The stock price for Bitmine Immersion Technologies has since more than doubled in value, climbing to a peak of over $140 on Thursday. The increase comes on the heels of their announcement to raise $250 million through shares sales to purchase Ethereum (ETH). This rally has been more than 3,000%-plus in less than a week, since launching this fundraising effort.
Bitmine’s original business plan was centered on using immersion cooling for crypto mining. Now, it is trying to become a publicly traded ether proxy. Before this round of funding, the company owned $16 million worth of Bitcoin. The sky’s the limit. As you likely know, the company is currently led by Fundstrat’s Thomas Lee.
The offering in the company’s private placement, priced at $4.50 per share, drew very strong legs of institutional demand. Founders Fund, Pantera, FalconX, Kraken, Galaxy Digital and DCG all participated in the funding round. As a result, Bitmine is now set to become one of the largest publicly-traded ETH holders.
Bitmine’s parabolic rise is reminiscent of the trading activity seen with Sharplink Gaming. Sharplink Gaming, a public company that turned into an ETH treasury holding company, pumped by as much as 4,000% in just days. This activity came on the heels of their record $450 million fundraising announcement. Sharplink Gaming has since suffered a second fall of more than 90% from its high. This plunge occurred as the firm completed its ETH acquisition and early investors from the private placement sold their stock, securing their profits.
The market capitalization of Bitmine has increased significantly following the fundraising announcement, but analysts caution that the valuation already prices in aggressive assumptions about the firm's future ETH gains. Sharplink Gaming’s trajectory serves as a cautionary tale of the perils of hasty pivoting. It helps illuminate what happens when dangerous market speculation runs rampant.
