Asfiled with the U.S. Securities and Exchange Commission on June 3, 2019.

RegistrationNo. 333-

UNITEDSTATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORMS-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

MGTCapital Investments, Inc.
(Exact name of registrant as specified in its charter)

RobertLadd
Chief Executive Officer and President
MGT Capital Investments, Inc.
512 S. Mangum Street, Suite 408
Durham, North Carolina 27701
(914) 630-7430
(Address, including zip code, and telephone number, including area code, of registrant’s principalexecutive offices)

RobertLadd
Chief Executive Officer and President
MGT Capital Investments, Inc.
512 S. Mangum Street, Suite 408
Durham, North Carolina 27701
(914) 630-7430
(Name, address, including zip code, and
telephone number, including area code, of agent for service)

Copiesto:

JasonSaltsberg, Esq.
Kenneth Schlesinger, Esq.
Olshan Frome Wolosky LLP
1325 Avenue of the Americas
New York, New York 10019
(212) 451-2300

Approximatedate of commencement of proposed sale to the public: From time to time after the effective date of this registration statement.

Ifany of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 underthe Securities Act of 1933 check the following box: [X]

Ifthis Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, pleasecheck the following box and list the Securities Act registration statement number of the earlier effective registration statementfor the same offering. [  ]

Ifthis Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and listthe Securities Act registration statement number of the earlier registration statement for the same offering. [  ]

Ifthis Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and listthe Securities Act registration statement number of the earlier registration statement for the same offering. [  ]

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

Ifan emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period forcomplying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(b) of the Securities Act.[  ]

CALCULATIONOF REGISTRATION FEE

TheRegistrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date untilthe Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter becomeeffective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shallbecome effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

Theinformation in this prospectus is not complete and may be changed. We may not sell these securities until the registration statementfiled with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and itis not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARYPROSPECTUS, SUBJECT TO COMPLETION, DATED JUNE __, 2019

MGTCapital Investments, Inc.

75,500,442Shares of Common Stock

Thisprospectus relates to the offer and resale of up to 75,500,442 shares of our common stock, par value $0.001 per share, by theselling stockholder identified on page 20. Such shares represent the shares that Oasis Capital, LLC (“Oasis Capital”)has agreed to purchase from us pursuant to the terms and conditions of an Equity Purchase Agreement that we entered into withOasis Capital on June 3, 2019 (the “Equity Purchase Agreement”). Subject to the terms and conditions of the EquityPurchase Agreement, we have the right to “put,” or sell, at our discretion, up to $10,000,000 worth of shares of ourcommon stock to Oasis Capital. This arrangement is also sometimes referred to herein as the “Equity Line” or the “OasisEquity Line.”

Formore information about the selling stockholder, please see the section of this prospectus entitled “Selling Stockholder”beginning on page 20.

Theselling stockholder may sell any shares offered under this prospectus at fixed prices, prevailing market prices at the time ofsale, at varying prices or negotiated prices.

OasisCapital is an “underwriter” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”),in connection with the resale of our common stock under the Equity Line, and any broker-dealers or agents that are involved insuch resales may be deemed to be “underwriters” within the meaning of the Securities Act in connection therewith.In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchasedby them may be deemed to be underwriting commissions or discounts under the Securities Act. For more information, please see thesection of this prospectus titled “Plan of Distribution” beginning on page 21.

Wewill not receive any proceeds from the resale of shares of common stock by the selling stockholder. We will, however, receiveproceeds from the sale of shares directly to Oasis Capital pursuant to the Equity Line.

Ourcommon stock is traded on the OTCQB tier of OTC Markets LLC under the ticker symbol “MGTI.” On May 31, 2019, the lastreported sale price of our common stock was $0.042 per share.

Investingin our common stock involves risks that are described in the “Risk Factors” section beginning on page 4 of this prospectus.

Youshould rely only on the information contained in this prospectus or any prospectus supplement or amendment thereto. We have notauthorized anyone to provide you with different information. This prospectus may only be used where it is legal to sell thesesecurities. The information in this prospectus is only accurate on the date of this prospectus, regardless of the time of anysale of securities.

Neitherthe Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities ordetermined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

Thedate of this prospectus is _________________ 2019.

Youshould rely only on the information contained in this prospectus and any prospectus supplement prepared by or on behalf of usor to which we have referred you. We have not authorized anyone to provide you with information that is different. If anyone providesyou with different or inconsistent information, you should not rely upon it. This prospectus is not an offer to sell, nor is theselling stockholder seeking an offer to buy, securities in any state where such offer or solicitation is not permitted. The informationin this prospectus is complete and accurate only as of the date on the front cover of this prospectus, regardless of the timeof delivery of this prospectus or any sale of shares of our common stock. Our business, financial condition, results of operationsand prospects may have changed since that date.

TABLEOF CONTENTS

Youshould rely only on the information contained in this prospectus or in any free writing prospectus we may authorize to be deliveredor made available to you. We have not authorized anyone to provide you with different information. We are offering to sell, andseeking offers to buy, shares of common stock only in jurisdictions where offers and sales are permitted. The information in thisprospectus is accurate only as of the date of this prospectus, regardless of the time of delivery of this prospectus or of anysale of shares of our common stock. Our business, financial condition, operating results and prospects may have changed sincethat date.

PROSPECTUSSUMMARY

Thissummary highlights information contained in this prospectus, or incorporated by reference into this prospectus, and does not containall of the information that you should consider in making your investment decision. Before investing in our common stock, youshould carefully read this entire prospectus, including the information set forth under the section “Risk Factors,”and our financial statements and the related notes thereto, in each case included in this prospectus or incorporated by referenceinto this prospectus. Some of the statements in this prospectus constitute forward looking statements. See “Cautionary NoteRegarding Forward Looking Information.”

Unlessthe context requires otherwise, the words “we,” “us,” “our,” “our company,” “ourbusiness” “the Company” and “MGT” refer collectively to MGT Capital Investments, Inc., a Delawarecorporation, and its subsidiaries.

Weare engaged primarily in Bitcoin mining operations.

Bitcoinis a world–recognized cryptocurrency, which can be traded and converted into major fiat currencies on most if not all cryptocurrencyexchanges. Cryptocurrencies are a medium of exchange that are transacted through and recorded on a decentralized distributed ledgersystem, called “blockchain.” The blockchain is built by a chronological addition of transactions, which are groupedinto blocks. Each new block requires a mathematical problem to be solved before it can be confirmed and added to the blockchain.

Additionalinformation about Bitcoin, blockchain and cryptocurrencies can be found on publicly available educational sources, such as www.bitcoin.org.We do not incorporate the information on, or accessible through these sources into this prospectus and you should not considerany information on these publicly available educational sources as part of this prospectus.

Asof March 31, 2019, MGT owned and or managed approximately 5,700 mining machines. Approximately 2,500 machines are located in Coloradoand 3,200 machines are located in Ohio. Of the 5,700 machines, 3,700 are owned by the Company, and the remaining machines areinvestor owned. All miners owned or managed by MGT are S9 Antminers sold by Bitmain Technologies LTD. In addition to the S9 Antminers,the Company owns 50 custom designed GPU-based Ethereum mining rigs. Because the price of Bitcoin steadily decreased during 2018and throughout the first quarter of 2019, the Company decided it was not economically responsible to commence mining operationsin Colorado or Ohio. On May 14, 2019, the Company announced commencement of operations in both Colorado and Ohio. During the yearended December 31, 2018, we mined 245 Bitcoin for total revenue of $2,010,000. In addition, the miners we operate pursuant tothe management agreements mined 184 Bitcoin during the same period.

MGT’sstrategy is to continue to expand its cryptocurrency mining operations and reduce costs by utilizing more efficient service providers,and to achieve operational economies of scale by increasing the number of Bitcoin machines maintained by the Company, either ownedor managed.

Ourlonger–term objective is focused towards vertical integration of our cryptocurrency mining business as well as diversificationinto other areas of the rapidly emerging blockchain and cryptocurrency industry.

MGTCapital Investments, Inc. is a Delaware corporation, incorporated in 2000. The predecessor of the Company was originally incorporatedin Utah in 1977. Our corporate office is located in Durham, North Carolina. MGT was formerly comprised of the parent company andits wholly–owned subsidiaries MGT Cybersecurity, Inc., Medicsight, Inc., MGT Sports, Inc., MGT Studios, Inc. (“MGTStudios”), MGT Interactive, LLC, MGT Gaming, Inc., MGT Mining One, Inc. and MGT Mining Two, Inc., and MGT Sweden AB. MGTStudios also owned a controlling minority interest in the subsidiary M2P Americas, Inc. During the first quarter of 2019, MGTdissolved all its wholly-owned subsidiaries excluding MGT Sweden AB.

Ourprincipal executive offices are located at 512 S. Mangum Street, Suite 408, Durham, NC 27701, our telephone number is (914) 630–7430and we maintain a website at www.mgtci.com. We do not incorporate the information on, or accessible through, our website intothis prospectus, and you should not consider any information on, or accessible through, our website as part of this prospectus.

RecentDevelopments

RecentFinancings

OnApril 15, 2019, Iliad Research and Triangle, L.P. (“Iliad”) purchased 17,500,000 shares of our common stock, $.001par value per share (“common stock”) for an aggregate purchase price of five hundred and twenty-five thousand dollars($525,000), or a per share price of $0.03.

OnApril 15, 2019, Chicago Venture Partners, L.P. (“Chicago Venture”) an affiliate of Iliad, purchased 150 shares ofour Series C Convertible Preferred Stock, $0.001 par value per share (the “Series C Preferred Stock”), which are convertibleinto shares of our common stock, for a total purchase price of one million five hundred thousand dollars ($1,500,000) (the “CVPurchase Price”) at a price of $10,000 per share (the “Stated Value”). The Series C Preferred Stock is convertibleinto our common stock at a conversion price equal to the lesser of i) $0.05 per share or ii) 70% multiplied by the lowest closingtrade price during the ten (10) trading days immediately preceding a conversion, subject to a 9.99% blocker provision. The Companyhas the right to redeem all or any portion of the outstanding Series C Preferred Stock in cash equal to 140% of Stated Value inthe first year of issuance, and at 120% of Stated Value thereafter.

Inaccordance with the terms of the stock purchase agreement with Chicago Venture, if at any time and for any reason, Chicago Ventureis not able to receive and deposit free trading common stock of the Company pursuant to conversions of the Series C PreferredStock it then owns or the Company fails to deliver conversion shares pursuant to a valid conversion notice from Chicago Ventureas provided in the CV Preferred Stock SPA, Chicago Venture can exchange any of its Series C Preferred Stock it then owns for aconvertible promissory note (the “Note”) pursuant to the Loan Documents (as defined in the CV Preferred Stock SPA).The Note, if issued, will have an initial outstanding balance equal to the Stated Value, with a term of twelve (12) months fromthe original issue date of April 15, 2019, and shall have the same conversion and redemption rights and privileges as the SeriesC Preferred Stock in all material respects.

OnApril 16, 2019, two unrelated accredited individual investors (“Individual Investors”) purchased a total of 40 sharesof the Series C Preferred Stock for an aggregate purchase price of four hundred thousand dollars ($400,000).

Theoffering of the securities described above was made pursuant to the Company’s registration statement on Form S-3 (SEC fileNo. 333- 225589).

OnMay 10, 2019, the two holders of the notes issued in May 2018 assigned and sold all their notes to Oasis Capital. On the samedate, the Company and Oasis Capital executed a letter agreement to amend the terms of these notes to allow Oasis Capital to convertthe total outstanding principal amount of $421,000 into shares of the Company’s common stock, at a price equal to 70% ofthe lowest trading price during the 20 days preceding the conversion dates, or any lower price made available to any other holderof the Company’s securities. This amendment also eliminated the Company’s mandatory monthly amortization paymentsand extended the maturity of these notes until August 15, 2019. On May 15, 2019, the Company issued 10,568,087 shares of its commonstock pursuant to the full conversion of the notes issued in May 2018.

OFFERINGSUMMARY

RISKFACTORS

Discussionof our business and operations included in this prospectus should be read together with the risk factors set forth below. Theydescribe various risks and uncertainties to which we are or may become subject. These risks and uncertainties, together with otherfactors described elsewhere in this report, have the potential to affect our business, financial condition, results of operations,cash flows, strategies or prospects in a material and adverse manner. New risks may emerge at any time, and we cannot predictthose risks or estimate the extent to which they may affect our financial performance. Each of the risks described below couldadversely impact the value of our securities. These statements, like all statements in this report, speak only as of the dateof this prospectus (unless another date is indicated), and we undertake no obligation to update or revise the statements in lightof future developments.

TheCompany generates limited revenue from operations upon which an evaluation of our prospects can be made. The Company’s prospectsmust be considered keeping in mind the risks, expenses and difficulties frequently encountered in the establishment of a new businessin a constantly changing industry. There can be no assurance that the Company will be able to achieve profitable operations inthe foreseeable future, if at all.

TheCompany has identified a number of specific risk areas that may affect our operations and results in the future:

RisksRelated to Our Business

Wehave had limited commercial results and revenues, and we may be required to curtail operations if adequate funds are not availableto us.

Ourcommercial results have been limited. Historically, the Company has not generated significant revenues to fund its operations,and the Company cannot be certain that revenues will be sufficient to fund operations for the foreseeable future. The Company’sprimary source of operating funds since inception has been debt and equity financings. The Company has also earned a limited amountof revenue through its Bitcoin operations. At December 31, 2018 and March 31, 2019, MGT’s cash and cash equivalents wereapproximately $96,000 and $362,000, respectively. Subsequent to March 31, 2019 the Company received proceeds of $2,425,000 fromthe financings described in “Prospectus Summary – Recent Developments”.

Inaddition to the Oasis Equity Line, the Company may raise additional capital, either through debt or equity financings, in orderto achieve its business plan objectives. Management believes that it can be successful in obtaining additional capital; however,no assurance can be provided that the Company will be able to do so. There is no assurance, moreover, that any funds raised fromthe Oasis Equity Line or otherwise, will be sufficient to enable the Company to attain profitable operations or continue as agoing concern. To the extent that the Company is unsuccessful, the Company may need to curtail its operations and implement aplan to extend payables or reduce overhead until sufficient additional capital is raised to support further operations. The Companymay also attempt to obtain funds through entering into arrangements with collaborative partners or others that may require theCompany to relinquish rights to certain of our technologies or products that the Company would not otherwise relinquish. Therecan be no assurance that any such plan will be successful.

TheCompany’s consolidated financial statements have been prepared on a going concern basis, and do not include adjustmentsthat might be necessary if the Company is unable to continue as a going concern.

TheCompany’s consolidated financial statements have been prepared on a going concern basis, which contemplates the realizationof assets and the satisfaction of liabilities in the normal course of business. As of March 31, 2019, the Company had incurredsignificant operating losses since inception, and continues to generate losses from operations, and has an accumulated deficitof $406,425,000. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The consolidatedfinancial statements included in this prospectus do not include any adjustments relating to the recoverability and classificationof asset amounts or the classification of liabilities that might be necessary should the Company be unable to continue as a goingconcern.

Thefurther development and acceptance of Bitcoin and other cryptographic and algorithmic protocols governing the issuance of transactionsin Bitcoin and other digital currencies, which represent a new and rapidly changing industry, are subject to a variety of factorsthat are difficult to evaluate. The slowing or stopping of the development or acceptance of Bitcoin may adversely affect our resultsof operations.

Theuse of digital currencies such as Bitcoin to, among other things, buy and sell goods and services, and the acquisition of digitalcurrencies as an investment, is part of a new and rapidly evolving industry that employs digital assets based upon a computer-generatedmathematical and/or cryptographic protocol. Bitcoin is a prominent, but not a unique part of this industry. The growth of thisindustry in general, and Bitcoin in particular, is subject to a high degree of uncertainty. The factors affecting the furtherdevelopment of this industry, include, but are not limited to:

Adecline in the popularity or acceptance of Bitcoin may adversely affect our results of operations.

Currently,there is relatively small use of Bitcoin in the retail and commercial marketplace in comparison to relatively large use by speculators,thus contributing to price volatility that could adversely affect our results of operations.

Bitcoinhas only recently become accepted as a means of payment for goods and services by certain major retail and commercial outletsand use of Bitcoin by consumers to pay such retail and commercial outlets remains limited. Conversely, a significant portion ofBitcoin demand is generated by speculators and investors seeking to profit from the short- or long-term holding of Bitcoin. Manyindustry commentators believe that Bitcoin’s best use case is as a store of wealth, rather than as a currency for transactions,and that other cryptocurrencies having better scalability and faster settlement times will better serve as currency. This couldlimit Bitcoin’s acceptance as transactional currency. A lack of expansion by Bitcoin into retail and commercial markets,or a contraction of such use, may result in increased volatility or a reduction in the Bitcoin Index Price, either of which couldadversely affect our results of operations.

Securitythreats could result in the halting of our operations and a loss of assets or damage to our reputation, each of which could havea material adverse effect on our business.

Securitybreaches, computer malware and computer hacking attacks have been a prevalent concern in the Blockchain industry. Any securitybreach caused by hacking, which involves efforts to gain unauthorized access to information or systems, or to cause intentionalmalfunctions or loss or corruption of data, software, hardware or other computer equipment, and the inadvertent transmission ofcomputer viruses, could harm our business operations or result in loss of our assets. Any breach of our infrastructure could resultin damage to our reputation.

AnyBitcoin we mine may be subject to loss, damage, theft or restriction on access.

Thereis a risk that some or all of the Bitcoin we mine could be lost, stolen or destroyed. Although we will seek to use various technologyto minimize the risk of loss, damage and theft, we cannot guarantee the prevention of such loss, damage or theft, whether causedintentionally, accidentally or by an act of God. Access to our Bitcoin could also be restricted by natural events (such as anearthquake or flood) or human actions (such as a terrorist attack). Any of these events may adversely affect our operations. Inaddition, government regulations in the United States and abroad could materially alter the landscape for Bitcoin and other cryptocurrenciesuse and accessibility, including through tax regulations, restrictions on use in transactions and regulation or prohibition ofcryptocurrency exchanges.

