Tonight, people in crypto circles are saying Bitmine is sitting on a $9 billion paper loss. The number gets copied around, with some saying $8.8 billion and others $9.7 billion. Let me separate what can be verified from what doesn't quite add up.
What can be verified is what the company reported itself. For the fiscal year ending August 31 this year, Bitmine's 10-K is clear: a net loss of more than $6.3 billion, of which about $6.23 billion was unrealized fair-value losses on digital assets. On that date, it held 5,901,837 ETH on its books, at a cost of about $19.95 billion and a fair value of about $14.56 billion. That works out to an average cost of around $3,380 per coin. Ethereum closed at about $2,466 then, already down roughly 44% during the fiscal year from around $4,390. The previous fiscal year, it had made a profit of $348.6 million.
Prices haven't stopped moving since August. Today, Ethereum on Binance spot hit a low of $1,711.08 and is now around $1,830. The company's November 9 announcement used holdings as of 2 p.m. Eastern Time on November 8: its position had grown to 6,070,092 ETH, or about 4.97% of the circulating supply, just shy of its own “Alchemy of 5%” target. Of those, 5,227,037 were staked—more than 86%. The announcement did not provide a new blended cost basis. Those charts online showing $8.8 billion or $9.7 billion in losses are mostly taking the $3,380 average cost from August, applying it to the larger holdings in November, then subtracting the market value at the time. That's not a new, officially disclosed company loss, nor is it a loss realized through selling. But the direction is not in dispute. Using that old average cost as a rough estimate, at around $1,830 tonight, the 6,070,092 ETH would be worth about $11.1 billion, roughly $9.4 billion less than the assumed $20.5 billion cost. When it hit $1,711 today, that gap would have widened further, to more than $10 billion by a rough estimate.
Tom Lee was still talking about a supercycle on November 9. He cited Vitalik's “ETH is money” line at Devcon 8 in Mumbai, calling it an earthquake-like shift, and said a supercycle in tokenization and AI would allow ETH to capture value. The company's strategy hasn't changed either: keep buying, don't sell, and raise money by issuing shares to add to its holdings. During the fiscal year, it sold 395.1 million shares through ATM offerings alone, raising $13.2 billion gross. Last week, it also bought 9,587 ETH.
In my view, this logic just doesn't hold up. I'm not making some ranking-style claim that “ETH is the worst asset of all time”—that's an overblown statement, and there's no data to back it up with comparisons. What's really indefensible is treating a conference remark as justification for continuing to dilute shareholders in pursuit of a 5% holding target. By the end of August, the cost basis was already $3,380, while fair value had fallen to $2,466. The 10-K itself said that the price of ETH could continue to cause significant volatility in earnings and shareholders' equity. They didn't stop. The November 8 announcement used a price of $2,234 per coin, already far below the August book cost, and they were still inching toward 5%. Today's bounce to $1,830 hasn't even recovered the $2,466 fair value at the end of August, let alone the $3,380 cost basis. By the company's own figures, staking rewards were running at an annualized rate of about $309 million at the time; if the coin price falls further, that dollar income will shrink too.
What is the most likely next step? They'll buy the final 0.03%, then keep talking about tokenization and AI. This model was never about trading: issue shares, accumulate ETH, don't sell, and wait for the cycle. As long as ETH doesn't return to around its cost basis, that hole will remain on the books. Some people are treating today's green daily candle as a bottom, but for a treasury like Bitmine's, with a cost basis above $3,300, a bounce to $1,830 won't get it back to break-even.
#ETH #Bitmine
What can be verified is what the company reported itself. For the fiscal year ending August 31 this year, Bitmine's 10-K is clear: a net loss of more than $6.3 billion, of which about $6.23 billion was unrealized fair-value losses on digital assets. On that date, it held 5,901,837 ETH on its books, at a cost of about $19.95 billion and a fair value of about $14.56 billion. That works out to an average cost of around $3,380 per coin. Ethereum closed at about $2,466 then, already down roughly 44% during the fiscal year from around $4,390. The previous fiscal year, it had made a profit of $348.6 million.
Prices haven't stopped moving since August. Today, Ethereum on Binance spot hit a low of $1,711.08 and is now around $1,830. The company's November 9 announcement used holdings as of 2 p.m. Eastern Time on November 8: its position had grown to 6,070,092 ETH, or about 4.97% of the circulating supply, just shy of its own “Alchemy of 5%” target. Of those, 5,227,037 were staked—more than 86%. The announcement did not provide a new blended cost basis. Those charts online showing $8.8 billion or $9.7 billion in losses are mostly taking the $3,380 average cost from August, applying it to the larger holdings in November, then subtracting the market value at the time. That's not a new, officially disclosed company loss, nor is it a loss realized through selling. But the direction is not in dispute. Using that old average cost as a rough estimate, at around $1,830 tonight, the 6,070,092 ETH would be worth about $11.1 billion, roughly $9.4 billion less than the assumed $20.5 billion cost. When it hit $1,711 today, that gap would have widened further, to more than $10 billion by a rough estimate.
Tom Lee was still talking about a supercycle on November 9. He cited Vitalik's “ETH is money” line at Devcon 8 in Mumbai, calling it an earthquake-like shift, and said a supercycle in tokenization and AI would allow ETH to capture value. The company's strategy hasn't changed either: keep buying, don't sell, and raise money by issuing shares to add to its holdings. During the fiscal year, it sold 395.1 million shares through ATM offerings alone, raising $13.2 billion gross. Last week, it also bought 9,587 ETH.
In my view, this logic just doesn't hold up. I'm not making some ranking-style claim that “ETH is the worst asset of all time”—that's an overblown statement, and there's no data to back it up with comparisons. What's really indefensible is treating a conference remark as justification for continuing to dilute shareholders in pursuit of a 5% holding target. By the end of August, the cost basis was already $3,380, while fair value had fallen to $2,466. The 10-K itself said that the price of ETH could continue to cause significant volatility in earnings and shareholders' equity. They didn't stop. The November 8 announcement used a price of $2,234 per coin, already far below the August book cost, and they were still inching toward 5%. Today's bounce to $1,830 hasn't even recovered the $2,466 fair value at the end of August, let alone the $3,380 cost basis. By the company's own figures, staking rewards were running at an annualized rate of about $309 million at the time; if the coin price falls further, that dollar income will shrink too.
What is the most likely next step? They'll buy the final 0.03%, then keep talking about tokenization and AI. This model was never about trading: issue shares, accumulate ETH, don't sell, and wait for the cycle. As long as ETH doesn't return to around its cost basis, that hole will remain on the books. Some people are treating today's green daily candle as a bottom, but for a treasury like Bitmine's, with a cost basis above $3,300, a bounce to $1,830 won't get it back to break-even.
#ETH #Bitmine
