BitMine Immersion Technologies (BMNR), an Ethereum treasury company led by Fundstrat co-founder Tom Lee, is borrowing a page from Strategy’s funding playbook and launching a $300 million preferred stock offering as crypto treasury companies look for new ways to obtain funding.
According to a filing Wednesday with the U.S. Securities and Exchange Commission (SEC), the company is offering 3 million shares of its Series A perpetual preferred stock at a stated value of $100 per share. The securities carry an annual dividend rate of 9.5%, with dividends paid weekly in cash if declared by the company’s board of directors.
The preferred shares will be listed on the New York Stock Exchange (NYSE) under the symbol BMNP, subject to approval, BitMine said.
The offering comes as digital asset treasury companies, recently under pressure from falling crypto prices, are exploring new sources of funding. Strategy (MSTR), the largest holding company of Bitcoin, has introduced various classes of preferred shares. Treasury peer Bitcoin Strive (ASST) has also issued dividend-paying preferred stock SATA.
Bitmine aims to integrate this playbook into its Ethereum treasury strategy, according to the filing.
The company has been among the most aggressive buyers in the industry, accumulating more than 5.3 million ETH worth around $10 billion and controlling around 4.5% of Ethereum’s circulating supply over the past year. This ETH bet currently represents an estimated $9 billion unrealized loss as ETH prices have fallen below $1,800 from around $5,000 in October.
Bitmine preferred shares can be repurchased by the company at premiums ranging from 10% to 0% depending on the timing of repurchase. Holders will also have redemption rights if certain fundamental changes within the company occur. The filing does not specify how Bitmine intends to use the proceeds.
The timing is opportune given the growing pressure on Strategy’s favored equity financing model. The company’s STRC preferred stock fell 5% below its $100 par value on Wednesday, as investors question whether the company can comfortably maintain its dividend payments as bitcoin prices fall. Strive’s SATA also fell below $97, trading 3% below its pat value, highlighting the pressure on the funding model of digital asset treasuries.
