BMNR Plunges

Tom Lee’s big bet on Ethereum (CRYPTO: ETH) has backfired, costing him and his investors, who include Peter Thiel and Cathie Wood, billions of dollars.

Shares of BitMine Immersion (NYSE: BMNR ) have plunged from last year’s high of $160 to $13.56, slashing the company’s market valuation from $18 billion to $7.72 billion.

BitMine and BMNP Stocks Have Been in a Steep Sell-Off The recently launched BitMine Immersion 9.5% Series A Perpetual Preferred Stock (BMNP) has dropped in the last 12 consecutive days.

It ended the week at $81, down from record high of $92.97.

BitMine’s stock continued its strong downward trend this year, reaching a low of $1,497, its lowest level since March last year.

It has dropped by 68% from its highest point last year as the crypto winter has accelerated.

As a result, it is sitting on over $10 billion in unrealized losses.

The stock also fell this week amid the ongoing woes surrounding BMNP, which have coincided with a broader sell-off in preferred shares issued by companies such as Strategy (NASDAQ: MSTR ) and Strive (NASDAQ: ASST ).

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BitMine is in a better position than Strategy.

For one, it has already bought 5.6 million ETH coins and has about 400k coins to buy.

If the trend continues, it will complete its acquisition in the next few months.

BitMine is also making money from its Ethereum holdings through staking program, which is earning about 3% in annual return.

Ethereum Price is at Risk of Further Downside Lee’s justification for Ethereum holdings is also facing challenges as its fundamentals deteriorate.

Recent data shows that its network fees have plunged to just $90 million this year from the $523 million it made last year.

Its total value locked in the decentralized finance industry has plunged by over 60% from its peak last year, while the amount of tokenized assets has fallen by over 5% in the last 30 days.

Demand for ETH ETFs has also waned, with outflows rising to over $1 billion this year.

Technicals also suggest that ETH price may drop further in the near term.

It has remained below the 50-day moving average and formed an inverted cup-and-handle pattern.

These technicals suggest that it may drop to as low as $1,000 in the near term, affecting BitMine’s holdings.

Read Also: XRP Hanging on a Thread as Ripple ETF Inflows Remain Steady Image: Shutterstock