BitMine chairman proposes 1,000x increase in company's authorized shares, to 50B

Tom Lee, president of publically listed Ether treasury institution BitMine, urged shareholders to backmost a connection to dramatically summation the company’s authorized stock number to 50 cardinal from 50 million, citing the imaginable request for aboriginal banal splits arsenic Ether’s terms drives the the company’s valuation.

Lee said BitMine’s stock terms intimately tracks the terms of Ether (ETH), and that helium modeled imaginable aboriginal valuations utilizing the ETH/Bitcoin ratio. According to Lee, ETH could scope $250,000 if Bitcoin (BTC) climbs to $1 million, a script that would propulsion BitMine’s stock terms to levels helium said would beryllium inaccessible for astir retail investors.

BitMine shifted from operating arsenic a Bitcoin mining and holding institution to an ETH treasury strategy successful 2025, but it inactive retains immoderate of its Bitcoin operations.

ETH reaching $250,000 puts BitMine shares astatine an “implied price” of astir $5,000 per share, according to Lee, which is acold excessively costly for astir retail investors. “Not everybody wants a banal terms astatine $500, $1,500, oregon $5,000. Most radical privation shares to enactment astatine astir $25.” 

Source: Tom Lee

Lee said if ETH hits $250,000, BitMine would person to initiate a 100:1 banal divided to support a stock terms of $25, which would make 43 cardinal shares outstanding.

“The existent shares outstanding are 426 million, and we are trying to get the authorized stock number to 50 billion. That doesn't mean we're issuing 50 cardinal shares. That's what we privation the full maximum shares to be,” Lee said.

Source: Tom Lee

Lee is describing the unit bias problem. In finance, portion bias is the intelligence inclination for investors to prioritize the fig of shares oregon tokens owned implicit their instrumentality connected investment, risk-to-reward ratio, oregon different captious metrics of evaluating an investment.

Reactions to Lee’s proposal connected X were overwhelmingly negative, with respective users arguing that raising the authorized stock bounds is simply a dilutive move. 

“Tom, this looks fishy and ridiculous to authorize a higher stock number due to the fact that the banal mightiness spell to $500. You tin bash this adjacent twelvemonth erstwhile it isn’t successful the gutter,” a idiosyncratic wrote successful response. 

Source: WAGMI Capital MGMT

Related: BitMine locks up $1B successful Ether arsenic large corporates involvement ETH for yield

BitMine buys different $98 cardinal successful ETH, arsenic stash crosses 4 million

BitMine bought 32,938 ETH connected Tuesday, valued astatine implicit $102 cardinal utilizing prices astatine the clip of this writing.

The company’s treasury crossed 4 cardinal ETH, valued astatine implicit $12 billion, successful December, arsenic it besides began staking ETH to gain yield.

Staking successful crypto refers to the process of validators locking up tokens to unafraid a proof-of-stake blockchain, allowing them to gain output paid successful the staked token.

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