of the equipment are recorded as equipment deposits.

Property and Equipment

Property and equipment, consisting primarily of computer and other cryptocurrency mining equipment (transaction verification servers) and leasehold improvements, is stated at the lower of cost or estimated realizable value and is depreciated when placed into service using the straight-line method over estimated useful lives. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management has assessed the basis of depreciation of these assets and believes they should be depreciated over a three-year period due to technological obsolescence reflecting rapid development of hardware that has faster processing capacity and other factors. Additionally, during the six months ended December 31, 2018, the Company wrote down cryptocurrency mining equipment by $2,097,930 to estimated net realizable value. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal.

Management has determined that the three-year diminishing value best reflects the current expected useful life of transaction verification servers. This assessment takes into consideration the availability of historical data and management’s expectations regarding the direction of the industry including potential changes in technology. Management will review this estimate annually and will revise such estimates as and when data becomes available.

32

To the extent that any of the assumptions underlying management’s estimate of useful life of its transaction verification servers are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets.

Derivatives

The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liability at the fair value of the instrument on the reclassification date.

Where the number of warrants or common shares to be issued under these agreements is indeterminate, the Company has concluded that the equity environment is tainted, and all additional warrants and convertible debt are included in the value of the derivatives.

We estimate the fair value of the derivatives associated with our convertible notes payable, warrants and put-back rights associated with two asset purchase agreements using, as applicable, either the Black-Scholes pricing model or multinomial lattice models that value the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, and, in the case of our convertible notes payable, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, additional paid-in capital and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs are subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

Impairment of Long-Lived Assets

All assets, including intangible assets subject to amortization, are reviewed for impairment when changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 350 and ASC 360. If the carrying amount of the asset exceeds the expected undiscounted cash flows of the asset, an impairment charge is recognized equal to the amount by which the carrying amount exceeds fair value or net realizable value. The testing of these intangibles under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operations and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations. Total impairment expense, consisting of write downs for cryptocurrency mining equipment totaled $2,097,930 for the six months ended December 31, 2018.

Fair Value of Financial Instruments

Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2018 and June 30, 2018, the amounts reported for cash, prepaid expenses and other current assets, accounts payable, accrued expenses and due to related party approximate fair value because of their short maturities.

33

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:

· Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

· Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

· Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

At December 31, 2018, we had no financial instrument assets measured at fair value. Our marketable securities as of June 30, 2018 are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
Marketable securities	$	1,700	$	1,700	$	-	$	-
Total assets measured at fair value	$	1,700	$	1,700	$	-	$	-

Our derivative liabilities are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
December 31, 2018:
Derivative liabilities	$	1,002,993	$	-	$	-	$	1,002,993
Total liabilities measured at fair value	$	1,002,993	$	-	$	-	$	1,002,993
June 30, 2018:
Derivative liabilities	$	2,886,965	$	-	$	-	$	2,886,965
Total liabilities measured at fair value	$	2,886,965	$	-	$	-	$	2,886,965

Stock-Based Compensation

The Company accounts for all equity-based payments in accordance with ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock awards, stock options, warrants and other equity-based compensation issued to employees. The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The fair value of a stock award is recorded at the fair market value of a share of the Company’s stock on the grant date. The Company estimates the fair value of stock options and warrants at the grant date by using an appropriate fair value model such as the Black-Scholes option pricing model or multinomial lattice models.

The Company accounts for non-employee share-based awards based upon ASC 505-50, Equity-Based Payments to Non-Employees. ASC 505-50 requires the costs of goods and services received in exchange for an award of equity instruments to be recognized using the fair value of the goods and services or the fair value of the equity award, whichever is more reliably measurable. The fair value of the equity award is determined on the measurement date, which is the earlier of the date that a performance commitment is reached or the date that performance is complete. Generally, our awards do not entail performance commitments. When an award vests over time such that performance occurs over multiple reporting periods, we estimate the fair value of the award as of the end of each reporting period and recognize an appropriate portion of the cost based on the fair value on that date. When the award vests, we adjust the cost previously recognized so that the cost ultimately recognized is equivalent to the fair value on the date the performance is complete.

34

Revenue Recognition

Effective July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, as amended, using the modified retrospective method, which requires the cumulative effect of adoption to be recognized as an adjustment to opening retained earnings in the period of adoption.. There was no cumulative effect of adopting the new standard and no impact on our financial statements. The new standard provides a single comprehensive model to be used in the accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, ASC 606 includes provisions within a five-step model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance obligation.

Our revenues currently consist of cryptocurrency mining revenues and revenues from the sale of cryptocurrency mining equipment recognized in accordance with ASC 606 as discussed above. Amounts collected from customers prior to shipment of products are recorded as deferred revenue.

The Company earns its cryptocurrency mining revenues by providing transaction verification services within the digital currency networks of crypto-currencies, such as Bitcoin, Litecoin and Ethereum. The Company satisfies its performance obligation at the point in time that the Company is awarded a unit of digital currency through its participation in the applicable network and network participants benefit from the Company’s verification service. In consideration for these services, the Company receives digital currencies, which are recorded as revenue using the closing U.S. dollar price of the related cryptocurrency on the date of receipt. Expenses associated with running the cryptocurrency mining operations, such as equipment depreciation, rent, operating supplies, rent, utilities and monitoring services are recorded as cost of revenues.

There is currently no specific definitive guidance in GAAP or alternative accounting frameworks for the accounting for the production and mining of digital currencies and management has exercised significant judgment in determining appropriate accounting treatment for the recognition of revenue for mining of digital currencies. Management has examined various factors surrounding the substance of the Company’s operations and the guidance in ASC 606, including identifying the transaction price, when performance obligations are satisfied, and collectability is reasonably assured being the completion and addition of a block to a blockchain and the award of a unit of digital currency to the Company. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies which could result in a change in the Company’s financial statements.

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. This new pronouncement, as amended, is effective January 1, 2019 for calendar-year-end public companies, or July 1, 2019 for the Company. Early adoption is permitted. The Company is unable to determine the impact on its financial statements for the adoption of the new pronouncement.

There were no new accounting pronouncements issued or proposed by the FASB during the six months ended December 31, 2018 and through the date of filing this report which the Company believes will have a material impact on its financial financial statements.

Off Balance Sheet Arrangements

We have consolidated our cryptocurrency mining operations in two locations, Huntingdon Valley, Pennsylvania and Marlboro, New Jersey, where facilities are leased under operating leases. The lease for the Pennsylvania location is on a month-to-month basis at $850 per month. The lease for the New Jersey location was effective April 1, 2018 for a period of one year at a monthly rental of $6,986, with an automatic one-year renewal period with a 5% increase in the monthly rent. We have negotiated reductions in the monthly rental at the New Jersey location for certain months in fiscal year 2019.

35

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

As a smaller reporting company, as defined by Item 10 of Regulation S-K, the Company is not required to provide the information required by this item.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Securities and Exchange Commission defines the term “disclosure controls and procedures” to mean a company’s controls and other procedures of an issuer that are designed to ensure that information required to be disclosed in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Securities Exchange Act of 1934 is accumulated and communicated to the issuer’s management, including its chief executive and chief financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. The Company maintains such a system of controls and procedures in an effort to ensure that all information which it is required to disclose in the reports it files under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified under the SEC’s rules and forms and that information required to be disclosed is accumulated and communicated to the chief executive and interim chief financial officer to allow timely decisions regarding disclosure.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are not effective as of such date. The Chief Executive Officer and Chief Financial Officer have determined that the Company continues to have the following deficiencies which represent a material weakness:

1.	As of December 31, 2018, we did not maintain effective controls over the control environment. Specifically, the Board of Directors does not currently have any independent members and no director qualifies as an audit committee financial expert as defined in Item 407(d)(5)(ii) of Regulation S-B. Since these entity level programs have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.
2.	As of December 31, 2018, due to the inherent issue of segregation of duties in a small company, we have relied heavily on entity or management review controls and engaged an outside financial consultant to lessen the issue of segregation of duties over accounting, financial close procedures and controls over financial statement disclosure. Accordingly, management has determined that this control deficiency constitutes a material weakness.
3.	As of December 31, 2018, we did not establish a written policy for the approval, identification and authorization of related party transactions. Accordingly, management has determined that this control deficiency constitutes a material weakness.

Because of these material weaknesses, management has concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2018, based on the criteria established in “Internal Control-Integrated Framework” (2013 Framework) issued by the COSO.

Changes in Internal Control Over Financial Reporting.

There have been no changes in the Company’s internal control over financial reporting through the date of this report or during the quarter ended December 31, 2018, that materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

36

PART II – OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

There are no pending legal proceedings in which we are a party or in which any of our directors, officers or affiliates, any owner of record or beneficiary of more than 5% of any class of our voting securities is a party adverse to us or has a material interest adverse to us. Our property is not the subject of any pending legal proceedings.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

During the three months ended December 31, 2018, the Company issued no shares of its common stock.

During the three months ended December 31, 2018, the Company issued no shares of its Series B convertible preferred stock.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. MINE SAFETY DISCLOSURES.

Not applicable.

ITEM 5. OTHER INFORMATION.

None.

37

ITEM 6. EXHIBITS.

(a) Exhibits.

Exhibit Number	Exhibit Description
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer and Principal Financial Officer. Filed herewith.
32.1	Section 1350 Certification of Chief Executive Officer and Principal Financial Officer. Filed herewith.

101.INS	XBRL Instance Document *
101.SCH	XBRL Taxonomy Extension Schema *
101.CAL	XBRL Taxonomy Extension Calculation Linkbase *
101.DEF	XBRL Taxonomy Extension Definition Linkbase *
101.LAB	XBRL Taxonomy Extension Label Linkbase *
101.PRE	XBRL Taxonomy Extension Presentation Linkbase *

______________

* Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed “furnished” and not “filed” or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, or deemed “furnished” and not “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, and otherwise is not subject to liability under these sections.

38

SIGNATURES

In accordance with the requirements of the Exchange Act, the Company has caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	Integrated Ventures, Inc.
Dated: February 14, 2019	By:	/s/ Steve Rubakh
		President and Chief Executive Officer and Principal Financial Officer

39

EX-31.1

EXHIBIT 31.1

CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 302 OF

THE SARBANES-OXLEY ACT OF 2002

I, Steve Rubakh, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Integrated Ventures, Inc.;

2.	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) [Omitted pursuant to SEC Release No. 33-8238];

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

5.	The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer’s auditors of the small business issuer’s board of directors (or persons performing the equivalent functions):
	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and
	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

Date: February 14, 2019	By:	/s/ Steve Rubakh
		Steve Rubakh
		Chief Executive Officer and Principal Financial Officer

EX-32.1

EXHIBIT 32.1

CERTIFICATION OF

PRINCIPAL EXECUTIVE OFFICER

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF

THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Integrated Ventures, Inc., (the “Company”) on Form 10-Q for the quarterly period ended December 31, 2018, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Steve Rubakh, the Chief Executive Officer and Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1.	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
2.	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: February 14, 2019	By:	/s/ Steve Rubakh
		Steve Rubakh
		Chief Executive Officer and Principal Financial Officer

XML

Document and Entity Information - shares	6 Months Ended
	Dec. 31, 2018	Feb. 14, 2019
Document And Entity Information
Entity Registrant Name	INTEGRATED VENTURES, INC.
Entity Central Index Key	0001520118
Document Type	10-Q
Document Period End Date	Dec. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--06-30
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		9,874,103
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2019
Entity Emerging Growth Company	false
Entity Small Business	true

XML

Condensed Balance Sheets - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Current assets:
Cash	$ 51,627	$ 749
Restricted cash		40,321
Prepaid expenses and other current assets	3,000	9,000
Inventories	114,851	114,851
Equipment deposits		3,896
Marketable securities		1,700
Total current assets	169,478	170,517
Non-current assets:
Property and equipment, net	1,337,944	633,105
Digital currencies		11,227
Deposits	14,673	14,673
Total assets	1,522,095	829,522
Current liabilities:
Accounts payable	29,487	26,973
Accrued expenses	24,340	29,428
Due to related party	64,774	20,974
Derivative liabilities	1,002,993	2,886,965
Convertible notes payable, net of discounts	127,934
Total current liabilities	1,249,528	2,964,340
Total liabilities	1,249,528	2,964,340
Commitments and contingencies
Stockholders' equity (deficit):
Common stock, $0.001 par value, (40,000,000 shares authorized, 9,874,103 and 8,964,103 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively)	9,875	8,965
Additional paid-in capital	12,843,224	9,290,344
Stock subscriptions payable	60,000	35,000
Accumulated deficit	(12,641,382)	(11,469,936)
Total stockholders' equity (deficit)	272,567	(2,134,818)
Total liabilities and stockholders' equity (deficit)	1,522,095	829,522
Series A Preferred Stock [Member]
Stockholders' equity (deficit):
Preferred stock	500	500
Series B Preferred Stock [Member]
Stockholders' equity (deficit):
Preferred stock	$ 350	$ 309

XML

Condensed Balance Sheets (Parenthetical) - $ / shares	Dec. 31, 2018	Jun. 30, 2018	Dec. 21, 2015
Stockholders' equity (deficit):
Common stock, par value per share	$ 0.001	$ 0.001
Common stock, shares authorized	40,000,000	40,000,000
Common stock, shares issued	9,874,103	8,964,103
Common stock, shares outstanding	9,874,103	8,964,103
Series A Preferred Stock [Member]
Stockholders' equity (deficit):
Preferred stock, par value per share	$ 0.001	$ 0.001
Preferred stock, shares authorized	1,000,000	1,000,000
Preferred stock, shares issued	500,000	500,000
Preferred stock, shares outstanding	500,000	500,000
Series B Preferred Stock [Member]
Stockholders' equity (deficit):
Preferred stock, par value per share	$ 0.001	$ 0.001	$ 0.001
Preferred stock, shares authorized	500,000	500,000	500,000
Preferred stock, shares issued	350,384	309,166
Preferred stock, shares outstanding	350,384	309,166

XML

Condensed Statements of Operations (Unaudited) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Revenues:
Cryptocurrency mining	$ 77,913	$ 59,498	$ 178,378	$ 59,498
Sales of cryptocurrency mining equipment	9,557	45,590	24,337	45,590
Total revenues	87,470	105,088	202,715	105,088
Cost of revenues	232,896	50,256	434,156	50,256
Gross margin (loss)	(145,426)	54,832	(231,441)	54,832
Operating expenses:
General and administrative	173,512	498,228	730,434	659,586
Impairment of assets			2,097,930
Total operating expenses	173,512	498,228	2,828,364	659,586
Loss from operations	(318,938)	(443,396)	(3,059,805)	(604,754)
Other income (expense):
Interest and other income		1,304		1,402
Interest expense	(41,328)	(56,827)	(44,652)	(143,707)
Realized gain (loss) on investments	(25,266)	7,193	(32,504)	288,416
Unrealized loss on investments		(64,987)		(3,876)
Gain on extinguishment of debt		3,259		7,934
Change in fair value of derivative liabilities	914,308	(404,539)	1,965,515	(416,288)
Loss on settlement of warrants		(25,000)		(25,000)
Total other income (expense)	847,714	(539,597)	1,888,359	(291,119)
Income (loss) before income taxes	528,776	(982,993)	(1,171,446)	(895,873)
Provision for income taxes
Net income (loss)	$ 528,776	$ (982,993)	$ (1,171,446)	$ (895,873)
Net income (loss) per common share:
Basic	$ 0.05	$ (0.12)	$ (0.12)	$ (0.12)
Diluted	$ 0.01	$ (0.12)	$ (0.12)	$ (0.12)
Weighted average number of common shares outstanding:
Basic	9,868,668	8,252,873	9,560,842	7,711,319
Diluted	46,817,888	8,252,873	9,560,842	7,711,319

