BitMine Immersion (BMNR), the largest Ethereum-focused digital asset treasury (DAT) company led by Wall Street veteran Thomas Lee, suffers large unrealized losses on its big bet on ether. .
The company on Friday reported $328 million in net income for its fiscal year ended Aug. 31, while fully diluted earnings per share were $13.39. It also declared a nominal dividend of $0.01 per share and announced plans to launch a staking infrastructure product, MAVAN (Made-in America Validator Network), in early 2026.
Despite the positive results, Markus Thielen, founder of 10x Research, warned that the company, like other DATs, faces deep structural problems.
The firm is now estimated to have more than $4 billion in unrealized losses on its holdings following a 45% drop in ETH prices from the August peak. BMNR’s share price has plunged 84% from its July peak, and the decline erased the net asset value (NAV) premium that once fueled investor enthusiasm, Thielen noted.
Thielen argued that many Digital Asset Treasury (DAT) firms rely on complex, layered entities such as asset managers, strategic advisors and high-paid promotional figures, while incorporating fees that “quietly erode returns.”
He noted that BitMine’s leadership compensation and outside advisors could extract $157 million per year over 10 years through compensation and advisory contracts.
The performance of Ether staking, a key source of income for cryptocurrency holdings, does not look as attractive to investors, Thielen noted. According to the CESR Composite Ether Staking Rate, the ether staking yield is currently around 2.9%, which is well below the yield of US dollar money market funds that are considered risk-free. Once operating costs and intermediaries are taken into account, the effective return to shareholders is much lower, Thielen said.
“No serious institutional allocator will accept” that yield, Thielen said, especially when ETH’s “price volatility puts the underlying collateral at constant risk.”
Thielen warned that DATs could trap shareholders, especially as the NAV premium collapses. “Investors find themselves trapped in the structure, unable to exit without significant damage – a true Hotel California scenario,” he said.