Ifwe do not keep pace with technological changes, our solutions may become less competitive and our business may suffer.

Themarket for Bitcoin technology is characterized by rapid technological change, frequent product and service innovation and evolvingindustry standards. We may need to continuously modify and enhance our solutions to keep pace with changes in internet-relatedhardware, software, communication, browser and database technologies. We may not be successful in either developing these modificationsand enhancements. Furthermore, uncertainties about the timing and nature of new network platforms or technologies, or modificationsto existing platforms or technologies, could increase our research and development expenses. Any failure of our solutions to keeppace with technological changes or operate effectively with future network platforms and technologies could adversely affect ourbusiness.

Adverseeconomic conditions or reduced technology spending may adversely impact our business.

Ourbusiness depends on the overall demand for technology and on the economic health of our prospective customers. In general, worldwideeconomic conditions remain unstable, and these conditions may make it difficult for our prospective customers and us to forecastand plan future business activities accurately. Weak global economic conditions, or a reduction in technology spending even ifeconomic conditions improve, could adversely impact our business, financial condition and results of operations in a number ofways, including longer sales cycles, lower prices for our solutions, reduced bookings and lower or no growth.

Ourability to attract, train and retain qualified employees is crucial to our results of operations and any future growth.

Toexecute our growth plan, we must attract and retain highly qualified personnel. Competition for these individuals is intense,especially for engineers with high levels of experience in designing and developing software and internet-related services, andprofessional services personnel with appropriate financial reporting experience. We have, from time to time, experienced, andwe expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications. Many of thecompanies with which we compete for experienced personnel have greater resources than we have. If we hire employees from competitorsor other companies, their former employers may attempt to assert that these employees have breached their legal obligations orthat we have induced such breaches, resulting in a diversion of our time and resources. If we fail to attract new personnel orfail to retain and motivate our current personnel, our business and future growth prospects could be adversely affected.

Regulatorychanges or actions may alter the nature of an investment in the Company or restrict the use of cryptocurrencies in a manner thatadversely affects the Company’s business, prospects or operations.

Governmentsaround the world have reacted differently to cryptocurrencies, with certain governments deeming them illegal while others haveallowed their use and trade. On-going and future regulatory actions may impact the ability of the Company to continue to operateand such actions could affect the ability of the Company to continue as a going concern or to pursue this segment at all, whichcould have a material adverse effect on the business, prospects or operations of the Company.

Theeffect of any future regulatory change on the Company or any cryptocurrency that the Company may mine or hold for others is impossibleto predict, and such change could have a material adverse effect on the ability of the Company to continue as a going concernor to pursue this segment at all, which would have a material adverse effect on the business, prospects or operations of the Company.

Governmentsmay in the future curtail or outlaw the acquisition, use or redemption of cryptocurrencies. Ownership of, holding or trading incryptocurrencies may then be considered illegal and subject to sanction. Governments may also take regulatory action that mayincrease the cost and/or subject cryptocurrency companies to additional regulation.

OnJuly 25, 2017, the SEC released an investigative report which states that the United States would, in some circumstances, considerthe offer and sale of Blockchain tokens pursuant to an initial coin offering (“ICO”) subject to federal securitieslaws. Thereafter, China released statements and took similar actions. Although the Company does not participate in ICOs, its clientsand customers may participate in ICOs and these actions may be a prelude to further action which chills widespread acceptanceof Blockchain and cryptocurrency adoption and have a material adverse effect on the ability of the Company to continue as a goingconcern or to pursue this segment at all, which would have a material adverse effect on the business, prospects or operationsof the Company.

Governmentsmay in the future take regulatory actions that prohibit or severely restrict the right to acquire, own, hold, sell, use or tradecryptocurrencies or to exchange cryptocurrencies for fiat currency. Similar actions by governments or regulatory bodies (suchas an exchange on which the Company’s securities are listed, quoted or traded) could result in restrictions of the acquisition,ownership, holding, selling, use or trading in the Company’s securities. Such a restriction could result in the Companyliquidating its inventory at unfavorable prices and may adversely affect the Company’s shareholders and have a materialadverse effect on the ability of the Company to continue as a going concern or to pursue this segment at all, raise new capitalor maintain a securities listing with an exchange which could have a material adverse effect on the business, prospects or operationsof the Company and harm investors in the Company’s securities.

Terroristactions and attacks may have a negative impact on economic conditions and market liquidity.

Thereis a risk of terrorist attacks on the United States and elsewhere causing significant loss of life and property damage and disruptionsin the global market. Economic and diplomatic sanctions may be in place or imposed on certain states and military action may becommenced. The impact of such events is unclear, but could have a material effect on general economic conditions and market liquidity.

Relianceon third parties to operate our mining machines may cause delays in production and mining and could have an impact on our business,financial condition and prospects.

TheCompany relies on third parties to operate its Bitcoin mining machinery. These third parties are not our employees and, exceptfor restrictions imposed by our contracts with such third parties, we have limited ability to control the amount or timing ofresources that they devote to our programs. Although we rely on these third parties to operate our mining machinery, we remainresponsible for the overall mining operations. Many of the third parties with whom we contract may also have relationships withother commercial entities, some of which may compete with us. If the third parties operating our machinery do not perform theircontractual duties or obligations we may need to enter into new arrangements with alternative third parties. This could be costly,and mining operations may be delayed or terminated. If any of our relationships with these third parties terminate, we may notbe able to enter into arrangements with alternative third party contractors or to do so on commercially reasonable terms. Thoughwe carefully manage our relationships with our contract machinery operators, there can be no assurance that we will not encountersimilar challenges or delays in the future or that these delays or challenges will not have a material adverse impact on our business,financial condition and prospects.

TheCompany’s reliance on a third-party mining pool service provider, such as Slush Pool or Antpool, for our mining revenuepayouts may have a negative impact on the Company operations.

Weuse a third–party mining pool to receive our mining rewards from the network. Bitcoin mining pools allow miners to combinetheir computing power, increasing their chances of solving a block and getting paid by the network. The rewards are distributedby the pool operator, proportionally to our contribution to the pool’s overall mining power, used to generate each block.Should the pool operator’s system suffer downtime due to a cyber-attack, software malfunction or other similar issues, itwill negatively impact our ability to mine and receive revenue.

Banksand financial institutions may not provide banking services, or may cut off services, to businesses that provide cryptocurrency-relatedservices or that accept cryptocurrencies as payment, including financial institutions of investors in the Company’s securities.

Anumber of companies that provide Bitcoin and/or other cryptocurrency-related services have been unable to find banks or financialinstitutions that are willing to provide them with bank accounts and other services. Similarly, a number of companies and individualsor businesses associated with cryptocurrencies may have had and may continue to have their existing bank accounts closed or servicesdiscontinued with financial institutions. We also may be unable to obtain or maintain these services for our business. The difficultythat many businesses that provide Bitcoin and/or other cryptocurrency-related services have and may continue to have in findingbanks and financial institutions willing to provide them services may be decreasing the usefulness of cryptocurrencies as a paymentsystem and harming public perception of cryptocurrencies and could decrease its usefulness and harm its public perception in thefuture. Similarly, the usefulness of cryptocurrencies as a payment system and the public perception of cryptocurrencies couldbe damaged if banks or financial institutions were to close the accounts of businesses providing Bitcoin and/or other cryptocurrency-relatedservices. This could occur as a result of compliance risk, cost, government regulation or public pressure. The risk applies tosecurities firms, clearance and settlement firms, national stock and commodities exchanges, the over the counter market and theDepository Trust Company, which, if any of such entities adopts or implements similar policies, rules or regulations, could resultin the inability of our investors to open or maintain stock or commodities accounts, including the ability to deposit, maintainor trade the Company’s securities. Such factors would have a material adverse effect the ability of the Company to continueas a going concern or to pursue this segment at all, which could have a material adverse effect on the business, prospects oroperations of the Company and harm investors.

Tothe extent that the profit margins of Bitcoin mining operations are not high, operators of Bitcoin mining operations are morelikely to immediately sell Bitcoin earned by mining in the market, resulting in a reduction in the price of Bitcoin that couldadversely impact the Company and similar actions could affect other cryptocurrencies.

Overthe past two years, Bitcoin mining operations have evolved from individual users mining with computer processors, graphics processingunits and first generation ASIC servers. Currently, new processing power is predominantly added by incorporated and unincorporated“professionalized” mining operations. Professionalized mining operations may use proprietary hardware or sophisticatedASIC machines acquired from ASIC manufacturers. They require the investment of significant capital for the acquisition of thishardware, the leasing of operating space (often in data centers or warehousing facilities), incurring of electricity costs andthe employment of technicians to operate the mining farms. As a result, professionalized mining operations are of a greater scalethan prior miners and have more defined, regular expenses and liabilities. These regular expenses and liabilities require professionalizedmining operations to more immediately sell Bitcoin earned from mining operations, whereas it is believed that individual minersin past years were more likely to hold newly mined Bitcoin for more extended periods. The immediate selling of newly mined Bitcoinsgreatly increases the supply of Bitcoin, creating downward pressure on the price of Bitcoin.

Theextent to which the value of Bitcoin mined by a professionalized mining operation exceeds the allocable capital and operatingcosts determines the profit margin of such operation. A professionalized mining operation may be more likely to sell a higherpercentage of its newly mined Bitcoin rapidly if it is operating at a low profit margin—and it may partially or completelycease operations if its profit margin is negative. In a low profit margin environment, a higher percentage could be sold morerapidly, thereby potentially reducing Bitcoin prices. Lower Bitcoin prices could result in further tightening of profit margins,particularly for professionalized mining operations with higher costs and more limited capital reserves, creating a network effectthat may further reduce the price of Bitcoin until mining operations with higher operating costs become unprofitable and removemining power. The network effect of reduced profit margins resulting in greater sales of newly mined Bitcoin could result in areduction in the price of Bitcoin that could adversely impact the Company.

Theforegoing risks associated with Bitcoin could be equally applicable to other cryptocurrencies, existing now or introduced in thefuture. Such circumstances would have a material adverse effect on the ability of the Company to continue as a going concern orto pursue this segment at all, which could have a material adverse effect on the business, prospects or operations of the Companyand potentially the value of any cryptocurrencies the Company holds or expects to acquire for its own account.

Politicalor economic crises may motivate large-scale sales of Bitcoin and Ethereum, or other cryptocurrencies, which could result in areduction in value and adversely affect the Company.

Asan alternative to fiat currencies that are backed by central governments, digital assets such as Bitcoin and Ethereum, which arerelatively new, are subject to supply and demand forces based upon the desirability of an alternative, decentralized means ofbuying and selling goods and services, and it is unclear how such supply and demand will be impacted by geopolitical events. Nevertheless,political or economic crises may motivate large-scale acquisitions or sales of Bitcoins and Ethereum and other cryptocurrencieseither globally or locally. Large-scale sales of Bitcoin and Ethereum or other cryptocurrencies would result in a reduction intheir value and could adversely affect the Company. Such circumstances could have a material adverse effect on the ability ofthe Company to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on thebusiness, prospects or operations of the Company and potentially the value of any cryptocurrencies the Company holds or expectsto acquire for its own account.

Itmay be illegal now, or in the future, to acquire, own, hold, sell or use Bitcoin, Ethereum, or other cryptocurrencies, participatein the Blockchain or utilize similar digital assets in one or more countries, the ruling of which could adversely affect the Company.

Althoughcurrently Bitcoin, Ethereum, and other cryptocurrencies, the Blockchain and digital assets generally are not regulated or arelightly regulated in most countries, including the United States, one or more countries such as China and Russia may take regulatoryactions in the future that could severely restrict the right to acquire, own, hold, sell or use these digital assets or to exchangefor fiat currency. Such restrictions may adversely affect the Company. Such circumstances could have a material adverse effecton the ability of the Company to continue as a going concern or to pursue this segment at all, which could have a material adverseeffect on the business, prospects or operations of the Company and potentially the value of any cryptocurrencies the Company holdsor expects to acquire for its own account and harm investors.

Ifregulatory changes or interpretations require the regulation of Bitcoin or other digital assets under the securities laws of theUnited States or elsewhere, including the Securities Act of 1933, the Securities Exchange Act of 1934 (the “Exchange Act”)and the Investment Company Act of 1940 or similar laws of other jurisdictions and interpretations by the SEC, the Commodity FuturesTrading Commission (the “CFTC”), the Internal Revenue Service (“IRS”), Department of Treasury or otheragencies or authorities, the Company may be required to register and comply with such regulations, including at a state or locallevel. To the extent that the Company decides to continue operations, the required registrations and regulatory compliance stepsmay result in extraordinary expense or burdens to the Company. The Company may also decide to cease certain operations. Any disruptionof the Company’s operations in response to the changed regulatory circumstances may be at a time that is disadvantageousto the Company.

Currentand future legislation and SEC rulemaking and other regulatory developments, including interpretations released by a regulatoryauthority, may impact the manner in which Bitcoin or other cryptocurrency is viewed or treated for classification and clearingpurposes. In particular, Bitcoin and other cryptocurrency may not be excluded from the definition of “security” bySEC rulemaking or interpretation requiring registration of all transactions, unless another exemption is available, includingtransacting in Bitcoin or cryptocurrency amongst owners and require registration of trading platforms as “exchanges”such as Coinsquare. The Company cannot be certain as to how future regulatory developments will impact the treatment of Bitcoinand other cryptocurrencies under the law. If the Company fails to comply with such additional regulatory and registration requirements,the Company may seek to cease certain of its operations or be subjected to fines, penalties and other governmental action. Suchcircumstances could have a material adverse effect on the ability of the Company to continue as a going concern or to pursue thissegment at all, which could have a material adverse effect on the business, prospects or operations of the Company and potentiallythe value of any cryptocurrencies the Company holds or expects to acquire for its own account and harm investors.

Therehave been calls for Bitcoin and other cryptocurrency regulation in China, which might make Bitcoin mining uneconomical for us.

ThePeoples Bank of China has recently instituted restrictions on certain exchange trading in cryptocurrencies and ICOs. Further governmentalregulation could negatively impact pricing for Bitcoin. In addition, the Company’s sole source of mining computers is aChinese company, exposing the Company to risk if restrictions are placed on the export of such computers.

Demandfor Bitcoin is driven, in part, by its status as the most prominent and secure digital asset. It is possible that a digital assetother than Bitcoin could have features that make it more desirable to a material portion of the digital asset user base, resultingin a reduction in demand for Bitcoins.

Bitcoinholds a “first-to-market” advantage over other digital currencies. This first-to-market advantage is driven in largepart by having the largest user base and, more importantly, the largest combined mining power in use. Having a large mining networkresults in greater user confidence regarding the security and long-term stability of a digital asset’s network and its Blockchain;as a result, the advantage of more users and miners makes a digital asset more secure, which makes it more attractive to new usersand miners, resulting in a network effect that strengthens the first-to-market advantage. Nonetheless, it is possible that anotherform of digital currency could become materially popular due to either a perceived or exposed shortcoming of the Bitcoin networkor a perceived advantage of another form of digital currency. If another form of digital currency obtains significant market share,this could reduce the profitability of our Bitcoin operations.

Becausethe number of Bitcoin awarded for solving a block in the Bitcoin network Blockchain continually decreases, miners must investin increasing processing power to maintain their yield of Bitcoins, which might make Bitcoin mining uneconomical for the Company.

Theaward of new Bitcoin for solving blocks continually declines, so that Bitcoin miners must invest in increasing processing powerin order to maintain or increase their yield of Bitcoin. The Company is committed to increasing its investment in its Bitcoinmining operations, but if the pricing of Bitcoin were to decline significantly, there can be no assurance that the Company wouldbe able to recover its investment in the computer hardware and processing power required to upgrade its mining operations. Therecan, moreover, be no assurance that the Company will have the resources to upgrade its processing power in order to maintain thecontinuing profitability of its Bitcoin mining operations. Also, the developers of the Bitcoin network or other programmers couldpropose amendments to the network’s protocols and software that, if accepted, might require the Company to modify its Bitcoinoperations, and increase its investment in Bitcoin, in order to maintain profitability. There can be no assurance, however, thatthe Company will be able to do so.

TheCompany continues to have discussions with potential investors to purchase more Bitcoin mining machines, but we cannot assureyou that we will be successful in obtaining the necessary financing.

TheCompany is considering further increasing the processing power of its Bitcoin mining operations, as the Company seeks to leverageits experience and expertise in this area of operations. To do so, however, the Company will need to raise additional investmentcapital. While we are in discussions with potential investors to provide the necessary capital to purchase additional Bitcoinmining machines, we cannot assure you that these discussions will lead to our obtaining additional capital or that we will otherwisebe successful in obtaining the necessary financing to expand our Bitcoin operations. If we are successful in raising capital toexpand our Bitcoin operations, the form in which the capital is invested could be different from the way we have traditionallystructured capital investments in the Company. For example, funds could be invested through a joint venture or similar arrangement,in which the Company does not have the entire equity ownership interest.

RisksRelating to Certain Litigation

Aclaim has been filed against the Company’s Chief Executive Officer alleging violations of federal securities laws.

OnSeptember 7, 2018, the SEC commenced a legal action in the United States District Court for the Southern District of New York(the “Court”) naming as defendant Robert Ladd, the Company’s then and now current Chief Executive Officer andPresident, among others. The SEC filed civil charges against multiple individuals and entities who are alleged to have violatedthe securities laws in connection with certain microcap stocks. To our knowledge there is no other ongoing investigation by anygovernment agency related to the Company or any of its officers or directors. We cannot predict the outcome or impact of any ongoingmatters, and there exists the possibility that we could be subject to liability, penalties and other restrictive sanctions andadverse consequences if the SEC, the Department of Justice, or any other government agency were to pursue legal action in thefuture. Moreover, we expect to incur costs in responding to related requests for information and subpoenas, and if instituted,in defending against any governmental proceedings.

TheCompany has received a subpoena from the SEC.

