BMNR Extreme Value Deduction 5.27

In the past week, there were two noteworthy pieces of information regarding BMNR. First, Vitalik published a lengthy article about EF's positioning and the vision for ETH, mentioning, “supporting ETH the asset has necessary aspects outside the scope of EF. This is where we need other heroes. This is where we need other heroes, some of whom hold more ETH than the EF does.” This means the Foundation is just one ordinary node within the ecosystem, and managing ETH's market cap and asset narrative requires “other heroes” beyond the Foundation. Tom Lee also chimed in, suggesting that as perhaps the largest ETH holding institution, continuously enriching the ETH ecosystem and asset narrative might be a key focus for BMNR in the next phase after achieving 5%.
Second, there was the Russell index adjustment. BMNR was added to the Russell 3000 and 1000 indices. The passive fund rebalancing will be executed after the close on June 26th. This marks BMNR's first inclusion in a major index and will bring in some institutional capital inflow.

On BMNR's operations, last week they accumulated 110,000 coins (surprisingly high), entirely using cash positions, with cash reserves remaining at $440 million. The company viewed ETH's recent drop below $2.2k as a buying opportunity, thus increasing the accumulation pace. I've compiled a chart of BMNR's coin accumulation timing versus ETH's historical trend. It shows BMNR's strategy is dollar-cost averaging, not market timing, with purchase volume depending on current financing capacity. This is similar to MSTR. Currently, mNAV is at 0.95. I think stock price movements are quite normal when mNAV is between 0.9 and 1, and the company won't activate the ATM. However, the near future requires close attention. As cash reserves are running low, once mNAV has a chance to break above 1 during trading, they will likely use the window for financing. Therefore, if ETH surges in the coming days and BMNR also surges intraday, it might be appropriate to employ some hedging strategies.

The FIT21 bill is currently in the backend coordination stage between Agriculture and Banking committees. However, the Senate's June agenda is crowded, needing to compete for time with issues like budget appropriations and geopolitics/national security. A more realistic path is to produce a merged text/ethics compromise in early June, strive for scheduling in mid-to-late June, with July being a more actionable window for a Senate vote. So, June is likely still a dead period for crypto.

Not investment advice

$BitMine Immersion Tech(BMNR.US)