Tom Lee said ownership levels up to 10% would not threaten Ethereum’s decentralization. | Source: X (@APompliano)
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Key Takeaways
BitMine now holds 3% of all ETH, after adding nearly 70,000 ETH in a week.
Tom Lee’s “Alchemy of 5%” target could unlock major staking revenue.
The large accumulation raises questions around centralization.
BitMine, the digital-asset treasury company chaired by Fundstrat’s Thomas “Tom” Lee, said it now holds 3% of the total Ethereum supply.
As BitMine’s holdings grow, questions are being raised about what large-scale corporate accumulation means for Ethereum’s decentralization and future.
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Lee said BitMine added 69,822 ETH over the past week alone, lifting its share of the Ethereum network to 3%.
“BitMine now has 3% of the ETH supply,” he wrote on X. “Two-thirds on the way to the ‘Alchemy of 5%.’”
BitMine now owns 3% of Ethereum’s total supply | Source: X
The company reported on Monday that it holds $11.2 billion in combined crypto, cash, and “moonshot” equity stakes.
Its holdings include:
3,629,701 ETH valued at $2,840 per token
192 Bitcoin (BTC)
$38 million stake in Eightco Holdings (NASDAQ: ORBS)
$800 million in unencumbered cash
BitMine’s accumulation places it ahead of all other corporate ETH treasuries.
Only MicroStrategy tops its overall crypto holdings, with 649,870 BTC valued at $57 billion.
What Happens When BitMine Reaches 5%?
BitMine is pursuing what Lee has dubbed “The Alchemy of 5%,” a target of holding 5% of the total Ethereum supply.
Reaching that threshold could accelerate two major developments for the firm: staking revenue and deeper integration with institutional finance.
Lee recently told Ark Invest CEO Cathie Wood that BitMine will launch a company-run staking solution “very soon.”
Once operational, he said, BitMine could earn a 2.79% pre-tax yield on its ETH positions, potentially placing it among the 800 most profitable publicly traded U.S. firms.
Staking would allow BitMine to convert a large portion of its ETH reserves from idle assets into a recurring revenue stream.
Despite its aggressive accumulation strategy, Lee dismissed concerns that BitMine could centralize influence over the network as it approaches its 5% goal.
Lee cited internal research and discussions with analysts at Fundstrat and Standard Chartered, suggesting that ownership levels up to 10% would not threaten Ethereum’s decentralization.
“…because if you think about even in any competitive world, if someone has 10% of a system, they aren’t in control of it,” he said.
Tom Lee Believes MSTR Is a Hedge
According to a recent Bloomberg report, Lee still believes that Bitcoin will rebound to between $150,000 and $200,000 by the end of January.
In a recent CNBC interview, he stated that pressure on MicroStrategy (MSTR) may stem from the stock’s growing use as a proxy for hedging cryptocurrency risk.
“[Strategy] is probably the most important stock watch right now, because that is the Bitcoin proxy, it’s the most liquid name,” Lee said last week.
Lee explained that the crypto world can’t find any other way to hedge their losses in Bitcoin and Ethereum except “shorting the liquid stocks that it proxies.”
He believes that anyone with a “sizable Bitcoin long position” has “very limited ability to hedge it in crypto derivatives.”
At the time of reporting, MicroStrategy holds 649,870 BTC worth roughly $56 billion.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
