vor 8 Monaten
Summary I see asymmetric upside for Bitmine Immersion Technologies if Ethereum (and the whole crypto space) recovers from the recent downtrend. The latest update shows 4,371,497 ETH (3.62% of supply), 193 BTC, and $670M cash, positioning BMNR as the largest public-company ETH treasury holder. Staking revenue is still modest ($0.98M in Q1 FY26), but the company aims to ramp its ETH holdings to reach "Alchemy" (i.e., 5% of ETH supply). I think risk will eventually return to the crypto space. However, I am unable to time the bottom of ETH. That's why I own only a small position in BMNR. Long term, I'm bullish, but short term, I'm cautious. I initiate coverage on Bitmine Immersion Technologies ( BMNR ) after its mid-2025 pivot into an Ethereum treasury model that’s starting to look more like an Ethereum version of Strategy (with caveats, of course). The stock is down considerably since mid-last year, partly due to dilution and partly due to the broader risk-off move in the crypto space. That said, I prefer to be a contrarian here, and I initiated a small single-digit position in my portfolio that may increase if the stock continues its downward trend. Wait a second, weren't you bearish last week on the broader markets and crypto ? (Some readers may say) It is my view that trying to time the lows of a selloff has more downside potential than upside. Over a longer-term timeframe, I see an asymmetrical upside on this stock. Why? In the Feb. 17, 2026, update, BMNR disclosed 4,371,497 ETH (3.62% of supply), 193 BTC, and $670M cash. On top of that, shareholders approved a massive increase in share issuance from 500M to 50B. Given that in the last quarter alone the company issued 168,532,074 shares under the ATM, generating $7.664B in net proceeds, I think the new program is good news. It should help move the company closer to the Alchemy point (i.e., owning 5% of the ETH supply). Using today's ETH price of $1,971, the gap to reach the Alchemy point requires just $3.45B. That said, my bull case has very little to do with fundamentals. In my view, a bet on BMNR is a bet on the recovery of Ethereum. As I am about to show in this piece, the crypto space is mainly cyclical, and now we are in a downturn. Therefore, the key question is when ETH will recover. I’ll admit I don’t know the answer to that question. In fact, I strongly believe no one does. However, despite the selloff, the Ethereum network is not dead. Data from Etherscan shows Ethereum just hit an all-time high daily transaction count of 2,896,853 on Feb. 7, 2026. Etherscan To be clear, that's not a price catalyst by itself, but it supports the idea that usage can stay resilient even during drawdowns. Still, I have enough stomach to sit through red ink until ETH prices eventually recover. What Is Bitmine Immersion Technologies? BMNR is now positioned as an Ethereum treasury holder after pivoting in mid-2025 from building and expanding its proprietary Bitcoin mining sites. Even though BMNR is not the largest holder of ETH in the world (that merit goes to the Ethereum Beacon Deposit Contract, which holds 80M ETH ), BMNR has the biggest public company ETH treasury, with 4.325M ETH , representing 3.58% of the total supply. So, how do they make money? In plain English, according to the last 10-K , the company raises capital and uses proceeds to acquire, hold, and actively manage ETH on the balance sheet. This is a similar model to Strategy, but instead of holding Bitcoin in its balance sheet, BMNR is staking Ethereum (which pays a yield). They also make money from leasing their miners ($1.112M in the last quarter) and from consulting services ($199k) as well. Some readers may argue there’s no major difference between these two cryptocurrencies. From a price perspective, the chart below shows ETH tracks Bitcoin very closely, even if Bitcoin has outperformed over the last three years. Seeking Alpha Unlike traditional value investors who consider these assets worthless, I think crypto has a place in the current markets. It is my view that crypto is a beta on risk, and one can use it to predict corrections in the broader markets. How? Take a look at the chart below showing the returns of BTC vs. the S&P 500 in the last year. Seeking Alpha Interestingly enough, it seems that Bitcoin is a very good proxy to predict the start of corrections or bull runs in the broader U.S. equity markets. Early last year, BTC dropped before the S&P 500 during Trump's tariff selloff. In April, it took off before the S&P 