BitMine Stock Rises as ETH Treasury Nears 5% Supply Target

BitMine stock moved higher on Aug. 31 as the company disclosed another week of Ethereum accumulation.

BMNR traded above $24 during the session after BitMine said it added 53,501 ETH over the preceding week. The purchase raised its holdings to 5,901,112 ETH, representing about 4.9% of Ethereum’s current supply.

The company is now close to completing its stated “Alchemy of 5%” treasury target. Ethereum’s recent recovery has also improved the value of BitMine’s holdings and supported the stock’s rebound.

BitMine Stock Rises as ETH Holdings Reach 5.90M

BitMine stock rose modestly after the company unveiled its recent accumulation measures. In a statement, it said that it spent $131 million worth of coins last week. It added 53,501 coins and now owns over 5.9 million coins. This means that it needs to buy 98,888 coins to hit the 6 million mark. As such, chances are that the company will now complete its Ethereum accumulation in September.

BitMine’s Ethereum accumulation strategy is different from that of other companies like Strategy. Instead of having an open-ended accumulation strategy, it has set a target of 6 million.

Therefore, ending the accumulation, it means that the company will stop the dilution that has seen it boost its outstanding shares from 2.02 million in 2022 to 579 million today. It now has over $541 million in cash and marketable securities, meaning that it will not need to raise additional cash to buy ETH.

The company will instead shift from dilution to a cash-flow machine as it monetizes its Ethereum holdings. A good example of this is SharpLink, the second-biggest Ethereum holder, which generated a quarterly revenue of $11.5 million. If it makes the same amount, and if ETH remains intact, it will make nearly $50 million in staking revenue.

BitMine’s ultimate goal is to have about 6 million coins, and according to StakingRewards, its reward rate is 2.60%. This means that the company will make 156,000 coins. Ethereum’s price stands at $2,470, implying annual revenue over $385 million.

Additionally, BitMine owns other assets such as Bitcoin, a stake in Beast Industries, and Eightco Holdings, which holds a stake in OpenAI, which may launch an IPO later this year at a $1 trillion valuation.

Ethereum Price is About to Surge

August was a good month for ETH price as it finally broke out. It moved from a consolidation phase and then surged to $2,562, its highest level since January 31st. At its peak, it was up by nearly 70% from its lowest level this year.

Technical indicators suggest the coin has more room to run. It is forming a bullish flag pattern, which consists of a vertical line and a horizontal channel. This pattern normally leads to more gains over time.

The coin has also formed a golden cross pattern as the 50-day and 200-day Weighted Moving Averages (WMA) crossed each other. As such, the coin could surge past the $3,000 mark in September.

BitMine Stock Price Technical Analysis

The daily chart shows that the BMNR stock has also rebounded in the past few days. It has jumped above the crucial resistance level of $23.76 and retested it. This price was its highest point in March, April, and May this year. It has formed a break-and-retest pattern, a common continuation sign.

BMNR has moved above the 50-day Exponential Moving Average, a sign that bulls remain in control for now. Therefore, the path of the least resistance for the stock is upward, with the next key target to watch being at $34.15, its highest point in January this year.

On the other hand, a move below the important support level of $19 will invalidate the bullish forecast.

This article is for informational purposes only and does not constitute financial advice. Equity and cryptocurrency markets can experience sharp price movements.