Tom Lee“s BitMine continues to bolster its position in Ethereum (ETH), having invested an additional $150 million in the cryptocurrency. This move comes in the face of significant declines in the broader treasury sector, where many companies have struggled to maintain their holdings.
On Wednesday, BitMine”s recent acquisition added to its growing Ethereum treasury, which now accounts for over 3% of the circulating supply of ETH. On-chain data from Arkham indicates that the firm acquired 18,345 ETH via BitGo and an additional 30,278 ETH through Kraken. This follows a series of aggressive purchases, including a notable acquisition of 14,618 ETH valued at around $44 million just last week, and another considerable buy of 96,798 ETH executed on Monday.
BitMine”s strategy is clear: the firm aims to increase its Ethereum holdings to 5% of the total supply, capitalizing on the growing role of ETH in settlement systems, tokenization, and a variety of financial services. Despite its ambitious accumulation plan, the company”s stock, BMNR, has plummeted by over 81% from its peak, signaling a decline in investor confidence. Currently, the estimated value of BitMine”s treasury stands at approximately $12 billion, with the firm facing unrealized losses near $2.8 billion.
In stark contrast to BitMine”s bullish stance, the broader Ethereum treasury market has experienced a severe downturn, with Bitwise reporting an 81% drop in monthly purchases. The market has seen total purchases fall to just 370,000 ETH in November, a sharp decline from the August peak of 1.97 million ETH. This downturn poses serious challenges for many smaller treasuries, which are nearing bankruptcy as multiples and premiums continue to shrink.
Max Shannon, a senior research associate at Bitwise, remarked on the current market scenario, noting that “treasuries were this cycle”s version of an altseason” and highlighting the oversupply of players compared to the available capital to sustain demand. He pointed out that while monthly purchases currently exceed the available supply, this gap is rapidly diminishing, indicating that the “unwind is underway.” This represents a significant shift from earlier in the year when firms like SharpLink Gaming were consistently active in the market, having made substantial purchases of ETH.
As BitMine forges ahead with its Ethereum investment strategy, the company remains a focal point in a market grappling with volatility and uncertainty.