XML

Condensed Statements of Cash Flows (Unaudited) - USD ($)	6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net loss	$ (1,171,446)	$ (895,873)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense	246,996	8,702
Stock-based compensation - related party	417,000	409,000
Stock-based compensation	80,159
Amortization of debt discount	38,782	108,121
Amortization of original issue discount		1,347
Impairment of assets	2,097,930
Change in fair value of derivative liabilities	(1,965,515)	416,288
Loss on settlement of warrants		25,000
Gain on extinguishment of debt		(7,934)
Financing fees related to notes payable		32,358
Realized (gain) loss on sale of investments	32,504	(288,416)
Unrealized loss on investments		3,876
Changes in assets and liabilities:
Digital currencies	(179,316)	(71,543)
Prepaid expenses and other current assets	6,000	5,000
Accrued interest receivable - related party		(98)
Inventories		(17,730)
Accounts payable	2,514	(827)
Accrued expenses	(5,088)	6,411
Due to related party	43,800	(7,060)
Net cash used in operating activities	(355,680)	(273,378)
Cash flows from investing activities:
Net proceeds from the sale of investments	159,739	579,460
Increase in notes receivable - related party		(49,880)
Purchase of property and equipment	(42,447)	(310,832)
Net cash provided by investing activities	117,292	218,748
Cash flows from financing activities:
Proceeds from convertible notes payable	223,945
Proceeds from sale of preferred stock		125,000
Proceeds from stock subscriptions payable	25,000	35,000
Net cash provided by financing activities	248,945	160,000
Net increase in cash	10,557	105,370
Cash, beginning of period	41,070	15,691
Cash, end of period	51,627	121,061
Supplemental disclosure of cash flow information:
Cash paid for interest	29,257
Cash paid for income taxes
Non-cash investing and financing activities:
Equipment deposits for property and equipment	3,896
Common shares issued for cashless exercise of warrants	560	188
Common shares issued for debt discount	53,250
Debt discount for derivative liability	81,543	72,617
Series B preferred shares for property and equipment	3,003,422
Series B preferred shares returned and cancelled	2
Settlement of derivative liabilities		405,970
Common shares issued for convertible notes payable		149,049
Common shares issued for accrued compensation		15,625
Accrued interest payable added to note payable		1,117
Note receivable and accrued interest receivable - related party for marketable securities		$ 66,850

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ORGANIZATION AND BASIS OF PRESENTATION

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 1 - ORGANIZATION AND BASIS OF PRESENTATION

Organization

Integrated Ventures, Inc. (the “Company,” “we,” “our,” or “EMS Find”) was incorporated in the State of Nevada on March 22, 2011, under the name of Lightcollar, Inc. On March 20, 2015, the Company amended its articles of incorporation and changed its name from Lightcollar, Inc. to EMS Find, Inc. On May 30, 2017, Integrated Ventures, Inc. (“Integrated Ventures”), a Nevada corporation, was formed as a wholly owned subsidiary of the Company. Pursuant to an Agreement and Plan of Merger dated May 30, 2017, Integrated Ventures was merged into the Company, with the Company being the surviving corporation and changing its name to Integrated Ventures, Inc.

The Company has discontinued its prior operations and changed its business focus from its prior technologies relating to the EMS Find platform to acquiring, launching and operating companies in the cryptocurrency sector, mainly in digital currency mining, equipment manufacturing, and sales of branded mining rigs, as well as blockchain software development.

The Company is developing and acquiring a diverse portfolio of digital currency assets and block chain technologies, and now operates cryptocurrency mining operations in two facilities located in Pennsylvania and New Jersey. Cryptocurrency mining revenues commenced in November 2017. Crypto-currencies are a medium of exchange that uses decentralized control (a block chain) as opposed to a central bank to track and validate transactions. The Company, through its wholly owned subsidiary, BitcoLab, Inc., is currently mining Bitcoin, Litecoin and Ethereum, whereby the Company earns revenue by solving “blocks” to be added to the block chain.

The Company expanded its cryptocurrency mining operations in April 2018 by acquiring the operations of digiMine LLC (“digiMine”) (Note 6) and by purchasing 182 cryptocurrency mining machines from Secure Hosting LLC (“Secure Hosting”) in August 2018 (see Note 5).

Basis of Presentation

The accompanying unaudited condensed financial statements of the Company have been prepared in accordance with U.S. generally accepted accounting principles (“US GAAP”) for interim financial information and the instructions to Form 10-Q and Article 8 of Regulation S-X. The results of operations for the interim periods ended December 31, 2018 shown in this report are not necessarily indicative of results to be expected for the full fiscal year ending June 30, 2019. In the opinion of the Company’s management, the information contained herein reflects all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of the Company’s results of operations, financial position and cash flows. The unaudited interim financial statements should be read in conjunction with the audited financial statements in the Company’s Annual Report on Form 10-K for the year ended June 30, 2018 filed on December 27, 2018 and Management’s Discussion and Analysis of Financial Condition and Results of Operations.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The significant accounting policies of the Company are disclosed in Notes to Financial Statements included in the Company’s Annual Report on Form 10-K. The following summary of significant accounting policies of the Company is presented to assist in understanding the Company’s interim financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.

Restatement

The Company is restating its condensed financial statements for the three months and six months ended December 31, 2017 to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Because of the use of estimates inherent in the financial reporting process, actual results could differ significantly from those estimates.

Digital Currencies

Digital currencies consist of Bitcoin, Litecoin and Ethereum, generally received for the Company’s own account as compensation for cryptocurrency mining services. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies under current Generally Accepted Accounting Principles (“GAAP”), the Company has determined to account for these digital currencies as indefinite-lived intangible assets in accordance with Accounting Standards Update (“ASU”) No. 350, Intangibles – Goodwill and Other, for the period covered by this report and in future reports unless and until further guidance is issued by the Financial Accounting Standards Board (“FASB”). An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not than an impairment exists. If it is determined that it is more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Realized gains on the sale of digital currencies are included in other income (expense) in the statements of operations.

Inventories

Inventories at December 31 and June 30, 2018 consist of cryptocurrency mining units held for sale or deployment in mining operatons, and are stated at the lower of cost or estimated realizable value. Payments to equipment suppliers prior to shipment of the equipment are recorded as equipment deposits.

Property and Equipment

Property and equipment, consisting primarily of computer and other cryptocurrency mining equipment (transaction verification servers) and leasehold improvements, is stated at the lower of cost or estimated realizable value and is depreciated when placed into service using the straight-line method over estimated useful lives. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management has assessed the basis of depreciation of these assets and believes they should be depreciated over a three-year period due to technological obsolescence reflecting rapid development of hardware that has faster processing capacity and other factors. Additionally, during the six months ended December 31, 2018, the Company wrote down cryptocurrency mining equipment by $2,097,930 to estimated net realizable value. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal.

Management has determined that the three-year diminishing value best reflects the current expected useful life of transaction verification servers. This assessment takes into consideration the availability of historical data and management’s expectations regarding the direction of the industry including potential changes in technology. Management will review this estimate annually and will revise such estimates as and when data becomes available.

To the extent that any of the assumptions underlying management’s estimate of useful life of its transaction verification servers are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets.

Derivatives

The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liability at the fair value of the instrument on the reclassification date.

Where the number of warrants or common shares to be issued under these agreements is indeterminate, the Company has concluded that the equity environment is tainted, and all additional warrants and convertible debt are included in the value of the derivatives.

We estimate the fair value of the derivatives associated with our convertible notes payable, warrants and put-back rights associated with two asset purchase agreements using, as applicable, either the Black-Scholes pricing model or multinomial lattice models that value the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, and, in the case of our convertible notes payable, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, additional paid-in capital and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs are subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

Impairment of Long-Lived Assets

All assets, including intangible assets subject to amortization, are reviewed for impairment when changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 350 and ASC 360. If the carrying amount of the asset exceeds the expected undiscounted cash flows of the asset, an impairment charge is recognized equal to the amount by which the carrying amount exceeds fair value or net realizable value. The testing of these intangibles under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operations and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations. Total impairment expense, consisting of write downs for cryptocurrency mining equipment totaled $2,097,930 for the six months ended December 31, 2018.

Fair Value of Financial Instruments

Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2018 and June 30, 2018, the amounts reported for cash, prepaid expenses and other current assets, accounts payable, accrued expenses and due to related party approximate fair value because of their short maturities.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:

• Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

• Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

• Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

At December 31, 2018, we had no financial instrument assets measured at fair value. Our marketable securities as of June 30, 2018 are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
Marketable securities	$	1,700	$	1,700	$	-	$	-
Total assets measured at fair value	$	1,700	$	1,700	$	-	$	-

Our derivative liabilities are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
December 31, 2018:
Derivative liabilities	$	1,002,993	$	-	$	-	$	1,002,993
Total liabilities measured at fair value	$	1,002,993	$	-	$	-	$	1,002,993
June 30, 2018:
Derivative liabilities	$	2,886,965	$	-	$	-	$	2,886,965
Total liabilities measured at fair value	$	2,886,965	$	-	$	-	$	2,886,965

During the six months ended December 31, 2018, the Company had the following activity in its derivative liabilities:

	Convertible Notes Payable			Warrants		Put Back Rights			Total
Derivative liabilities at June 30, 2018	$	-		$	-	$	2,886,965		$	2,886,965
Addition to liabilities for new debt/warrants		81,543			-		-			81,543
Change in fair value		(385	)		47,528		(2,012,658	)		(1,965,515	)
Derivative liabilities at December 31, 2018	$	81,158		$	47,528	$	874,307		$	1,002,993

Stock-Based Compensation

The Company accounts for all equity-based payments in accordance with ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock awards, stock options, warrants and other equity-based compensation issued to employees. The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The fair value of a stock award is recorded at the fair market value of a share of the Company’s stock on the grant date. The Company estimates the fair value of stock options and warrants at the grant date by using an appropriate fair value model such as the Black-Scholes option pricing model or multinomial lattice models.

The Company accounts for non-employee share-based awards based upon ASC 505-50, Equity-Based Payments to Non-Employees. ASC 505-50 requires the costs of goods and services received in exchange for an award of equity instruments to be recognized using the fair value of the goods and services or the fair value of the equity award, whichever is more reliably measurable. The fair value of the equity award is determined on the measurement date, which is the earlier of the date that a performance commitment is reached or the date that performance is complete. Generally, our awards do not entail performance commitments. When an award vests over time such that performance occurs over multiple reporting periods, we estimate the fair value of the award as of the end of each reporting period and recognize an appropriate portion of the cost based on the fair value on that date. When the award vests, we adjust the cost previously recognized so that the cost ultimately recognized is equivalent to the fair value on the date the performance is complete.

Revenue Recognition

Effective July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, as amended, using the modified retrospective method, which requires the cumulative effect of adoption to be recognized as an adjustment to opening retained earnings in the period of adoption.. There was no cumulative effect of adopting the new standard and no impact on our financial statements. The new standard provides a single comprehensive model to be used in the accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, ASC 606 includes provisions within a five-step model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance obligation.

Our revenues currently consist of cryptocurrency mining revenues and revenues from the sale of cryptocurrency mining equipment recognized in accordance with ASC 606 as discussed above. Amounts collected from customers prior to shipment of products are recorded as deferred revenue.

The Company earns its cryptocurrency mining revenues by providing transaction verification services within the digital currency networks of crypto-currencies, such as Bitcoin, Litecoin and Ethereum. The Company satisfies its performance obligation at the point in time that the Company is awarded a unit of digital currency through its participation in the applicable network and network participants benefit from the Company’s verification service. In consideration for these services, the Company receives digital currencies, which are recorded as revenue using the closing U.S. dollar price of the related cryptocurrency on the date of receipt. Expenses associated with running the cryptocurrency mining operations, such as equipment depreciation, rent, operating supplies, rent, utilities and monitoring services are recorded as cost of revenues.

There is currently no specific definitive guidance in GAAP or alternative accounting frameworks for the accounting for the production and mining of digital currencies and management has exercised significant judgment in determining appropriate accounting treatment for the recognition of revenue for mining of digital currencies. Management has examined various factors surrounding the substance of the Company’s operations and the guidance in ASC 606, including identifying the transaction price, when performance obligations are satisfied, and collectability is reasonably assured being the completion and addition of a block to a blockchain and the award of a unit of digital currency to the Company. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies which could result in a change in the Company’s financial statements.

Income Taxes

The Company adopted the provisions of ASC 740-10, Accounting for Uncertain Income Tax Positions. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded an asset for unrecognized tax benefits. As of December 31, 2018, tax years 2018, 2017, 2016 and 2015 remain open for IRS audit. The Company has received no notice of audit from the IRS for any of the open tax years.

The Company adopted ASC 740-10, Definition of Settlement in FASB Interpretation No. 48, (“ASC 740-10”), which was issued on May 2, 2007. ASC 740-10 amends FIN 48 to provide guidance on how an entity should determine whether a tax position is effectively settled for the purpose of recognizing previously unrecognized tax benefits. The term “effectively settled” replaces the term “ultimately settled” when used to describe recognition, and the terms “settlement” or “settled” replace the terms “ultimate settlement” or “ultimately settled” when used to describe measurement of a tax position under ASC 740-10. ASC 740-10 clarifies that a tax position can be effectively settled upon the completion of an examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The adoption of ASC 740-10 did not have an impact on the accompanying financial statements.

Income (Loss) Per Share

Basic net income or loss per share is calculated by dividing net income or loss by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as “in-the-money” stock options and warrants, convertible debt and convertible preferred stock, were exercised or converted into common stock. Equivalent shares are not utilized when the effect is anti-dilutive.

The common shares used in the computation of basic and diluted net income (loss) per share are reconciled as follows:

	Three Months Ended December 31,				Six Months Ended December 31,
	2018		2017		2018		2017
Weighted average number of shares outstanding – basic		9,868,668		8,252,873		9,560,842		7,711,319
Dilutive effect of convertible debt		1,910,820		-		-		-
Dilutive effect of Series B convertible preferred stock		35,038,400		-		-		-
Weighted average number of shares outstanding – diluted		46,817,888		8,252,873		9,560,842		7,711,319

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. This new pronouncement, as amended, is effective January 1, 2019 for calendar-year-end public companies, or July 1, 2019 for the Company. Early adoption is permitted. The Company is unable to determine the impact on its financial statements for the adoption of the new pronouncement.

There were no new accounting pronouncements issued or proposed by the FASB during the six months ended December 31, 2018 and through the date of filing this report which the Company believes will have a material impact on its financial financial statements.

Reclassifications

Certain amounts in the condensed financial statements for the prior-year periods have been reclassified to conform to the presentation for the current-year periods.

