Bitmine is approaching its 5% target of Ethereum supply, involving US$10.8 billion...

Why did Bitcoin mining companies increase their holdings in Ethereum?

Bitcoin Immersion Technology increased its Ethereum reserves to 5,777,468, accounting for 4.8% of the total supply of 120.7 million Ethereum units. At the same time, the company repurchased 5.5 million shares of common stock under a previously authorized $4 billion repurchase program. At current prices, the company's Ethereum holdings are worth approximately $10.8 billion. According to the company's statement, this makes it the world's largest ethereum corporate holder and second only to Strategy in terms of corporate digital asset reserves. The latest data shows that the company has increased its holdings of 7,430 Ethereum units in the past week. The company said it has now achieved 96% of its "5% alchemy" target, which refers to holding 5% of the total supply of Ethereum. The pace of Ethereum purchases slowed because the company used funds for share buybacks. In the past week, the company has repurchased 5.5 million shares of common stock at an average price of $15.6156 per share. The repurchase was conducted under the company's existing $4 billion repurchase authority. Chairman Tom Lee said in a statement: "The slowdown in the pace of purchases reflects the repurchase of 5.5 million shares of common stock by Bit Mining. Since the launch of the Ethereum Reserve Strategy on June 30, 2025, Bit Mining has been buying Ethereum every week."

What kind of capital allocation signal does repurchase release?

The simultaneous Ethereum purchases and share buybacks gave investors a clearer view of how Bit Mining balances its balance sheet strategies. The company is still accumulating Ethereum, but is willing to use cash to buy back shares when management considers the stock price attractive relative to its asset value and future pledge income. This is important because the transaction value of a digital asset reserve company depends not only on the market price of the tokens it holds. Investors will also focus on dilution, cash levels, number of shares, operating income, and whether companies can create value beyond passively holding crypto assets. For Bit Mining, buybacks could help address a common concern surrounding crypto reserve companies: whether the growth in token holdings is at the expense of shareholder dilution. Mass repurchase programs provide companies with tools to reduce the number of shares, but their long-term effects will depend on how hard the program is used and how stocks trade relative to net asset value. The company also reported other positions outside Ethereum, including 207 bitcoins, a $180 million investment in Beast Industries, a $58 million investment in Eightco Holdings, and $385 million in cash and marketable securities.

Investor inspiration

Bit Mining is trying to position itself as more than just a passive Ethereum holder. The latest developments combine continued Ethereum accumulation, stock buybacks, pledge income and equity investments to provide investors with multiple valuation factors that are tied to the Ethereum price.

How important is pledge to Bit Mining?

Ethereum pledge has become the company's main operating business. Bit Mining said its 4.92 million Ethereum holdings (approximately 85% of the total) are currently pledged through its MAVAN verifier platform and pledge partners. The company said that its pledge business achieved a 7-day annualized rate of return of 2.67%. Based on current positions, annualized pledge revenue is expected to be approximately US$247 million, which will increase to approximately US$290 million once all Ethereum reserves are pledged. This revenue stream distinguishes Bit Mining's Ethereum reserves from a simple buy-and-hold model. Unlike Bitcoin, Ethereum can generate native revenue through pledges, allowing business owners to convert some of their reserves into recurring income. For Bit Mining, the size of its holdings means that even low yields can be translated into considerable operating income. Financial reports for the quarter ended May 31 showed that the pledge and verification business contributed US$45.7 million, accounting for 98% of total quarterly revenue of US$46.5 million. This makes pledges not only an add-on to the reserve strategy, but also a core source of reported income.

Investor Enlightenment

BitMining's valuation depends on two interrelated variables: the market price of Ethereum and the revenue generated by the pledge. Greater Ethereum reserves can support higher pledge income, but also increase exposure if Ethereum prices fall.

What are the market risks?

Bit Mining's Ethereum strategy is still closely related to Ethereum prices. Ethereum rose slightly on Monday, rising 0.27% in the past 24 hours to $1,871.39, but the asset is still down about 62% from its all-time high of $4,946.05. This gap is critical for investors because the value of company reserves can fluctuate sharply with the price of the underlying token. The large Ethereum holdings have directly benefited Bit Mining when Ethereum recovers, but also increased balance sheet sensitivity during market downturns. The company's share price is another factor. Bit Mining shares closed at $15.69 on Friday, up 1.62% on the day. Given that the company is buying back shares around that price, investors may be concerned about whether the repurchase continues and whether the shares are trading at a premium or discount relative to the value of its crypto assets and pledged business. The latest developments show that Bit Mining is gradually approaching its 5% Ethereum supply target, while using repurchase authorizations to support shareholder returns. This strategy may appeal to investors seeking to invest in Ethereum through corporate leverage, but the same structure also exposes the company to the risk of token price fluctuations, changes in pledge yields, and changes in market perceptions of the valuation of crypto reserves.