Bitmine Reports $3.8B Q1 Loss: Ethereum Treasury Firm’s Bold Bet Backfires?

Markets

What to know:

Bitmine Immersion Technologies has rapidly expanded like the company Strategy, but focused on Ethereum. In just six months, they’ve increased their shares and raised over $10 billion, allowing them to acquire almost 5% of all existing ether cryptocurrency.

The company’s latest financial report filed on Tuesday showed a net loss of $3.8 billion for the quarter. Over that same period, the number of outstanding shares nearly doubled, increasing from 232 million to 494 million between August 31st and February 28th.

Additional investments increased from $8.36 billion to $18.55 billion during this time, and all of that money was used to purchase Ethereum (ETH).

As of April 12th, Bitmine possessed 4.87 million ether, purchased at an average price of $2,206 each. This makes them the company with the largest Ethereum holdings worldwide, and the second-largest corporate cryptocurrency treasury overall, following Strategy.

While the investment is currently down slightly, it’s not a significant loss. Ether was trading around $2,325 on Wednesday, about 5% higher than the average price Bitmine paid. The $3.78 billion in unrealized losses reported this quarter is due to a recent decrease from Ether’s peak price in August 2025 of around $4,900, and doesn’t represent a loss of the original investment amount.

New accounting rules starting in 2024 require companies to report the current value of their assets, and any changes in that value affect their profits and losses, even if nothing has been sold.

However, shifting from a traditional mining operation to one focused on holding Ethereum as an investment is causing new challenges.

In the last quarter, we saw a significant shift in our revenue streams. Revenue from self-mining dropped dramatically, down 86% to $219,000 compared to the same quarter last year. Fortunately, staking has become our primary income source, bringing in $10.2 million of our total $11 million quarterly revenue. Essentially, staking has completely taken over from self-mining as our main driver of income.

Selling, general, and administrative expenses totaled $75 million this quarter, a significant increase from $964,000 last year. Over the first six months of the year, these expenses reached $298.6 million, while revenue was only $13.3 million. While some of this increase is due to stock-based compensation related to fundraising, the difference between the cost of running the business and the revenue it generates is substantial, especially considering the company’s main activity now focuses on holding and staking a single cryptocurrency.

The filing also reveals derivatives exposure that wasn’t previously detailed.

During the last quarter, Bitmine experienced $65.3 million in unrealized losses from its derivative investments, but also earned $24.1 million from option premiums. This indicates the company is likely using options strategies – potentially selling covered calls – to increase its earnings from its Ethereum holdings.

In March, Chairman Tom Lee stated the recent decrease in ether’s price was a good opportunity, citing the network’s improving underlying strengths. He added on Monday that Bitmine has been increasing its purchases significantly over the last month.

As of February 28th, Bitmine had $879.6 million in cash, plus holdings including 198 Bitcoin, a $200 million investment in Beast Industries, and an $85 million investment in Eightco Holdings.

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2026-04-15 09:48