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GOING CONCERN

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 3 - GOING CONCERN

The Company has reported recurring net losses since its inception and used net cash in operating activities of $355,680 in the six months ended December 31, 2018. As of December 31, 2018, the Company had an accumulated deficit of $12,641,382. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.

The accompanying financial statements have been prepared in conformity with U.S. GAAP, which contemplate continuation of the Company as a going concern and the realization of assets and satisfaction of liabilities in the normal course of business. The ability of the Company to reach a successful level of operations is dependent on the execution of management’s plans, which include the raising of capital through the debt and/or equity markets, until such time that funds provided by operations are sufficient to fund working capital requirements. If the Company were not to continue as a going concern, it would likely not be able to realize its assets at values comparable to the carrying value or the fair value estimates reflected in the balances set out in the preparation of the financial statements.

There can be no assurances that the Company will be successful in attaining a profitable level of operations or in generating additional cash from the equity/debt markets or other sources fund its operations. The financial statements do not include any adjustments relating to the recoverability of assets and classification of assets and liabilities that might be necessary. Should the Company not be successful in its business plan or in obtaining the necessary financing to fund its operations, the Company would need to curtail certain or all operational activities and/or contemplate the sale of its assets, if necessary.

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PROPERTY AND EQUIPMENT

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at:

	December 31, 2018			June 30, 2018
Cryptocurrency mining equipment	$	1,483,194		$	573,806
Furniture and equipment		16,366			14,427
Leasehold improvements		143,440			102,932
Total		1,643,000			691,165
Less accumulated depreciation and amortization		(305,056	)		(58,060	)
Net	$	1,337,944		$	633,105

Depreciation and amortization expense, included in cost of revenues, for the three months ended December 31, 2018 and 2017 was $136,778 and $8,702, respectively. Depreciation and amortization expense, included in cost of revenues, for the six months ended December 31, 2018 and 2017 was $246,996 and $8,702, respectively.

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ASSET PURCHASE AGREEMENT

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 5 - ASSET PURCHASE AGREEMENT

On August 2, 2018, the Company entered into an Asset Purchase Agreement with Secure Hosting LLC, a Florida limited liability, for the purchase of 182 Ethereum mining machines.

As consideration for the purchase of the machines, the Company issued 38,018 restricted shares of its Series B convertible preferred stock, valued on an “as converted to common” basis at an aggregate of $3,801,800, based on the market value of the Company’s common stock on the date of the transaction.

Of the 182 machines purchased, 152 were placed into operations, and 30 units deemed to be under-performing will be utilized by the Company as repair parts or sold as repair parts. The Company performed a lower of cost or market impairment analysis on the machines purchased, including writing off the purchase price allocated to the defective machines, and recorded an impairment expense of $2,097,930, which amount is included in operating expenses for the six months ended December 31, 2018.

The Agreement contains customary representations and warranties and covenants as of the Closing Date, including, without limitation, that the Equipment is (i) in good condition, (ii) free of all liens, (iii) not subject to any intellectual property rights other than software used in the Equipment and (iv) covered by certain manufacturer warranties. Because a portion of the machines were defective, certain shares of the Series B preferred stock issued in the transaction were subsequently returned to the Company and cancelled.

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DIGIMINE ACQUISITION

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 6 - DIGIMINE ACQUISITION

In April 2018, the Company acquired the digital currency mining operations of digiMine LLC (“digiMine”) through two Asset Purchase Agreements (the “digiMine Acquisition”) in a transaction recorded as a business combination.

On April 16, 2018, the Company entered into an Asset Purchase Agreement with digiMine for the purchase of digiMine’s digital currency mining assets located in Marlboro, New Jersey, the principal assets consisting of: 150 cryptocurrency mining machines; all right, title and interest in, the lease and leasehold improvements for the premises on which digiMine’s business operates; all books and records pertaining to ownership of digiMine’s business as applicable; and restricted cash of $175,000. The Company issued 16,666 shares of its Series B preferred stock to digiMine.

The Company also entered into a separate Security and Pledge Agreement, dated as of April 13, 2018, securing its obligations to digiMine under the Asset Purchase Agreement.

digiMine has the right (the “Put-Back Right”), at any time commencing April 1, 2019, to require that the Company redeem for cash any of Seller’s then-outstanding Shares at a redemption price equal to 72% of the Shares. The Conversion Amount on execution is equal to $1,200,000 (the “Put-Back Price”) of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share.

On April 30, 2018, the Company entered into a second Asset Purchase Agreement with digiMine for the purchase of digiMine’s digital currency mining assets located in Marlboro, New Jersey, the principal assets consisting of: 97 cryptocurrency mining machines and computer workstation; digital currency portfolio with an estimated value of $15,487; all right, title and interest in, the lease and leasehold improvements for the premises on which digiMine’s business operates; all books and records pertaining to ownership of digiMine’s business as applicable; and restricted cash of $200,000. The Company issued 20,000 shares of its Series B preferred stock to digiMine.

The Company also entered into a separate Security and Pledge Agreement, dated as of April 30, 2018, securing its obligations to digiMine under the Agreement.

digiMine has the right (the “Put-Back Right”), at any time commencing May 1, 2019, to require that the Company redeem for cash any of Seller’s then-outstanding Shares at a redemption price equal to 72% of the Shares. The Conversion Amount on execution is equal to $1,440,000 (the “Put-Back Price”) of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share.

The Company has identified the Put-Back Rights associated with the two Asset Purchase Agreements as derivatives.

The Company engaged an independent valuation firm to estimate the fair value of the Series B preferred stock issued in the two Asset Purchase Agreements, to estimate the value of the derivative liabilities associated with the Put-Back Rights, and allocate the total consideration paid to the assets acquired. The valuation firm developed multinomial lattice models that valued the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes.

The total consideration paid in the Acquisition is summarized as follows:

Value of 36,667 total Series B preferred shares	$	1,163,806
Derivative liabilities associated with Put-Back Rights		3,729,109
Total consideration paid	$	4,892,915

The total consideration paid was allocated to the fair value of the assets acquired as follows:

Restricted cash	$	375,000
Property and equipment		350,349
Digital currencies		14,056
Goodwill		4,153,510
Total consideration allocated	$	4,892,915

No liabilities of digiMine were assumed by the Company in the Acquisition. The excess of consideration paid over fair value of assets acquired was recorded as goodwill.

The Company performed an impairment analysis on the goodwill at June 30, 2018 and recorded an impairment expense of $4,153,510, which amount is included in operating expenses for the year ended June 30, 2018. The total cash acquired of $375,000 was restricted to fund digital mining operations. As of December 31, 2018, the restricted cash had been fully utilized in digital mining operations.

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RELATED PARTY TRANSACTIONS

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 7 - RELATED PARTY TRANSACTIONS

We have one executive officer, Steve Rubakh, who is currently our only full-time employee and sole member of our Board of Directors. Mr. Rubakh is paid an annual salary established by the Board of Directors and is issued shares of Series B Preferred Stock for additional compensation. The number of shares issued, generally on a quarterly basis, is at the discretion of the Board of Directors.

On March 18, 2018, the Board of Directors of the Company modified the annual compensation for Steve Rubakh, effective April 1, 2018 to include annual salary of $150,000 per year and the issuance on a quarterly basis of 5,000 shares of Series B preferred stock.

On July 1, 2018, the Company issued to Mr. Rubakh 5,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $417,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2018.

On August 1, 2017, the Company issued to Mr. Rubakh 30,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $9,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

On August 31, 2017, Steve Rubakh converted accrued compensation of $15,625 into 347,222 common shares of the Company.

Amounts due to related party, including accrued salary to Mr. Rubakh, totaled $64,774 and $20,974 as of December 31, 2018 and June 30, 2018, respectively.

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CONVERTIBLE NOTES PAYABLE

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 8 - CONVERTIBLE NOTES PAYABLE

Convertible notes payable, all classified as current, consist of the following at December 31, 2018:

			Debt
	Principal		Discount		Net
Geneva Roth Remark Holdings, Inc.	$	128,000	$	35,025	$	92,975
BHP Capital NY, Inc.		52,000		34,520		17,480
Armada Investment Fund, LLC		52,000		34,521		17,479
Total	$	232,000	$	104,066	$	127,934

On September 17, 2018, the Company entered into a convertible promissory note with Geneva Roth Remark Holdings, Inc. (“Geneva”) in the principal amount of $128,000. The note matures on September 26, 2019 and bears interest at 10%. A debt discount of $49,169 was recorded, including a derivative liability of $46,169. Geneva has the right beginning on the date that is 170 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $14,144 of the debt discount had been amortized and there was accrued interest payable of $3,682. The Company recorded a derivative liability of $45,046 as of December 31, 2018.

On September 26, 2018, the Company entered into a convertible promissory note with with BHP Capital NY, Inc. (“BHP”) in the principal amount of $52,000, with an original issue discount of $2,000. The note matures on September 17, 2019 and bears interest at 8%. BHP was issued 75,000 shares of the Company’s common stock valued at $26,625 as a fee. A debt discount of $46,840 was recorded, including a derivative liability of $17,687. BHP has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $12,320 of the debt discount had been amortized and there was accrued interest payable of $1,094. The Company recorded a derivative liability of $18,056 as of December 31, 2018.

On September 26, 2018, the Company entered into a convertible promissory note with with Armada Investment Fund, LLC (“Armada”) in the principal amount of $52,000, with an original issue discount of $2,000. The note matures on September 17, 2019 and bears interest at 8%. Armada was issued 75,000 shares of the Company’s common stock valued at $26,625 as a fee. A debt discount of $46,840 was recorded, including a derivative liability of $17,687. Armada has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock. The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion. As of December 31, 2018, $12,319 of the debt discount had been amortized and there was accrued interest payable of $1,094. The Company recorded a derivative liability of $18,056 as of December 31, 2018.

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STOCKHOLDERS’ DEFICIT

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 9 - STOCKHOLDERS’ DEFICIT

Preferred Stock

Series A Preferred Stock

In March 2015, the Company filed with the State of Nevada a Certificate of Designation establishing the designations, preferences, limitations and relative rights of 1,000,000 shares of the Company’s Series A preferred stock (“Series A Preferred Stock”). Holders of the Series A Preferred Stock have the right to vote in aggregate, on all shareholder matters equal to 1,000 votes per share of Series A Preferred Stock. The shares of Series A Preferred Stock are not convertible into shares of common stock.

The Company has 1,000,000 shares of Series A Preferred Stock authorized, with 500,000 shares issued and outstanding as of December 31, 2018 and June 30, 2018, which were issued in March 2015 in consideration for services to members of the Company’s Board of Directors.

Series B Preferred Stock

On December 21, 2015, the Company filed a Certificate of Designation for a new Series B Convertible Preferred Stock with the State of Nevada following approval by the board of directors of the Company. Five Hundred (500,000) Thousand shares of the Company’s authorized preferred stock are designated as the Series B Convertible Preferred Stock (the “Series B Preferred Stock”), par value of $0.001 per share and with a stated value of $0.001 per share (the “Stated Value”). Holders of Series B Preferred Stock shall be entitled to receive dividends, when and as declared by the Board of Directors out of funds legally available therefor. At any time and from time to time after the issuance of shares of the Series B Preferred Stock, each issued share of Series B Preferred Stock is convertible into One (100) Hundred shares of Common Stock (“Conversion Ratio”). The holders of the Series B Preferred Stock shall have the right to vote together with holders of Common Stock, on an as “converted basis”, on any matter that the Company’s shareholders may be entitled to vote on, either by written consent or by proxy. Upon any liquidation, dissolution or winding-up of the Company, the holders of the Series B Preferred Stock shall be entitled to receive out of the assets of the Company, whether such assets are capital or surplus, for each share of Series B Preferred Stock an amount equal to the Stated Value, and all other amounts in respect thereof then due and payable prior to any distribution or payment shall be made to the holders of any junior securities.

The Company has 500,000 shares of Series B Preferred Stock authorized, with 350,384 and 309,166 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively.

On March 18, 2018, the Board of Directors of the Company modified the annual compensation for Steve Rubakh, effective April 1, 2018 to include annual salary of $150,000 per year and the issuance on a quarterly basis of 5,000 shares of Series B preferred stock. On July 1, 2018, the Company issued to Mr. Rubakh 5,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $417,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2018.

As discussed in Note 5, on August 2, 2018, the Company entered into an Asset Purchase Agreement for the purchase of 182 cryptocurrency mining machines. As consideration for the purchase of the machines, the Company issued 38,018 shares of its Series B convertible preferred stock, valued on an “as converted to common” basis at an aggregate of $3,801,800. In December 2018, a total of 1,800 shares of Series B preferred stock originally issued pursuant to the Asset Purchase Agreement were returned to the Company and cancelled.

On August 1, 2017, the Company issued to Mr. Rubakh 30,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $9,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

On October 25, 2017, four investors entered into subscription agreements for the purchase of a total of 16,000 shares of Series B Preferred stock for cash at $10 per share. Through December 31, 2017, 12,500 of the shares had been issued for an investment of $125,000. As of December 31, 2018 and June 30, 2018, a stock subscription payable of $35,000 was recorded for unissued shares.

On November 1, 2017, the Company issued to Mr. Rubakh 40,000 shares of Series B convertible preferred stock valued on an “as converted to common” basis at $400,000. The stock-based compensation – related party is included in general and administrative expenses for the six months ended December 31, 2017.

Common Stock

The Company has 40,000,000 shares of common stock authorized, with 9,874,103 and 8,964,103 shares issued and outstanding as of December 31, 2018 and June 30, 2018, respectively.

During the six months ended December 31, 2018, the Company issued a total of 910,000 shares of its common stock.

On August 14, 2018, 100,000 shares of common stock valued at $55,000, based on the closing market price of stock on the date of grant, were issued to a consultant.

On August 23, 2018, 560,000 shares of common stock were issued to a lender in the cashless exercise of warrants recorded at par value of $560. See Note 10.

On September 26, 2018, a total of 150,000 shares of common stock valued at $53,250, based on the closing market price of stock on the date of grant, were issued to two lenders as loan fees. See Note 8.

On October 5, 2018, 100,000 shares of common stock valued at $25,160, based on the closing market price of stock on the date of grant, were issued to a consultant.

During the six months ended December 31, 2017, the Company issued a total of 3,175,774 shares of its common stock.

A total of 2,640,017 shares of the Company’s common stock, valued at $149,049, were issued in conversion of $55,760 note principal, $2,715 accrued interest payable, $58,216 in derivative liabilities, $2,449 in fees and $29,909 in penalties.

On July 6, 2017, 188,240 shares of common stock were issued to a lender in the cashless exercise of warrants recorded at par value of $188.

On August 31, 2017, 347,222 shares of common stock valued at $15,625 were issued to Steve Rubakh for accrued compensation.

On September 30, 2017, the Company increased the number of outstanding common shares by 114 shares due to rounding of shares in the reverse stock split.

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WARRANTS

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 10 - WARRANTS

The Company has granted warrants to non-employee lenders in connection with the issuance of certain convertible promissory notes and to an investor in connection with the purchase of common shares of the Company. The Company has also granted warrants to officers and directors. Certain of the warrants have been subsequently surrendered to the Company and cancelled.

