A Bitcoin (BTC) mining company backed by tech billionaire Peter Thiel just announced that it is on track to become one of the world’s largest holders of Ethereum (ETH).
In a statement, BitMine says it has accumulated over $1 billion worth of the second-largest crypto asset by market cap just days after closing a $250 million private placement to support its Ethereum treasury strategy.
The company’s newly appointed chairman of the board of directors, Fundstrat’s Thomas Lee, says that BitMine is well on its way to achieving its goal of acquiring and staking 5% of the total supply of ETH.
According to Lee, BitMine seeks to become the MicroStrategy of Ethereum. The software company now known as Strategy already holds 601,000 BTC worth about $72 billion, or around 2.865% of the total supply of the flagship crypto asset.
“Among Bitcoin treasury companies, we have witnessed the reflexive benefit of acquiring large holdings… Such sizable holdings have created a ‘sovereign put’ for the company, meaning a nation-state views MSTR holdings as attractive if a nation ever wanted to acquire 5% of the Bitcoin network. Similarly, ETH Treasuries, which accumulate 5% of ETH supply, can benefit from a similar ‘Wall Street put.'”
BitMines aims to increase the amount of ETH held per share by reinvesting the company’s cash flows as well as through capital markets activities, staking yields and changes in the value of the crypto asset.
As of July 17th, the company holds a total of 300,657 ETH worth about $1.085 billion.
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