Bitmine Makes Bold Contrarian Move: Launches High-Yield Preferred Stock to Deepen Ethereum Holdings Despite Billions in Unrealized Losses
In a striking display of conviction, major Ethereum investor Bitmine is embarking on a bold contrarian strategy. Despite grappling with a staggering $9.2 billion in unrealized losses on its Ethereum holdings, the company has announced plans to raise capital through the issuance of high-dividend perpetual preferred stock, specifically to further accumulate Ethereum.
The Offering: High Yields and Investor Protections
According to a Form 424B5 filing submitted to the U.S. Securities and Exchange Commission (SEC) on Wednesday, Bitmine has applied for a public offering of 3 million shares of its Series A Perpetual Preferred Stock. Each share will carry a par value of $100 and offer an attractive fixed cumulative dividend rate of 9.50% per annum.
Adding to its appeal, Bitmine intends to distribute these dividends on a weekly cash basis. Should the company face a dividend default, unpaid dividends will accrue with compounding interest, starting at an initial default rate of 9.55%. This rate is slated to increase by 5 basis points (0.05%) per period, capped at a maximum of 15%, providing robust protection for investors.
NYSE Listing and Underwriters
Bitmine has also applied to list these preferred shares on the New York Stock Exchange (NYSE) under the ticker symbol “BMNP”. Trading is anticipated to commence within 30 days of the initial offering. The offering will be jointly led by prominent investment banks Moelis & Company and Cantor as underwriters.
Strategic Rationale: Doubling Down on Ethereum
The net proceeds from this ambitious fundraising initiative are earmarked for general corporate purposes, with a clear focus on expanding Bitmine’s Ethereum portfolio and bolstering its staking operations. This move underscores Bitmine’s long-term bullish outlook on the second-largest cryptocurrency, even amidst market volatility.
A Precedent for Success: The Strategy Model
This strategy draws parallels with Strategy’s highly successful high-yield perpetual preferred stock, STRC. Offering an 11.5% dividend yield, STRC has become a favored vehicle for investors seeking stable income coupled with indirect exposure to Bitcoin. Since its initial public offering in July 2025, which garnered approximately $2.52 billion, Strategy has consistently expanded its fundraising through subsequent offerings, ballooning STRC’s nominal total to an impressive $10.5 billion. Bitmine appears to be leveraging a similar model to attract capital in a challenging market.
Navigating Market Headwinds: Unrealized Losses and Continued Accumulation
The timing of Bitmine’s latest move comes amidst a prolonged downturn in the cryptocurrency market. Blockchain data platform Dropstab estimates that Bitmine’s current unrealized losses on its Ethereum position stand at a substantial $9.2 billion. Yet, this hasn’t deterred the firm from its accumulation strategy. As recently as June 1st, Bitmine announced the acquisition of an additional 26,497 Ethereum, bringing its total holdings to an impressive 5,416,901 ETH.
Market Snapshot: ETH and Bitmine Stock Performance
As of the time of writing, Ethereum is trading at approximately $1,769, marking a 5.5% decline over the past 24 hours and a significant 32% drop over the last year. Bitmine’s stock also reflected the broader market sentiment, closing down 5.95% on Wednesday at $16.9.
Disclaimer: This article is for market information purposes only. All content and views are for reference only, do not constitute investment advice, and do not represent the views and positions of BlockTempo. Investors should make their own decisions and trades. The author and BlockTempo will not bear any responsibility for direct or indirect losses resulting from investor transactions.
