Bitmine Immersion Technologies shares tumbled 7.3% to $14.02 in Wednesday afternoon trading, as the price of ether continued its slide, putting pressure on the company's enormous cryptocurrency holdings. The decline came just two days after Bitmine disclosed a staggering $10.7 billion crypto treasury, including 5,672,956 ETH, representing approximately 4.7% of the total ether supply.
Ether was down 5.1% at $1,571.40, according to market data. Based on that price, Bitmine's ether stash was worth roughly $8.9 billion, down from the $9.8 billion valuation the company reported on June 21, when ether was trading at $1,733 per token. The company's total treasury also includes 205 bitcoin, $601 million in cash and marketable securities, and equity stakes in Beast Industries and Eightco Holdings, which Bitmine refers to as 'moonshot' investments.
In its latest annual filing, Bitmine warned that its ether-focused strategy relies on favorable capital market conditions in what it described as a cyclical market. The filing cautioned that if ether prices remain depressed for an extended period, the company could face a reduction in the carrying value of its digital assets and may encounter greater difficulty in raising additional capital. The filing also highlighted risks related to custody, regulatory changes, and Ethereum-specific technological vulnerabilities.
Despite the near-term headwinds, Bitmine Chairman Thomas 'Tom' Lee struck an optimistic tone in the company's June 22 update. Lee stated that 'the best years for crypto remain ahead,' citing growth in tokenization—the process of moving assets like securities and real estate onto blockchain technology—and the expansion of artificial intelligence as key drivers for the sector.
Bitmine also revealed that 4,718,677 of its ether tokens are staked on its MAVAN (Made in America VAlidator Network). Staking involves locking up tokens to support a proof-of-stake blockchain and earn rewards. Lee projected annualized staking revenue of approximately $223 million, based on a seven-day yield of 2.73%.
In a separate development, Bitmine announced that its BMNP preferred stock is now trading on the New York Stock Exchange following a net offering of $273.8 million. The company closed the sale of 3.5 million shares of its 9.50% Series A perpetual preferred stock at $80 per share on June 10. The preferred shares are senior equity with no maturity date, and Bitmine said dividends on BMNP are set weekly according to the terms of the offering.
Bitmine's funding strategy mirrors that of other publicly traded crypto treasury firms. According to Strategy's website, as of June 22, the company holds 847,363 bitcoin. CoinDesk reported that Bitmine's preferred-share offering copied Strategy's approach to raising capital.
Meanwhile, SharpLink, another Ethereum treasury holder, announced on June 22 that it would raise $75 million in a registered direct offering, with proceeds earmarked for working capital, additional ether purchases, and potential share buybacks. SharpLink shares fell approximately 5.8% in Wednesday afternoon trading.
The broader market context underscores the risks inherent in corporate crypto strategies. While the potential for significant gains exists during bull markets, the recent decline in ether highlights the vulnerability of companies with large, concentrated holdings in digital assets. Investors will be closely watching whether ether can stabilize or if further declines will force Bitmine and its peers to reassess their strategies.