OnSeptember 15, 2016, the Company received a subpoena from the SEC requesting certain information from the Company, and in December2017 our President and Chief Executive Officer also received a subpoena from the SEC. Except as detailed in the previous paragraph,we have no indication or reason to believe that the Company or its officers or directors are or will be the subject of any enforcementproceedings. The Company has publicly announced its receipt of the subpoena and is fully cooperating to comply with the SEC’srequest. Nevertheless, response to the subpoena has entailed, and may continue to entail legal costs and the diversion of management’sattention, and the issuance of the subpoena may create a perception of wrongdoing that could be harmful to our business.

Anumber of claims have been filed against the Company alleging violations of federal securities laws.

Variousshareholders of the Company filed two putative class action lawsuits presently against the Company, its former and now currentCEO, alleging violations of federal securities laws and seeking damages. The lawsuits followed, and referenced allegations madeagainst the Company’s former and now current CEO and others in a complaint filed by the SEC on September 7, 2018. The firstputative class action lawsuit was filed on September 28, 2018, in the United States District Court for the District of New Jersey,and alleges generally that defendants were engaged in a pump-and-dump scheme to artificially inflate MGT’s stock price andthat, as a result, defendants’ statements about MGT’s business and prospects were materially false and misleadingand/or lacked a reasonable basis at all relevant times. The second action was filed on October 9, 2018, in the United States DistrictCourt for the Southern District of New York and makes similar allegations. While the Company intends to defend against the actionsvigorously and believes that there are no merits to claims that the Company violated applicable securities laws, the results ofany investigation, or the outcome of any claims that may brought against us, if any, cannot be predicted with certainty. Moreover,regardless of the outcome, investigations can have an adverse impact on us because they may entail a significant amount of coststo defend the Company against any claims, such claims may negatively affect morale of employees and may divert the attention ofmanagement.

Defendingthe SEC and class actions could divert the attention of our President and Chief Executive Officer.

Regardlessof the outcome of the SEC actions and shareholder class action lawsuits, the Company’s business may be disrupted by Mr.Ladd having to focus on his defense. Moreover, the SEC actions and shareholder class action lawsuits may entail legal costs, increasein the cost of the future director and officer insurance and the diversion of management’s attention, and could negativelyimpact the trading prices of our common stock.

RisksRelated to Our Stock

Pennystock regulations may impose certain restrictions on marketability of our securities.

TheSEC has adopted regulations which generally define a “penny stock” to be any equity security that has a market priceof less than $5.00 per share or an exercise price of less than $5.00 per share, subject to certain exceptions. A security listedon a national securities exchange is exempt from the definition of a penny stock. Our common stock is not currently listed ona national security exchange. Our common stock is therefore subject to rules that impose additional sales practice requirementson broker-dealers who sell such securities to persons other than established customers and accredited investors (generally thosewith assets in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 together with their spouse). For transactionscovered by such rules, the broker-dealer must make a special suitability determination for the purchase of such securities andhave received the purchaser’s written consent to the transaction prior to the purchase.

Additionally,for any transaction involving a penny stock, unless exempt, the rules require the delivery, prior to the transaction, of a riskdisclosure document mandated by the SEC relating to the penny stock market. The broker-dealer must also disclose the commissionpayable to both the broker-dealer and the registered representative, current quotations for the securities and, if the broker-dealeris the sole market maker, the broker dealer must disclose this fact and the broker-dealer’s presumed control over the market.Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and informationon the limited market in penny stocks. Broker-dealers must wait two business days after providing buyers with disclosure materialsregarding a security before effecting a transaction in such security. Consequently, the “penny stock” rules restrictthe ability of broker-dealers to sell our securities and affect the ability of investors to sell our securities in the secondarymarket and the price at which such purchasers can sell any such securities, thereby affecting the liquidity of the market forour common stock.

Stockholdersshould also be aware that, according to the SEC, the market for penny stocks has suffered in recent years from patterns of fraudand abuse. Such patterns include:

Ourstock price and trading volume may be volatile, which could result in losses for our stockholders.

Theequity markets may experience periods of volatility, which could result in highly variable and unpredictable pricing of equitysecurities. The market price of our common stock could change in ways that may or may not be related to our business, our industryor our operating performance and financial condition and could negatively affect our share price or result in fluctuations inthe price or trading volume of our common stock. We cannot predict the potential impact of these periods of volatility on theprice of our common stock. The Company cannot assure you that the market price of our common stock will not fluctuate or declinesignificantly in the future.

Ifsecurities or industry analysts do not publish research or reports about our business, or if they publish inaccurate or unfavorableresearch reports about our business, our share price and trading volume could decline.

Thetrading market for our common stock will, to some extent, depend on the research and reports that securities or industry analystspublish about us or our business. We do not have any control over these analysts. If one or more of the analysts who cover usshould downgrade our shares or change their opinion of our business prospects, our share price would likely decline. If one ormore of these analysts ceases coverage of our Company or fails to regularly publish reports on us, we could lose visibility inthe financial markets, which could cause our share price and volume to decline.

Futuresales and issuances of our equity securities or rights to purchase our equity securities, including pursuant to equity incentiveplans, would result in additional dilution of the percentage ownership of our stockholders and could cause our stock price tofall.

Tothe extent we raise additional capital by issuing equity securities through the Oasis Equity Line or otherwise, our stockholdersmay experience substantial dilution. We may, as we have in the past, sell common stock, rights, warrants, options or convertiblesecurities or other equity securities in one or more transactions at prices and in a manner we determine from time to time. Ifwe sell common stock, rights, warrants, options or convertible securities or other equity securities in more than one transaction,investors may be further diluted by subsequent sales. Such sales may also result in material dilution to our existing stockholders,and new investors could gain rights superior to existing stockholders.

Becausewe are quoted on the OTCQB instead of a national securities exchange or quotation system, our investors may experience significantvolatility in the market price of our stock and have difficulty selling their shares.

Ourcommon stock is currently quoted on the OTC Market Group’s OTCQB market quotation system under the ticker symbol “MGTI.”The OTCQB is a regulated quotation services that displays real-time quotes and last sale prices in over-the-counter securities.Trading in shares quoted on the OTCQB is often thin and characterized by volatility in trading prices. This volatility may becaused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrativesupervision of bid and ask quotations, lower trading volume and market conditions. As a result, there may be wide fluctuationsin the market price of the shares of our common stock for reasons unrelated to operating performance, and this volatility, whenit occurs, may have a negative effect on the market price for our securities. Moreover, the OTCQB is not a stock exchange, andtrading of securities on this platform is more sporadic than the trading of securities listed on a national quotation system orstock exchange. Accordingly, our stockholders may not be able to realize a fair price from their shares when they determine tosell them or may have to hold them for a substantial period of time until the market for our common stock improves.

Asignificant number of additional shares of our common stock may be issued at a later date, and their sale could depress the marketprice of our common stock.

Asof May 24, 2019 we had outstanding warrants exercisable for 1,460,000 shares of our common stock and options exercisable for 6,000,000shares of our common stock. In addition, we have shares issuable upon conversion of outstanding notes and 155 shares of SeriesC Preferred Stock which are convertible into shares of our common stock at any time at the option of the holder in an amount determinedby dividing the Stated Value ($10,000) by the conversion price. The conversion price of the Series C Preferred Stock will be equalto the lower of (i) $0.05 per share (subject to adjustment for stock splits, stock dividends, and similar transactions) or (ii)70% of the lowest trading price of the common stock for the 10 days prior to the conversion date. The possibility of the issuanceof all or some of the shares upon the exercise or conversion of the outstanding warrants, options or Series C Preferred Stock,as well as the sale of shares pursuant to the Oasis Equity Line, could substantially reduce the market price for our common stock.

Offersor availability for sale of a substantial number of shares of our common stock may cause the price of our common stock to decline.

Ifour stockholders sell substantial amounts of our common stock in the public market, including upon the expiration of any statutoryholding period under Rule 144 under the Securities Act of 1933, as amended, or registration for resale, or the conversion of SeriesC Preferred Stock or exercise of warrants, circumstances commonly referred to as an “overhang” could result, in anticipationof which the market price of our common stock could fall. The existence of an overhang, whether or not sales have occurred orare occurring, could also make more difficult our ability to raise additional financing through the sale of equity or equity–relatedsecurities in the future at a time and price that we deem reasonable or appropriate.

Theprice of our common stock has fluctuated considerably and is likely to remain volatile, in part due to the limited market forour common stock, and you could lose all or part of your investment.

Thereis a limited public market for our common stock, and we cannot provide assurances that a more active trading market will developor continue. As a result of low trading volume in our common stock, the purchase or sale of a relatively small number of sharescould result in significant share price fluctuations. Additionally, the market price of our common stock may continue to fluctuatesignificantly in response to a number of factors, some of which are beyond our control.

Forthese reasons and others, an investment in our securities is risky and you should invest only if you can withstand a significantloss and wide fluctuations in the value of your investment.

Theprice of the Company’s shares could be subject to wide price swings since the value of cryptocurrencies may be subject topricing risk and have historically been subject to wide swings in value.

TheCompany’s shares are subject to arbitrary pricing factors that are not necessarily associated with traditional factors thatinfluence stock prices or the value of non-cryptocurrency assets such as revenue, cash flows, profitability, growth prospectsor business activity levels since the value and price, as determined by the investing public, may be influenced by future anticipatedadoption or appreciation in value of cryptocurrencies or the Blockchain generally, factors over which the Company has little orno influence or control. The Company’s share prices may also be subject to pricing volatility due to supply and demand factorsassociated with few or limited public company options for investment in the segment.

Cryptocurrencymarket prices are determined primarily using data from various exchanges, over-the-counter markets, and derivative platforms.Furthermore, such prices may be subject to factors such as those that impact commodities, more so than business activities, whichcould be subjected to additional influence from fraudulent or illegitimate actors, real or perceived scarcity, and political,economic, regulatory or other conditions. Pricing may be the result of, and may continue to result in, speculation regarding futureappreciation in the value of cryptocurrencies, or the Company or its share price, inflating and making their market prices morevolatile or creating “bubble” type risks.

Inaddition, the success of the Company, the Company’s share price, and the interest in investors and the public in the Companyas an early entrant into the Blockchain and cryptocurrency ecosystem may in large part be the result of the Company’s earlyemergence as a publicly traded company in which holders of appreciated cryptocurrency have an opportunity to invest inflated cryptocurrencyprofits for shares of the Company, which could be perceived as a way to maintaining investing exposure to the Blockchain and cryptocurrencymarkets without exposing the investor to the risk in a particular cryptocurrency. Cryptocurrency holders have realized exponentialvalue due to large increases in the prices of cryptocurrencies and may seek to lock in cryptocurrency appreciation, which investingin the Company’s securities may be perceived as a way to achieve that result but may not continue in the future. As a result,the value of the Company’s securities, and the value of cryptocurrencies generally may be more likely to fluctuate due tochanging investor confidence in future appreciation (or depreciation) in market prices, profits from related or unrelated investmentsor holdings of cryptocurrency. Such factors or events would have a material adverse effect on the ability of the Company to continueas a going concern or to pursue this segment at all, or on the price of the Company’s securities, which would have a materialadverse effect on the business, prospects or operations of the Company and potentially the value of any cryptocurrencies the Companyholds or expects to acquire for its own account.

Investorrelations activities, nominal “float” and supply and demand factors may affect the price of our stock.

TheCompany may utilize various techniques such as non–deal road shows and investor relations campaigns in order to create investorawareness for the Company. These campaigns may include personal, video and telephone conferences with investors and prospectiveinvestors in which our business practices are described. The Company may provide compensation to investor relations firms andpay for newsletters, websites, mailings and email campaigns that are produced by third parties based upon publicly–availableinformation concerning the Company. The Company does not intend to review or approve the content of such analysts’ reportsor other materials based upon analysts’ own research or methods. Investor relations firms should generally disclose whenthey are compensated for their efforts, but whether such disclosure is made or complete is not under our control. In addition,investors in the Company may, from time to time, also take steps to encourage investor awareness through similar activities thatmay be undertaken at their own expense. Investor awareness activities may also be suspended or discontinued, which may impactthe trading market for our common stock. Any of these activities could affect our stock price in a manner that is unrelated tothe underlying value of our Company.

Theability of our board of directors to issue additional stock may prevent or make more difficult certain transactions, includinga sale or merger of the Company.

Ourboard of directors is authorized to issue up to 8,500,000 shares of preferred stock (inclusive of the preferred stock previouslydesignated) with powers, rights and preferences designated by it. Shares of voting or convertible preferred stock could be issued,or rights to purchase such shares could be issued, to create voting impediments or to frustrate persons seeking to effect a takeoveror otherwise gain control of the Company. The ability of the Board to issue such additional shares of preferred stock, with suchrights and preferences it deems advisable, could discourage an attempt by a party to acquire control of the Company by tenderoffer or other means. Such issuances could therefore deprive stockholders of benefits that could result from such an attempt,such as the realization of a premium over the market price for their shares in a tender offer or the temporary increase in marketprice that such an attempt could cause. Moreover, the issuance of such additional shares of preferred stock to persons friendlyto the board of directors could make it more difficult to remove incumbent officers and directors from office even if such removalwould be favorable to stockholders generally. In addition, the Board is authorized to issue up to 2,500,000,000 shares of commonstock (inclusive of the shares of common stock currently outstanding or reserved for issuance upon the exercise or conversionof the outstanding, warrants, options, Series C preferred Stock or pursuant to the Oasis Equity Line). The issuance of these authorizedbut unissued shares of common stock may dilute the ownership interests of existing stockholders and may have a dilutive effecton our common stock.

Wedo not intend to pay dividends on our common stock in the foreseeable future so any returns on our common stock will be limitedto the price of our common stock.

Wehave never declared dividends on our common stock, and currently do not plan to declare dividends on shares of our common stockin the foreseeable future. We currently expect to retain future earnings, if any, for use in the operation and expansion of ourbusiness. The payment of cash dividends in the future, if any, will be at the discretion of our board of directors and will dependupon such factors as earnings levels, capital requirements, our overall financial condition and any other factors.

Accordingly,investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realizeany return on their investment. Also, investors seeking cash dividends should not purchase our common stock.

Wemay not be able to attract the attention of research analysts at major brokerage firms.

Becausewe are not listed on a national securities exchange, security analysts of brokerage firms may not provide coverage of our company.In addition, investment banks may be less likely to agree to underwrite secondary offerings on our behalf or recommend the purchaseof our common stock because they may be less familiar with our company as a result of more limited coverage by analysts and themedia. The failure to receive research coverage or support in the market for our shares will likely have an adverse effect onour ability to develop a liquid market for our common stock.

FINRAsales practice requirements may limit a stockholder’s ability to buy and sell our stock.

TheFinancial Industry Regulatory Authority (referred to as FINRA) has adopted rules requiring that, in recommending an investmentto a customer, a broker-dealer must have reasonable grounds for believing that the investment is suitable for that customer. Priorto recommending speculative or low-priced securities to their non-institutional customers, broker-dealers must make reasonableefforts to obtain information about the customer’s financial status, tax status, investment objectives and other information.Under interpretations of these rules, FINRA has indicated its belief that there is a high probability that speculative or low-pricedsecurities will not be suitable for at least some customers. If these FINRA requirements are applicable to us or our securities,they may make it more difficult for broker-dealers to recommend that at least some of their customers buy our common stock, whichmay limit the ability of our stockholders to buy and sell our common stock and could have an adverse effect on the market forand price of our common stock.

RisksRelating to Our Equity Line with Oasis Capital

Resalesof shares purchased by Oasis Capital under the Equity Purchase Agreement may cause the market price of our common stock to decline.

Subjectto the terms and conditions of the Equity Purchase Agreement with Oasis Capital, we have the right to “put,” or sell,at our discretion, up to $10,000,000 worth of shares of our common stock to Oasis Capital. Unless terminated earlier, Oasis Capital’spurchase commitment will automatically terminate on the earlier of the date on which Oasis Capital shall have purchased sharespursuant to the Equity Purchase Agreement for an aggregate purchase price of $10,000,000 or June 3, 2022. The shares to be issuedto Oasis Capital pursuant to the Equity Purchase Agreement will be purchased at a price equal to 95% of the “Market Price,”which is defined as the one lowest daily volume weighted average traded price on the OTCQB, as reported by Bloomberg Finance L.P.or Quotestream, during the five trading days immediately following the date Oasis Capital receives the Put Shares via deposit/withdrawalat custodian share transfer method (“DWAC”) associated with the applicable put notice (the “Pricing Period”),which in most circumstances will be the trading day immediately following the date that a put notice is delivered to Oasis Capital(the “Put Date”). Oasis Capital may have the financial incentive to sell the shares of our common stock issuable underthe Equity Purchase Agreement in advance of or upon receiving such shares and to realize the profit equal to the difference betweenthe discounted price and the current market price of the shares. This may cause the market price of our common stock to decline.

Theforegoing description of the terms of the Equity Purchase Agreement does not purport to be complete and is subject to and qualifiedin its entirety by reference to the Equity Purchase Agreement itself, which is filed as an exhibit to the registration statement,of which this prospectus forms a part of.

Putsunder Equity Purchase Agreement may cause dilution to existing stockholders.

Fromtime to time during the term of the Equity Purchase Agreement, and at our sole discretion, we may present Oasis Capital with aput notice requiring Oasis Capital to purchase shares of our common stock. We have the ability to sell up to $10 million in sharesof our common stock (or approximately 238,095,238 shares assuming a purchase price of $0.042 per share, the closing price of ourshares of common stock on the OTCQB on May 31, 2019) under the Equity Purchase Agreement, subject to certain limits, and providedthat, among other things, such shares are registered by us for resale by Oasis Capital. Pursuant to this registration statementof which this prospectus is a part, we are registering a total of 75,500,442 shares that Oasis Capital has agreed to purchasefrom us pursuant to the terms and conditions of an Equity Purchase Agreement. Such share amount represents one-third of the sharesof our common stock held by non-affiliates of our Company as of May 31, 2019. Our ability to sell any additional shares to OasisCapital under the Equity Purchase Agreement will be contingent on our ability to prepare and file one or more additional registrationstatements registering the resale of such additional shares.