Warrant activity for the six months ended December 31, 2018 is as follows:

	Number of Warrants			Weighted Average Exercise  Price		Weighted Average Remaining Contract Term (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2018		348,375		$	2.20		2.55	$	-
Granted		-		$	-
Exercised		(34,333	)	$	2.16
Forfeited or expired		-		$	-
Outstanding and exercisable at December 31, 2018		314,042		$	2.20		2.05	$	-

Because the number of common shares to be issued under convertible notes payable is indeterminate, the Company concluded that the equity environment was tainted as of December 31, 2018. Therefore, all warrants issued prior to that date were included in the Company’s calculations of derivative liabilities.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 11 - COMMITMENTS AND CONTINGENCIES

Legal Matters

From time to time, we may be involved in litigation relating to claims arising out of our operations in the normal course of business. As of the date of filing of this report, there were no pending or threatened lawsuits.

Operating Leases

During the year ended June 30, 2018, the Company consolidated its cryptocurrency mining operations in two locations, Huntingdon Valley, Pennsylvania and Marlboro, New Jersey, where facilities are leased under operating leases. The lease for the Pennsylvania location is on a month-to-month basis at $850 per month. The lease for the New Jersey location was effective April 1, 2018 for a period of one year at a monthly rental of $6,986, with an automatic one-year renewal period with a 5% increase in the monthly rent. We have negotiated reductions in the monthly rental at the New Jersey location for certain months in fiscal year 2019.

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RESTATEMENT

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 12 - RESTATEMENT

The Company has restated its financial statements as of December 31, 2017 and for the three months and six months then ended to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections.

The following adjustments were made to the December 31, 2017 Restated Balance Sheet:

Integrated Ventures, Inc.
Balance Sheet
	As Originally Reported on December 31, 2017		Adjustments			As Restated December 31, 2017
ASSETS
Current assets:
Cash	$	121,061	$	-		$	121,061
Accounts receivable		15,000		-			15,000
Digital currencies		43,786		(43,786	)(a)		-
Prepaid expenses and other current assets		2,500		-			2,500
Inventories		17,730		-			17,730
Marketable securities		1,760		-			1,760
Total current assets		201,837		(43,786	)		158,051
Non-current assets:
Property and equipment		305,568		(3,438	)(c)		302,130
Digital currencies		-		43,786	(a)		43,786
Deposits		700		-			700
Total assets	$	508,105	$	(3,438	)	$	504,667

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	23,331		$	-		$	23,331
Accrued expenses		29,745			8,468	(b)		38,213
Due to related party		993			(993	)(b)		-
Derivative liabilities		21,419			63,404	(d)		84,823
Convertible notes payable, net of discounts		14,458			-			14,458
Note payable		125,000			-			125,000
Total current liabilities		214,946			70,879			285,825
Total liabilities		214,946			70,879			285,825
Commitments and contingencies
Stockholders’ equity (deficit):
Series A preferred stock, $0.001 par value, (1,000,000 shares authorized, 500,000 shares issued and outstanding)		500			-			500
Series B preferred stock, $0.001 par value, (500,000 shares authorized, 232,500 shares issued and outstanding)		233			-			233
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)		8,388			-			8,388
Additional paid-in capital		5,538,477			1,424,603	(d)(f)		6,963,080
Stock subscription payable		35,000			-			35,000
Accumulated deficit		(5,289,439	)		(1,498,920	)(b)(c)(d)(e)		(6,788,359	)
Total stockholders’ equity (deficit)		293,159			(74,317	)		218,842
Total liabilities and stockholders’ equity (deficit)	$	508,105		$	(3,438	)	$	504,667

The following adjustments were made to the Restated Statement of Operations for the three months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Three Months Ended December 31, 2017			Adjustments			As Restated for the Three Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		494,247			3,981	(e)		498,228
Total operating expenses		494,247			3,981			498,228
Loss from operations		(435,977	)		(7,419	)		(443,396	)
Other income (expense):
Interest and other income		1,304			-			1,304
Interest expense		(34,738	)		(22,089	)(b)(d)		(56,827	)
Realized gain on sale of investments		85,911			(78,718	)(f)		7,193
Unrealized loss on investments		(64,987	)		-			(64,987	)
Gain on extinguishment of debt		3,259			-			3,259
Change in fair value of derivative liabilities		273,032			(677,571	)(d)		(404,539	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		200,016			(739,613	)		(539,597	)
Loss before income taxes		(235,961	)		(747,032	)		(982,993	)
Provision for income taxes		-			-			-
Net loss	$	(235,961	)	$	(747,032	)	$	(982,993	)
Net loss per common share:
Basic	$	(0.03	)	$	(0.09	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		8,252,873			-			8,252,873

The following adjustments were made to the Restated Statement of Operations for the six months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		634,124			25,462	(e)		659,586
Total operating expenses		634,124			25,462			659,586
Loss from operations		(575,854	)		(28,900	)		(604,754	)
Other income (expense):
Interest and other income		1,402			-			1,402
Interest expense		(120,319	)		(23,388	)(b)(d)		(143,707	)
Realized gain on sale of investments		367,134			(78,718	)(f)		288,416
Unrealized loss on investments		(3,876	)		-			(3,876	)
Gain (loss) on extinguishment of debt		(268,476	)		276,410	(d)		7,934
Change in fair value of derivative liabilities		201,197			(617,485	)(d)		(416,288	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		113,297			(404,416	)		(291,119	)
Loss before income taxes		(462,557	)		(433,316	)		(895,873	)
Provision for income taxes		-			-			-
Net loss	$	(462,557	)	$	(433,316	)	$	(895,873	)
Net loss per common share:
Basic	$	(0.06	)	$	(0.06	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		7,711,319			-			7,711,319

The Following adjustments were made to the Restated Statement of Cash Flows for the six months ended December 31, 2017: 

Integrated Ventures, Inc.
Statement of Cash Flows
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Cash flows from operating activities:
Net loss	$	(462,557	)	$	(433,316	)(b)(c)(d)(e)(f)		(895,873	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		5,264			3,438	(c)		8,702
Stock-based compensation – related party		409,000			-			409,000
Amortization of debt discount		79,631			28,490	(d)		108,121
Amortization of original issue discount		1,347			-			1,347
Change in fair value of derivative liabilities		(201,197	)		617,485	(d)		416,288
(Gain) loss on extinguishment of debt		268,476			(276,410	)(d)		(7,934	)
Financing fees related to notes payable		32,358			-			32,358
Realized gain on sale of investments		(367,134	)		78,718	(f)		(288,416	)
Unrealized loss on investments		3,876			-			3,876
Loss on settlement of warrants		63,765			(38,765	)(d)		25,000
Changes in assets and liabilities:
Digital currencies		(61,892	)		(9,651	)(b)		(71,543	)
Prepaid expenses and other current assets		5,000			-			5,000
Inventories		(17,730	)		-			(17,730	)
Accrued interest receivable – related party		(98	)		-			(98	)
Accounts payable		(827	)		-			(827	)
Accrued expenses		(1,786	)		8,197	(b)		6,411
Due to related party		(19,223	)		12,163	(b)		(7,060	)
Net cash used in operating activities		(263,727	)		(9,651	)		(273,378	)
Cash flows from investing activities:
Net proceeds from the sale of investments		579,460			-			579,460
Purchase of investments		(9,651	)		9,651	(b)		-
Increase in notes receivable – related party		(49,880	)		-			(49,880	)
Purchase of property and equipment		(310,832	)		-			(310,832	)
Net cash provided by investing activities		209,097			9,651			218,748
Cash flows from financing activities:
Proceeds from sale of preferred stock		125,000			-			125,000
Proceeds from stock subscriptions payable		35,000			-			35,000
Net cash provided by financing activities		160,000			-			160,000
Net increase in cash		105,370			-			105,370
Cash, beginning of period		15,691			-			15,691
Cash, end of period	$	121,061		$	-			121,061

Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-		$	-
Cash paid for income taxes		-			-			-
Non-cash investing and financing activities:
Common shares issued for convertible notes payable	$	379,021			(229,972	)(d)		149,049
Common shares issued for due to related party		15,625			-			15,625
Common shares issued for cashless exercise of warrants		188			-			188
Debt discount for derivative liability		47,617			25,000	(d)		72,617
Accrued interest added to convertible notes payable		1,117			-			1,117
Settlement of derivative liabilities		-			405,970	(d)		405,970
Marketable securities for conversion of notes receivable		66,850			-			66,850
Marketable securities exchanged for note payable		(37,074	)		37,074	(d)		-
Marketable securities exchanged for accrued expenses		(1,370	)		1,370	(d)		-
Marketable securities exchanged for derivative liabilities		(78,718	)		78,718	(d)		-
Marketable securities exchanged for accounts receivable		(15,000	)		15,000	(d)		-
Note payable issued in settlement of warrants		25,000			(25,000	)(d)		-
Derivative liabilities extinguished in settlement of warrants		67,064			(67,064	)(d)		-

_________________ 

(a)	Reclassified digital currencies from current to long-term asset.
(b)	Accrued officer compensation was reclassified from accrued expenses to due to related party and subsequently reduced. Accrued interest payable was increased.
(c)	Reduced useful life for depreciation from 5 years to 3 years.
(d)	The Company engaged an outside consultant to revise derivative liabilities associated with convertible notes payable and to add derivative liabilities associated with warrants. The calculations were made for each issuance of new debt and warrants and for each conversion, exchange or exercise of debt and warrants. As a result, total derivative liabilities increased, and modifications were made to the calculation of debt discount, interest expense for the amortization of debt discount, and change in fair value of derivative liabilities. In addition, convertible notes payable, net of discounts, increased, interest expense increased, and change in fair value of derivative liabilities decreased. Additionally, no loss on extinguishment of debt for note conversions was recorded, resulting in a decrease in the loss and an increase in additional paid-in capital.
(e)	Total general and administrative expenses decreased as a result of corrections to certain operating expenses.
(f)	Adjusted realized gain on sale of investments, including recording gain on sale of related party investment to capital.
(g)	As a result of the adjustments discussed above, net loss and net loss per share increased.

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SUBSEQUENT EVENTS

6 Months Ended

Dec. 31, 2018

Notes to Financial Statements

NOTE 13 - SUBSEQUENT EVENTS

Management has evaluated subsequent events according to the requirements of ASC TOPIC 855, and has reported the following:

Increase in Authorized Shares

On January 25, 2019, the Board of Directors of the Company approved a resolution to increase the number of authorized common shares to 250,000,000 shares and the number of authorized preferred shares to 20,000,000 shares.

Issuance of Series B Preferred Shares

On January 9, 2019, 3,500 shares of Series B preferred stock were issued for stock subscriptions payable of $35,000.

On January 24, 2019, 5,000 shares of Series B preferred stock were issued to Steve Rubakh for compensation valued on an “as converted to common” basis at $80,000.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Dec. 31, 2018

Summary Of Significant Accounting Policies

Restatement

The Company is restating its condensed financial statements for the three months and six months ended December 31, 2017 to correct reporting of derivative liabilities associated with its convertible notes payable and warrants, stock-based compensation, gain on sale of investments and other miscellaneous corrections.

Use of Estimates

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Because of the use of estimates inherent in the financial reporting process, actual results could differ significantly from those estimates.

Digital Currencies

Digital currencies consist of Bitcoin, Litecoin and Ethereum, generally received for the Company’s own account as compensation for cryptocurrency mining services. Given that there is limited precedent regarding the classification and measurement of cryptocurrencies under current Generally Accepted Accounting Principles (“GAAP”), the Company has determined to account for these digital currencies as indefinite-lived intangible assets in accordance with Accounting Standards Update (“ASU”) No. 350, Intangibles – Goodwill and Other, for the period covered by this report and in future reports unless and until further guidance is issued by the Financial Accounting Standards Board (“FASB”). An intangible asset with an indefinite useful life is not amortized but assessed for impairment annually, or more frequently, when events or changes in circumstances occur indicating that it is more likely than not that the indefinite-lived asset is impaired. Impairment exists when the carrying amount exceeds its fair value. In testing for impairment, the Company has the option to first perform a qualitative assessment to determine whether it is more likely than not than an impairment exists. If it is determined that it is more likely than not that an impairment exists, a quantitative impairment test is not necessary. If the Company concludes otherwise, it is required to perform a quantitative impairment test. To the extent an impairment loss is recognized, the loss establishes the new cost basis of the asset. Subsequent reversal of impairment losses is not permitted. Realized gains on the sale of digital currencies are included in other income (expense) in the statements of operations.

Inventories

Inventories at December 31 and June 30, 2018 consist of cryptocurrency mining units held for sale or deployment in mining operatons, and are stated at the lower of cost or estimated realizable value. Payments to equipment suppliers prior to shipment of the equipment are recorded as equipment deposits.

Property and Equipment

Property and equipment, consisting primarily of computer and other cryptocurrency mining equipment (transaction verification servers) and leasehold improvements, is stated at the lower of cost or estimated realizable value and is depreciated when placed into service using the straight-line method over estimated useful lives. The Company operates in an emerging industry for which limited data is available to make estimates of the useful economic lives of specialized equipment. Management has assessed the basis of depreciation of these assets and believes they should be depreciated over a three-year period due to technological obsolescence reflecting rapid development of hardware that has faster processing capacity and other factors. Additionally, during the six months ended December 31, 2018, the Company wrote down cryptocurrency mining equipment by $2,097,930 to estimated net realizable value. Maintenance and repairs are expensed as incurred and improvements are capitalized. Gains or losses on the disposition of property and equipment are recorded upon disposal.

Management has determined that the three-year diminishing value best reflects the current expected useful life of transaction verification servers. This assessment takes into consideration the availability of historical data and management’s expectations regarding the direction of the industry including potential changes in technology. Management will review this estimate annually and will revise such estimates as and when data becomes available.

To the extent that any of the assumptions underlying management’s estimate of useful life of its transaction verification servers are subject to revision in a future reporting period, either as a result of changes in circumstances or through the availability of greater quantities of data, then the estimated useful life could change and have a prospective impact on depreciation expense and the carrying amounts of these assets.

Derivatives

The Company evaluates its convertible debt, options, warrants or other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for. The result of this accounting treatment is that under certain circumstances the fair value of the derivative is marked-to-market each balance sheet date and recorded as a liability. In the event that the fair value is recorded as a liability, the change in fair value is recorded in the statement of operations as other income or expense. Upon conversion or exercise of a derivative instrument, the instrument is marked to fair value at the conversion date and then that fair value is reclassified to equity. Equity instruments that are initially classified as equity that become subject to reclassification under this accounting standard are reclassified to liability at the fair value of the instrument on the reclassification date.

Where the number of warrants or common shares to be issued under these agreements is indeterminate, the Company has concluded that the equity environment is tainted, and all additional warrants and convertible debt are included in the value of the derivatives.

We estimate the fair value of the derivatives associated with our convertible notes payable, warrants and put-back rights associated with two asset purchase agreements using, as applicable, either the Black-Scholes pricing model or multinomial lattice models that value the derivative liability based on a probability weighted discounted cash flow model using future projections of the various potential outcomes. We estimate the fair value of the derivative liabilities at the inception of the financial instruments, and, in the case of our convertible notes payable, at the date of conversions to equity and at each reporting date, recording a derivative liability, debt discount, additional paid-in capital and a gain or loss on change in derivative liabilities as applicable. These estimates are based on multiple inputs, including the market price of our stock, interest rates, our stock price volatility, variable conversion prices based on market prices as defined in the respective agreements and probabilities of certain outcomes based on management projections. These inputs are subject to significant changes from period to period and to management’s judgment; therefore, the estimated fair value of the derivative liabilities will fluctuate from period to period, and the fluctuation may be material.

