Ethereum loses significant "bull market firepower"? Wall Street "math whiz" suffers defeat at Ethereum: Bitmine (BMNR.US), personally trading, loses a staggering $1.3 billion

The enterprise buying frenzy surrounding Ethereum seems to be unraveling in real-time. The global number two cryptocurrency, Ethereum, fell below $3,400 on Tuesday as Wall Street's bullish sentiment fueled by the AI boom significantly waned, leading to a sharp decline in market risk appetite. Ethereum, along with the "cryptocurrency bellwether" Bitcoin and other cryptocurrencies, followed the downward trend of US technology stocks simultaneously, but the correction in cryptocurrencies was much more severe compared to stocks. During this period, both technology stocks and cryptocurrencies, which have historically moved almost synchronously, faced massive sell-offs, causing the price of Ethereum to retreat by 30% from its August all-time high. This brought the price back to levels before the wave of US-listed companies focusing on accumulating Ethereum. These companies, known as "treasury companies," which have been accumulating Bitcoin or Ethereum in large quantities in recent years, have essentially exhausted their idle cash (fully invested in cryptocurrencies) and may be inclined to sell cryptocurrencies to protect profits during this market downturn, further solidifying the downturn of this decentralized token. The largest cryptocurrency in the world, Bitcoin, although fared better than Ethereum in recent drops, also suffered a significant decline. Bitcoin erased all its summer gains and dropped below $97,000 at one point during New York trading hours on Tuesday, breaking the $100,000 mark for the first time since June. This decline of over 20% from its all-time high a month ago is consistent with the pullback in the US stock market, particularly the tech-heavy Nasdaq 100 index during the bear market period. Data from market research firm 10x Research shows that this reversal has led the most aggressive corporate supporters of Ethereum, such as Bitmine Immersion Technologies Inc. (BMNR.US), which is listed on the US stock market, to face over $1.3 billion in unrealized losses. This listed company, funded by Silicon Valley "venture capital godfather" and billionaire Peter Thiel, with seasoned stock market veteran Tom Lee, known as "Wall Street oracle," at the helm, essentially replicates the approach of MicroStrategy, founded by Michael Saylor, of the "treasury companies" with Bitcoin assets on the balance sheet, buying 3.4 million Ethereum at an average price of up to $3,909. With the "ammunition" fully deployed, Bitmine is currently facing increasing pressure. Bitmine, which has propped up the Ethereum bull market, is facing a major challenge "For months, Bitmine has been pushing the narrative of a super bull market for Ethereum and the flow of cryptocurrency funds," 10x Research wrote in a report. "And now, its cash reserves are almost entirely depleted, and it has over $1.3 billion in unrealized losses, with no dry powder available." This research report points out that retail investors who bought Bitmine stock assets at a premium above their net asset value (NAV) are facing more severe impacts, and the market's interest in "catching flying knives" is understandably limited. Tom Lee, who also serves as the chairman of Bitmine, is the co-founder and managing partner of Fundstrat Global Advisors, one of Wall Street's top asset management firms. He did not immediately respond to requests for comment. Representatives of Bitmine also did not respond immediately. Tom Lee has been one of the few bullish forces on Wall Street in recent years to accurately predict the direction of the S&P 500 index, especially foreseeing a bull market in 2023-2024 when pessimism shrouded Wall Street at the end of 2022, earning him the nickname "Wall Street oracle." Bitmine Immersion publicly disclosed its transition from a mining business to an Ethereum treasury strategy. Bitmine sees its stock ownership as a "financing engine" and Ethereum (ETH) as a "currency-like high beta + functional asset." Under the structural trend of Ethereum scalability landing, ETFs gaining popularity, and global RWA on-chain trends, Bitmine amplifies sensitivity of each share to ETH; it follows a similar strategy as MicroStrategy's Bitcoin treasury approach, but the staking/application layer of ETH may bring both excess alpha returns and additional execution requirements and compliance complexity. Bitmine's massive bet is not just a simple balance sheet trade. The company's cumulative actions reflect a grander vision: that digital assets can transition from speculative tools to the corporate financial infrastructure, strengthening Ethereum's value and trading position in the global financial mainstream. Tom Lee and other Ethereum supporters believe that by locking Ethereum in the treasuries of listed companies, businesses will help usher in a new decentralized economy, where code replaces traditional contracts, and Ethereum tokens act as real assets. Bitmine's ambition, or rather Ethereum's ambition, helped drive the unprecedented bull market in Ethereum last summer, pushing the price of Ethereum to nearly $5,000. Additionally, Ethereum ETFs attracted over $9 billion in inflows in just July and August. However, since the significant drop in the cryptocurrency market on October 10th, the situation has completely reversed: according to the latest data compiled by Coinglass, Ethereum ETFs have seen outflows of $850 million since then, and the size of outstanding Ethereum futures contracts has decreased by $16 billion. Tom Lee had recently staunchly predicted that Ethereum would rise to $16,000 by the end of this year. Bitmine, whose stock price has plummeted over 70% According to Artemis's statistics, Bitmine's multiple of market value to net asset value (mNAV) has plummeted from 5.6 times in July to just 1.2 times currently, and Bitmine's stock price has dropped by 70% since its historical peak earlier this year. Similar to other listed companies linked to Bitcoin assets, Bitmine's stock price now trades closer to its underlying holdings, as the market reevaluates the high valuation multiples previously attached to its cryptocurrency assets on the balance sheet. Bitmine's mNAV premium drops significantly Last week, another publicly listed company with a much smaller market value, ETHZilla (ETHZ.US), which also holds an Ethereum treasury, sold holdings worth $40 million to buy back stocks in an attempt to return its mNAV ratio to a normal range. The company stated in a press release, "ETHZilla plans to use the remaining profits from the sale of Ethereum for additional stock buybacks and intends to continue selling Ethereum to buy back stocks until its net asset value discount returns to normal." While the price has dropped, the long-term fundamentals of Ethereum, a popular cryptocurrency, still appear very robust: its on-chain value surpasses that of any competitor's smart contract network, including Solana, and its staking mechanism gives the token both yield properties and deflationary features. However, with competitors like Solana making positive strides in underlying technology, a reversal in ETF flows, and a decrease in interest from retail investors, the significant corporate buying from entities like Bitmine that once stabilized the narrative of a bull market for cryptocurrencies is now being severely shaken. Fundamentally, Ethereum is an open-source blockchain platform designed to support decentralized applications (DApps) and smart contracts. Ethereum is not just a cryptocurrency (ETH); it provides a decentralized computing platform that can run code. Smart contracts allow users to trade directly without intermediaries, with contract execution relying entirely on code execution rather than third-party trust. Solana, self-proclaimed as the "Ethereum killer," has become a preferred network for decentralized cryptocurrency issuance, and its innovative PoH and PoS hybrid consensus mechanism gives it a significant advantage in transaction speed and fees compared to Ethereum.