Asa result, if we sell and issue any shares to Oasis Capital under the Equity Purchase Agreement, our existing stockholders willexperience immediate dilution upon the purchase of any of the shares by Oasis Capital. Oasis Capital may resell some, if not all,of the shares that we issue to it under the Equity Purchase Agreement, and subject to certain volume limitations, the commitmentfee shares, and such sales could cause the market price of our common stock to decline significantly. To the extent of any suchdecline, any subsequent puts would require us to issue and sell a greater number of shares to Oasis Capital in exchange for eachdollar of the put amount. Under these circumstances, the existing stockholders of our company will experience greater dilution.The effect of this dilution may, in turn, cause the price of our common stock to decrease further, both because of the downwardpressure on the stock price that would be caused by a large number of sales of our shares into the public market by Oasis Capital,and because our existing stockholders may disagree with a decision to sell shares to Oasis Capital at a time when our stock priceis low, and may in response decide to sell additional shares, further decreasing our stock price. If we draw down amounts underthe Equity Line when our share price is decreasing, we will need to issue more shares to raise the same amount of funding.

Thereis no guarantee that we will satisfy the conditions to the Equity Purchase Agreement.

Althoughthe Equity Purchase Agreement provides that we can require Oasis Capital to purchase, at our discretion, up to $10,000,000 worthof shares of our common stock in the aggregate, our ability to put shares to Oasis Capital and obtain funds when requested islimited by the terms and conditions of the Equity Purchase Agreement, including restrictions on when we may exercise our put rights,restrictions on the amount we may put to Oasis Capital at any one time, which is determined in part by the trading volume of ourcommon stock, and a limitation on our ability to put shares to Oasis Capital to the extent that it would cause Oasis Capital tobeneficially own more than 9.99% of the outstanding shares of our common stock.

Wemay not have access to the full amount available under the Equity Purchase Agreement with Oasis Capital.

Ourability to draw down funds and sell shares under the Equity Purchase Agreement requires that a registration statement be declaredeffective and continue to be effective registering the resale of shares issuable under the Equity Purchase Agreement. The registrationstatement of which this prospectus is a part registers the resale of 75,500,442 shares of our common stock issuable under theEquity Line. Our ability to sell any additional shares under the Equity Purchase Agreement will be contingent on our ability toprepare and file one or more additional registration statements registering the resale of such additional shares. These registrationstatements (and any post-effective amendments thereto) may be subject to review and comment by the staff of the SEC and will requirethe consent of our independent registered public accounting firm. Therefore, the timing of effectiveness of these registrationstatements (and any post-effective amendments thereto) cannot be assured. Even if we are successful in causing one or more registrationstatements registering the resale of some or all of the shares issuable under the Equity Purchase Agreement to be declared effectiveby the SEC in a timely manner, we may not be able to sell the shares unless certain other conditions are met. Accordingly, becauseour ability to draw down any amounts under the Equity Purchase Agreement with Oasis Capital is subject to a number of conditions,there is no guarantee that we will be able to draw down all of the proceeds of $10,000,000 under the Equity Purchase Agreement.

***

Therisks above do not necessarily comprise of all those associated with an investment in our Company. This registration statementof which this prospectus is a part contains forward looking statements that involve unknown risks, uncertainties and other factorsthat may cause our actual results, financial condition, performance or achievements to be materially different from any futureresults, performance or achievements expressed or implied by such forward looking statements. Factors that might cause such adifference include, but are not limited to, those set out above.

CAUTIONARYSTATEMENT ON FORWARD LOOKING STATEMENTS

Thisprospectus and other written and oral statements made from time to time by us may contain forward-looking statements. Forward-lookingstatements can be identified by the use of words such as “expects,” “plans,” “will,” “forecasts,”“projects,” “intends,” “estimates,” and other words of similar meaning. One can identify themby the fact that they do not relate strictly to historical or current facts. These statements are likely to address our growthstrategy, financial results and product and development programs. One must carefully consider any such statement and should understandthat many factors could cause actual results to differ from our forward looking statements. These factors may include inaccurateassumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-lookingstatement can be guaranteed, and actual future results may vary materially.

Thesestatements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks in thesection entitled “Risk Factors” and the risks set out above, any of which may cause our or our industry’s actualresults, levels of activity, performance or achievements to be materially different from any future results, levels of activity,performance or achievements expressed or implied by these forward-looking statements. These risks include, by way of example andnot in limitation:

Thislist is not an exhaustive list of the factors that may affect any of our forward-looking statements. These and other factors shouldbe considered carefully, and readers should not place undue reliance on our forward-looking statements. Forward looking statementsare made based on management’s beliefs, estimates and opinions on the date the statements are made, and we undertake noobligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change.Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee futureresults, levels of activity, performance or achievements. Except as required by applicable law, including the securities lawsof the United States we do not intend to update any of the forward-looking statements to conform these statements to actual results.

Informationregarding market and industry statistics contained in this prospectus is included based on information available to us that webelieve is accurate. It is generally based on industry and other publications that are not produced for purposes of securitiesofferings or economic analysis. We have not reviewed or included data from all sources. Forecasts and other forward-looking informationobtained from these sources are subject to the same qualifications and the additional uncertainties accompanying any estimatesof future market size, revenue and market acceptance of products and services. As a result, investors should not place undue relianceon these forward-looking statements.

USEOF PROCEEDS

Wewill not receive any proceeds from the sale of the shares of our common stock by the selling stockholder. However, we will receiveproceeds from the sale of the shares of our common directly to Oasis Capital pursuant to the Equity Purchase Agreement. We willuse these proceeds for general corporate and working capital purposes, or for other purposes that our board of directors, in itsgood faith, deems to be in the best interest of our Company. We have agreed to bear the expenses relating to the registrationof the offer and resale by the selling stockholder of the shares being offered hereby.

DETERMINATIONOF OFFERING PRICE

Theselling stockholder will determine at what price it may sell the shares of our common stock offered by this prospectus, and suchsales may be made at prevailing market prices, at prices related to the prevailing market price or at privately negotiated prices.

THEOFFERING

Theselling stockholder may offer and resale of up to 75,500,442 shares of our common stock, par value $0.001 per share, pursuantto this prospectus. Such shares represent shares of our common stock that Oasis Capital has agreed to purchase from us pursuantto the terms and conditions of an Equity Purchase Agreement we entered into with Oasis Capital on June 3, 2019, which are describedbelow.

EquityPurchase Agreement and Registration Rights Agreement with Oasis Capital, LLC

Subjectto the terms and conditions of the Equity Purchase Agreement, we have the right to “put,” or sell, up to $10,000,000worth of shares of our common stock to Oasis Capital. Unless terminated earlier, Oasis Capital’s purchase commitment willautomatically terminate on the earlier of the date on which Oasis Capital shall have purchased shares pursuant to the Equity PurchaseAgreement for an aggregate purchase price of $10,000,000 or June 3, 2022. We have no obligation to sell any shares under the EquityPurchase Agreement.

Asprovided in the Equity Purchase Agreement, we may require Oasis Capital to purchase shares of our common stock from time to timeby delivering a put notice to Oasis Capital specifying the total number of shares to be purchased (such number of shares multipliedby the purchase price described below, the “Investment Amount”); provided there must be a minimum of ten trading daysbetween delivery of each put notice. We may determine the Investment Amount, provided that such amount may not be more than 250%of the average daily trading volume in dollar amount for our common stock during the 10 trading days preceding the date on whichwe deliver the applicable put notice. Additionally, such amount may not be higher than $1,000,000. Oasis Capital will have noobligation to purchase shares under the Equity Line to the extent that such purchase would cause Oasis Capital to own more than9.99% of our common stock.

Foreach share of the our common stock purchased under the Equity Line, Oasis Capital will pay a purchase price (the “PurchasePrice”) equal to 95% of the “Market Price,” which is defined as the one lowest daily volume weighted averagetraded price on the OTCQB, as reported by Bloomberg Finance L.P. or Quotestream, during the five trading days immediately followingthe date Oasis Capital receives the Put Shares via DWAC associated with the applicable put notice, which in most circumstanceswill be the trading day immediately following the date that a put notice is delivered to Oasis Capital. On the settlement date,Oasis Capital will purchase the applicable number of shares of our common stock subject to customary closing conditions, includingwithout limitation a requirement that a registration statement remain effective registering the resale by Oasis Capital of theshares to be issued under the Equity Line as contemplated by the Registration Rights Agreement described below. Oasis Capitalmay not assign its rights or obligations under the Equity Purchase Agreement and the Equity Purchase Agreement is not transferableand any benefits attached thereto may not be assigned.

Inconnection with the Equity Purchase Agreement, on June 3, 2019, we also entered into Registration Rights Agreement (the “RegistrationRights Agreement,” and together with the Purchase Agreement, are referred to herein as the “Transaction Documents”)with Oasis Capital requiring us to prepare and file a registration statement registering the resale by Oasis Capital of the PutShares (as defined below) by June 5, 2019, and to use commercially reasonable efforts to cause such registration statementto become effective, and to keep such registration statement effective until (i) the date when Oasis Capital may sell all of theshares that we may put to Oasis Capital (the “Put Shares”) under the Equity Purchase Agreement without any restrictions(including under Rule 144 without volume limitations), or (ii) the date when no Put Shares remain issuable under the PurchaseAgreement. In accordance with the Registration Rights Agreement, on June 3, 2019, we filed the registration statement of whichthis prospectus is a part registering the resale by Oasis Capital of up to 75,500,442 Put Shares. This registration statementwas declared effective by the SEC on ___________, 2019.

The75,500,442 shares being offered pursuant to this prospectus by Oasis Capital represent approximately 33.33% of shares of our commonstock issued and outstanding held by non-affiliates of our Company as of May 31, 2019 assuming the offering is fully subscribed.

Effectiveas of the Closing Date, we reserved approximately 200,000,000 shares of our common stock from our authorized and unissued sharesof common stock to provide for all issuances of shares of common stock under the Transaction Documents (in the event that we issueand sell the Put Shares up to $10,000,000, the maximum amount) and are required to reserve and keep available out of the authorizedand unissued shares of our common stock a number of shares of our common stock at least three times the number of shares of commonstock obtained by dividing the remaining balance on the maximum commitment amount by the Purchase Price. While we have the obligationto maintain such reserve while the Equity Purchase Agreement is effective, we do not have the obligation to sell any Put Sharesto Oasis Capital. Oasis Capital also agreed that neither it nor any affiliate acting on Oasis Capital’s behalf or pursuantto any understanding with Oasis Capital, will execute any short sales during the three-year term of the Equity Purchase Agreement.

TheTransaction Documents contain covenants, representations and warranties of our Company and Oasis Capital that are typical fortransactions of this type. In addition, we and Oasis Capital have granted each other customary indemnification rights in connectionwith the Equity Purchase Agreement. The Equity Purchase Agreement may be terminated by us at any time.

Weintend to sell Oasis Capital periodically shares of our common stock under the Equity Purchase Agreement and Oasis Capital may,in turn, sell such shares to investors in the market at the market price or at negotiated prices. This may cause our stock priceto decline, which will require us to issue increasing numbers of common shares to Oasis Capital to raise the intended amount offunds, as our stock price declines.

Likelihoodof Accessing the Full Amount of the Equity Line

Notwithstandingthat the Equity Line is in an amount of $10,000,000, we anticipate that the actual likelihood that we will be able to access thefull amount of the Equity Line is low due to several factors, including that our ability to access the Equity Line is impactedby our average daily trading volume, which may limit the maximum dollar amount of each put we deliver to Oasis Capital, and ourstock price. Our use of the Equity Line will continue to be limited and restricted if our share trading volume or and market priceof our stock continue at their current levels or decrease further in the future from the volume and stock prices reported overthe past year. Further, if the price of our stock remains at $0.042 per share (which represents the last reported sale price ofthe shares of our common stock as reported on the OTCQB on May 31, 2019), the sale by Oasis Capital of all 75,500,442 of the PutShares registered in this prospectus would mean we would receive only approximately $3,012,468 from our sale of the shares underthe Equity Line. Our ability to issue shares in excess of the 75,500,442 shares covered by the registration statement of whichthis prospectus is a part will be subject to our filing a subsequent registration statement with the SEC and the SEC declaringit effective.

Inaddition, because our ability to deliver puts to Oasis Capital under the Equity Purchase Agreement is subject to a number of conditions,there is no guarantee that we will receive all or any portion of the $10,000,000 that is available to us under the Equity Line.

SELLINGSTOCKHOLDER

Thisprospectus covers the resale by the selling stockholder or its permitted transferees of up to 75,500,442 shares that may be issuedby us to Oasis Capital under the Equity Purchase Agreement. Oasis Capital is an “underwriter” within the meaning ofthe Securities Act in connection with its resale of our common stock pursuant to this prospectus. The selling stockholder hasnot had any position or office, or other material relationship with us or any of our affiliates over the past three years. Thefollowing table sets forth certain information regarding the beneficial ownership of shares of common stock by the selling stockholderas of May 31, 2019 and the number of shares of our common stock being offered pursuant to this prospectus.

Thetable below (i) lists the selling stockholder and other information regarding the beneficial ownership (except with respect tothe totals in Column 2, as determined under Section 13(d) of the Exchange Act and the rules and regulations thereunder) of ourcommon stock by the selling stockholder; (ii) have been prepared based upon information furnished to us by the selling stockholder;and (iii) to our knowledge, is accurate as of the date of this prospectus. The selling stockholder may sell all, some or noneof their shares in this offering. The selling stockholder identified in the table below may have sold, transferred or otherwisedisposed of some or all of its shares since the date of this prospectus in transactions exempt from or not subject to the registrationrequirements of the Securities Act. Information concerning the selling stockholder may change from time to time and, if necessary,we will amend or supplement this prospectus accordingly and as required.

PLANOF DISTRIBUTION

Theselling stockholder or its permitted transferees may, from time to time, sell any or all of shares of our common stock coveredhereby on the OTCQB, or any other stock exchange, market or trading facility on which the shares are traded or in private transactions.The selling stockholder may sell all or a portion of the shares being offered pursuant to this prospectus at fixed prices, atprevailing market prices at the time of sale, at varying prices or at negotiated prices. The selling stockholder may use any oneor more of the following methods when selling securities:

Theselling stockholder may also sell securities under Rule 144 under the Securities Act, if available, rather than under this prospectus.

Broker-dealersengaged by the selling stockholder may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissionsor discounts from the selling stockholder (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser)in amounts to be negotiated, provided such amounts are in compliance with FINRA Rule 2121. Discounts, concessions, commissionsand similar selling expenses, if any, that can be attributed to the sale of common stock will be paid by the selling stockholderand/or the purchasers.

OasisCapital is an underwriter within the meaning of the Securities Act and any broker-dealers or agents that are involved in sellingthe shares may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales.In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchasedby them may be deemed to be underwriting commissions or discounts under the Securities Act. Because Oasis Capital is an underwriterwithin the meaning of the Securities Act, it will be subject to the prospectus delivery requirements of the Securities Act.

Underapplicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may notsimultaneously engage in market making activities with respect to the common stock for the applicable restricted period, as definedin Regulation M, prior to the commencement of the distribution. In addition, the selling stockholder will be subject to applicableprovisions of the Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing ofpurchases and sales of securities of the common stock by the selling stockholder or any other person. We will make copies of thisprospectus available to the selling security holders and have informed them of the need to deliver a copy of this prospectus toeach purchaser at or prior to the time of the sale.

AlthoughOasis Capital has agreed not to enter into any “short sales” of our common stock, sales after delivery of a put noticeof a number of shares reasonably expected to be purchased under a put notice shall not be deemed a “short sale.” Accordingly,Oasis Capital may enter into arrangements it deems appropriate with respect to sales of shares of our common stock after it receivesa put notice under the Equity Purchase Agreement so long as such sales or arrangements do not involve more than the number ofput shares reasonably expected to be purchased by Oasis Capital under such put notice.

DESCRIPTIONOF CAPITAL STOCK

Thefollowing description of our capital stock and provisions of our (i) restated certificate of incorporation, as amended, (ii) thecertificate of designation of our Series C Preferred Stock, and (iii) amended and restated bylaws are summaries. You should alsorefer to our (i) restated certificate of incorporation, as amended, (ii) the certificate of designation of our Series C PreferredStock, and (iii) amended and restated bylaws, which are incorporated by reference as exhibits to the registration statement ofwhich this prospectus is part.

Inthis offering, we are offering 75,500,442 shares of our common stock.

Wehave authorized capital stock consisting of 2,500,000,000 shares of common stock, $0.001 par value per share, and 8,500,000 sharesof preferred stock. On April 12, 2019, we filed a certificate of designation (“COD”) of Series C Convertible PreferredStock of the Company with the Secretary of State the State of Delaware to create a class of the Series C Preferred Stock.

Asof May 31, 2019, there were 231,003,479 shares of our common stock outstanding, and 155 shares of Series C Convertible PreferredStock outstanding. In addition, the Company previously authorized for issuance 1,380,362 shares of Preferred Stock designatedas Series A Preferred Stock and 10,000 shares of Preferred Stock designated as 12% Series B Preferred Stock, none of which arecurrently issued and outstanding.

CommonStock

Theholders of common stock are entitled to one vote per share. Our certificate of incorporation does not provide for cumulative voting.The holders of our common stock are entitled to receive ratably such dividends, if any, as may be declared by the Board of Directorsout of legally available funds.

Uponliquidation, dissolution or winding-up, the holders of our common stock are entitled to share ratably in all assets that are legallyavailable for distribution, after distributions to the holders of our preferred stock, if any. The holders of our common stockhave no preemptive, subscription, redemption or conversion rights. The rights, preferences and privileges of holders of our commonstock are subject to, and may be adversely affected by, the rights of the holders of any series of preferred stock, which maybe designated solely by action of the Board of Directors and issued in the future.

Asof May 31, 2019, we had 360 holders of record of our common stock, which excludes stockholders whose shares were held in nomineeor street name by brokers. The actual number of common stockholders is greater than the number of record holders and includesstockholders who are beneficial owners, but whose shares are held in street name by brokers and other nominees. This number ofholders of record also does not include stockholders whose shares may be held in trust by other entities.

Ourcommon stock is traded on the OTC QB tier of OTC Markets LLC under the symbol “MGTI.”

