by In a striking move, Kerrisdale Capital has taken a short position against BitMine Immersion (BMNR), the ether-focused digital asset treasury firm led by Thomas Lee of Fundstrat. This bold stance comes as Kerrisdale criticizes BitMine’s business model, labeling it as a relic of an outdated crypto era. In a comprehensive report released on Wednesday, Kerrisdale asserted that BitMine’s strategy resembles that of MicroStrategy (MSTR)—issuing shares at a premium to acquire cryptocurrency and enhance token-per-share metrics. However, they argue that current market conditions no longer favor this approach.
“BMNR is chasing a model that is on its way to extinction,” Kerrisdale’s report states, highlighting the diminishing factors of scarcity and meme-like enthusiasm that once supported high premiums despite ongoing dilution.
BitMine Immersion: A Shift in Strategy
Over the past year, Las Vegas-based BitMine has made a significant pivot from being a niche Bitcoin miner to establishing itself as an ether-heavy corporate treasury. Under the leadership of Thomas Lee, BitMine has successfully raised over $10 billion since July 2025, primarily through at-the-market (ATM) stock sales. The firm has also amassed a substantial holding of more than 2.8 million ETH.
Initially, BitMine’s stock saw an explosion in value, soaring from approximately $5 to over $100 following the announcement of its ether treasury strategy. However, this upward momentum has faltered, with the stock now trading around $58.
Stock Issuance and Investor Sentiment
Kerrisdale pointed out that the rapid pace of stock issuance—averaging about $170 million per day—has led to what they describe as “early enthusiasm turning into fatigue.” Furthermore, they criticized BitMine’s recent $365 million equity raise, which was marketed as a premium deal but is viewed by Kerrisdale as a “discounted giveaway” once the terms of the warrants are considered.
The report did not spare Lee himself from scrutiny, suggesting that while he provides name recognition as a strategist and television commentator, he lacks the “cult-like” following that has propelled other figures in the crypto space, such as Michael Saylor, to meme-stock status.
Kerrisdale’s Bullish Outlook on Ether
Despite their bearish stance on BitMine, Kerrisdale remains optimistic about the future of ether itself. They argue that there is no rationale for paying a premium through intermediaries like BitMine. “If you want ETH, just buy it directly,” they advise, emphasizing the simplicity and cost-effectiveness of acquiring ether without additional layers.
Increasing Competition in Crypto Treasury Offerings
Adding to BitMine’s challenges is an influx of new competition. Reports indicate that over 150 U.S.-listed firms are preparing to launch approximately $100 billion in crypto treasury offerings, coupled with an anticipated wave of Ethereum ETFs that promise lower-cost and more transparent exposure to ether.
Kerrisdale has also noted a decline in the transparency of BitMine’s disclosures, with ETH-per-share growth slowing markedly in recent months even as token holdings have increased. They pointed out that the reflexive loop that every Digital Asset Trust (DAT) relies on is showing signs of stalling, with BitMine’s market premium falling sharply from 2.0x in August to roughly 1.2x in October.
Conclusion: The Future of BitMine Immersion
“The strategy is generic, the competition is mushrooming, disclosures have grown opaque, and ETH-per-share growth has slowed,” Kerrisdale concluded. “BMNR’s premium is destined to sink.” As the cryptocurrency landscape continues to evolve, investors and stakeholders are left to ponder the implications of Kerrisdale’s report on BitMine and the broader market.
A representative from BitMine did not respond to requests for comment. As of Wednesday, shares of the company have decreased by 2%.
For those interested in exploring more about cryptocurrency investments, consider visiting our guides on How to Buy Ethereum and Bitcoin ETFs. Understanding these investment avenues could provide valuable insights into the shifting dynamics of the crypto market.
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Discover why Kerrisdale Capital has taken a short position against BitMine Immersion (BMNR), led by Thomas Lee. Explore insights into the challenges facing BitMine’s ether-focused strategy and the evolving crypto landscape.