500. Similarly, when Bitcoin began to sell off at the end of last year, the broader markets struggled to break new highs. Back to Ethereum, as I said before, the network pays a yield. At the time of writing this article, that yield is about 2.8% APR. How? Essentially, the network prints some new ETH and gives it to validators (like BMNR) as a reward for doing the job. Bitcoin doesn't have an equivalent protocol yield because it’s secured by mining, not staking, so there is no yield for holding BTC. That's the main moat of ETH, in my view. As for Tom Lee’s narrative that Wall Street wants to tokenize everything via stablecoins (with Robinhood and BlackRock as examples), I’m not that bullish, to be honest. Here is an excerpt from the Chairman’s Message last year: Stable coins are the ChatGPT moment for crypto, because we’ve seen widespread adoption of stablecoins by consumers, corporates, and banks, and, as you can see from these various headlines: J.P. Morgan wants to create a stablecoin; Goldman and BNY want to tokenize money market funds; Walmart and Amazon are looking at issuing their own stablecoins; and Robinhood wants to tokenize a lot of private companies. That ChatGPT moment hasn't arrived yet, despite ETH leading stablecoin issuance with 52% market share of the stablecoin market cap. Back to BMNR, the last 10-Q shows $0.98M in staking revenue in Q1 FY26 (the November-ending quarter). Peanuts, right, especially when compared to the leasing of miners ($1.1M)? Maybe not. Now, take a look at the projected annualized staking revenue from the latest update a few weeks back: BMNR You may have noticed the blue line on the right of that chart. It says “Alchemy.” At that point, the company estimates $420M in annualized revenue from ETH staking. Not bad. What's that? According to a September filing , Alchemy is the slogan for the company's strategy to accumulate 5% of Ethereum’s total ETH supply. The idea is to then turn that ETH pile into recurring income. Are The Lows Behind? It's impossible to say when crypto will recover. In an earlier February update , the company suggested that prices should follow the hike in ETH daily transactions (7-day MA). BMNR That didn't happen, as ETH is down close to 13% since that update, after Bitcoin had its worst day since the FTX era earlier this month. Overall, even though I am unsure if the lows of ETH are behind us or not, I am quite confident of one thing: risk will eventually come back in the crypto space. As I said in this article, the only value I see in crypto is that it acts like a high-beta bet on risk. Risk moves in cycles (see ETH mark below), and we’re in a downcycle right now. TradingView The risk here is that the downward pressure continues until (at least) the next technical support. That's 30% below the current ETH price. From a standard technical perspective, ETH’s 14-day RSI is approximately 43.7 , and short/intermediate moving averages still screen as a sell, which is consistent with a downtrend rather than a confirmed reversal. That's why my position in BMNR remains small until momentum improves. If that happens, I think we could see lower Ethereum network activity (unless retail buys the dip), which would further pressure yields and therefore the top-line of BMNR. Conclusion In the near term, I remain cautious about anything exposed to the crypto space. I am unsure if the lows are behind, especially after the dead cat bounce in Bitcoin last week. TradingView That's why my position in BMNR is small. From a risk perspective, dilution is a key risk to consider, especially after the new ATM program. On top of that, staking revenue is highly volatile and depends largely on the volume of ETH staked and the number of transactions in the network. With current estimates of ETH staking rewards of around 1.89%, the yield is quite small, and I want to see an improvement before I decide to increase my position in BMNR. However, if I look at a multiyear timeframe, there is a very small chance of risk not coming back to the crypto space. As I've shown in the charts of this article, crypto is highly cyclical, and now we are on a clear downtrend. More often than not, recoveries tend to be V-shaped, so trying to time the bottom is nearly impossible. BMNR As for BMNR, even though I am not particularly excited about the $200M stake in Beast Industries or the $19M stake in Eightco Holdings, I think the company is well-positioned in an environment where ETH prices recover (and BTC as well, given that it also holds 193 BTCs ).