Bitmine's own numbers show it may no longer need to keep buying Ethereum to hit its 5% ownership target — staking rewards on its existing holdings could close most of the gap. But that depends on how much of those rewards the company keeps rather than converts to cash, and on how fast Ethereum's total supply grows.
Bitmine doesn't necessarily need to buy more Ethereum to reach its 5% ownership goal — staking rewards on tokens it already holds could do most of the work. The Nasdaq-listed treasury company disclosed that it acquired 53,501 ETH in the week through Aug. 30, taking its holdings to 5.9 million tokens.
More than 5.06 million of those tokens were already staked at an annualized seven-day yield of 2.67%. Buying appears to have continued: on Sept. 1, blockchain analysis platform Lookonchain said wallets linked to Bitmine appeared to acquire another 51,000 ETH worth about $126 million from FalconX and BitGo, though Bitmine had not formally confirmed that transaction.
Staking can finish what buying started
Using Bitmine's own benchmark of 120.7 million ETH in circulation, owning 5% would require about 6.035 million tokens. Against its disclosed 5.9 million ETH balance, Bitmine was about 134,000 ETH short — almost exactly one year of modeled staking rewards at the current pace. The reported Sept. 1 purchase, if confirmed, would narrow that gap to about 83,000 tokens, needing roughly 61% of a year's modeled rewards to close it.
Supply growth raises the bar
However, Ethereum's expanding supply complicates that path because every increase in the network's token count raises the amount Bitmine must hold to keep a 5% share. Etherscan showed roughly 122.02 million ETH outstanding on Sept. 5, which would put Bitmine's illustrative ownership share around 4.84% against its Aug. 30 balance.
Over two years, Bitmine would need to retain about 74% of modeled rewards if supply stayed flat, rising to roughly 96.5% at 0.5% annual supply growth. At 1% growth, even retaining every modeled reward would fall short without further purchases.
How much Bitmine keeps decides it
The company periodically converts ETH-denominated staking rewards into US dollars and has not committed to a fixed retention percentage. Its management agreement with Ethereum Tower includes reward-linked compensation and infrastructure and custody costs, and it has declared 17 cash dividends on its BMNP preferred stock, with payments scheduled through late December. Because those obligations can require selling ETH that would otherwise count toward the 5% target, the key disclosure to watch is no longer how much Bitmine buys, but how much of what it earns it actually keeps.
Source: CryptoSlate
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