The BitMine stock price has suffered a harsh reversal in the past few months as demand for crypto treasury companies waned in Wall Street and as Ethereum retreated from its all-time high. Still, fundamentals suggest that the stock will rebound, and possibly blast past $70, its highest level in October.
Why the BitMine stock price has imploded
The BMNR stock price has imploded, a move that has erased billions of dollars in value, bringing its market capitalization to $15 billion, down from over $18 billion.
This crash is mostly because of the ongoing Ethereum price retreat as it moved from the all-time high of $4,950 in August to $3,313 today. This is notable because BitMine has emerged from obscurity into the biggest Ethereum holder in the world with over 3.8 million coins worth over $12.8 billion. It holds about 3.2% of the circulating supply.
BitMine stock price has also plunged as demand for Digital Asset Treasury (DAT) companies has stalled in the past few months, with all of them plunging. SharpLink, the second-biggest Ethereum treasury company, has plunged by over 70% from its all-time high. Similarly, the MSTR stock price has remained in a deep bear market in the past few months.
These companies have dropped as investors questioned their business models of borrowing months to invest in Bitcoin and other coins. One of the primary arguments among investors is why these companies have a premium to their crypto holdings.
Why BMNR stock may rebound
Still, there are a few reasons why the BMNR stock price will rebound in the coming weeks or months.
First, while BitMine and Strategy are similar companies, the former is a more superior one in that it holds Ethereum, a coin that offers a monthly return.
BitMine is now working on its staking solution, which will be launched in 2026, and according to Tom Lee, the company will be making at least $400 million of high-margin return on its Ethereum holdings. It will likely return these staking returns to investors as dividends or continue its Ethereum accumulation strategy.
This is a different model to MSTR, which only benefits when Bitcoin price is rising and does not generate a monthly return to investors.
Second, technicals suggest that the Ethereum price is on the verge of a strong bullish breakout in the coming days. For one, it is about to flip the Supertrend indicator from red to green for the first time since July this year. Such a move would confirm the bullish outlook and push it higher.
Ethereum price has also moved above the upper side of the falling wedge pattern, which is one of the most popular bullish reversal signs in technical analysis. It is also about to move above the 50-day moving average. Therefore, the coin may eventually rebound to the psychological level at $4,000 in the coming weeks or months.
Third, BitMine has a clean balance sheet with over $900 million in cash and no debt, a move that gives it the flexibility it needs to accelerate its Ethereum purchases towards its goal of owning 5% of the network.
Most importantly, Ethereum has emerged as the most important player in the crypto industry as most companies are now building on it. This includes large companies like JPMorgan and Janus Henderson, which have opted for the network for their real-world asset tokenization solutions.
Ethereum has continued to gain market share in key industries like RWA and DeFi despite the recent launches of networks like Plasma, Midnight, and Keeta. It also has a market dominance of over 63% in the decentralized finance industry and in stablecoins. This growth will continue after the recent launch of the Fusaka upgrade.
All this has helped to push Ethereum’s supply in exchanges to a record low, a sign of increased demand from ETFs, stakers, and other investors.
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