Outstandingoptions and warrants to acquire common stock; restricted stock

Asof March 31, 2019, we had outstanding stock options to purchase 6,000,000 shares of common stock, at exercise prices of between$0.25 and $1.00 and with a weighted average exercise price of $0.71.

TheCompany has also issued from time to time warrants to acquire common stock in private transactions. As of March 31, 2019, we hadoutstanding warrants to acquire 5,477,975 shares of common stock, at exercise prices of between $0.40 and $2.00 and with a weightedaverage exercise price of $1.01, of which in consideration for an immediate exercise warrants to purchase 4,000,000 shares atan amended purchase price of $0.03 were exercised in May 2019.

TheCompany has from time to time issued restricted shares of common stock to directors, officers and employees of the Company Asof December 31, 2018, there are outstanding 3,355,000 shares of restricted stock.

Descriptionof Series C Preferred Stock

General.Our board of directors has designated up to 200 shares of the 8,500,000 authorized shares of preferred stock as Series C PreferredStock, of which 155 are issued and outstanding. Each share of Series C Preferred has a Stated Value of $10,000 per share.

Conversion.Shares of Series C Preferred Stock are convertible into shares of our common stock at any time at the option of the holder inan amount determined by dividing the Stated Value being converted by the conversion price. The conversion price is equal to thelower of (i) $0.05 per share (subject to adjustment for stock splits, stock dividends, and similar transactions) or (ii) 70% ofthe lowest trading price of the common stock for the 10 days prior to the conversion date. Holders of Series C Preferred Stockare prohibited from converting Series C Preferred Stock into shares of our common stock if, as a result of such conversion, theholder, together with its affiliates, would beneficially own more than 9.99% of the total number of shares of our common stockthen issued and outstanding.

Ranking.With respect to the payment of dividends and distribution of amounts of the Company’s net assets upon a dissolution, liquidationor winding up of the Company, the Series C Preferred ranks senior to the common stock, subject to any applicable rights of theCompany’s 6% Series A Preferred Stock and 12% Series B Preferred Stock if any such shares are outstanding, and any otherclass or series of the Company’s stock, including all other classes of preferred stock, whether now existing or createdhereafter, and no senior class of preferred stock of the Company may be created without the prior written consent of the RequiredHolders (as defined in the COD), voting separate as a single class. Liquidation Preference. In the event of our liquidation, dissolutionor winding-up, holders of Series C Preferred are entitled to receive an amount equal to the stated value of their shares priorto any payments to holders of common stock or any other series of preferred stock.

VotingRights. Shares of Series C Preferred Stock have no voting rights except as may be required under applicable law.

Dividends.Shares of Series C Preferred Stock are not entitled to receive any dividends.

Redemption.We are not obligated to redeem or repurchase any shares of Series C Preferred Stock. We have the right to redeem outstanding sharesof Series C Preferred Stock, in whole or in part, at a redemption price of 140% of the Stated Value during the first 12 monthsafter issuance, and at 120% of the Stated Value thereafter.

PreferredStock

Theremaining shares of preferred stock may be divided and issued from time to time in one or more classes and/or series within anyclass or classes as may be determined by our Board of Directors, each such class or series to be distinctly designated and toconsist of the number of shares determined by the Board of Directors. The Board of Directors has the authority to adopt resolutionswith respect to any unissued and/or treasury shares of preferred stock to issue the shares, to fix the number of shares constitutingany class or series, and to provide for the voting powers, designations, preferences and relative, participating, optional orother special rights, qualifications, limitations or restrictions, if any, of preferred stock, and each class or series thereof,in each case without approval of the stockholders. The authority of the Board of Directors with respect to each class or seriesof preferred stock includes, without limiting the generality of the foregoing, the determination of the following:

Thenumber of shares, voting powers, designations, preferences and relative, participating, optional or other special rights, qualifications,limitations or restrictions, if any, of any class or series of preferred stock which may be designated by the Board of Directorsmay differ from those of any and all other class or series at any time outstanding.

Authorizedand Unissued Capital Stock

Delawarelaw does not require stockholder approval for any issuance of authorized shares. These additional shares may be used for a varietyof corporate purposes, including future public offerings, to raise additional capital or to facilitate acquisitions.

Oneof the effects of the existence of unissued and unreserved common stock or preferred stock may be to enable our board of directorsto issue shares to persons friendly to current management, which issuance could render more difficult or discourage an attemptto obtain control of our company by means of a merger, tender offer, proxy contest or otherwise, and thereby protect the continuityof our management and possibly deprive the stockholders of opportunities to sell their shares at prices higher than prevailingmarket prices.

Dividends

Wehave not paid any cash dividends to our stockholders. The declaration of any future cash dividends is at the discretion of ourboard of directors and depends upon our earnings, if any, our capital requirements and financial position, and general economicconditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings,if any, in our business operations.

Theabove description of our capital stock is a summary only and is subject to applicable provisions of the Delaware General CorporationLaw, and our restated certificate of incorporation, as amended, and our amended and restated bylaws, each as may be further amendedfrom time to time. You should refer to, and read this summary together with, our restated certificate of incorporation, as amended,and our amended and restated bylaws, each as may be further amended from time to time, to review all of the terms of our capitalstock. Our restated certificate of incorporation, as amended, and our amended and restated bylaws are incorporated by referenceas exhibits to the registration statement of which this prospectus is a part and other reports incorporated by reference herein.

AntitakeoverEffects of Provisions of Charter Documents and Delaware Law

CharterDocuments. Our restated certificate of incorporation, as amended, and our amended and restated bylaws, include a number ofprovisions that may have the effect of deterring hostile takeovers or delaying or preventing changes in control or managementof our company. First, our bylaws limit who may call special meetings of the stockholders. Our restated certificate does not includea provision for cumulative voting for directors. Under cumulative voting, a minority stockholder holding a sufficient percentageof a class of shares may be able to ensure the election of one or more directors. Our bylaws establish procedures, including advancenotice procedures, with regard to the nomination of candidates for election as directors and stockholder proposals. These andother provisions of our restated certificate and bylaws and Delaware law could discourage potential acquisition proposals andcould delay or prevent a change in control or management of our company.

DGCLSection 203. The Company is not subject to Section 203 of the Delaware General Corporation Law, which imposes certain restrictionson transactions with interested stockholders, as defined.

TransferAgent and Registrar

Thetransfer agent and registrar for our common stock is VStock Transfer, LLC. The transfer agent’s address is 18 LafayettePlace, Woodmere, NY 11598.

EXPERTS

Ourconsolidated financial statements as of and for the years ended December 31, 2018 and 2017, appearing in this prospectus and theregistration statement of which it is a part, have been audited by RBSM LLP, an independent registered public accounting firm,as set forth in their report dated April 16, 2019 (except Note 16, dated May 17, 2019) which contains an explanatory paragraphregarding our ability to continue as a going concern) appearing elsewhere herein, and are included in reliance upon such reportgiven on the authority of such firm as experts in accounting and auditing.

LEGALMATTERS

OlshanFrome Wolosky LLP has provided us with an opinion on the validity of the shares of our common stock being offered pursuant tothis prospectus.

INTERESTOF NAMED EXPERTS AND COUNSEL

Noexpert named in the registration statement of which this prospectus forms a part as having prepared or certified any part thereof(or is named as having prepared or certified a report or valuation for use in connection with such registration statement) orcounsel named in this prospectus as having given an opinion upon the validity of the securities being offered pursuant to thisprospectus or upon other legal matters in connection with the registration or offering such securities was employed for such purposeon a contingency basis. Also, other than as set forth herein, at the time of such preparation, certification or opinion or atany time thereafter, through the date of effectiveness of such registration statement or that part of such registration statementto which such preparation, certification or opinion relates, no such person had, or is to receive, in connection with the offering,a substantial interest, direct or indirect, in our Company or any of our parents or subsidiaries. Nor was any such person connectedwith our Company or any of our parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director,officer or employee.

BUSINESS

MGTCapital Investments, Inc. is a Delaware corporation, incorporated in 2000. The predecessor of the Company was originally incorporatedin Utah in 1977. Our corporate office is located in Durham, North Carolina.

CryptocurrencyMining Business

IndustrySummary

Bitcoinis a world–recognized cryptocurrency, which can be traded and converted into major fiat currencies on cryptocurrency exchanges.Cryptocurrencies are a medium of exchange that are transacted through and recorded on a decentralized distributed ledger system,called the “Blockchain.” The Blockchain is built by a chronological addition of transactions, which are grouped intoblocks. Each new block requires a mathematical problem to be solved before it can be confirmed and added to the Blockchain. Thespeed at which these mathematical problems are solved is called Hash Rate. It represents the overall computing power of the networkand is measured in Hashes per second (“H/s”). The complexity of these problems, also referred to as mining difficulty,increases with the network’s growing Hash Rate.

Bitcoinmining entails solving these complex mathematical problems using custom designed and programmed application-specific integratedcircuit (“ASIC”) computers (also referred to as “miners”). Bitcoin miners perform a vital function onthe Bitcoin Blockchain network, by performing these Hash calculations and adding transactions blocks to the Blockchain ledger.When a miner is successful in adding a block to the Blockchain, it is rewarded with a fixed number of Bitcoin; a miner can alsobe compensated by network transaction fees.

Additionalinformation about Bitcoin, Blockchain and cryptocurrencies can be found on publicly available educational sources such as www.Bitcoin.org.We do not incorporate the information on, or accessible through these sources into this prospectus and you should not considerany information on these publicly available educational sources as part of this prospectus.

OurOperations

InSeptember 2016, we commenced our Bitcoin mining operations in the Wenatchee Valley area of central Washington. Throughout 2017,we expanded our mining capacity with the purchase of additional Bitcoin mining machines and by entering into hosting and poweragreements with Washington facilities owners. We have also entered into management agreements with third party investors wherebythe investors purchased the mining hardware, and we receive both a fee to manage the mining operations plus one-half of the netoperating profit.

Towardsthe end of 2017, we determined that there was inadequate electric power in Washington to support our growth, and we moved swiftlyto find a new facility to conduct our mining operations. By the end of 2017, we made the decision to move our principal miningoperations to northern Sweden, a geographic location with historically low ambient temperatures and available inexpensive electricity.We entered into a hosting agreement (the “Hosting Agreement”) with Beacon Leasing LLC (“Beacon”), pursuantto which Beacon agreed to deliver a turn-key solution in northern Sweden with up to 15 megawatts of electricity capacity, includinga facility with power, cooling, and hosting services for a fixed price of $810,000 per month. The facility in Sweden is ownedby the city of Älvsbyn and leased by a subsidiary of Beacon. Beacon committed to provide a fully functional facility by theend of March 2018. The Hosting Agreement required us to pay $1,620,000 to Beacon, representing the first and last month of service.During the first quarter of 2018, we took delivery of an additional 2,000 Bitcoin mining machines in Sweden and moved 4,300 machines(including 2,100 investor-owned machines) from Washington to Sweden.

Beaconfailed to deliver the fully built out facility and necessary power supply levels required by us by the end of March 2018. Throughthe first quarter of 2018 and into the second quarter, our personnel made visits to Sweden and assisted Beacon with efforts toget the facility up and running. We also advanced additional funds to Beacon to maximize operational capacity as quickly as possible.During April 2018, we became involved in the design and setup of the Sweden facility due to concern that Beacon may have overstatedtheir construction abilities and financial capacity.

OnMay 16, 2018, we were informed that none of the amounts due from Beacon to the electric utility serving the Älvsbyn facilityhad been paid and that the utility would begin shutting down the electricity to the Älvsbyn facility. On the same day, wenotified Beacon that it was in material breach of the Hosting Agreement. In order to avoid a shutdown of the facility and a suspensionof mining operations, we paid the utility provider $368,000, as a good faith deposit. During the three months ended September30, 2018, we paid an additional aggregate of $947,000 to the utility provider for power consumed.

Subsequentto May 16, 2018, we intensified our efforts to determine the extent of Beacon’s non-performance under the Hosting Agreement.Management made several more trips to Sweden to supervise the completion of the facility as well as investigate Beacon’saccounting records. We determined that Beacon also was faced with unpaid invoices from various material and service providersto the facility.

Beginningin late May 2018, we took steps to become the direct operator of the Swedish facility to gain control of the situation, protectour assets, and maximize operational capacity as quickly as possible. These actions included paying some of the outstanding amountsowed by Beacon in order to maintain key vendor relationships needed to complete the facility. We also formed MGT Sweden AB inanticipation of assuming the building lease and the power agreements.

Continuingissues arising from poor engineering and demands from the electric utility forced us to devote a significant amount of time andeffort to the operations in Sweden. Further, we determined that the financial investment to fully assume the position of Beaconwas excessive. Simultaneously, based on an analysis of available facilities in the United States, we concluded that the UnitedStates provided hosting opportunities for us. On September 24, 2018, the combination of these factors led us to decide to forgoany further monetary investment in Sweden. We have subsequently relocated all of the miners in Sweden to facilities in Coloradoand Ohio.

Asof March 31, 2019, MGT owned and or managed approximately 5,700 mining machines. Approximately 2,500 machines are located in Coloradoand 3,200 machines are located in Ohio. Of the 5,700 machines, 3,700 are owned by the Company, and the remaining machines areinvestor owned. All miners owned or managed by MGT are S9 Antminers sold by Bitmain Technologies LTD. In addition to the S9 Antminers,the Company owns 50 custom designed GPU-based Ethereum mining rigs. Because the price of Bitcoin steadily decreased during 2018and throughout the first quarter of 2019, the Company decided it was not economically responsible to commence mining operationsin Colorado or Ohio. On May 14, 2019, the Company announced commencement of operations in both Colorado and Ohio. During the yearended December 31, 2018, we mined 245 Bitcoin for total revenue of $2,010,000. In addition, the miners we operate pursuant tothe management agreements mined 184 Bitcoin during the same period.

ManagementAgreements

OnOctober 12, 2017, we entered into two management agreements (each, a “Management Agreement”, collectively “ManagementAgreements”) with two accredited investors, Deep South Mining LLC and BDLM, LLC. On November 21, 2017, we entered into athird management agreement with another accredited investor, Buckhead Crypto, LLC (all three accredited investors together are“Users”). Each of the Users agreed on substantially similar terms to purchase an aggregate of 2,376 Bitmain AntminerS9 mining computers (the “Bitcoin Hardware”) for a total of $3,650,000 to mine Bitcoin with us acting as the exclusivemanager for each of the Users. In addition, the Users have agreed to pay to us, in advance, the first three months of expectedelectricity costs of the Bitcoin mining operations in the sum of $691,000. Initial electricity cost for the first three monthsfollowing delivery of the Bitcoin Hardware was reimbursed to the Users within the first three months of operations. Each ManagementAgreement is in effect for 24 months from the date that the Bitcoin Hardware begins mining operations, and may be terminated bymutual written agreement.

Pursuantto the Management Agreements, the Company shall provide for installation, hosting, maintenance and repair and provide ancillaryservices necessary to operate the Bitcoin Hardware. In accordance with each of the Management Agreements, each of the Users willgain a portion of the Bitcoin mined called the User Distribution Portion. The User Distribution Portion is 50% of the amount ofBitcoin mined net of the operating fee (10% of the total Bitcoin mined) and the electricity cost.

OnFebruary 13, 2018, the Company entered into a new management agreement with a third party with substantially the same terms asthe other Management Agreements. The third party agreed to purchase 200 Bitmain Antminer S9 mining computers for a total of $428,000to mine Bitcoin with the Company acting as the exclusive manager. This management agreement is in effect for 24 months from thedate that the Bitcoin Hardware begins mining operations, and may be terminated by mutual written agreement.

OnFebruary 28, 2018, the Company and Buckhead Crypto, LLC terminated their Management Agreement. The Company agreed to purchasethe Bitcoin mining machines and the prepaid electricity from Buckhead Crypto, LLC for an aggregate amount of $767,000.

OnMay 2, 2019, the Company entered into amended management agreements with Deep South Mining LLC and BDLM, LLC (the “Users”).The Users’ miners shall be reconnected and resume mining Bitcoin upon execution of these agreements. Due to wear and tear,the parties acknowledge the Users’ Bitcoin Hardware consist of 1,800 Bitmain Antminer S9 mining computers, collectively.

Bitcoinand Blockchain Overview

ABitcoin is one type of a digital asset that is issued by, and transmitted through, an open source, math-based protocol platformusing cryptographic security (the “Bitcoin Network”). The Bitcoin Network is an online, peer-to-peer user networkthat hosts the public transaction ledger, known as the “Blockchain,” and the source code that comprises the basisfor the cryptography and math-based protocols governing the Bitcoin Network. No single entity owns or operates the Bitcoin Network,the infrastructure of which is collectively maintained by a decentralized user base. Bitcoin can be used to pay for goods andservices or can be converted to fiat currencies, such as the US Dollar, at rates determined on Bitcoin exchanges or in individualend-user-to-end-user transactions under a barter system.

Bitcoinsare “stored” or reflected on the digital transaction ledger known as the “Blockchain,” which is a digitalfile stored in a decentralized manner on the computers of each Bitcoin Network user. The Blockchain records the transaction historyof all Bitcoin in existence and, through the transparent reporting of transactions, allows the Bitcoin Network to verify the associationof each Bitcoin with the digital wallet that owns them. The Bitcoin Network and Bitcoin software programs can interpret the Blockchainto determine the exact Bitcoin balance, if any, of any digital wallet listed in the Blockchain as having taken part in a transactionon the Bitcoin Network.

TheBitcoin Network is decentralized and does not rely on either governmental authorities or financial institutions to create, transmitor determine the value of Bitcoin. Rather, Bitcoin are created and allocated by the Bitcoin Network protocol through a “mining”process subject to a strict, well-known issuance schedule. The value of Bitcoin is determined by the supply and demand of Bitcoinin the Bitcoin exchange market (and in private end-user-to-end-user transactions), as well as the number of merchants that acceptthem. As Bitcoin transactions can be broadcast to the Bitcoin Network by any user’s Bitcoin software and Bitcoin can betransferred without the involvement of intermediaries or third parties, there are little or no transaction costs in direct peer-to-peertransactions on the Bitcoin Network. Third party service providers such as Bitcoin Exchanges and Bitcoin third party payment processingservices may charge significant fees for processing transactions and for converting, or facilitating the conversion of, Bitcointo or from fiat currency.

