Mr. Tom Lee is urging Bitmine shareholders to approve a proposal to significantly expand the number of shares the company can issue. This will facilitate future stock dilution as Bitmine adopts Ethereum as a core asset.
Mr. Lee requested investors to support the proposal to increase the allowable stock limit from 500 million shares to 50 billion shares in his New Year's message. The voting will close on January 14th, and Bitmine's annual shareholders' meeting is scheduled for January 15th in Las Vegas.
Bitmain share dilution controversy... related to Ethereum
Mr. Tom Lee mentioned that this expansion does not mean that Bitmain will immediately issue all shares.
He explained that this measure allows the company to respond flexibly to future capital demands and makes stock splits possible when the stock price rises significantly.
Bitmain converted ETH into a major asset last year. Since then, the company has gradually increased its Ethereum holdings and has begun transforming into a leveraged Ethereum asset structure, unlike traditional mining companies.
Over the past month, the company has purchased more than $1.1 billion worth of Ethereum.
Mr. Lee stated that Bitmain's stock price is now more closely tied to the ETH price than to performance indicators for shareholders.
According to his opinion, if the price of Ethereum rises sufficiently over time, issuing new shares to secure additional ETH could still benefit shareholders, even if their ownership percentage decreases.
If this proposal passes before the shareholder meeting on January 15 in Las Vegas, Bitmain will have significantly more stock available, which can be used as follows.
Capital raising (including funds for additional Ethereum purchases)
Mergers and acquisitions or strategic transactions
Stock split (according to Mr. Lee, to maintain 'public investor accessibility')
Mr. Lee emphasized to investors that an increase in the number of available shares does not immediately mean stock dilution. The actual dilution effect only occurs when new shares are issued.
He also mentioned that the stock split is a key background for this proposal. He explained that if Bitmain's stock price rises along with ETH, a split may be necessary to keep individual investors accessible. A higher issuance limit helps facilitate such splits.
Meanwhile, this proposal offers shareholders a crossroads. Even if this proposal is approved, ownership will not be diluted immediately, but the threshold for future stock dilution linked to Ethereum will be lowered.