BitMine Immersion Sitting on $4B Loss on Ether Bet as Analyst Warns of Structural issues

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BitMine Immersion Sitting on $4B Loss on Ether Bet as Analyst Warns of Structural issues

Tom Lee's company could trap shareholders amid low staking yields, hefty embedded fees and vanishing NAV premium, 10x Research founder Markus Thielen warns.

By Krisztian Sandor|Edited by Stephen Alpher

Updated Nov 21, 2025, 6:07 p.m. Published Nov 21, 2025, 6:06 p.m.

Thomas Lee, Fundstrat Capital co-founder and CIO, BitMine chairman (CoinDesk)

What to know:

• BitMine Immersion is sitting on steep unrealized losses on its ether (ETH) holdings as crypto prices plunge.
• The company reported $328 million in profit for fiscal 2025, but it faces structural issues, 10x Research's Markus Thielen warned.
• Investors could be trapped in an opaque, costly structure as high compensations, lackluster ETH staking yield and disappearing NAV premium linger, Thielen said.

BitMine Immersion (BMNR), the largest Ethereum-focused digital asset treasury (DAT) firm and helmed by Wall Street veteran Thomas Lee, is sitting on steep unrealized losses on its big bet on ether ETH$2,760.16.

The firm reported Friday $328 million in net income for its fiscal year ended August 31, while fully diluted earnings per share came in at $13.39. It also declared a nominal dividend of $0.01 per share and announced plans to launch a staking infrastructure product, MAVAN (Made-in America Validator Network), in early 2026.

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Despite the positive headline earnings, Markus Thielen, founder of 10x Research, warned that the company, as well as other DATs, face deep structural issues.

The firm is now estimated to be sitting on over $4 billion in unrealized losses on its holdings following a 45% decline in ETH prices since the August peak. BMNR's stock price plunged 84% from its July peak, with the drawdown erasing the net asset value (NAV) premium that once fueled investor enthusiasm, Thielen noted.

Thielen argued that many Digital Asset Treasury (DAT) firms rely on complex and layered entities such as asset managers, strategic advisors and promotional figureheads with high paychecks while embedding fees that "quietly erode returns."

He pointed out that BitMine’s leadership compensation and external advisors could extract $157 million per year over 10 years through compensation and advisory contracts.

Ether's staking yield, a key revenue source on the crypto holdings, doesn't look that compelling to investors, Thielen noted. According to the CESR Composite Ether Staking Rate, ether's staking yield is currently at around 2.9%, which is far below U.S. dollar money market fund yield that's considered risk-free. Once operational costs and intermediaries are accounted for, the effective yield to shareholders is far lower, Thielen said.

"No serious institutional allocator will accept" that yield, Thielen said, especially with when ETH's "price volatility puts the underlying collateral at constant risk."

Thielen warned that DATs could trap shareholders, especially as the NAV premium collapses. "Investors find themselves trapped in the structure, unable to get out without significant damage — a true Hotel California scenario," he said.

Ethereum NewsDigital Asset TreasuryEthereum Treasury Markus thielen10x researchCoinDesk Wealth

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