Minersdedicate substantial resources to mining. Given the increasing difficulty of the target established by the Bitcoin Network, currentminers must invest in expensive mining devices with adequate processing power to hash at a competitive rate.

Bitcoinis an example of a digital asset that is not a fiat currency (i.e., a currency that is backed by a central bank or a national,supra-national or quasi-national organization) and are not backed by hard assets or other credit. As a result, the value of Bitcoinis determined by the value that various market participants place on Bitcoin through their transactions.

Thecryptocurrency markets have grown rapidly in both popularity and market size. These markets are local, national and internationaland include an ever-broadening range of products and participants. The United States Securities and Exchange Commission, and othergovernmental agencies around the world, are evaluating the cryptocurrency markets and are likely to institute new rules and regulationswithin this market to protect investors and such regulations could result in the restriction of the acquisition, ownership, holding,selling, use or trading of our common stock.

LegacyBusinesses

Cybersecurity

OnMay 9, 2016, MGT entered into an asset purchase agreement to acquire certain assets owned by D–Vasive, Inc. (“D-Vasive”),a company in the business of developing and marketing certain privacy and anti–spy applications. Pursuant to the terms ofthe agreement, the Company would purchase assets including applications for use on mobile devices, intellectual property, customerlists, databases, project files and licenses. The proposed purchase price for D–Vasive was $300,000 in cash and 23.8 millionshares of MGT common stock.

OnMay 26, 2016, the Company agreed to acquire certain technology and assets of Demonsaw LLC (“Demonsaw”), a companyin the business of developing and marketing secure and anonymous information sharing applications. Pursuant to the terms of thisagreement, the Company would purchase assets including the source code for the Demonsaw solution, intellectual property, customerlists, databases, project files and licenses. The proposed purchase price for Demonsaw was 20.0 million shares of MGT common stock.

OnJuly 7, 2016, and prior to the closing of either of the above transactions, the Company and Demonsaw terminated their agreement.Simultaneously, D–Vasive entered an agreement with the holders of Demonsaw’s outstanding membership interests, wherebyD–Vasive would purchase all such membership interests. Accordingly, the proposed purchase price for D–Vasive (inclusiveof the Demonsaw assets) was increased to 43.8 million shares of MGT common stock.

BothD-Vasive and Demonsaw were partly owned by Future Tense Secure Systems (“FTS”), an entity controlled by the wife ofcybersecurity pioneer John McAfee, and as an integral part of the acquisition, Mr. McAfee would become Chairman and Chief ExecutiveOfficer of MGT, and the Company would enter into a consulting agreement with FTS.

OnAugust 8, 2016, the Company filed a Definitive Proxy Statement to solicit, among other things, shareholder approval of the D–Vasiveacquisition, at the Annual Meeting of Stockholders. On September 8, 2016, shareholder approval was obtained. However, on September19, 2016, the New York Stock Exchange (the “Exchange”) informed the Company that it would not approve for listingon the Exchange the 43.8 million shares required to be issued to complete the closing of the D–Vasive acquisition, resultingin the termination of the acquisition.

InMarch 2017, MGT purchased 46% of the outstanding membership interests of Demonsaw from FTS for 2.0 million shares of MGT commonstock.

Notwithstandingthe termination of the D-Vasive acquisition, John McAfee agreed to join MGT in November 2016 and served as Chairman and CEO untilAugust 2017, at which time he was appointed Chief Cybersecurity Visionary, a position he held until his relationship with theCompany ended in January 2018.

Priorto the expected September 2016 closing of the above transaction, the Company added employees and consultants to develop a cybersecuritybusiness, and position itself to address various cyber threats through advanced protection technologies for mobile devices andcorporate networks. In November 2016, we acquired intellectual property from a third party for 150,000 shares of our common stockfor a total acquisition price of $495,000. In August 2017, we commenced commercial development of our cybersecurity business,including Sentinel, a network intrusion detector released in October 2017. We incurred $47,000 and $346,000 in research and developmentexpenses in 2018 and 2017, respectively. Prior to the sale described below, we realized nominal revenue from our cybersecuritybusiness.

OnMarch 19, 2018, we announced the end of our cybersecurity operations by selling the Sentinel product line to a new entity formedby the unit’s management team and stopping development of a secure mobile phone. The Sentinel assets were sold for considerationof $60,000 in cash and a $1,000,000 promissory note, convertible into a 20% equity interest of the buyer.

Onlineand Mobile Gaming

Priorto the second quarter ending June 30, 2016, the Company and its subsidiaries were principally engaged in the business of acquiring,developing and monetizing assets in the online and mobile gaming space as well as the social casino industry.

Strategy

MGT’sstrategy is to oversee the operation of approximately 5,700 cryptocurrency mining machines in Colorado and Ohio and continue toexecute on an expansion model to secure low cost power and grow its cryptocurrency assets. The Company’s immediate focusis to grow free cash flow. Our longer-term objective is focused towards vertical integration of our cryptocurrency mining businessas well as diversification into other areas of the rapidly emerging Blockchain and cryptocurrency industry.

Competition

Ourindustry is extremely new and subject to rapid change and constant innovation. We face significant competition, including fromcompanies that have entered this space much earlier than us and are better capitalized, with vertically integrated business models.Some of these companies are our suppliers. We compete to attract, engage, and retain personnel, educated and skilled in the Blockchainand cryptocurrency mining space.

Wecompete with vertically integrated companies such as Bitfury Group Limited and Bitmain Technologies LTD that engage in both thedesign and distribution of mining machines, as well as cryptocurrency mining. We also compete with many other companies that areengaged in cryptocurrency mining, some of which may have lower operating costs or cost of capital than MGT.

Employees

Currently,the Company and its subsidiaries have 3 full–time employees. None of our employees are represented by a union and we believeour relationships with our employees are good.

DESCRIPTIONOF PROPERTY

Ourprincipal corporate office is located at 512 S. Mangum Street, Suite 408 Durham, NC 2770, under a sublease that expires on January31, 2020. Monthly rent is $7,000 until expiration of the lease. A security deposit of $13,000 was required upon execution of thesublease. The Company believes our office is in good condition and is sufficient to conduct our operations.

TheCompany has a mining operation in the state of Colorado under a lease that expires on November 1, 2020 and a mining operationin Ohio under a lease that expires in 2021. The Company had a month-to-month mining operation in Washington which it terminatedon March 22, 2019. In May 2019, the Company purchased five acres of real property in the state of Georgia.

LEGALPROCEEDINGS

InSeptember 2016, various shareholders in the Company filed putative class action lawsuits against the Company, its president andcertain of its individual officers and directors. The cases were filed in the United States District Court for the Southern Districtof New York and alleged violations of federal securities laws and sought damages. On April 11, 2017, those cases were consolidatedinto a single action (the “2016 Securities Class Action”) and two individual shareholders were appointed lead plaintiffsby the Court. On June 30, 2017, the lead plaintiffs filed an amended complaint. On August 29, 2017, the defendants moved to dismissthe amended complaint, which the plaintiffs opposed. The Court heard oral argument on the motion to dismiss on February 7, 2018.On February 27, 2018, the Court issued a Memorandum and Order dismissing the 2016 Securities Class Action in its entirety, withprejudice. The time for plaintiffs to file a notice of appeal expired on March 30, 2018.

Separately,on September 15, 2016, the Company received a subpoena from the SEC and in December 2017, the Company’s Chief ExecutiveOfficer and President received a subpoena from the SEC. The Company has cooperated fully with the SEC and its staff in a timelymanner. The Company intends to fully comply with any additional requests the Company may receive from the SEC in the future.

OnJanuary 24, 2017, the Company was served with a summons and complaint filed by plaintiff shareholder Atul Ojha in New York statecourt against certain officers and directors of the Company, and naming the Company as a nominal defendant. The lawsuit is styledas a derivative action (the “Ojha Derivative Action”) and was originally filed (but not served on any defendant) onOctober 15, 2016. The Ojha Derivative Action substantively alleges that the defendants, collectively or individually, inadequatelymanaged the business and assets of the Company resulting in the deterioration of the Company’s financial condition. TheOjha Derivative Action asserts claims including, but not limited to, breach of fiduciary duties, unjust enrichment and waste ofcorporate assets. On February 27, 2017, the parties to the Ojha Derivative Action executed a stipulated stay of proceedings pendingresolution of the 2016 Securities Class Action. Shortly after issuance of the February 27, 2018, ruling dismissing the 2016 SecuritiesClass Action, the parties to the Ojha Derivative Action agreed to extend the stay indefinitely, with the plaintiff having theoption to vacate the stay on thirty days’ notice. Should the plaintiff seek to vacate the stay, the Company will addressand defend the Ojha Derivative Action.

OnSeptember 7, 2018, the SEC commenced a legal action in the United States District Court for the Southern District of New York(the “SEC Action”) which asserts civil charges against multiple individuals and entities who are alleged to have violatedthe securities laws by engaging in pump-and-dump schemes in connection with certain microcap stocks and three unidentified companies.The Company is one of the three unidentified companies but is not named as a defendant. However, the SEC named as defendants RobertLadd, the Company’s Chief Executive Officer and President, as well as certain individuals alleged to have participated inthe schemes while they were shareholders of the Company, among others. The SEC filed an amended complaint in the SEC Action onMarch 8, 2019. The Company, through its counsel, is monitoring the progress of the SEC Action.

OnMay 29, 2019, the SEC served a Rule 45 third-party subpoena on the Company seeking the production of documents in the SEC Action,to which the Company intends to respond in due course.

InSeptember 2018 and October 2018, various shareholders of the Company filed putative class action lawsuits against the Company,its Chief Executive Officer and certain of its individual officers and shareholders, alleging violations of federal securitieslaws and seeking damages (the “2018 Securities Class Actions”). The 2018 Securities Class Actions followed and referencedthe allegations made against the Company’s Chief Executive Officer and others in the SEC Action. The first putative classaction lawsuit was filed on September 28, 2018, in the United States District Court for the District of New Jersey, and allegesthat the named defendants engaged in a pump-and-dump scheme to artificially inflate the price of the Company’s stock, andthat, as a result, defendants’ statements about the Company’s business and prospects were materially false and misleadingand/or lacked a reasonable basis at relevant times. The second putative class action was filed on October 9, 2018, in the UnitedStates District Court for the Southern District of New York and makes similar allegations. On May 28, 2019, the parties to the2018 Securities Class Actions entered into a Binding Settlement Term Sheet setting forth the essential terms of a settlement agreementof these actions. The terms provide for the payment of a cash sum to the plaintiff class and an agreement to assign certain potentialcash recoveries to the class, together with dismissal of the action with prejudice and the exchange of releases. The settlementis subject to all parties’ agreement to final settlement documentation which all parties have agreed to negotiate in goodfaith, and to court approval.

InNovember 2018, the Company’s board received a shareholder demand letter dated November 6, 2018, from shareholders NicholasFulton and Kelsey Thacker (the “Fulton Demand”). The Fulton Demand referenced the SEC Action and the allegations therein,and demanded that the board take action to investigate, address and remedy the allegations raised in the SEC Action. The Company’scounsel has communicated with counsel for the shareholders, advising them concerning the existence and status of the 2018 SecuritiesClass Actions, the Ojha Derivative Action, and the Thomas Derivative Action (defined below). Shareholders’ counsel has indicateda general willingness to defer further action until resolution of the 2018 Securities Class Actions, and counsel continue to communicateconcerning the details.

OnDecember 12, 2018, a shareholder derivative action was filed by shareholder Bob Thomas against the Company and certain of itscurrent and former directors, officers and shareholders in New York state court, alleging breach of fiduciary duties, unjust enrichment,abuse of control, gross mismanagement, and waste and seeking declaratory relief and damages (the “Thomas Derivative Action”).The underlying allegations in the Thomas Derivative Action largely repeat the allegations of wrongdoing in the 2018 SecuritiesClass Actions. Based on recent communications between the Company’s counsel and plaintiff’s counsel in the ThomasDerivative Action, plaintiff intends to seek consolidation of this case with the Ojha Derivative Action, and then to stay theconsolidated derivative action pending resolution of the 2018 Securities Class Actions. The Company-related defendants’time to respond to the Thomas Derivative Action has been extended until thirty days after the Court rules on plaintiff’smotion.

MARKETPRICE OF DIVIDENDS ON OUR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Ourcommon stock is traded on the OTC QB tier of OTC Markets LLC under the symbol “MGTI.”

Holders

OnMay 31, 2019, the Company’s common stock closed on the OTC QB tier of OTC Markets LLC at $0.042 per share and there were360 stockholders of record.

Dividends

TheCompany has never declared or paid cash dividends on its common stock and has no intention to do so in the foreseeable future.

SecuritiesAuthorized for Issuance under Equity Compensation Plans

Thetable below provides information on our equity compensation plans as of December 31, 2018:

MANAGEMENT’SDISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(InThousands Except Share and Per Share Amounts)

Youshould read the following discussion and analysis of our financial condition and operating results together with our financialstatements and related notes included elsewhere in this prospectus. This discussion and analysis and other parts of this prospectuscontain forward-looking statements based upon current beliefs, plans and expectations that involve risks, uncertainties and assumptions.Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors,including those set forth under “Risk Factors” or in other parts of this prospectus. The last day of our fiscal yearis December 31. Our fiscal quarters end on March 31, June 30, September 30, and December 31, and our current fiscal year endedon December 31, 2018. U.S. Dollars are denoted herein by “USD,” “$” and “dollars”.

Overview

InSeptember 2016, we commenced our Bitcoin mining operations in the Wenatchee Valley area of central Washington. Throughout 2017,we expanded our mining capacity with the purchase of additional Bitcoin mining machines and by entering into hosting and poweragreements with Washington facilities owners. We have also entered into management agreements with third party investors wherebythe investors purchased the mining hardware, and we receive both a fee to manage the mining operations plus one-half of the netoperating profit.

Towardsthe end of 2017, we determined that there was inadequate electric power in Washington to support our growth, and we moved swiftlyto find a new facility to conduct our mining operations. By the end of 2017, we made the decision to move our principal miningoperations to northern Sweden, a geographic location with historically low ambient temperatures and available inexpensive electricity.We entered into the Hosting Agreement with Beacon, pursuant to which Beacon agreed to deliver a turn-key solution in northernSweden with up to 15 megawatts of electricity capacity, including a facility with power, cooling, and hosting services for a fixedprice of $810 per month. The facility in Sweden is owned by the city of Älvsbyn and leased by a subsidiary of Beacon. Beaconcommitted to provide a fully functional facility by the end of March 2018. The Hosting Agreement required us to pay $1,620 toBeacon, representing the first and last month of service. During the first quarter of 2018, we took delivery of an additional2,000 Bitcoin mining machines in Sweden and moved 4,300 machines (including 2,100 investor-owned machines) from Washington toSweden.

Beaconfailed to deliver the fully built out facility and necessary power supply levels required by us by the end of March 2018. Throughthe first quarter of 2018 and into the second quarter, our personnel made visits to Sweden and assisted Beacon with efforts toget the facility up and running. We also advanced additional funds to Beacon to maximize operational capacity as quickly as possible.During April 2018, we became involved in the design and setup of the Sweden facility due to concern that Beacon may have overstatedtheir construction abilities and financial capacity.

OnMay 16, 2018, we were informed that none of the amounts due from Beacon to the electric utility serving the Älvsbyn facilityhad been paid and that the utility would begin shutting down the electricity to the Älvsbyn facility. On the same day, wenotified Beacon that it was in material breach of the Hosting Agreement. In order to avoid a shutdown of the facility and a suspensionof mining operations, we paid the utility provider $368, as a good faith deposit. During the three months ended September 30,2018, we paid an additional aggregate of $947 to the utility provider for power consumed.

Subsequentto May 16, 2018, we intensified our efforts to determine the extent of Beacon’s non-performance under the Hosting Agreement.Management made several more trips to Sweden to supervise the completion of the facility as well as investigate Beacon’saccounting records. We determined that Beacon also was faced with unpaid invoices from various material and service providersto the facility.

Beginningin late May 2018, we took steps to become the direct operator of the Swedish facility to gain control of the situation, protectour assets, and maximize operational capacity as quickly as possible. These actions included paying some of the outstanding amountsowed by Beacon in order to maintain key vendor relationships needed to complete the facility. We also formed MGT Sweden AB inanticipation of assuming the building lease and the power agreements.

Duringthe three months ended June 30, 2018, we recorded restructuring expense of $2,499, which included the write-off of the unamortizedbalance of the initial deposit paid to Beacon in the amount of $1,350 and $1,149, for additional costs paid by us to service providersand vendors engaged to complete the facility. These costs consisted of unpaid obligations for services provided prior to the secondquarter of 2018, including:

Continuingissues arising from poor engineering and demands from the electric utility forced us to devote a significant amount of time andeffort to the operations in Sweden. Further, we determined that the financial investment to fully assume the position of Beaconwas excessive. Simultaneously, based on an analysis of available facilities in the United States, we concluded that the UnitedStates provided hosting opportunities for us. On September 24, 2018, the combination of these factors led us to decide to forgoany further monetary investment in Sweden. We have subsequently relocated all the miners in Sweden to facilities in Colorado andOhio.

Basedon the significant decline in the price of Bitcoin during the year ended December 31, 2018, the Company performed a recoverabilitytest of its cryptocurrency mining assets. Due to the unpredictable volatility of bitcoin’s price, the Company believes thereare indications that the decrease in Bitcoin’s price could be other than temporary. Accordingly, the Company decided tofully impair its cryptocurrency mining assets as of December 31, 2018. In addition to the $3,668 impairment charge recorded inthe third quarter of 2018, the Company recorded an additional impairment charge of $2,677 during the fourth quarter of 2018. Asof December 31, 2018, the Company’s cryptocurrency mining assets have no carrying value on the Company’s balance sheet,however, they are still operational and management plans to commence mining in the Colorado and Ohio locations upon improvementof Bitcoin economics.

