In the cold winter of the cryptocurrency market, BitMine's accumulation strategy is more aggressive than a polar bear.
While most investors are sighing over their shrinking account balances, BitMine, the world's largest Ethereum treasury company, is executing the boldest 'greed' action in the history of the crypto world. On December 18, they purchased another 48,049 ETH, worth approximately $141 million.
As of today, BitMine's total ETH holdings have reached approximately 3.608 million coins, accounting for nearly 3.1% of the circulating supply of Ethereum, and is about 62% towards the company's long-term goal of 'holding 5% of the circulating supply'.
01 The courage of counter-cyclical layout
During market panic, BitMine's buying strategy is a quintessential reflection of 'anti-human' behavior. While ordinary investors are cutting losses and exiting, this institution has entered a 'buying the dip' mode.
Since December alone, BitMine has accumulated 679,000 ETH worth over $2.1 billion, becoming the primary buyer of ETH in the current market. Even more surprising is that their average purchase price is around $4,009; based on the current ETH price of $2,948, they face an unrealized loss of nearly $3 billion, but this has not shaken their resolve.
BitMine's board chairman Tom Lee has publicly expressed bullish views on Ethereum multiple times, insisting on a 'low-position incremental' strategy. Behind this counter-cyclical layout is a firm belief in Ethereum's long-term value, rather than concerns over short-term price fluctuations.
02 Precisely calculated accumulation strategy
BitMine's accumulation is by no means blind impulse, but a meticulously designed capital operation. Their buying operations feature significant precision, often using a staggered approach to avoid the impact of large trades on market prices.
From their accumulation pace, a clear pattern emerges: they consistently increase buying intensity during market correction phases. For example, during the 'October 10.11 crash', they accumulated nearly 380,000 ETH, and in late November, they added over 69,000 ETH in a single week.
This 'buying the dip' strategy not only lowers the average cost but also provides liquidity support during market panic. BitMine's accumulation has transcended simple asset allocation, becoming a strategic action that influences market psychology.
03 Sufficient financial ammunition
Any large-scale accumulation action requires a solid financial backing, and BitMine is well-prepared in this regard. The company currently holds approximately $11.8 billion in crypto assets and cash, including $607 million in uncollateralized cash.
Their funding comes from three main pillars: profits from immersion cooling mining, Ethereum staking rewards, and secondary market stock financing. Several well-known institutions have participated in their financing plan, providing a stable cash flow for continued accumulation.
Even more impressive is that BitMine has raised its fundraising target for purchasing ETH to $24.5 billion, demonstrating its full confidence and preparation for future accumulation. This scale of financial preparation allows BitMine to maintain a continuous 'shopping spree' in the market.
04 Why 5%? Analysis of strategic intent
The target of 'holding 5% of the circulating supply' set by BitMine is not a random choice, but a strategically calculated deployment. This ratio is sufficient for the company to have a significant influence in the Ethereum ecosystem.
When an institution holds 5% of the circulating supply of an asset, it has transformed from an ordinary investor into a market shaper. BitMine's substantial holdings not only recognize Ethereum's value but will also further tighten the circulation supply of ETH, significantly impacting market prices.
From a broader perspective, BitMine is replicating MicroStrategy's successful experience in the Bitcoin space, but with important innovations. Unlike Bitcoin, Ethereum provides BitMine with diversified sources of income, including staking rewards and opportunities to participate in the DeFi ecosystem.
As ETH prices fluctuate below $3,000, market bullish and bearish divergences intensify. On one side is BitMine's continuous accumulation, while on the other are the passive liquidations of highly leveraged investors. This disparity reflects the maturation trend of the crypto market, where institutional funds are gradually dominating the market in a compliant and stable manner.
BitMine's '5% journey' is not yet over; their purchases may continue. For ordinary investors, the scale of institutional funds and risk tolerance is unmatched, necessitating caution regarding investment risks amid market volatility, but they should also pay attention to the symbolic significance of such institutional confidence.
In the coming quarters, when the market reflects on this period of history, BitMine's crazy hoarding behavior will either become a textbook success story or a classic case of overconfidence failure. Personally, I lean towards the former; in times of fear, greed requires not only courage but also foresight.
What do you think of BitMine's aggressive strategy? Feel free to share your thoughts in the comments!
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