Impairment of Long-Lived Assets

All assets, including intangible assets subject to amortization, are reviewed for impairment when changes in circumstances indicate that the carrying amount of the asset may not be recoverable in accordance with ASC 350 and ASC 360. If the carrying amount of the asset exceeds the expected undiscounted cash flows of the asset, an impairment charge is recognized equal to the amount by which the carrying amount exceeds fair value or net realizable value. The testing of these intangibles under established guidelines for impairment requires significant use of judgment and assumptions. Changes in forecasted operations and other assumptions could materially affect the estimated fair values. Changes in business conditions could potentially require adjustments to these asset valuations. Total impairment expense, consisting of write downs for cryptocurrency mining equipment totaled $2,097,930 for the six months ended December 31, 2018.

Fair Value of Financial Instruments

Disclosures about fair value of financial instruments require disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2018 and June 30, 2018, the amounts reported for cash, prepaid expenses and other current assets, accounts payable, accrued expenses and due to related party approximate fair value because of their short maturities.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 established a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (level 1measurements) and the lowest priority to unobservable inputs (level 3 measurements). These tiers include:

• Level 1, defined as observable inputs such as quoted prices for identical instruments in active markets;

• Level 2, defined as inputs other than quoted prices in active markets that are either directly or indirectly observable such as quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in markets that are not active; and

• Level 3, defined as unobservable inputs in which little or no market data exists, therefore requiring an entity to develop its own assumptions, such as valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.

At December 31, 2018, we had no financial instrument assets measured at fair value. Our marketable securities as of June 30, 2018 are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
Marketable securities	$	1,700	$	1,700	$	-	$	-
Total assets measured at fair value	$	1,700	$	1,700	$	-	$	-

Our derivative liabilities are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
December 31, 2018:
Derivative liabilities	$	1,002,993	$	-	$	-	$	1,002,993
Total liabilities measured at fair value	$	1,002,993	$	-	$	-	$	1,002,993
June 30, 2018:
Derivative liabilities	$	2,886,965	$	-	$	-	$	2,886,965
Total liabilities measured at fair value	$	2,886,965	$	-	$	-	$	2,886,965

During the six months ended December 31, 2018, the Company had the following activity in its derivative liabilities:

	Convertible Notes Payable			Warrants		Put Back Rights			Total
Derivative liabilities at June 30, 2018	$	-		$	-	$	2,886,965		$	2,886,965
Addition to liabilities for new debt/warrants		81,543			-		-			81,543
Change in fair value		(385	)		47,528		(2,012,658	)		(1,965,515	)
Derivative liabilities at December 31, 2018	$	81,158		$	47,528	$	874,307		$	1,002,993

Stock-Based Compensation

The Company accounts for all equity-based payments in accordance with ASC Topic 718, Compensation – Stock Compensation. ASC Topic 718 requires companies to recognize in the statement of operations the grant-date fair value of stock awards, stock options, warrants and other equity-based compensation issued to employees. The value of the portion of an award that is ultimately expected to vest is recognized as an expense over the requisite service periods using the straight-line attribution method. The fair value of a stock award is recorded at the fair market value of a share of the Company’s stock on the grant date. The Company estimates the fair value of stock options and warrants at the grant date by using an appropriate fair value model such as the Black-Scholes option pricing model or multinomial lattice models.

The Company accounts for non-employee share-based awards based upon ASC 505-50, Equity-Based Payments to Non-Employees. ASC 505-50 requires the costs of goods and services received in exchange for an award of equity instruments to be recognized using the fair value of the goods and services or the fair value of the equity award, whichever is more reliably measurable. The fair value of the equity award is determined on the measurement date, which is the earlier of the date that a performance commitment is reached or the date that performance is complete. Generally, our awards do not entail performance commitments. When an award vests over time such that performance occurs over multiple reporting periods, we estimate the fair value of the award as of the end of each reporting period and recognize an appropriate portion of the cost based on the fair value on that date. When the award vests, we adjust the cost previously recognized so that the cost ultimately recognized is equivalent to the fair value on the date the performance is complete.

Revenue Recognition

Effective July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers, as amended, using the modified retrospective method, which requires the cumulative effect of adoption to be recognized as an adjustment to opening retained earnings in the period of adoption.. There was no cumulative effect of adopting the new standard and no impact on our financial statements. The new standard provides a single comprehensive model to be used in the accounting for revenue arising from contracts with customers and supersedes current revenue recognition guidance, including industry-specific guidance. The standard’s stated core principle is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this core principle, ASC 606 includes provisions within a five-step model that includes identifying the contract with a customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations, and recognizing revenue when, or as, an entity satisfies a performance obligation.

Our revenues currently consist of cryptocurrency mining revenues and revenues from the sale of cryptocurrency mining equipment recognized in accordance with ASC 606 as discussed above. Amounts collected from customers prior to shipment of products are recorded as deferred revenue.

The Company earns its cryptocurrency mining revenues by providing transaction verification services within the digital currency networks of crypto-currencies, such as Bitcoin, Litecoin and Ethereum. The Company satisfies its performance obligation at the point in time that the Company is awarded a unit of digital currency through its participation in the applicable network and network participants benefit from the Company’s verification service. In consideration for these services, the Company receives digital currencies, which are recorded as revenue using the closing U.S. dollar price of the related cryptocurrency on the date of receipt. Expenses associated with running the cryptocurrency mining operations, such as equipment depreciation, rent, operating supplies, rent, utilities and monitoring services are recorded as cost of revenues.

There is currently no specific definitive guidance in GAAP or alternative accounting frameworks for the accounting for the production and mining of digital currencies and management has exercised significant judgment in determining appropriate accounting treatment for the recognition of revenue for mining of digital currencies. Management has examined various factors surrounding the substance of the Company’s operations and the guidance in ASC 606, including identifying the transaction price, when performance obligations are satisfied, and collectability is reasonably assured being the completion and addition of a block to a blockchain and the award of a unit of digital currency to the Company. In the event authoritative guidance is enacted by the FASB, the Company may be required to change its policies which could result in a change in the Company’s financial statements.

Income Taxes

The Company adopted the provisions of ASC 740-10, Accounting for Uncertain Income Tax Positions. When tax returns are filed, it is highly certain that some positions taken would be sustained upon examination by the taxing authorities, while others are subject to uncertainty about the merits of the position taken or the amount of the position that would be ultimately sustained. In accordance with the guidance of ASC 740-10, the benefit of a tax position is recognized in the financial statements in the period during which, based on all available evidence, management believes it is more likely than not that the position will be sustained upon examination, including the resolution of appeals or litigation processes, if any. Tax positions taken are not offset or aggregated with other positions. Tax positions that meet the more-likely-than-not recognition threshold are measured as the largest amount of tax benefit that is more than 50 percent likely of being realized upon settlement with the applicable taxing authority. The portion of the benefits associated with tax positions taken that exceeds the amount measured as described above should be reflected as a liability for unrecognized tax benefits in the accompanying balance sheets along with any associated interest and penalties that would be payable to the taxing authorities upon examination. The Company believes its tax positions are all highly certain of being upheld upon examination. As such, the Company has not recorded an asset for unrecognized tax benefits. As of December 31, 2018, tax years 2018, 2017, 2016 and 2015 remain open for IRS audit. The Company has received no notice of audit from the IRS for any of the open tax years.

The Company adopted ASC 740-10, Definition of Settlement in FASB Interpretation No. 48, (“ASC 740-10”), which was issued on May 2, 2007. ASC 740-10 amends FIN 48 to provide guidance on how an entity should determine whether a tax position is effectively settled for the purpose of recognizing previously unrecognized tax benefits. The term “effectively settled” replaces the term “ultimately settled” when used to describe recognition, and the terms “settlement” or “settled” replace the terms “ultimate settlement” or “ultimately settled” when used to describe measurement of a tax position under ASC 740-10. ASC 740-10 clarifies that a tax position can be effectively settled upon the completion of an examination by a taxing authority without being legally extinguished. For tax positions considered effectively settled, an entity would recognize the full amount of tax benefit, even if the tax position is not considered more likely than not to be sustained based solely on the basis of its technical merits and the statute of limitations remains open. The adoption of ASC 740-10 did not have an impact on the accompanying financial statements.

Income (Loss) Per Share

Basic net income or loss per share is calculated by dividing net income or loss by the weighted average number of common shares outstanding for the period. Diluted income or loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock, such as “in-the-money” stock options and warrants, convertible debt and convertible preferred stock, were exercised or converted into common stock. Equivalent shares are not utilized when the effect is anti-dilutive.

The common shares used in the computation of basic and diluted net income (loss) per share are reconciled as follows:

	Three Months Ended December 31,				Six Months Ended December 31,
	2018		2017		2018		2017
Weighted average number of shares outstanding – basic		9,868,668		8,252,873		9,560,842		7,711,319
Dilutive effect of convertible debt		1,910,820		-		-		-
Dilutive effect of Series B convertible preferred stock		35,038,400		-		-		-
Weighted average number of shares outstanding – diluted		46,817,888		8,252,873		9,560,842		7,711,319

Recently Issued Accounting Pronouncements

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and disclosing key information about leasing transactions. This new pronouncement, as amended, is effective January 1, 2019 for calendar-year-end public companies, or July 1, 2019 for the Company. Early adoption is permitted. The Company is unable to determine the impact on its financial statements for the adoption of the new pronouncement.

There were no new accounting pronouncements issued or proposed by the FASB during the six months ended December 31, 2018 and through the date of filing this report which the Company believes will have a material impact on its financial financial statements.

Reclassifications

Certain amounts in the condensed financial statements for the prior-year periods have been reclassified to conform to the presentation for the current-year periods.

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Dec. 31, 2018

Organization And Summary Of Significant Accounting Policies Tables Abstract

Fair value of marketable securities

Our marketable securities as of June 30, 2018 are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
Marketable securities	$	1,700	$	1,700	$	-	$	-
Total assets measured at fair value	$	1,700	$	1,700	$	-	$	-

Fair value of derivative liabilities

Our derivative liabilities are measured at fair value on a recurring basis and estimated as follows:

	Total		Level 1		Level 2		Level 3
December 31, 2018:
Derivative liabilities	$	1,002,993	$	-	$	-	$	1,002,993
Total liabilities measured at fair value	$	1,002,993	$	-	$	-	$	1,002,993
June 30, 2018:
Derivative liabilities	$	2,886,965	$	-	$	-	$	2,886,965
Total liabilities measured at fair value	$	2,886,965	$	-	$	-	$	2,886,965

Derivative liability

During the six months ended December 31, 2018, the Company had the following activity in its derivative liabilities:

	Convertible Notes Payable			Warrants		Put Back Rights			Total
Derivative liabilities at June 30, 2018	$	-		$	-	$	2,886,965		$	2,886,965
Addition to liabilities for new debt/warrants		81,543			-		-			81,543
Change in fair value		(385	)		47,528		(2,012,658	)		(1,965,515	)
Derivative liabilities at December 31, 2018	$	81,158		$	47,528	$	874,307		$	1,002,993

Schedule of earnings per share, basic and diluted

The common shares used in the computation of basic and diluted net income (loss) per share are reconciled as follows:

	Three Months Ended December 31,				Six Months Ended December 31,
	2018		2017		2018		2017
Weighted average number of shares outstanding – basic		9,868,668		8,252,873		9,560,842		7,711,319
Dilutive effect of convertible debt		1,910,820		-		-		-
Dilutive effect of Series B convertible preferred stock		35,038,400		-		-		-
Weighted average number of shares outstanding – diluted		43,817,888		8,252,873		9,560,842		7,711,319

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PROPERTY AND EQUIPMENT (Tables)

6 Months Ended

Dec. 31, 2018

Property And Equipment

Property and equipment

Property and equipment consisted of the following at:

	December 31, 2018			June 30, 2018
Cryptocurrency mining equipment	$	1,483,194		$	573,806
Furniture and equipment		16,366			14,427
Leasehold improvements		143,440			102,932
Total		1,643,000			691,165
Less accumulated depreciation and amortization		(305,056	)		(58,060	)
Net	$	1,337,944		$	633,105

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DIGIMINE ACQUISITION (Tables)

6 Months Ended

Dec. 31, 2018

Digimine Acquisition

Summarized of acquisition

The total consideration paid in the Acquisition is summarized as follows:

Value of 36,667 total Series B preferred shares	$	1,163,806
Derivative liabilities associated with Put-Back Rights		3,729,109
Total consideration paid	$	4,892,915

Schedule of fair value of the assets acquired

The total consideration paid was allocated to the fair value of the assets acquired as follows:

Restricted cash	$	375,000
Property and equipment		350,349
Digital currencies		14,056
Goodwill		4,153,510
Total consideration allocated	$	4,892,915

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CONVERTIBLE NOTES PAYABLE (Tables)

6 Months Ended

Dec. 31, 2018

Convertible Notes Payable

Schedule of convertible notes payable

Convertible notes payable, all classified as current, consist of the following at December 31, 2018:

			Debt
	Principal		Discount		Net
Geneva Roth Remark Holdings, Inc.	$	128,000	$	35,025	$	92,975
BHP Capital NY, Inc.		52,000		34,520		17,480
Armada Investment Fund, LLC		52,000		34,521		17,479
Total	$	232,000	$	104,066	$	127,934

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WARRANTS (Tables)

6 Months Ended

Dec. 31, 2018

Non Employees [Member]

Schedule of warrant

Warrant activity for the six months ended December 31, 2018 is as follows:

	Number of Warrants			Weighted Average Exercise  Price		Weighted Average Remaining Contract Term (Years)		Aggregate Intrinsic Value
Outstanding at June 30, 2018		348,375		$	2.20		2.55	$	-
Granted		-		$	-
Exercised		(34,333	)	$	2.16
Forfeited or expired		-		$	-
Outstanding and exercisable at December 31, 2018		314,042		$	2.20		2.05	$	-

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RESTATEMENT (Tables)

6 Months Ended

Dec. 31, 2018

Restatement Tables Abstract

Restated Balance Sheet

The following adjustments were made to the December 31, 2017 Restated Balance Sheet:

Integrated Ventures, Inc.
Balance Sheet
	As Originally Reported on December 31, 2017		Adjustments			As Restated December 31, 2017
ASSETS
Current assets:
Cash	$	121,061	$	-		$	121,061
Accounts receivable		15,000		-			15,000
Digital currencies		43,786		(43,786	)(a)		-
Prepaid expenses and other current assets		2,500		-			2,500
Inventories		17,730		-			17,730
Marketable securities		1,760		-			1,760
Total current assets		201,837		(43,786	)		158,051
Non-current assets:
Property and equipment		305,568		(3,438	)(c)		302,130
Digital currencies		-		43,786	(a)		43,786
Deposits		700		-			700
Total assets	$	508,105	$	(3,438	)	$	504,667