Asof March 31, 2019, MGT owned and or managed approximately 5,700 mining machines. Approximately 2,500 machines are located in Coloradoand 3,200 machines are located in Ohio. Of the 5,700 machines, 3,700 are owned by the Company, and the remaining machines areinvestor owned. All miners owned or managed by MGT are S9 Antminers sold by Bitmain Technologies LTD. In addition to the S9 Antminers,the Company owns 50 custom designed GPU-based Ethereum mining rigs. Because the price of Bitcoin steadily decreased during 2018and throughout the first quarter of 2019, the Company decided it was not economically responsible to commence mining operationsin Colorado or Ohio. On May 14, 2019, the Company announced commencement of operations in both Colorado and Ohio. During the yearended December 31, 2018, we mined 245 Bitcoin for total revenue of $2,010. In addition, the miners we operate pursuant to themanagement agreements mined 184 Bitcoin during the same period.

Criticalaccounting policies and estimates

Ourdiscussion and analysis of financial condition and results of operations are based upon our consolidated financial statements,which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.GAAP”). The notes to the consolidated financial statements contained in this prospectus describe our significant accountingpolicies used in the preparation of the consolidated financial statements. The preparation of these financial statements requiresus to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assetsand liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reportingperiods. Actual results could differ from those estimates. We continually evaluate our critical accounting policies and estimates.

Webelieve the critical accounting policies listed below reflect significant judgments, estimates and assumptions used in the preparationof our consolidated financial statements.

Revenuerecognition

TheCompany’s primary revenue stream is related to the mining of digital currencies. The Company derives its revenue by solving“blocks” to be added to the blockchain and providing transaction verification services within the digital currencynetworks of cryptocurrencies, such as Bitcoin and Ethereum, commonly termed “cryptocurrency mining.” In considerationfor these services, the Company receives digital currency (“Coins”). The Coins are recorded as revenue, using theaverage spot price of Bitcoin on the date of receipt. The Coins are recorded on the balance sheet as an intangible digital assetvalued at the lower of cost or net realizable value. Net realizable value adjustments, to reduce the value of the Coins to theirmarket value, is included in cost of revenue on the Company’s consolidated statements of operation. Any gain or loss onsale would be recorded to cost of revenues. Costs of revenues includes equipment depreciation, rent, net realizable value adjustments,and electricity costs.

TheCompany also recognizes revenue from its management agreements. The Company receives a fee from each management agreement basedon the amount of Bitcoin mined and is reimbursed for any electricity costs incurred to run the Bitcoin mining machines it managesin its facility.

Stock–basedcompensation

TheCompany recognizes compensation expense for all equity–based payments in accordance with Accounting Standards Codification(“ASC”) 718 “Compensation – Stock Compensation”. Under fair value recognition provisions, the Companyrecognizes equity–based compensation net of an estimated forfeiture rate and recognizes compensation cost only for thoseshares expected to vest over the requisite service period of the award.

Restrictedstock awards are granted at the discretion of the compensation committee of the board of directors of the Company. These awardsare restricted as to the transfer of ownership and generally vest over the requisite service periods, typically over a 12 to 24month period (vesting on a straight–line basis). The fair value of a stock award is equal to the fair market value of ashare of the Company’s common stock on the grant date.

Thefair value of an option award is estimated on the date of grant using the Black–Scholes option valuation model. The Black–Scholesoption valuation model requires the development of assumptions that are inputs into the model. These assumptions are the expectedstock volatility, the risk–free interest rate, the expected life of the option, the dividend yield on the underlying stockand the expected forfeiture rate. Expected volatility is calculated based on the historical volatility of the Company’scommon stock over the expected term of the option. Risk–free interest rates are calculated based on continuously compoundedrisk–free rates for the appropriate term.

Determiningthe appropriate fair value model and calculating the fair value of equity–based payment awards requires the input of thesubjective assumptions described above. The assumptions used in calculating the fair value of equity–based payment awardsrepresent management’s best estimates, which involve inherent uncertainties and the application of management’s judgment.The Company is required to estimate the expected forfeiture rate and recognize expense only for those shares expected to vest.

TheCompany accounts for share–based payments granted to non–employees in accordance with ASC 505–50, “EquityBased Payments to Non–Employees”. The Company determines the fair value of the stock–based payment as eitherthe fair value of the consideration received or the fair value of the equity instruments issued, whichever is more readily determinable.If the fair value of the equity instruments issued is used, it is measured using the stock price and other measurement assumptionsas of the earlier of either (1) the date at which a commitment for performance by the counterparty to earn the equity instrumentsis reached, or (2) the date at which the counterparty’s performance is complete. The fair value of unvested equity instrumentsis re–measured each reporting period and such re-measured value is amortized over the requisite remaining service period.

Impairment

Underthe guidance of ASC 360, a long-lived asset (or asset group) should be tested for recoverability whenever events or changes incircumstances indicate that its carrying amount may not be recoverable. Based on the significant decline in the price of Bitcoinduring the year ended December 31, 2018, the Company performed a recoverability test, in which it measured the undiscounted cashflows of its cryptocurrency mining assets. This recoverability test indicated that its cryptocurrency mining assets might be impaired.The Company then performed the second step of the analysis, whereby it measured the fair value of the cryptocurrency mining assets.The Company used a weighted approach where it measured both the discounted cash flows expected from the cryptocurrency miningassets as well as determining the market value of the assets. The Company does not believe that the mining assets will providevalue to the Company’s structure. Furthermore, from December 31, 2017 through December 31, 2018, the price of Bitcoin droppedby more than two-thirds. Due to the unpredictable volatility of Bitcoin’s price, the Company believes there are indicationsthat the decrease in Bitcoin’s price could be other than temporary. Based on the aforementioned reasons, the Company hasdecided to fully impair the long-lived assets as of December 31, 2018.

Recentaccounting pronouncements

Note3 to our audited consolidated financial statements and unaudited consolidated financial statements appearing elsewhere in thisreport includes Recent Accounting Pronouncements.

Resultsof operations

Threemonths ended March 31, 2019 and 2018

Revenues

Ourrevenues for the three months ended March 31, 2019 decreased by $928, or 97%, to $28 as compared to $956 for the three monthsended March 31, 2018. Our revenue is derived from cryptocurrency mining. The decrease in revenues is a result of our decisionto not operate the majority of our miners due to the unfavorable economics of decreased price of Bitcoin and increased difficulty.

OperatingExpenses

Operatingexpenses for the three months ended March 31, 2019 decreased by $3,192, or 61%, to $2,000 as compared to $5,192 for the threemonths ended March 31, 2018. The decrease in operating expenses was primarily due to a decrease in general and administrativeexpenses, as well as no costs associated with marketing or research and development, and a decrease of $795 in cost of sales fromcryptocurrency mining operations.

Thedecrease in general and administrative expenses of $2,295, or 55% to $1,914 as compared to $4,209 for the three months ended March31, 2018, was primarily due to a decrease in stock-based compensation of $1,273 and a decrease in payroll and related expensesof $426, offset by an increase in legal and professional fees of $57.

OtherIncome and Expense

Forthe three months ended March 31, 2019, non–operating expenses consisted of interest expense of $3, accretion of debt discountof $1,091, gain on sale of property and equipment of $82 and a gain on extinguishment of debt of $1,275. During the comparableperiod ended March 31, 2018, non–operating expenses consisted of a warrant modification expense of $139, loss on sale ofbusiness unit of $127, and a loss on sale of property and equipment of $47.

Yearsended December 31, 2018 and 2017

Revenues

Ourrevenues for the year ended December 31, 2018 decreased by $1,104, or 35.2%, to $2,030 as compared to $3,134 for the year endedDecember 31, 2017. Our revenue is derived from cryptocurrency mining. The decrease in revenues is a result of decrease in theprice of Bitcoin during 2018. Additionally, our mining machines in Sweden were dormant for the fourth quarter of 2018 in connectionwith the move back to the U.S.

OperatingExpenses

Operatingexpenses for the year ended December 31, 2018 increased by $1,211, or 4.9%, to $25,953 as compared to $24,742 for the year endedDecember 31, 2017. The increase in operating expenses was primarily due to an increase of $2,689 in cost of sales from cryptocurrencymining operations resulting from additional costs to operate in Sweden, an impairment charge to the Company’s cryptocurrencymining assets of $6,345 and a charge of $2,499 for the Sweden restructuring with no similar costs in 2017, offset by a decreasein general and administrative expenses of $9,537 explained below, a $482 decrease in sales and marketing and research and developmentcosts related to the termination of the Company’s cybersecurity business in the first quarter of 2018.

Thedecrease in general and administrative expenses of $9,537, or 42.7%, to $12,816 as compared to $22,353 for the year ended December31, 2017 was primarily due to a decrease in stock-based compensation of $10,178 primarily as a result of a decrease in the Companystock price used to measure stock compensation compared to the prior year, and a decrease in legal and professional fees of $520primarily resulting from settlement of certain legal matters during 2018, offset by an increase in payroll and related expensesof $472 primarily for the appointment of a Chief Financial Officer and Chief Operating Officer in 2018 and administrative coststo operate our Sweden facility of $983 with no similar costs in 2017.

OtherIncome and Expense

Forthe year ended December 31, 2018, non–operating income and expenses consisted of a gain on extinguishment of debt of $1,875,offset by interest expense of $3, accretion of debt discount of $919, a warrant modification expense of $139, and a loss on disposalof investments and assets of $174. During the comparable period ended December 31, 2017, non–operating expenses consistedof inducement expense of $20,312, accretion of debt discount of $5,627, interest expense of $385, all related to the conversionof all our outstanding notes payable and a loss on sale of investments of $2,871, offset by a gain on sales of property and equipmentof $370.

Liquidityand capital resources

Sourcesof Liquidity

Wehave historically financed our business through the sale of debt and equity interests. We have incurred significant operatinglosses since inception and continue to generate losses from operations and as of March 31, 2019 have an accumulated deficit of$406,425. At December 31, 2018, our cash and cash equivalents were $96 and our working capital deficit was $2,079. As of December31, 2018, we had notes payable outstanding with a face value of $3,200. At March 31, 2019, our cash and cash equivalents were$362 and our working capital deficit was $526. As of March 31, 2019, we had notes payable outstanding with a face value of $3,659.As described in this prospectus we received financing subsequent to March 31, 2019.

Management’splans include overseeing the operation of approximately 5,700 cryptocurrency mining machines in Colorado and Ohio and continuingto execute on an expansion model to secure low cost power and grow its cryptocurrency assets. As discussed in Note 1 to the unauditedcondensed consolidated financial statements, the Company decided not to commence the majority of its mining operations duringthe first quarter of 2019 as it believed that it was not economically responsible to do so based on unfavorable Bitcoin economics.The Company’s revenue in the first quarter of 2019 was significantly less than historical results, as it had only 500 machinesin operation. Based on current budget assumptions, the Company believes that it will be able to meet its operating expenses andobligations for one year from the date these condensed consolidated financial statements are issued. The Company will need toraise additional funding to grow its operations and to pay current maturities of debt. There can be no assurance however thatthe Company will be able to raise additional capital when needed, or at terms deemed acceptable, if at all. Such factors raisesubstantial doubt about the Company’s ability to sustain operations for at least one year from the issuance of these unauditedcondensed consolidated financial statements. Management’s plans, including the operation of its existing cryptocurrencymining machines, the raising of additional capital and potentially curtailing its operations alleviate such substantial doubt.The accompanying unaudited condensed consolidated financial statements do not include any adjustments related to the recoverabilityand classification of asset amounts or the classification of liabilities that might be necessary should the Company be unableto continue as a going concern.

Theprice of Bitcoin is volatile, and fluctuations are expected. Declines in the price of Bitcoin has a negative impact in our operatingresults and liquidity and could harm the price of our common stock. Movements may be influenced by various factors, including,but not limited to, government regulation, security breaches experienced by service providers, as well as political and economicuncertainties around the world. Since we record revenue based on the price of earned Bitcoin and we may retain such Bitcoin asan asset or as payment for future expenses, the relative value of such revenues may fluctuate, as will the value of any Bitcoinwe retain. The high and low exchange rate per Bitcoin for the year ending December 31, 2018, as reported by Blockchain.info, wereapproximately $3 and $17 respectively. The high and low exchange rate per Bitcoin for the three months ended March 31, 2019, asreported by Blockchain.info, were approximately $3 and $5 respectively.

TheCompany’s primary source of operating funds has been through debt and equity financing. On August 30, 2018, the Companyand L2 Capital, LLC (“L2 Capital”), a Kansas limited liability company, entered into an equity purchase agreement(the “Equity Purchase Agreement”), pursuant to which the Company may issue and sell to L2 Capital from time to timeup to $35,000 of the Company’s common stock that is registered with the SEC under a registration statement on a Form S–3.The amount of the Equity Purchase Agreement was amended to $50,000 on December 3, 2018. During the year ended December 31, 2018,the Company issued 33,650,000 shares of its common stock in exchange for $2,459. During the period January 1, 2019 through April15, 2019, the Company issued 58,600,000 shares of its common stock in exchange for $3,277. On April 16, 2019, the Company’sregistration statement on Form S–3 lost its effectiveness as the aggregate market value of the Company’s common stockheld by non-affiliates was below the regulatory threshold of $75,000. Therefore the Company will not be able to use its EquityPurchase Agreement as a source of operating funds until such time as the common stock potentially issuable under the Equity PurchaseAgreement is subject to an effective Registration Statement. Accordingly, the Company is seeking to raise financing through theOasis Equity Line.

Saleof Preferred Stock

OnApril 12, 2019, the Company’s Board of Directors approved the authorization of 200 shares of Series C Convertible PreferredStock with a par value of $0.001 and a stated value of $10,000 per share (“Series C Preferred Shares”). The holdersof the Series C Preferred Shares are not entitled to vote their shares or receive dividends. At any time prior to the one-yearanniversary from the issuance date, the Company may redeem the Series C Preferred Shares at 1.4 times the Stated Value, followingwhich the Company may redeem the Series C Preferred Shares at 1.2 times the Stated Value.

EachSeries C Preferred Share is convertible into shares of the Company’s common stock in an amount equal to the greater of:(a) 200,000 shares of common stock or (b) the amount derived by dividing the Stated Value by the product of 0.7 times the marketprice of the Company’s common stock, defined as the lowest trading price of the Company’s common stock during theten day period preceding the conversion date. The holder may not convert any Series C Preferred Shares if the total amount ofshares, together with holdings of its affiliates, following a conversion shall exceed 9.99% of the Company’s commons stock.The common shares issued upon conversion have been registered under the Company’s registration statement on Form S-3. OnApril 12, 2019, the Company sold 190 Series C Preferred Shares for $1,900, of which 35 shares of Series C Preferred Shares weresubsequently converted into 8,463,465 shares of Common Stock.

CashFlows

Operatingactivities

Netcash used in operating activities was $8,763 for the year ended December 31, 2018 as compared to $2,377 for the year ended December31, 2017. Cash used in operating activities for the year ended December 31, 2018 primarily consisted of a net loss of $23,283partially offset by non-cash charges of $15,961 primarily consisting of: stock-based compensation of $6,402, an impairment chargeof $6,345 to the Company’s intangible cryptocurrency mining assets, depreciation expense of $3,291, amortization of debtdiscount of $919, partially offset by a gain on extinguishment of debt of $1,875, less a change in working capital excluding cashof $875. Cash used in operating activities for the year ended December 31, 2017 primarily consisted of a net loss of $50,433,partially offset by non-cash charges of $46,546 primarily consisting of: inducement expense of $20,312, stock-based compensationof $16,574 and impairment/loss on sale of long-term investments of $2,787, amortization of debt discount of $5,627, depreciationand amortization expense of $1,111, plus a decrease due to changes in working capital of $1,510.

Netcash used in operating activities was $1,109 for the three months ended March 31, 2019 as compared to $2,919 for the three monthsended March 31, 2018. Cash used in operating activities for the three months ended March 31, 2019 primarily consisted of a netloss of $1,709, partially offset by non-cash stock-based compensation of $949, amortization of note discounts of $1,091 less anon-cash gain on extinguishment of $1,275 and a decrease in working capital of $83. Cash used in operating activities for thethree months ended March 31, 2018 primarily consisted of a net loss of $4,549 partially offset by non-cash stock-based compensationof $2,227, and depreciation expense of $481, less a decrease in working capital of $1,391.

Investingactivities

Netcash used in investing activities was $6,507 for the year ended December 31, 2018 as compared to net cash used in investing activitiesof $3,065 for the year ended December 31, 2017. Net cash used in investing activities for the year ended December 31, 2018 wasprimarily due to our purchases of property and equipment of $6,994 partially offset by proceeds from the sale of property andequipment of $427 and proceeds from the sale of our cybersecurity assets of $60. During the year ended December 31, 2017, theCompany used $4,067 in the purchase of property and equipment, and realized $26 in net proceeds from sales of various investmentsin the open market and $976 from the sale of property and equipment.

Netcash used in investing activities was $0 for the three months ended March 31, 2019 as compared to net cash used in investing activitiesof $6,500 for the three months ended March 31, 2018. During the three months ended March 31, 2018, the Company used $6,987 inthe purchase of property and equipment, and realized $60 in proceeds from sales of our cybersecurity assets and $427 from thesale of property and equipment.

Financingactivities

Duringthe year ended December 31, 2018, cash provided by financing activities totaled $5,847, which includes $5,200 from the net proceedsof notes payable, $1,309 from the sale of common stock under our equity purchase agreement, $80 from private placements of ourcommon stock and $907 from the exercise of stock purchase warrants offset by $1,649 from the repayments of notes payable. Duringthe year ended December 31, 2017, cash provided by financing activities totaled $14,616, comprised of $4,971 in net proceeds fromconvertible debt instruments, $395 from the proceeds of exercise of warrants, $100 from the proceeds from the sale of common stockwarrants and $9,150 from the proceeds of a private placement of common stock.

