BitMines Faces $3.5B Loss on Ethereum Investment

BitMines Faces $3.5B Loss on Ethereum Investment – Is Recovery Possible?

The cryptocurrency market is experiencing a tough time, especially for digital asset treasuries (DATs). BitMine Immersion, renowned as the largest Ethereum treasury firm globally, has faced a staggering unrealized loss of $3.5 billion on its ETH investments. Despite this setback, the firm’s chair remains optimistic, though other ETH treasuries are struggling. Meanwhile, large investors continue to buy ETH, believing in its future potential.

Key Takeaways

BitMine Immersion has reported a $3.5 billion unrealized loss on its Ethereum holdings.
The firm had previously invested $14.6 billion in ETH, acquiring 3.7 million tokens.
Institutional demand for Ethereum remains strong, with significant purchases occurring even during market downturns.
Current valuations suggest Ethereum may be undervalued, with a potential upside of 45%.

Ethereum

BitMine's Significant Investment in Ethereum

The ongoing downturn in the crypto market during Q4 2025 is testing the resilience of digital asset treasuries (DATs). BitMine Immersion, the largest Ethereum treasury firm, has suffered a whopping unrealized loss of $3.5 billion on its Ethereum (ETH) assets. For the past two months, this loss has fluctuated between $3.5 billion and $4.2 billion as ETH prices have hovered around the $2.6K-$2.75K range following a significant 40% drop.

Ethereum

Source: CryptoQuant

Tom Lee, the Chair of BitMine, has been a strong proponent of Ethereum, confident in the future of tokenization and the growth of stablecoins as driving forces for ETH's value. To support his conviction, BitMine invested a substantial $14.6 billion to acquire 3.7 million ETH. However, with the recent downturn resulting in a loss exceeding $3.5 billion, Lee persists in increasing his holdings. On the contrary, some distressed firms, including SharpLink and ETHZilla, have been compelled to liquidate their assets and abandon their Ethereum strategies altogether.

Experts worry that if more companies opt for liquidation, it could deepen the current bear market unless they're absorbed by major players. Presently, these treasury firms own about 5.6% of the total Ethereum supply, rivaling exchange-traded funds (ETFs).

Increased Purchases by Whales

In spite of the distress among digital asset treasuries, there is a notable rise in institutional demand for Ethereum. Jack Yi, founder of Liquid Capital, announced that they have amassed an impressive $1.72 billion worth of ETH as the asset's price dipped to $2,600 in November. He emphasized plans to buy an additional $1 billion in ETH and cautioned against short-selling, stating, “We strongly advise against shorting. Undoubtedly, this will be a historic opportunity.”

Ethereum

Source: X

Supporting his assertion, recent data shows that large holders, or "whales," owning between 10,000 and 100,000 ETH have ramped up their accumulation significantly in 2025. This trend of buying the dip intensified during the late 2025 downturn, with these whales holding over 21 million ETH at the time of reporting.

Ethereum

Source: CryptoQuant

ETH's Potential for Appreciation

From a valuation standpoint, the current price for Ethereum, standing at $2.9K, is viewed as undervalued and a favorable buy for long-term investors. Out of ten critical metrics evaluated, seven indicate a "buy" signal, suggesting a fair value of $4.2K, which points towards a 45% upside potential.

Ethereum

Source: ETHVal

Historically, in March, the projected fair value was $2.5K while Ethereum traded at $1.5K. By May, the price reached $2,500. Similarly, in June, when trading at $2.5K, the projections indicated a rise to $3.6K, which was achieved the following month. However, it is crucial to remember that past performances do not guarantee future outcomes.

Conclusion

As BitMine navigates a difficult phase, the larger market dynamics suggest a mix of distress and opportunity. While significant losses are reported, the continued interest from large institutional investors indicates that Ethereum might have a bright future ahead.