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable	$	23,331		$	-		$	23,331
Accrued expenses		29,745			8,468	(b)		38,213
Due to related party		993			(993	)(b)		-
Derivative liabilities		21,419			63,404	(d)		84,823
Convertible notes payable, net of discounts		14,458			-			14,458
Note payable		125,000			-			125,000
Total current liabilities		214,946			70,879			285,825
Total liabilities		214,946			70,879			285,825
Commitments and contingencies
Stockholders’ equity (deficit):
Series A preferred stock, $0.001 par value, (1,000,000 shares authorized, 500,000 shares issued and outstanding)		500			-			500
Series B preferred stock, $0.001 par value, (500,000 shares authorized, 232,500 shares issued and outstanding)		233			-			233
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)		8,388			-			8,388
Additional paid-in capital		5,538,477			1,424,603	(d)(f)		6,963,080
Stock subscription payable		35,000			-			35,000
Accumulated deficit		(5,289,439	)		(1,498,920	)(b)(c)(d)(e)		(6,788,359	)
Total stockholders’ equity (deficit)		293,159			(74,317	)		218,842
Total liabilities and stockholders’ equity (deficit)	$	508,105		$	(3,438	)	$	504,667

Restated Statement of Operations

The following adjustments were made to the Restated Statement of Operations for the three months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Three Months Ended December 31, 2017			Adjustments			As Restated for the Three Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		494,247			3,981	(e)		498,228
Total operating expenses		494,247			3,981			498,228
Loss from operations		(435,977	)		(7,419	)		(443,396	)
Other income (expense):
Interest and other income		1,304			-			1,304
Interest expense		(34,738	)		(22,089	)(b)(d)		(56,827	)
Realized gain on sale of investments		85,911			(78,718	)(f)		7,193
Unrealized loss on investments		(64,987	)		-			(64,987	)
Gain on extinguishment of debt		3,259			-			3,259
Change in fair value of derivative liabilities		273,032			(677,571	)(d)		(404,539	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		200,016			(739,613	)		(539,597	)
Loss before income taxes		(235,961	)		(747,032	)		(982,993	)
Provision for income taxes		-			-			-
Net loss	$	(235,961	)	$	(747,032	)	$	(982,993	)
Net loss per common share:
Basic	$	(0.03	)	$	(0.09	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		8,252,873			-			8,252,873

The following adjustments were made to the Restated Statement of Operations for the six months ended December 31, 2017:

Integrated Ventures, Inc.
Statement of Operations
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Revenues:
Cryptocurrency mining	$	59,498		$	-		$	59,498
Sales of cryptocurrencymining equipment		45,590			-			45,590
Total revenues		105,088			-			105,088
Cost of revenues		46,818			3,438	(c)		50,256
Gross margin		58,270			(3,438	)		54,832
Operating expenses:
General and administrative		634,124			25,462	(e)		659,586
Total operating expenses		634,124			25,462			659,586
Loss from operations		(575,854	)		(28,900	)		(604,754	)
Other income (expense):
Interest and other income		1,402			-			1,402
Interest expense		(120,319	)		(23,388	)(b)(d)		(143,707	)
Realized gain on sale of investments		367,134			(78,718	)(f)		288,416
Unrealized loss on investments		(3,876	)		-			(3,876	)
Gain (loss) on extinguishment of debt		(268,476	)		276,410	(d)		7,934
Change in fair value of derivative liabilities		201,197			(617,485	)(d)		(416,288	)
Loss on settlement of warrants		(63,765	)		38,765	(d)		(25,000	)
Total other income (expense)		113,297			(404,416	)		(291,119	)
Loss before income taxes		(462,557	)		(433,316	)		(895,873	)
Provision for income taxes		-			-			-
Net loss	$	(462,557	)	$	(433,316	)	$	(895,873	)
Net loss per common share:
Basic	$	(0.06	)	$	(0.06	)(g)	$	(0.12	)
Weighted average number of common shares outstanding:
Basic		7,711,319			-			7,711,319

Restated Statement of Cash Flows

The Following adjustments were made to the Restated Statement of Cash Flows for the six months ended December 31, 2017: 

Integrated Ventures, Inc.
Statement of Cash Flows
	As Originally Reported for the Six Months Ended December 31, 2017			Adjustments			As Restated for the Six Months Ended December 31, 2017
Cash flows from operating activities:
Net loss	$	(462,557	)	$	(433,316	)(b)(c)(d)(e)(f)		(895,873	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense		5,264			3,438	(c)		8,702
Stock-based compensation – related party		409,000			-			409,000
Amortization of debt discount		79,631			28,490	(d)		108,121
Amortization of original issue discount		1,347			-			1,347
Change in fair value of derivative liabilities		(201,197	)		617,485	(d)		416,288
(Gain) loss on extinguishment of debt		268,476			(276,410	)(d)		(7,934	)
Financing fees related to notes payable		32,358			-			32,358
Realized gain on sale of investments		(367,134	)		78,718	(f)		(288,416	)
Unrealized loss on investments		3,876			-			3,876
Loss on settlement of warrants		63,765			(38,765	)(d)		25,000
Changes in assets and liabilities:
Digital currencies		(61,892	)		(9,651	)(b)		(71,543	)
Prepaid expenses and other current assets		5,000			-			5,000
Inventories		(17,730	)		-			(17,730	)
Accrued interest receivable – related party		(98	)		-			(98	)
Accounts payable		(827	)		-			(827	)
Accrued expenses		(1,786	)		8,197	(b)		6,411
Due to related party		(19,223	)		12,163	(b)		(7,060	)
Net cash used in operating activities		(263,727	)		(9,651	)		(273,378	)
Cash flows from investing activities:
Net proceeds from the sale of investments		579,460			-			579,460
Purchase of investments		(9,651	)		9,651	(b)		-
Increase in notes receivable – related party		(49,880	)		-			(49,880	)
Purchase of property and equipment		(310,832	)		-			(310,832	)
Net cash provided by investing activities		209,097			9,651			218,748
Cash flows from financing activities:
Proceeds from sale of preferred stock		125,000			-			125,000
Proceeds from stock subscriptions payable		35,000			-			35,000
Net cash provided by financing activities		160,000			-			160,000
Net increase in cash		105,370			-			105,370
Cash, beginning of period		15,691			-			15,691
Cash, end of period	$	121,061		$	-			121,061

Supplemental disclosure of cash flow information:
Cash paid for interest	$	-		$	-		$	-
Cash paid for income taxes		-			-			-
Non-cash investing and financing activities:
Common shares issued for convertible notes payable	$	379,021			(229,972	)(d)		149,049
Common shares issued for due to related party		15,625			-			15,625
Common shares issued for cashless exercise of warrants		188			-			188
Debt discount for derivative liability		47,617			25,000	(d)		72,617
Accrued interest added to convertible notes payable		1,117			-			1,117
Settlement of derivative liabilities		-			405,970	(d)		405,970
Marketable securities for conversion of notes receivable		66,850			-			66,850
Marketable securities exchanged for note payable		(37,074	)		37,074	(d)		-
Marketable securities exchanged for accrued expenses		(1,370	)		1,370	(d)		-
Marketable securities exchanged for derivative liabilities		(78,718	)		78,718	(d)		-
Marketable securities exchanged for accounts receivable		(15,000	)		15,000	(d)		-
Note payable issued in settlement of warrants		25,000			(25,000	)(d)		-
Derivative liabilities extinguished in settlement of warrants		67,064			(67,064	)(d)		-

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ORGANIZATION AND BASIS OF PRESENTATION (Details Narrative)	6 Months Ended
	Dec. 31, 2018
Organization And Basis Of Presentation
State of Incorporation	Nevada
Date of incorporation	Mar. 22, 2011

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)	Dec. 31, 2018 USD ($)
Marketable securities	$ 1,700
Total assets measured at fair value	1,700
Level 1 [Member]
Marketable securities	1,700
Total assets measured at fair value	1,700
Level 2 [Member]
Marketable securities
Total assets measured at fair value
Level 3 [Member]
Marketable securities
Total assets measured at fair value

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 1) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Derivative liabilities	$ 1,002,993	$ 2,886,965
Total liabilities measured at fair value	1,002,993	2,886,965
Level 1 [Member]
Derivative liabilities
Total liabilities measured at fair value
Level 2 [Member]
Derivative liabilities
Total liabilities measured at fair value
Level 3 [Member]
Derivative liabilities	1,002,993	2,886,965
Total liabilities measured at fair value	$ 1,002,993	$ 2,886,965

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 2)	6 Months Ended
	Dec. 31, 2018 USD ($)
Derivative liability Beginning	$ 2,886,965
Addition to liabilities for new debt/warrants	81,543
Change in fair value	(1,965,515)
Derivative liability Ending	1,002,993
Warrants [Member]
Derivative liability Beginning
Addition to liabilities for new debt/warrants
Change in fair value	47,528
Derivative liability Ending	47,528
Convertible Notes Payable [Member]
Derivative liability Beginning
Addition to liabilities for new debt/warrants	81,543
Change in fair value	(385)
Derivative liability Ending	81,158
Put Back Rights [Member]
Derivative liability Beginning	2,886,965
Addition to liabilities for new debt/warrants
Change in fair value	(2,012,658)
Derivative liability Ending	$ 874,307

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details 3) - shares	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Summary Of Significant Accounting Policies Details 2Abstract
Weighted average number of shares outstanding - basic	9,868,668	8,252,873	9,560,842	7,711,319
Dilutive effect of convertible debt	1,910,820
Dilutive effect of Series B convertible preferred stock	35,038,400
Weighted average number of shares outstanding - diluted	46,817,888	8,252,873	9,560,842	7,711,319

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($)	6 Months Ended
	Dec. 31, 2018	Jun. 30, 2018
Property and equipment	$ 1,337,944	$ 633,105
Impairment expense of long-lived assets	2,097,930
Crypto-Currency Mining Equipment [Member]
Property and equipment	$ 2,097,930
Property and equipment estimated useful life	3 years

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GOING CONCERN (Details Narrative) - USD ($)	6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2018
Going Concern
Net cash used in operating activities	$ (355,680)	$ (273,378)
Accumulated deficit	$ (12,641,382)		$ (11,469,936)

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PROPERTY AND EQUIPMENT (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Property and Equipment, Total	$ 1,643,000	$ 691,165
Less accumulated depreciation and amortization	(305,056)	(58,060)
Property and Equipment, Net	1,337,944	633,105
Cryptocurrency mining equipment [Member]
Property and Equipment, Total	1,483,194	573,806
Furniture and equipment [Member]
Property and Equipment, Total	16,366	14,427
Leasehold Improvements [Member]
Property and Equipment, Total	$ 143,440	$ 102,932

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PROPERTY AND EQUIPMENT (Details Narrative) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Property And Equipment Details Abstract
Depreciation and amortization expense	$ 136,778	$ 8,702	$ 246,996	$ 8,702

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ASSET PURCHASE AGREEMENT (Details Narrative)		6 Months Ended
	Aug. 02, 2018 USD ($) Number shares	Dec. 31, 2018 USD ($)
Impairment expense | $		$ 2,097,930
Asset Purchase Agreement [Member] | Ethereum mining machines [Member]
Number of machines to be purchased under agreement	182
Number of machines placed in operations	152
Number of machines deemed to be defective	30
Asset Purchase Agreement [Member] | Series B Convertible Preferred Stock [Member] | Ethereum mining machines [Member]
Restricted stock shares issued for the purchase of machine under agreement | shares	38,018
Amount of restricted stock shares issued for the purchase of machine under agreement | $	$ 3,801,800

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DIGIMINE ACQUISITION (Details)	Dec. 31, 2018 USD ($)
Digimine Acquisition Details Abstract
Value of 36,667 total Series B preferred shares	$ 1,163,806
Derivative liabilities associated with Put-Back Rights	3,729,109
Total consideration paid	$ 4,892,915

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DIGIMINE ACQUISITION (Details 1) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Restricted cash		$ 375,000
Property and equipment	$ 1,643,000	691,165
Digital currencies		$ 11,227
DigiMine LLC [Member]
Restricted cash	375,000
Property and equipment	350,349
Digital currencies	14,056
Goodwill	4,153,510
Total consideration allocated	$ 4,892,915

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DIGIMINE ACQUISITION (Details Narrative) - USD ($)		1 Months Ended	12 Months Ended
	Apr. 16, 2018	Apr. 30, 2018	Jun. 30, 2018	Dec. 31, 2018
Restricted cash			$ 375,000
Impairment expense			$ 4,153,510
DigiMine LLC [Member]
Restricted cash				$ 375,000
Goodwill				$ 4,153,510
Asset Purchase Agreement [Member] | DigiMine LLC [Member]
Restricted cash	$ 175,000	$ 200,000
Description for shares of redemption price	DigiMine has the right (the "Put-Back Right"), at any time commencing April 1, 2019, to require that the Company redeem for cash any of Seller's then-outstanding Shares at a redemption price equal to 72% of the Shares	DigiMine has the right (the "Put-Back Right"), at any time commencing May 1, 2019, to require that the Company redeem for cash any of Seller's then-outstanding Shares at a redemption price equal to 72% of the Shares
Put-Back Price	$ 1,200,000	$ 1,440,000
Fixed price	$ 100	$ 100
Description of put-back price	The Conversion Amount on execution is equal to $1,200,000 (the "Put-Back Price") of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share	The Conversion Amount on execution is equal to $1,440,000 (the "Put-Back Price") of such Shares; provided, that the Put Back Right expires with respect to any of the Shares at such time as the Shares are registered for resale. Each of the Shares for purposes of the Put-Back Price is equal to a fixed price of $100 per share
Digital currency portfolio an estimated value		$ 15,487
Asset Purchase Agreement [Member] | DigiMine LLC [Member] | Series B Preferred Stock [Member]
Shares issued	16,666	20,000

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RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($)	1 Months Ended	3 Months Ended	6 Months Ended
	Mar. 18, 2018	Sep. 30, 2017	Dec. 31, 2018	Dec. 31, 2017	Aug. 31, 2018	Jun. 30, 2018
Stock-based compensation - related party			$ 417,000	$ 409,000
Due to related party			$ 64,774			$ 20,974
Series B Preferred Stock [Member]
Preferred stock shares issued			350,384			309,166
Mr. Rubakh [Member]
Due to related party			$ 64,774			$ 20,974
Conversion of accrued compensation, amount					$ 15,625
Conversion of accrued compensation, shares issued					347,222
Mr. Rubakh [Member] | Series B Preferred Stock [Member]
Preferred stock shares reserved for future issuance periodically	5,000
Frequency of periodic issuance	Quarterly
Mr. Rubakh [Member] | On August 1, 2017 [Member] | Series B Preferred Stock [Member]
Preferred stock shares issued		30,000		30,000
Stock-based compensation - related party		$ 9,000		$ 9,000
Mr. Rubakh [Member] | On July 1, 2018 [Member] | Series B Preferred Stock [Member]
Preferred stock shares issued			5,000
Stock-based compensation - related party			$ 417,000
Mr. Rubakh [Member] | April 1, 2018 [Member]
Accrued compensation	$ 150,000

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CONVERTIBLE NOTES PAYABLE (Details) - USD ($)	Dec. 31, 2018	Jun. 30, 2018
Principal	$ 232,000
Debt Discount	104,066
Net	127,934
Convertible Notes Payable [Member] | Geneva Roth Remark Holdings, Inc. [Member]
Principal	128,000
Debt Discount	35,025
Net	92,975
Convertible Notes Payable [Member] | BHP Capital NY, Inc. [Member]
Principal	52,000
Debt Discount	34,520
Net	17,480
Convertible Notes Payable [Member] | Armada Investment Fund, LLC [Member]
Principal	52,000
Debt Discount	34,521
Net	$ 17,479