Duringthe three months ended March 31, 2019, cash provided by financing activities totaled $1,375, which includes $1,457 from the saleof stock under our equity purchase agreement, offset by $82 in repayments of notes payable. During the three months ended March31, 2018, cash provided by financing activities totaled $361, comprised of $80 from private placements of our common stock and$281 from the exercise of stock purchase warrants.

Off–balancesheet arrangements

Asof March 31, 2019 we had no obligations, assets or liabilities which would be considered off–balance sheet arrangements.We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, oftenreferred to as variable interest entities, which would have been established for the purpose of facilitating off–balancesheet arrangements.

Saleof Common Stock

OnApril 12, 2019, the Company entered into a Purchase Agreement with an accredited investor whereby it sold 17,500,000 shares ofits common stock for $525 pursuant to the Company’s registration statement on Form S-3. The holder of these shares is alsothe holder of the June 2018 Note and an affiliate of the holder of the Series C Preferred Stock.

QUANTITATIVEAND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

TheCompany is not exposed to market risk related to interest rates on foreign currencies.

CHANGESIN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

DIRECTORS,EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directorsare elected based on experience, qualifications and in accordance with the Company’s by–laws to serve until the nextannual stockholders meeting and until their successors are elected in their stead. Officers are appointed by the Board and holdoffice until their successors are chosen and qualified, until their death or until they resign or have been removed from office.All corporate officers serve at the discretion of the Board. There are no family relationships between any director or executiveofficer and any other director or executive officer of the Company.

H.Robert Holmes was elected as a director in May 2012 and served as Interim President and Chief Executive Officer from September10, 2018 to May 1, 2019. From 2008 to 2012, Mr. Holmes has served on the board of Dejour Energies Inc. (NYSE–MKT: DEJ, 2008–2013).Mr. Holmes was the founder and general partner of Gilford Partners Hedge Fund. From 1980 to 1992, Mr. Holmes was the Co–Founder,and President of Gilford Securities, Inc. Previously, Mr. Holmes served in various positions with Paine Webber and Merrill Lynch.Mr. Holmes has served on the Board of Trustees North Central College in Naperville, II; Board of Trustees of Sacred Heart Schools,Chairman of Development Committee, in Chicago, IL; Board of Trustees of Crested Butte Academy where he was Chairman of DevelopmentCommittee; and the Board of Trustees Mary Wood Country Day School, Rancho Mirage, CA. The Board believes that Mr. Holmes has theexperience, qualifications, attributes and skills necessary to serve as a director because of his years of business experienceand service as a director for many companies over his career.

MichaelOnghai was appointed a director in May 2012. Mr. Onghai has been the CEO of LookSmart (OTC: LKST), since February 2013. Hehas been the founder and Chairman of AppAddictive, an advertising and social commerce platform since July 2011. Mr. Onghai isthe President of Snowy August Management LLC, a special situations fund concentrating on the Asian market, spin–offs andevent–driven situations. Mr. Onghai is the founder of Stock Sheet, Inc., and Daily Stocks, Inc. – the web’searly providers of financial information and search engine related content for financial information. Mr. Onghai has founded severalother internet technology companies for the last two decades. Mr. Onghai is an advisor to several internet incubators and is apanelist who advises FundersClub on which companies to accept for its pioneering venture capital platform. Mr. Onghai has earnedhis designation as a Chartered Financial Analyst (2006) and holds a B.S. in Electrical Engineering and Computer Science from theUniversity of California, Los Angeles and graduated from the Executive Management Certificate Program in Value Investing (TheHeilbrunn Center for Graham & Dodd Investing) Graduate School of Business at Columbia Business School. The Board believesthat Mr. Onghai has the experience, qualifications, attributes and skills necessary to serve as a director and chairman of theAudit Committee because of his years of business experience and financial expertise.

RobertB. Ladd joined the Company in December 2010 as a Director. He was named Interim President and CEO in February 2011, and appointedPresident and CEO in January 2012, positions held continuously with the exception of November 2016 through August 2017, a periodduring which Mr. Ladd was President. He also served as our Interim CFO from November 2015 through February 2018. On September10, 2018, Mr. Ladd took a leave of absence from his positions as President and Chief Executive Officer. He resumed his positionsas President and Chief Executive Officer on May 1, 2019. Mr. Ladd is also the Managing Member of Laddcap Value Advisors, LLC,which serves as the investment manager for various private partnerships, including Laddcap Value Partners LP. Prior to forminghis investment partnership in 2003, Mr. Ladd was a Managing Director at Neuberger Berman Group. Mr. Ladd is a former Directorof InFocus Systems, Inc. (NASDAQ – INFS, 2007 to 2009), and served on the boards of Delcath Systems, Inc. (NASDAQ –DCTH, 2006–2012) and Pyxis Tankers (NASDAQ – PXS, 2016 – 2017). Mr. Ladd has earned his designation as a CharteredFinancial Analyst (1986). Based on Mr. Ladd’s familiarity with the Company in serving as our Chief Executive Officer since2011 and his overall background and experience as an executive in the financial industry, the Nominating and Corporate GovernanceCommittee of the Board concluded that Mr. Ladd has the requisite experience, qualifications, attributes and skill necessary toserve as a member of the Board.

RobertS. Lowrey was appointed as Chief Financial Officer, Treasurer and Secretary on March 1, 2018. Mr. Lowrey most recently servedas a Director of Finance for Bioventus LLC, a privately held medical device company, from January 2013 through September 2017.Prior to Bioventus, Mr. Lowrey served as the Controller and Principal Accounting Officer for BioCryst Pharmaceutics, Inc., a NASDAQlisted company, from January 2011 through January 2013. Mr. Lowrey has previously served in various financial roles at Dex One,a NYSE listed company, and was employed by Ernst & Young, LLP for 11 years, where he served both public and private companies.Mr. Lowrey holds a B.A. degree in Business Administration from Grove City College and is a licensed CPA in North Carolina as wellas a Charted Global Management Accountant. Mr. Lowrey is also a member of the America Institute of Certified Public Accountantsand the North Carolina Association of CPAs.

FamilyRelationships

Thereare no family relationships among any of the Company’s directors and executive officers.

BoardRole in Risk Oversight

TheBoard’s primary function is one of oversight. The Board as a whole works with the Company’s management team to promoteand cultivate a corporate environment that incorporates enterprise-wide risk management into strategy and operations. Managementperiodically reports to the Board about the identification, assessment and management of critical risks and management’srisk mitigation strategies. Each committee of the Board is responsible for the evaluation of elements of risk management basedon the committee’s expertise and applicable regulatory requirements. In evaluating risk, the Board and its committees considerwhether the Company’s programs adequately identify material risks in a timely manner and implement appropriately responsiverisk management strategies throughout the organization. The audit committee focuses on assessing and mitigating financial risk,including risk related to internal controls, and receives at least quarterly reports from management on identified risk areas.In setting compensation, the compensation committee strives to create incentives that encourage behavior consistent with the Company’sbusiness strategy, without encouraging undue risk-taking. The nominating committee considers areas of potential risk within corporategovernance and compliance, such as management succession. Each of the committees reports regularly to the Board as a whole asto their findings with respect to the risks they are charged with assessing.

Codeof Business Conduct and Ethics

OnJuly 11, 2018, the Board revised the Code of Business Conduct and Ethics which applies to all directors and employees includingthe Company’s principal executive officer, principal financial officer and principal accounting officer or persons performingsimilar functions. Prior to July 11, 2018, the Company’s employees and directors were subject to the previous Code of Ethicsadopted by the Board on June 25, 2012.

Copiesof the Code of Business Conduct and Ethics can be obtained, without charge by writing to the Corporate Secretary at MGT CapitalInvestments, Inc., 512 S. Mangum Street, Suite 408, Durham, NC 27701, or through our corporate website at mgtci.com.

Section16(A) Beneficial Ownership Reporting Compliance

Section16(a) of the Exchange Act requires the Company’s directors, executive officers and persons who own more than 10% of theCompany’s stock (collectively, “Reporting Persons”) to file with the SEC initial reports of ownership and changesin ownership of the Company’s common stock. Reporting Persons are required by SEC regulations to furnish the Company withcopies of all Section 16(a) reports they file. Based solely on a review of the reports furnished to us, or written representationsfrom reporting persons that all reportable transaction were reported, we believe that during the fiscal year ended December 31,2018, our officers, directors and greater than ten percent stockholders timely filed all reports and did not miss any filingsas required to file under Section 16(a).

AuditCommittee and Audit Committee Financial Expert

OnNovember 25, 2004, the Board established an Audit Committee to carry out its audit functions. At December 31, 2018, the membershipof the Audit Committee was Michael Onghai and H. Robert Holmes.

TheBoard has determined that Michael Onghai, an independent director, is the Audit Committee financial expert, as defined in RegulationS–K promulgated under the Exchange Act, serving on its Audit Committee.

EXECUTIVECOMPENSATION

(InThousands Except Share and Per Share Amounts)

SummaryCompensation Table

Thefollowing table summarizes Fiscal Years 2018 and 2017 compensation for services in all capacities of the Company’s namedexecutive officers and other individuals:

EmploymentAgreements

RobertB. Ladd

OnJuly 7, 2016, the Company entered into an employment agreement with Robert B. Ladd, to act as its President and Chief ExecutiveOfficer. The terms of his agreement were reviewed and approved by the Company’s Nominations and Compensation Committee andratified by stockholders on September 8, 2016. Under the terms of the agreement, Mr. Ladd served as President and Chief ExecutiveOfficer with a salary of $240 per year and was eligible for a cash and/or equity bonus as determined by the Nomination and CompensationCommittee. Further, Mr. Ladd received 2,000,000 shares of the Company’s common stock, 1/3 of which vested within 12 monthsfrom the execution of the agreement, another 1/3 at 18 months, and the remaining 1/3 at 24 months from the execution of the agreement.Lastly, the agreement also provides for certain rights granted to Mr. Ladd in the event of his death, permanent incapacity, voluntarytermination or discharge for cause.

FromNovember 18, 2016 through August 15, 2017, Mr. Ladd relinquished his duties as Chief Executive Officer, while remaining President.

OnApril 1, 2018, the Company entered into an Amended and Restated Executive Employment Agreement (the “Employment Agreement”)with Mr. Ladd, which was executed on April 6, 2018. The Employment Agreement provides that Mr. Ladd has been reappointed as Presidentand Chief Executive Officer of the Company for an initial term of two years. Mr. Ladd is entitled to receive an annualized basesalary of $360 and is also eligible for a cash and/or equity bonus as the Compensation Committee may determine, from time to time,based on meeting performance objectives and bonus criteria to be mutually identified by Mr. Ladd and the Compensation Committee.In connection with the execution of the Employment Agreement, the Company issued to Mr. Ladd 600,000 shares of the Company’srestricted common stock, pursuant to the Company’s 2016 Stock Option Plan, vesting over a two-year period. On September10, 2018, Mr. Ladd took an indefinite leave of absence as an executive and officer of the Company in order to focus on allegationslevied against him in an SEC complaint filed on September 7, 2018. Mr. Ladd resumed his position as an executive and officer ofthe Company on May 1, 2019.

RobertS. Lowrey

OnMarch 8, 2018, the Company entered into an employment agreement with Mr. Lowrey, effective March 1, 2018. Mr. Lowrey’s employmentagreement provides that he has been appointed for an initial term of two years. Mr. Lowrey is entitled to receive an annualizedbase salary of $240. Mr. Lowrey also received a one-time signing bonus of $10. Mr. Lowrey is also eligible for a cash and/or equitybonus as the Compensation Committee may determine, from time to time, based on meeting performance objectives and bonus criteriato be mutually identified by Mr. Lowrey and the Compensation Committee. In connection with the execution of his employment agreement,the Company issued to Mr. Lowrey 750,000 shares of the Company’s restricted common stock, pursuant to the Company’s2016 Stock Option Plan, one-third of which vested on March 8, 2019, one-third of which shall vest on September 8, 2019, and one-thirdof which shall vest on March 8, 2020.

StephenSchaeffer

OnJuly 11, 2018, the Company entered into the Second Amended and Restated Executive Employment Agreement with Stephen Schaeffer.The Agreement provided that Mr. Schaeffer had been appointed Chief Operating Officer of the Company. Mr. Schaeffer will continueto serve as President of Cryptocurrency Operations, the position for which he was originally hired pursuant to his original ExecutiveEmployment Agreement dated August 15, 2017. Mr. Schaeffer was entitled to receive an annualized base salary of $250 and was alsoeligible for a cash and/or equity bonus as the Compensation Committee may determine, from time to time, based on meeting performanceobjectives and bonus criteria to be mutually identified by Mr. Schaeffer and the Compensation Committee.

OutstandingEquity Awards at December 31, 2018

OutstandingStock Awards at Fiscal Year-End for 2018

DirectorCompensation

Thefollowing table sets forth the compensation of persons who served as a member of our Board of Directors during all or part of2018, other than Robert B. Ladd, who is not compensated separately for Board service, and H. Robert Holmes whose compensationsare discussed under “Executive Compensation” below.

Directorsare reimbursed for their out–of–pocket expenses incurred in connection with the performance of Board duties. On May31, 2018, Mr. Bushnell resigned as a Director.

IndependentDirector Compensation

Forfiscal year 2018, the Company changed its cash compensation policy for independent directors. Each independent director will receiveannual compensation of $50. The Chairman of the Board will receive an additional $25.

SECURITYOWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

SecurityOwnership of Certain Beneficial Owners

Thefollowing table sets forth certain information regarding beneficial ownership and voting power of the common stock as of May 31,2019, of:

“Beneficialownership” here means direct or indirect voting or investment power over outstanding stock and stock which a person hasthe right to acquire now or within 60 days after May 31, 2019. See the accompanying footnotes to the tables below for more detailedexplanations of the holdings. Except as noted, to our knowledge, the persons named in the tables beneficially own and have solevoting and investment power over all shares listed.

Percentagebeneficially owned is based upon 231,003,479 shares of common stock issued and outstanding as of May 31, 2019.

CERTAINRELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE

JaniceDyson, wife of John McAfee, the Company’s former Chief Cybersecurity Visionary, is the sole director of FTS and owns 33%of the outstanding common shares of FTS. On March 3, 2017, the Company purchased from FTS its 46% ownership interest Demonsawfor 2,000,000 shares of MGT common stock (approximate value of $2,500), as described fully in the section entitled Businessabove. The Company impaired the investment during the year ended December 31, 2017.

OnMay 9, 2016, the Company entered a consulting agreement with FTS, pursuant to which FTS would provide advice, consultation, informationand services to the Company including assistance with executive management, business and product development and potential acquisitionsor related transactions. On January 26, 2018, the Company terminated its agreement with FTS. During the years ended December 31,2018 and 2017, the Company recorded consulting fees of $137 and $360, respectively, to FTS for such services. As of December31, 2018, the Company owed $0 to FTS.

InJanuary 2018, our agreement with FTS was terminated.

DirectorIndependence

MichaelOnghai is considered independent under Section 803A of NYSE MKT rules.

WHEREYOU CAN FIND MORE INFORMATION

Wefile annual, quarterly and current reports and other information with the SEC. Such filings are available to the public over theInternet at the SEC’s website at http://www.sec.gov.

Wehave filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the securities offered underthis prospectus. This prospectus, which forms a part of that registration statement, does not contain all information includedin the registration statement. Certain information is omitted and you should refer to the registration statement and its exhibits.

Youmay review a copy of the registration statement, and the reports and other information that we file with the SEC, at the SEC’spublic reference room at 100 F Street, N.E. Washington, D.C. 20549 on official business days during the hours of 10 a.m. to 3p.m. You may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. You may alsoread and copy any materials we file with the SEC at the SEC’s public reference room. Our filings and the registration statementcan also be reviewed by accessing the SEC’s website at http://www.sec.gov.

Statementscontained in this prospectus as to the contents of any contract or other document that we have filed as an exhibit to the registrationstatement are qualified in their entirety by reference to the exhibits for a complete statement of their terms and conditions.

Therepresentations, warranties and covenants made by us in any agreement that is filed as an exhibit to the registration statementof which this prospectus is a part were made solely for the benefit of the parties to such agreement, including, in some cases,for the purpose of allocating risk among the parties to such agreements, and should not be deemed to be a representation, warrantyor covenant to you. Moreover, such representations, warranties or covenants were made as of an earlier date. Accordingly, suchrepresentations, warranties and covenants should not be relied on as accurately representing the current state of our affairs.

DISCLOSUREOF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES

OurRestated Certificate of Incorporation, as amended, contains provisions that limit the liability of our directors for monetarydamages to the fullest extent permitted by Delaware law. Consequently, our directors will not be personally liable to us or ourstockholders for monetary damages for any breach of fiduciary duties as directors, except liability for:

OurCertificate of Incorporation, as amended, provides that we are required to indemnify our directors and officers, in each caseto the fullest extent permitted by Delaware law. Our Certificate of Incorporation also provides that we are obligated to advanceexpenses incurred by a director or officer in advance of the final disposition of any action or proceeding, and permit us to secureinsurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in thatcapacity regardless of whether we would otherwise be permitted to indemnify him or her under the provisions of Delaware law.

Tothe extent that indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or personscontrolling our company pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnificationis against public policy as expressed in the Securities Act and is therefore unenforceable.

INDEXTO FINANCIAL STATEMENTS

AuditedConsolidated Financial Statements for the Fiscal Years Ended December 31, 2018 and 2017

MGTCAPITAL INVESTMENTS, INC. AND SUBSIDIARY

CONDENSEDCONSOLIDATED BALANCE SHEETS

(inthousands, except share and per share amounts)

Theaccompanying notes are an integral part of these unaudited condensed consolidated financial statements

MGTCAPITAL INVESTMENTS, INC. AND SUBSIDIARY

CONDENSEDCONSOLIDATED STATEMENTS OF OPERATIONS

(inthousands, except share and per-share amounts)

Theaccompanying notes are an integral part of these unaudited condensed consolidated financial statements

MGTCAPITAL INVESTMENTS, INC. AND SUBSIDIARY

CONDENSEDCONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ (DEFICIT) EQUITY

FORTHE THREE MONTHS ENDED MARCH 31, 2019 AND 2018

(inthousands, except share and per-share amounts)

(Unaudited)