Invest1 publisher2 min readPublished
Bitmine is about seven weeks of buying at last week's pace from owning 5% of ether
Bitmine added 17,362 ether last week to hold about 4.9% of supply, while Strategy bought 1,665 bitcoin to reach 847,666. Both kept buying as prices eased, with Bitmine now near a 5% target it set itself and Strategy adding about 0.2% to its holdings.
The Investor · Invest desk
What happened
- Strategy paid for the bitcoin, bought between September 21 and 27, by selling common stock through an existing at-the-market program.
- The same filing showed Strategy retired about $152 million of STRC preferred stock and held $6.02 billion in dollar assets as of September 27.
- Bitmine says it is 98 percent of the way to its stated "Alchemy of 5 percent" target for ether ownership.
- Bitcoin slipped toward $83,000 after recently testing levels above $87,000, and ether traded near $2,700.
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Why it matters
- cost Strategy's common shareholders bear the dilution from funding bitcoin with share sales while $6.02 billion of dollar assets, enough for about 42 weeks at last week's rate, stays in reserve.
- exposure A $1,000 move in bitcoin shifts the value of Strategy's 847,666 coins by about $848 million, nearly six weeks of buying at last week's size.
- constraint If Bitmine stops at 5%, ether loses a buyer taking about 17,000 tokens a week, part of the corporate bid Crowdfund Insider credits with limiting downside.
At an average of roughly $85,681, Strategy's 1,665 bitcoin cost about $142.7 million [1][1]. That is about $9 million less than it spent retiring STRC preferred stock in the same week [2][11]. The purchase added about 0.2% to its holdings [2]. Its average cost sits about 3.1% above the $83,000 area bitcoin slipped toward once the new week opened [8][4].
According to Crowdfund Insider, traders blamed renewed tension around the Iran conflict and doubts about the return on AI capital spending [9]. The same report wrote that "corporate treasury buying provides a persistent bid that can limit downside" [10]. Strategy's buying window closed on September 27 [1], and bitcoin opened the following week with a modest pullback [8].
The case that treasuries are absorbing supply is stronger on ether. Bitmine's 17,362 new tokens come to about $46.9 million at the roughly $2,700 ether traded at [4][8][5]. Its holdings of just over 6 million tokens are worth about $16.2 billion at that price, roughly 94% of the $17.2 billion Bitmine reports across cash, bitcoin and other investments [6][6]. Tom Lee, Bitmine's chairman, described the milestone as a "tremendous achievement" reached in under 15 months [7].
On Bitmine's own figures, 6 million tokens at 4.9% and 98% of the way to target, circulating supply is near 122 million ether and the gap to 5% is about 122,000 tokens [5][7]. Closing it costs roughly $330 million at $2,700 [8]. At last week's pace it takes about seven weeks [9]. The report does not say what Bitmine plans once it gets there.
This could go differently in three ways. Bitmine could set a target above 5% and keep its ether bid going well past seven weeks. Strategy could sell more stock until its weekly bitcoin spending clearly exceeds what it puts into preferred buybacks. Or Lee could be right that money rotating out of crowded technology trades is already supporting crypto [13], and prices would not need treasury orders as much.
In my view the supply argument holds for ether and is thin for bitcoin. Last week more of Strategy's cash went to preferred stock than to coins [11]. The counter-case is that Strategy funds its bitcoin by issuing shares [3], so its buying can continue for as long as buyers take the stock. Either of the first two outcomes would prove this view wrong within a few weekly filings.
What to watch
- The August PCE print due September 30, and whether markets keep pricing a high probability of another Fed rate increase in October.
- The November 3 midterms, where a change in congressional control could reshape digital-asset regulation for both treasury companies.