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CONVERTIBLE NOTES PAYABLE (Details Narrative) - USD ($)	1 Months Ended		6 Months Ended
	Sep. 26, 2018	Sep. 17, 2018	Dec. 31, 2018	Dec. 31, 2017	Jun. 30, 2018
Principal amount			$ 232,000
Common stock shares issued			9,874,103		8,964,103
Derivative liability			$ 1,002,993		$ 2,886,965
Amortization of debt discount			38,782	$ 108,121
Convertible Promissory Note [Member] | BHP Capital NY, Inc. [Member]
Principal amount	$ 52,000
Original issue discount	$ 2,000
Maturity date	Sep. 17, 2019
Interest rate	8.00%
Common stock shares issued	75,000
Proceeds from issuance of common stock	$ 26,625
Debt discount	46,840
Derivative liability	$ 17,687		18,056
Terms of conversion feature	BHP has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock
Conversion price, description	The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion.
Amortization of debt discount			12,320
Accrued interest			1,094
Convertible Promissory Note [Member] | Geneva Roth Remark Holdings, Inc. [Member]
Principal amount		$ 128,000
Maturity date		Sep. 26, 2019
Interest rate		10.00%
Debt discount		$ 49,169
Derivative liability		$ 46,169	45,046
Terms of conversion feature		Geneva has the right beginning on the date that is 170 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock
Conversion price, description		The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion.
Amortization of debt discount			14,144
Accrued interest			3,682
Convertible Promissory Note [Member] | Armada Investment Fund, LLC [Member]
Principal amount	$ 52,000
Original issue discount	$ 2,000
Maturity date	Sep. 17, 2019
Interest rate	8.00%
Common stock shares issued	75,000
Proceeds from issuance of common stock	$ 26,625
Debt discount	46,840
Derivative liability	$ 17,687		18,056
Terms of conversion feature	Armada has the right beginning on the date that is 31 days following the date of the note to convert principal and accrued interest into shares of the Company’s common stock
Conversion price, description	The conversion price is 70% of the average of the three lowest trading prices of the Company’s common stock during the ten trading days ending on the latest complete trading day prior to the date of conversion.
Amortization of debt discount			12,319
Accrued interest			$ 1,094

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STOCKHOLDERS' DEFICIT (Details Narrative)				1 Months Ended					3 Months Ended	6 Months Ended
	Oct. 05, 2018 USD ($) shares	Aug. 02, 2018 USD ($) Number shares	Jul. 06, 2017 USD ($) shares	Sep. 26, 2018 USD ($) shares	Aug. 23, 2018 USD ($) shares	Mar. 18, 2018 USD ($) shares	Aug. 31, 2017 USD ($) shares	Mar. 31, 2015 shares	Sep. 30, 2017 USD ($) shares	Dec. 31, 2018 USD ($) $ / shares shares	Dec. 31, 2017 USD ($) $ / shares shares	Aug. 14, 2018 USD ($) shares	Jun. 30, 2018 USD ($) $ / shares shares	Dec. 21, 2015 $ / shares shares
Stock-based compensation - related party | $										$ 417,000	$ 409,000
Common stock value | $										$ 9,875			$ 8,965
Common stock, par value | $ / shares										$ 0.001			$ 0.001
Common stock, shares authorized										40,000,000			40,000,000
Common stock, shares issued										9,874,103			8,964,103
Common stock, shares outstanding										9,874,103			8,964,103
Common shares issued for cashless exercise of warrants, amount | $										$ 560	$ 188
Common stock shares issued, shares										910,000	3,175,774
Unissued shares | $										$ 35,000			$ 35,000
Asset Purchase Agreement [Member] | Ethereum mining machines [Member]
Number of machines to be purchased under agreement | Number		182
Consultant [Member]
Common stock value | $												$ 55,000
Common stock, shares issued												100,000
Common Stock | Consultant [Member]
Common stock shares issued, shares	100,000
Common stock shares issued, amount | $	$ 25,160
Convertible debt [Member]
Debt conversion converted instrument, shares issued											2,640,017
Value of shares issued upon conversion of debt | $											$ 149,049
Debt conversion converted amount, principal | $											55,760
Debt conversion converted amount, accrued interest | $											2,715
Debt conversion converted amount, derivative liabilities | $											58,216
Debt conversion converted amount, fees | $											2,449
Debt conversion converted amount, penalties | $											$ 29,909
Series B Preferred Stock [Member]
Preferred stock, shares authorized										500,000			500,000	500,000
Preferred stock, shares issued										350,384			309,166
Preferred stock, shares outstanding										350,384			309,166
Common stock shares issuable upon conversion of preferred stock														100
Preferred stock, par value per share | $ / shares										$ 0.001			$ 0.001	$ 0.001
Series B Preferred Stock [Member] | Asset Purchase Agreement [Member]
Preferred stock originally issued										1,800
Series B Convertible Preferred Stock [Member] | Asset Purchase Agreement [Member] | Ethereum mining machines [Member]
Restricted shares issued		38,018
Amount of restricted stock shares issued for the purchase of machine under agreement | $		$ 3,801,800
Series A Preferred Stock [Member]
Preferred stock, shares authorized										1,000,000			1,000,000
Preferred stock, shares issued										500,000			500,000
Preferred stock, shares outstanding										500,000			500,000
Preferred stock, par value per share | $ / shares										$ 0.001			$ 0.001
Series A Preferred Stock [Member] | Board of Directors [Member]
Preferred stock, shares authorized								1,000,000
Preferred stock, shares issued								500,000
Preferred stock, shares outstanding								500,000
limitations and relative rights								1,000,000
Common stock voting rights								Holders of the Series A Preferred Stock have the right to vote in aggregate, on all shareholder matters equal to 1,000 votes per share of Series A Preferred Stock
Common Stock
Reverse stock split, description									The Company increased the number of outstanding common shares by 114 shares due to rounding of shares in the reverse stock split
Four Investors [Member] | Series B Preferred Stock [Member] | On October 25, 2017 [Member]
Preferred stock, par value per share | $ / shares											$ 10
Purchase of shares											16,000
Shares issued for investment											12,500
Investment amount | $											$ 125,000
Mr. Rubakh [Member] | April 1, 2018 [Member]
Accrued compensation | $						$ 150,000
Mr. Rubakh [Member] | Series B Preferred Stock [Member]
Preferred stock shares reserved for future issuance periodically						5,000
Frequency of periodic issuance						Quarterly
Mr. Rubakh [Member] | Series B Preferred Stock [Member] | On November 1, 2017 [Member]
Preferred stock, shares issued											40,000
Stock-based compensation - related party | $											$ 400,000
Mr. Rubakh [Member] | Series B Preferred Stock [Member] | On August 1, 2017 [Member]
Preferred stock, shares issued									30,000		30,000
Stock-based compensation - related party | $									$ 9,000		$ 9,000
Mr. Rubakh [Member] | Series B Preferred Stock [Member] | On July 1, 2018 [Member]
Preferred stock, shares issued										5,000
Stock-based compensation - related party | $										$ 417,000
Steve Rubakh [Member]
Common stock shares issued, shares							347,222
Common stock shares issued, amount | $							$ 15,625
Lender [Member] | Common Stock
Common shares issued for cashless exercise of warrants, amount | $			$ 188		$ 560
Common shares issued for cashless exercise of warrants, shares			188,240		560,000
Common stock shares issued, shares				150,000
Common stock shares issued, amount | $				$ 53,250

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WARRANTS (Details) - Warrant [Member]	6 Months Ended
	Dec. 31, 2018 USD ($) $ / shares shares
Number of Outstanding Shares, Beginning Balance | shares	348,375
Granted | shares
Exercised | shares	(34,333)
Forfeited or expired | shares
Number of Outstanding Shares, Ending Balance | shares	314,042
Weighted Average Exercise Price, Beginning Balance | $ / shares	$ 2.20
Granted | $ / shares
Exercised | $ / shares	2.16
Forfeited or expired | $ / shares
Weighted Average Exercise Price, Ending Balance | $ / shares	$ 2.20
Weighted average remaining contractual life (Years), Outstanding and exercisable, Beginning Balance	2 years 6 months 18 days
Weighted average remaining contractual life (Years), Outstanding and exercisable, Ending Balance	2 years 18 days
Aggregate intrinsic value, Beginning Balance | $
Aggregate intrinsic value, Ending Balance | $

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COMMITMENTS AND CONTINGENCIES (Details Narrative)	12 Months Ended
	Jun. 30, 2018
Pennsylvania [Member]
Operating lease term description	The lease for the Pennsylvania location is on a month-to-month basis at $850 per month.
New Jersey [Member]
Operating lease term description	The lease for the New Jersey location was effective April 1, 2018 for a period of one year at a monthly rental of $6,986, with an automatic one-year renewal period with a 5% increase in the monthly rent.

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RESTATEMENT (Details) - USD ($)		Dec. 31, 2018	Jun. 30, 2018	Dec. 31, 2017	Jun. 30, 2017
Current assets:
Cash		$ 51,627	$ 749
Digital currencies			11,227
Prepaid expenses and other current assets		3,000	9,000
Inventories		114,851	114,851
Marketable securities			1,700
Total current assets		169,478	170,517
Non-current assets:
Property and equipment		1,337,944	633,105
Deposits		14,673	14,673
Total assets		1,522,095	829,522
Current liabilities:
Accounts payable		29,487	26,973
Accrued expenses		24,340	29,428
Due to related party		64,774	20,974
Derivative liabilities		1,002,993	2,886,965
Convertible notes payable, net of discounts		127,934
Total current liabilities		1,249,528	2,964,340
Total liabilities		1,249,528	2,964,340
Commitments and contingencies
Stockholders'equity (deficit):
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)		9,875	8,965
Additional paid-in capital		12,843,224	9,290,344
Stock subscription payable		60,000	35,000
Accumulated deficit		(12,641,382)	(11,469,936)
Total stockholders’ equity (deficit)		272,567	(2,134,818)
Total liabilities and stockholders’ equity (deficit)		1,522,095	829,522
Series A Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock		500	500
Series B Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock		$ 350	$ 309
As Originally Reported [Member]
Current assets:
Cash				$ 121,061	$ 15,691
Accounts receivable				15,000
Digital currencies				43,786
Prepaid expenses and other current assets				2,500
Inventories				17,730
Marketable securities				1,760
Total current assets				201,837
Non-current assets:
Property and equipment				305,568
Digital currencies
Deposits				700
Total assets				508,105
Current liabilities:
Accounts payable				23,331
Accrued expenses				29,745
Due to related party				993
Derivative liabilities				21,419
Convertible notes payable, net of discounts				14,458
Note payable				125,000
Total current liabilities				214,946
Total liabilities				214,946
Commitments and contingencies
Stockholders'equity (deficit):
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)				8,388
Additional paid-in capital				5,538,477
Stock subscription payable				35,000
Accumulated deficit				(5,289,439)
Total stockholders’ equity (deficit)				293,159
Total liabilities and stockholders’ equity (deficit)				508,105
As Originally Reported [Member] | Series A Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock				500
As Originally Reported [Member] | Series B Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock				233
Adjustments [Member]
Current assets:
Cash
Accounts receivable
Digital currencies	[1]			(43,786)
Prepaid expenses and other current assets
Inventories
Marketable securities
Total current assets				(43,786)
Non-current assets:
Property and equipment	[2]			(3,438)
Digital currencies	[1]			43,786
Deposits
Total assets				(3,438)
Current liabilities:
Accounts payable
Accrued expenses	[3]			8,468
Due to related party	[3]			(993)
Derivative liabilities	[4]			63,404
Convertible notes payable, net of discounts
Note payable
Total current liabilities				70,879
Total liabilities				70,879
Commitments and contingencies
Stockholders'equity (deficit):
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)
Additional paid-in capital	[4],[5]			1,424,603
Stock subscription payable
Accumulated deficit	[2],[3],[4],[6]			(1,498,920)
Total stockholders’ equity (deficit)				(74,317)
Total liabilities and stockholders’ equity (deficit)				(3,438)
Adjustments [Member] | Series A Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock
Adjustments [Member] | Series B Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock
As Restated [Member]
Current assets:
Cash				121,061	$ 15,691
Accounts receivable				15,000
Digital currencies
Prepaid expenses and other current assets				2,500
Inventories				17,730
Marketable securities				1,760
Total current assets				158,051
Non-current assets:
Property and equipment				302,130
Digital currencies				43,786
Deposits				700
Total assets				504,667
Current liabilities:
Accounts payable				23,331
Accrued expenses				38,213
Due to related party
Derivative liabilities				84,823
Convertible notes payable, net of discounts				14,458
Note payable				125,000
Total current liabilities				285,825
Total liabilities				285,825
Commitments and contingencies
Stockholders'equity (deficit):
Common stock, $0.001 par value, (40,000,000 shares authorized, 8,388,337 shares issued and outstanding)				8,388
Additional paid-in capital				6,963,080
Stock subscription payable				35,000
Accumulated deficit				(6,788,359)
Total stockholders’ equity (deficit)				218,842
Total liabilities and stockholders’ equity (deficit)				504,667
As Restated [Member] | Series A Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock				500
As Restated [Member] | Series B Preferred Stock [Member]
Stockholders'equity (deficit):
Preferred stock				$ 233

[1] (a) Reclassified digital currencies from current to long-term asset.

[2] (c) Reduced useful life for depreciation from 5 years to 3 years.

[3] (b) Accrued officer compensation was reclassified from accrued expenses to due to related party and subsequently reduced. Accrued interest payable was increased.

[4] (d) The Company engaged an outside consultant to revise derivative liabilities associated with convertible notes payable and to add derivative liabilities associated with warrants. The calculations were made for each issuance of new debt and warrants and for each conversion, exchange or exercise of debt and warrants. As a result, total derivative liabilities increased, and modifications were made to the calculation of debt discount, interest expense for the amortization of debt discount, and change in fair value of derivative liabilities. In addition, convertible notes payable, net of discounts, increased, interest expense increased, and change in fair value of derivative liabilities decreased. Additionally, no loss on extinguishment of debt for note conversions was recorded, resulting in a decrease in the loss and an increase in additional paid-in capital.

[5] (f) Adjusted realized gain on sale of investments, including recording gain on sale of related party investment to capital.

[6] (e) Total general and administrative expenses decreased as a result of corrections to certain operating expenses.

