BREAKING: Tom Lee’s Bitmine Files For Preferred Stock With 9.5% Yield To Buy More Ethereum
Highlights
- Bitmine has submitted a filing to issue 3 million shares in preferred stock.
- The stock aims to offer a 9.50% annual yield backed by Ethereum reserves.
- The company noted that proceeds from the stock sale could be used for additional ETH purchases.
Bitmine Immersion Technologies, led by Wall Street strategist Tom Lee, has applied to sell $300 million in 9.50% Series A Perpetual Preferred Stock. It represents a new initiative to build its strategy to increase its Ethereum holdings.
Ethereum Treasury Firm Bitmine Files To Issue Preferred Stock Equity
A new SEC prospectus supplement says that Bitmine will sell 3 million shares, each worth $100. The securities will pay a 9.5% annual dividend that will be paid in cash upon declaration by the company’s board of directors.
Bitmine became the first public company to consider launching a preferred stock with Ethereum focus. Earlier, Strategy and Strive introduced the BTC-based variants.
The filing is another aggressive step from Bitmine to increase buying in the Ethereum market. In the filing, Bitmine said that its business strategy now focuses primarily on the Ethereum blockchain and its native currency, ETH.
It also mentioned that the company has become more reliant on ETH-related capital formation opportunities. These include staking and validator infrastructure, and ETH treasury management.
The stock will earn a 9.5% annual dividend whether or not the dividend is actually declared, per the filing. The company also announced it plans to file for a listing for the preferred shares on the New York Stock Exchange. For this, a ticker symbol which will be announced at a later time.
How Will ETH Exposure Affect The Preferred Stock?
The preferred stock sale could also give Bitmine a decent infusion of new capital to buy more Ethereum. This comes as institutional participation in Ethereum has been on the rise since the introduction of U.S. spot Ether ETFs. Also, Ether network has seen the rise of tokenized financial products has been gaining momentum with BlackRock’s entry.
However, Bitmine cautioned investors that it will continue to be strongly correlated to the performance of Ethereum. The exposure includes the ETH price volatility, staking economics, regulatory developments, and counterparty risks with digital asset operations.
It follows a trend of preferred stock launches in the crypto industry with Strategy’s STRC and Strive’s SATA leading the charge. Recently, Strive announced upsizing its ASST and SATA stock offerings by $2.1 billion each.
Meanwhile, Strategy’s STRC semi-monthly dividend proposal vote is set to end on June 8.
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