Bitmine Proposes $300M 9.5% Preferred Stock to Fund ETH Staking
BMNR•Bitmine launches $300M preferred stock sale at 9.5% yield to fund Ethereum staking, net cost of capital roughly 6.5%. Meanwhile, its chief strategist Tom Lee faces nearly $9B unrealized losses as Ether slides below $1,800.
1. Ethereum Price Slide and Losses
Ether’s decline below $1,800 has triggered an estimated $9 billion unrealized loss for Tom Lee’s crypto positions, marking one of the largest paper losses tied to Ethereum exposure. The drop intensifies scrutiny on leveraged strategies and heightens concerns over margin calls for major market participants.
2. $300M Preferred Stock Offering
Bitmine is proposing a $300 million preferred stock issuance carrying a 9.5% annual dividend aimed at investors seeking Ethereum exposure. Proceeds are earmarked for staking operations, offering shareholders a direct link to Ether yields while supplementing the company’s liquidity.
3. Net Capital Cost and Risks
With Ethereum staking generating roughly 3% annually, the effective cost of capital on the preferred issuance stands near 6.5%. While this structure appears more conservative than some bitcoin-backed debt plays, the high leverage introduces refinancing and market-price volatility risks if Ether prices remain depressed.