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RESTATEMENT (Details 1) - USD ($)		3 Months Ended		6 Months Ended
		Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Revenues
Cryptocurrency mining		$ 77,913	$ 59,498	$ 178,378	$ 59,498
Sales of cryptocurrencymining equipment		9,557	45,590	24,337	45,590
Total revenues		87,470	105,088	202,715	105,088
Cost of revenues		232,896	50,256	434,156	50,256
Gross margin		(145,426)	54,832	(231,441)	54,832
Operating expenses:
General and administrative		173,512	498,228	730,434	659,586
Total operating expenses		173,512	498,228	2,828,364	659,586
Loss from operations		(318,938)	(443,396)	(3,059,805)	(604,754)
Other income (expense):
Interest and other income			1,304		1,402
Interest expense		(41,328)	(56,827)	(44,652)	(143,707)
Realized gain on sale of investments		(25,266)	7,193	(32,504)	288,416
Unrealized loss on investments			64,987		3,876
Gain (loss) on extinguishment of debt			3,259		7,934
Change in fair value of derivative liabilities		914,308	(404,539)	1,965,515	(416,288)
Loss on settlement of warrants			(25,000)		(25,000)
Total other income (expense)		847,714	(539,597)	1,888,359	(291,119)
Loss before income taxes		528,776	(982,993)	(1,171,446)	(895,873)
Provision for income taxes
Net loss		$ 528,776	$ (982,993)	$ (1,171,446)	$ (895,873)
Net loss per common share:
Basic		$ 0.05	$ (0.12)	$ (0.12)	$ (0.12)
Weighted average number of common shares outstanding:
Basic		9,868,668	8,252,873	9,560,842	7,711,319
As Originally Reported [Member]
Revenues
Cryptocurrency mining			$ 59,498		$ 59,498
Sales of cryptocurrencymining equipment			45,590		45,590
Total revenues			105,088		105,088
Cost of revenues			46,818		46,818
Gross margin			58,270		58,270
Operating expenses:
General and administrative			494,247		634,124
Total operating expenses			494,247		634,124
Loss from operations			(435,977)		(575,854)
Other income (expense):
Interest and other income			1,304		1,402
Interest expense			(34,738)		(120,319)
Realized gain on sale of investments			85,911		367,134
Unrealized loss on investments			(64,987)		(3,876)
Gain (loss) on extinguishment of debt			3,259		(268,476)
Change in fair value of derivative liabilities			273,032		201,197
Loss on settlement of warrants			(63,765)		(63,765)
Total other income (expense)			200,016		113,297
Loss before income taxes			(235,961)		(462,557)
Provision for income taxes
Net loss			$ (235,961)		$ (462,557)
Net loss per common share:
Basic			$ (0.03)		$ (0.06)
Weighted average number of common shares outstanding:
Basic			8,252,873		7,711,319
Adjustments [Member]
Revenues
Cryptocurrency mining
Sales of cryptocurrencymining equipment
Total revenues
Cost of revenues	[1]		3,438		3,438
Gross margin			(3,438)		(3,438)
Operating expenses:
General and administrative	[2]		3,981		25,462
Total operating expenses			3,981		25,462
Loss from operations			(7,419)		(28,900)
Other income (expense):
Interest and other income
Interest expense	[3],[4]		(22,089)		(23,388)
Realized gain on sale of investments	[5]		(78,718)		(78,718)
Unrealized loss on investments
Gain (loss) on extinguishment of debt					276,410	[4]
Change in fair value of derivative liabilities	[4]		(677,571)		(617,485)
Loss on settlement of warrants	[4]		38,765		38,765
Total other income (expense)			(739,613)		(404,416)
Loss before income taxes			(747,032)		(433,316)
Provision for income taxes
Net loss			$ (747,032)		$ (433,316)	[1],[2],[3],[4],[5]
Net loss per common share:
Basic	[6]		$ (0.09)		$ (0.06)
Weighted average number of common shares outstanding:
Basic
As Restated [Member]
Revenues
Cryptocurrency mining			$ 59,498		$ 59,498
Sales of cryptocurrencymining equipment			45,590		45,590
Total revenues			105,088		105,088
Cost of revenues			50,256		50,256
Gross margin			54,832		54,832
Operating expenses:
General and administrative			498,228		659,586
Total operating expenses			498,228		659,586
Loss from operations			(443,396)		(604,754)
Other income (expense):
Interest and other income			1,304		1,402
Interest expense			(56,827)		(143,707)
Realized gain on sale of investments			7,193		288,416
Unrealized loss on investments			(64,987)		(3,876)
Gain (loss) on extinguishment of debt			3,259		7,934
Change in fair value of derivative liabilities			(404,539)		(416,288)
Loss on settlement of warrants			(25,000)		(25,000)
Total other income (expense)			(539,597)		(291,119)
Loss before income taxes			(982,993)		(895,873)
Provision for income taxes
Net loss			$ (982,993)		$ (895,873)
Net loss per common share:
Basic			$ (0.12)		$ (0.12)
Weighted average number of common shares outstanding:
Basic			8,252,873		7,711,319

[1] (c) Reduced useful life for depreciation from 5 years to 3 years.

[2] (e) Total general and administrative expenses decreased as a result of corrections to certain operating expenses.

[3] (b) Accrued officer compensation was reclassified from accrued expenses to due to related party and subsequently reduced. Accrued interest payable was increased.

[4] (d) The Company engaged an outside consultant to revise derivative liabilities associated with convertible notes payable and to add derivative liabilities associated with warrants. The calculations were made for each issuance of new debt and warrants and for each conversion, exchange or exercise of debt and warrants. As a result, total derivative liabilities increased, and modifications were made to the calculation of debt discount, interest expense for the amortization of debt discount, and change in fair value of derivative liabilities. In addition, convertible notes payable, net of discounts, increased, interest expense increased, and change in fair value of derivative liabilities decreased. Additionally, no loss on extinguishment of debt for note conversions was recorded, resulting in a decrease in the loss and an increase in additional paid-in capital.

[5] (f) Adjusted realized gain on sale of investments, including recording gain on sale of related party investment to capital.

[6] (g) As a result of the adjustments discussed above, net loss and net loss per share increased.

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RESTATEMENT (Details 2) - USD ($)		3 Months Ended		6 Months Ended
		Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017
Cash flows from operating activities:
Net loss		$ 528,776	$ (982,993)	$ (1,171,446)	$ (895,873)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense				246,996	8,702
Stock-based compensation - related party				80,159
Amortization of debt discount				38,782	108,121
Amortization of original issue discount					1,347
Change in fair value of derivative liabilities				(1,965,515)	416,288
(Gain) loss on extinguishment of debt			(3,259)		(7,934)
Financing fees related to notes payable					32,358
Realized gain on sale of investments		25,266	(7,193)	32,504	(288,416)
Unrealized loss on investments			(64,987)		(3,876)
Changes in assets and liabilities:
Digital currencies				(179,316)	(71,543)
Prepaid expenses and other current assets				6,000	5,000
Inventories					(17,730)
Accrued interest receivable – related party					(98)
Accounts payable				2,514	(827)
Accrued expenses				(5,088)	6,411
Due to related party				43,800	(7,060)
Net cash used in operating activities				(355,680)	(273,378)
Cash flows from investing activities:
Net proceeds from the sale of investments				159,739	579,460
Increase in notes receivable – related party					(49,880)
Purchase of property and equipment				(42,447)	(310,832)
Net cash provided by investing activities				117,292	218,748
Cash flows from financing activities:
Proceeds from sale of preferred stock					125,000
Proceeds from stock subscriptions payable				25,000	35,000
Net cash provided by financing activities				248,945	160,000
Net increase in cash				10,557	105,370
Cash, beginning of period				749
Cash, end of period		$ 51,627		51,627
Supplemental disclosure of cash flow information:
Cash paid for interest				29,257
Non-cash investing and financing activities:
Common shares issued for convertible notes payable					149,049
Common shares issued for cashless exercise of warrants				560	188
Debt discount for derivative liability				81,543	72,617
Settlement of derivative liabilities					405,970
As Originally Reported [Member]
Cash flows from operating activities:
Net loss			(235,961)		(462,557)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense					5,264
Stock-based compensation - related party					409,000
Amortization of debt discount					79,631
Amortization of original issue discount					1,347
Change in fair value of derivative liabilities					(201,197)
(Gain) loss on extinguishment of debt			(3,259)		268,476
Financing fees related to notes payable					32,358
Realized gain on sale of investments			(85,911)		(367,134)
Unrealized loss on investments			64,987		3,876
Loss on settlement of warrants					63,765
Changes in assets and liabilities:
Digital currencies					(61,892)
Prepaid expenses and other current assets					5,000
Inventories					(17,730)
Accrued interest receivable – related party					(98)
Accounts payable					(827)
Accrued expenses					(1,786)
Due to related party					(19,223)
Net cash used in operating activities					(263,727)
Cash flows from investing activities:
Net proceeds from the sale of investments					579,460
Purchase of investments					(9,651)
Increase in notes receivable – related party					(49,880)
Purchase of property and equipment					(310,832)
Net cash provided by investing activities					209,097
Cash flows from financing activities:
Proceeds from sale of preferred stock					125,000
Proceeds from stock subscriptions payable					35,000
Net cash provided by financing activities					160,000
Net increase in cash					105,370
Cash, beginning of period					15,691
Cash, end of period			121,061		121,061
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for income taxes
Non-cash investing and financing activities:
Common shares issued for convertible notes payable					379,021
Common shares issued for due to related party					15,625
Common shares issued for cashless exercise of warrants					188
Debt discount for derivative liability					47,617
Accrued interest added to convertible notes payable					1,117
Settlement of derivative liabilities
Marketable securities for conversion of notes receivable					66,850
Marketable securities exchanged for note payable					(37,074)
Marketable securities exchanged for accrued expenses					(1,370)
Marketable securities exchanged for derivative liabilities					(78,718)
Marketable securities exchanged for accounts receivable					(15,000)
Note payable issued in settlement of warrants					25,000
Derivative liabilities extinguished in settlement of warrants					67,064
Adjustments [Member]
Cash flows from operating activities:
Net loss			(747,032)		(433,316)	[1],[2],[3],[4],[5]
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense	[2]				3,438
Stock-based compensation - related party
Amortization of debt discount	[3]				28,490
Amortization of original issue discount
Change in fair value of derivative liabilities	[3]				617,485
(Gain) loss on extinguishment of debt					(276,410)	[3]
Financing fees related to notes payable
Realized gain on sale of investments	[5]		78,718		78,718
Unrealized loss on investments
Loss on settlement of warrants	[5]				(38,765)
Changes in assets and liabilities:
Digital currencies	[1]				(9,651)
Prepaid expenses and other current assets
Inventories
Accrued interest receivable – related party
Accounts payable
Accrued expenses	[1]				8,197
Due to related party	[1]				12,163
Net cash used in operating activities					(9,651)
Cash flows from investing activities:
Net proceeds from the sale of investments
Purchase of investments					9,651
Increase in notes receivable – related party
Purchase of property and equipment
Net cash provided by investing activities					9,651
Cash flows from financing activities:
Proceeds from sale of preferred stock
Proceeds from stock subscriptions payable
Net cash provided by financing activities
Net increase in cash
Cash, beginning of period
Cash, end of period
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for income taxes
Non-cash investing and financing activities:
Common shares issued for convertible notes payable	[3]				(229,972)
Common shares issued for due to related party
Common shares issued for cashless exercise of warrants
Debt discount for derivative liability	[3]				25,000
Accrued interest added to convertible notes payable
Settlement of derivative liabilities	[3]				405,970
Marketable securities for conversion of notes receivable
Marketable securities exchanged for note payable	[3]				37,074
Marketable securities exchanged for accrued expenses	[3]				1,370
Marketable securities exchanged for derivative liabilities	[3]				78,718
Marketable securities exchanged for accounts receivable	[3]				15,000
Note payable issued in settlement of warrants	[3]				(25,000)
Derivative liabilities extinguished in settlement of warrants	[3]				(67,064)
As Restated [Member]
Cash flows from operating activities:
Net loss			(982,993)		(895,873)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation expense					8,702
Stock-based compensation - related party					409,000
Amortization of debt discount					108,121
Amortization of original issue discount					1,347
Change in fair value of derivative liabilities					416,288
(Gain) loss on extinguishment of debt			(3,259)		(7,934)
Financing fees related to notes payable					32,358
Realized gain on sale of investments			(7,193)		(288,416)
Unrealized loss on investments			64,987		3,876
Loss on settlement of warrants					25,000
Changes in assets and liabilities:
Digital currencies					(71,543)
Prepaid expenses and other current assets					5,000
Inventories					(17,730)
Accrued interest receivable – related party					(98)
Accounts payable					(827)
Accrued expenses					6,411
Due to related party					(7,060)
Net cash used in operating activities					(273,378)
Cash flows from investing activities:
Net proceeds from the sale of investments					579,460
Purchase of investments
Increase in notes receivable – related party					(49,880)
Purchase of property and equipment					(310,832)
Net cash provided by investing activities					218,748
Cash flows from financing activities:
Proceeds from sale of preferred stock					125,000
Proceeds from stock subscriptions payable					35,000
Net cash provided by financing activities					160,000
Net increase in cash					105,370
Cash, beginning of period					15,691
Cash, end of period			$ 121,061		121,061
Supplemental disclosure of cash flow information:
Cash paid for interest
Cash paid for income taxes
Non-cash investing and financing activities:
Common shares issued for convertible notes payable					149,049
Common shares issued for due to related party					15,625
Common shares issued for cashless exercise of warrants					188
Debt discount for derivative liability					72,617
Accrued interest added to convertible notes payable					1,117
Settlement of derivative liabilities					405,970
Marketable securities for conversion of notes receivable					66,850
Marketable securities exchanged for note payable
Marketable securities exchanged for accrued expenses
Marketable securities exchanged for derivative liabilities
Marketable securities exchanged for accounts receivable
Note payable issued in settlement of warrants
Derivative liabilities extinguished in settlement of warrants

[1] (b) Accrued officer compensation was reclassified from accrued expenses to due to related party and subsequently reduced. Accrued interest payable was increased.

[2] (c) Reduced useful life for depreciation from 5 years to 3 years.

[3] (d) The Company engaged an outside consultant to revise derivative liabilities associated with convertible notes payable and to add derivative liabilities associated with warrants. The calculations were made for each issuance of new debt and warrants and for each conversion, exchange or exercise of debt and warrants. As a result, total derivative liabilities increased, and modifications were made to the calculation of debt discount, interest expense for the amortization of debt discount, and change in fair value of derivative liabilities. In addition, convertible notes payable, net of discounts, increased, interest expense increased, and change in fair value of derivative liabilities decreased. Additionally, no loss on extinguishment of debt for note conversions was recorded, resulting in a decrease in the loss and an increase in additional paid-in capital.

[4] (e) Total general and administrative expenses decreased as a result of corrections to certain operating expenses.

[5] (f) Adjusted realized gain on sale of investments, including recording gain on sale of related party investment to capital.

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SUBSEQUENT EVENTS (Details Narrative) - USD ($)	Jan. 25, 2019	Jan. 24, 2019	Jan. 09, 2019	Dec. 31, 2018	Jun. 30, 2018	Dec. 21, 2015
Common stock, shares increase				9,874,103	8,964,103
Common stock value				$ 9,875	$ 8,965
Stock subscriptions payable				$ 60,000	$ 35,000
Series B Preferred Stock [Member]
Preferred stock, shares authorized				500,000	500,000	500,000
Subsequent Event [Member] | Series B Preferred Stock [Member]
Shares issued			3,500
Stock subscriptions payable			$ 35,000
Subsequent Event [Member] | Series B Preferred Stock [Member] | Steve Rubakh [Member]
Shares issued		5,000
Common stock value		$ 80,000
Subsequent Event [Member] | Board of Directors [Member]
Common stock, shares increase	250,000,000
Preferred stock, shares authorized	20,000,000