BitMine sets 5% Ether supply ‘hard cap’ as accumulation target nears

BitMine Immersion Technologies will cap its Ether holdings at 5% of the cryptocurrency’s supply, according to Chairman Tom Lee.

Speaking during a keynote at Token2049 in Singapore on Wednesday, Lee said BitMine is nearing the threshold after accumulating roughly 6 million Ether, equivalent to about 4.9% of the supply. He said the company needs about 100,000 ETH more to reach its target.

“That’s a hard cap. We’re not gonna be accumulating past 5%,” Lee said. “We’re not gonna own more than 5% of Ethereum.”

Lee had previously left open the possibility of accumulating more than 5% of Ether’s supply depending on Ethereum adoption. In an August interview with Bankless, he said the company may revisit that possibility in 2027.

BitMine says it is “done stacking” Ether

Lee said BitMine accumulated most of its Ether during what he described as a crypto bear market, saying that the company was able to build its position while prices were depressed. 

“We did all this buying in a bear market,” Lee said. “We protected the downside for ETH because we were buying. But now, we’re done stacking in front of a 25X move.”

Lee also tied the 5% hard cap to BitMine’s capital strategy. Stopping its accumulation would remove the need to raise additional funds to keep buying Ether. 

“So if we have a 5% hard cap, that means we’re gonna outperform ETH on the way up, right?” Lee said. “‘Cause you don’t have to worry about us trying to raise capital. We’re done.”

Related: Bitmine projects $334M in annual staking revenue from $15.8B crypto treasury

BitMine has tapped capital markets to build its Ether treasury. In June, the company launched a $300 million perpetual preferred stock offering. By early August, BitMine had repurchased 16.1 million common shares under its $4 billion buyback program.

Even after Ether purchases stop, staking could add to BitMine’s holdings. Lee previously said the company could sell ETH earned through staking to prevent its share of supply from rising above 5%.

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