Bitmine's Ethereum supply approaches 5%, with a loss of US$8.4 billion

Tom Lee's Bitmine Immersion Technologies restarts Ethereum's continued increase in holdings

Tom Lee's Bitmine Immersion Technologies has restarted its stable increase in holdings in Ethereum, purchasing 9,926 new ETH units in the week ended August 16. The company said the increase brought its total Ethereum holdings to approximately 5.82 million units-approximately 4.8% of Ethereum's circulating supply-close to its long-term goal of holding 5% of the asset's total supply.

Bitmine also provided valuation reference in its disclosure information: Based on the ETH reference price of US$1,893, the total value of the latest investment portfolio is approximately US$11 billion. But the company noted that a large number of its ETH was purchased at significantly higher prices, highlighting the serious challenges posed by a prolonged bear market to Ethereum's asset allocation strategy.

Core Points

As of the week ended August 16, Bitmine purchased 9,926 ETH units, increasing its position to approximately 5.82 million units (accounting for approximately 4.8% of the circulating supply).

Based on a reference price of US$1,893, Bitmine's Ethereum positions are worth nearly US$11 billion, but the purchase cost of most of these positions is much higher than the current price.

Industry data shows that the current unrealized loss on Ethereum's positions exceeds US$8.4 billion.

Despite a book loss, Bitmine continued to pledge more than 5 million ETH units and said the move was generating negotiated rewards.

According to Tom Lee, Bitmine's pledge yield in the past seven days is approximately 2.61%, and the annualized pledge reward is expected to be approximately US$287 million.

Restart the "5% Alchemy" promotion plan

Bitmine's strategy is based on scale and patience. After resuming purchases last week, the company is close to its "5% alchemy" goal of holding 5% of Ethereum's total supply. This goal is important because it marks an asset allocation model that views Ethereum as a long-term bet rather than a tactical trading position.

According to Bitmine's disclosures, purchases in the recent week also help explain why the company has always characterized its shareholding plan as a continuous process rather than a series of opportunistic transactions. This increase allows the company to continue moving towards a specific ownership threshold-a threshold that will substantially enhance its influence and relevance as an institutional holder in Ethereum's expanding ecosystem.

Unrealized losses are still a pressure point

This resumption of purchasing comes at a time when the Ethereum market environment tests Bitmine's beliefs. According to reports, based on industry data, the company's Ethereum position has unrealized losses of more than $8.4 billion. Although the current portfolio is worth more than $11 billion, data estimates unrealized losses of approximately 43% relative to the company's reported acquisition costs.

This mismatch between the size of positions and the extent of book losses highlights the key risks faced by any "buy and hold" asset allocation plan that spans the full market cycle. Even if the strategy is long-term, the path is important: Buying in a downtrend can generate huge paper losses that can only be reversed if market prices rebound significantly.

Pledge income helps waiting period

The difference between Bitmine's strategy and the simple spot accumulation strategy lies in its continuous pledge operations. The company said it is pledging more than 5 million ETH units, worth approximately $9.6 billion at current prices. Through pledges, Bitmine earns agreement rewards to ensure network security-which provides a source of revenue that partially offsets the emotional and financial pressure of unrealized losses.

Bitmine's filing also links its pledge activities to measurable performance indicators. Based on a seven-day pledge yield of 2.61%, annualized pledge rewards are expected to be approximately $287 million. While annualized estimates can fluctuate-because pledge yields depend on network conditions and how rewards are distributed-the point for investors is clear: Bitmine's asset allocation is not fully exposed to price fluctuations. Part of its payoff is related to the pledge economy, not just the market direction of Ethereum.

However, pledges do not eliminate core uncertainty. If Ethereum prices fail to recover, unrealized losses may remain high even if agreed rewards continue to accumulate. Conversely, if Ethereum rebounds, pledge gains can accelerate the overall position towards a healthier state-both in absolute return and relative to the cost of purchase.

Why continues to increase holdings at this time is worth paying attention to

Bitmine resumed weekly Ethereum purchases, indicating that the company believes the current market stage is in line with its long-term ownership goals. Previous reports pointed out that since the launch of the Ethereum asset allocation strategy in June 2025, Bitmine has continued to increase its holdings of ETH through weekly purchases. In this context, the latest increase in holdings looks more like an execution of an established roadmap than a reaction to short-term price movements.

This is important for market observers because large asset allocation behavior can be a counterexample to the narrative of "institutional interest fades during downturns." Even with an increase in unrealized losses, Bitmine seems willing to continue buying as it approaches its 5% target-while using pledge proceeds to fund the strategy.

However, there is one important asymmetry that deserves attention. As Bitmine approaches the 5% level, further purchases may become more difficult, depending on remaining supply dynamics and how the company plans for future deployments. The company's short-term challenges may shift from "whether it can continue to increase holdings" to "how to manage valuation risk and portfolio efficiency as positions grow."

Next, investors and traders may be concerned about whether Bitmine can maintain its weekly increase in holdings while the Ethereum pledge yield remains stable enough to support the expected reward rate. Also noteworthy is the speed at which the market price of Ethereum changes relative to the purchase cost of Bitmine-because pledges can alleviate book losses, but only a meaningful recovery in prices can completely eliminate the situation of unrealized losses.