BMNR Stock Outlook as Tom Lee Says Bitmine Will Halt ETH Purchases at 5% Supply Target

Bitmine (NYSE: BMNR) stock faces a test after the executive chairman, Tom Lee, noted that the company will not buy more Ethereum after it accumulates 5% of ETH’s total supply.

BMNR stock price was down by 4.58% in pre-market trading at press time as a dip across the broader crypto market weighed on the shares.

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Tom Lee Sets Ethereum Hard Cap for Bitmine

While speaking at Token 2049, Lee noted that Bitmine only needs around 100,000 more ETH to hold 5% of the total Ethereum supply. He noted that the 5% was a “hard cap,” adding that Bitmine would not own more than 5% of ETH’s supply.

“We protected the downside for ETH because we were buying. But now, we’re done stacking in front of a 25X move,” Lee said.

He also added that with the 5% supply hard cap, BMNR stock will likely outperform Ethereum because Bitmine will not have to raise additional capital to purchase more ETH.

As CoinGape reported earlier, Bitmine currently holds 6,016,414 ETH after purchasing $41 million worth of Ethereum last week.

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Bitmine Scoops an Additional 12,500 ETH

A recent X post by LookonChain noted that Bitmine purchased an additional 12,500 ETH on October 5 on the BitGo exchange.

The recent purchase comes as Ethereum’s price falls below $2,600 amid a drawdown across the broader crypto market today.

The declining price has pushed the value of Bitmine’s Ethereum holdings down to $15.56 billion, with this being the lowest reading since September 20. ETH’s decline is also pushing BMNR stock price lower.

Bitmine now sits at an unrealized loss of $4.49 billion on its Ethereum holdings, per data from DropsTab.

BMNR Stock Prediction as Investment Bank Reiterates $63 Target

Cantor Fitzgerald has reiterated an overweight rating for BMNR stock and a $63 price target.

The investment firm noted that it remained bullish on the Ethereum ecosystem, from which the crypto stock price could benefit. Cantor Fitzgerald analyst Nathan Frankovitz also added that Bitmine could expand Ethereum’s opportunity set.

Despite the bullish outlook, the one-day chart for BMNR stock shows that the shares have been on a downtrend since late September. If this downtrend persists, the shares might drop to test support at the 78.2% Fib of $25.

However, the MACD line remains positive, suggesting that the momentum remains bullish despite the recent decline.

BMNR stock will confirm a trend reversal if it can close above the resistance at $28, after which it could target the 123.6% Fib of $32.