BitMine Slides 5%, Strategy Falls 4% as Crypto Crash Deepens on Ethereum’s 7% Plunge

BitMine Immersion Technologies (NYSE: BMNR) shares dropped 5% to $16.91, while Strategy (NASDAQ: MSTR) fell 4% to $124.38 in early Friday trading, following a sharp decline in cryptocurrency markets. Ethereum (ETH) plunged 7% in 24 hours to $1,665, dragging down BMNR as its largest corporate Ethereum holder, while Bitcoin (BTC) fell 3% to $61,965, impacting MSTR stock. Both stocks reflect a brutal year-to-date performance, with BMNR down 34% and MSTR down 15%. BitMine operates as an Ethereum treasury vehicle, meaning its stock acts as a leveraged proxy for ETH. With Ethereum down 44% year-to-date compared to Bitcoin’s 29% drop, BMNR’s underperformance aligns with its exposure. Chairman Thomas Lee framed the decline as part of a prolonged liquidation event, citing historical crypto price recoveries after extended downturns. BitMine’s latest SEC filing announced a Series A Perpetual Preferred Stock offering of 3 million shares at $100 each, with a 9.5% annual dividend. Proceeds will fund Ethereum acquisitions, staking infrastructure expansion, and ecosystem investments. This mirrors Strategy’s preferred stock model but includes Ethereum staking yields, which Bitcoin lacks. Strategy previously sold 32 BTC to fund dividends, briefly pushing Bitcoin below $62,000. Analysts debate whether Ethereum treasury firms like BitMine could outperform Bitcoin-focused peers due to staking yields offsetting dividends. However, critics argue a 9.5% preferred coupon is unsustainable without continued ETH accumulation, given staking yields of 3% to 5%. BitMine’s goal of holding 5% of all Ethereum also raises concentration risks. Prediction markets suggest a 73% chance Strategy will announce a Bitcoin purchase between June 2 and 8, reflecting expectations that CEO Phong Le will capitalize on the downturn. Strategy holds 713,502 BTC as of early February, but longer-term bets remain uncertain, with only a 37% probability of reaching 1 million BTC by year-end. Delisting risks from MSCI also loom, though margin call risks are currently low. Investors will watch whether Ethereum stabilizes above $1,653 and Bitcoin holds $62,000 ahead of the U.S. close. For BMNR, the next catalysts include the MAVAN staking network launch and details on the Series A preferred shares, which could determine dividend sustainability if Ethereum remains weak.