Why BMNR Stock Dilution Could Get Much Worse...

Ladies and gentlemen, it feels like no one wants to talk about it, so I will. Tom Lee is making BMR a worse and worse investment by the week. And it's because of the decisions that BMR is making, not just where ETH's price is going. Meaning, if you were to have just held Ethereum, you'd be better off than holding BMR. This is the problem, right? Everyone points to the new press releases talking about how they continue to climb as their total percentage of overall ETH holdings climbs. Cash is going up, everything's looking good. But we're seeing a decoupling of Ethereum price versus where BMR's stock price is going. Whenever we look at the overall amount of Ethereum, it continues to climb up. And Tom Lee is screaming from the rooftops about how this is the main mission. And I have to give them some credit. They're doing well. This is a major milestone as the company moves towards acquiring 5% of the ETH supply. And this pace of accumulation is astonishing, taking only 10 months to reach 5 million ETH, which is good. I'll give them a lot of credit for that. Lately, we've had an acceleration of total Ethereum that they've been purchasing from 24,000 a week all the way up to the 100 plus thousand again for two weeks in a row, which is very exciting. Their total percentage is now starting to inflect even higher as they try to go for that 5% of total Ethereum holdings. But look at this unbelievable graph. While we're seeing some raises and some, you know, not so large raises over time, all of this in this area was whenever BMR was above one times MNAV. And then you can see how quickly this has changed whenever they've fallen below 1 times MNAV. Extremely small raises. And now most recently in some of these weeks we've had the lowest raises we've ever seen, 10 million. Then right after raising 10 million, we raised $640 million while still under one times MNAV. And I know that I've continued to bring this up as like, hey, you can't continue to bring up ETH and bring up more cash and raise all this capital well under one times MNAV cuz what happens? Well, you see it in the BMR cheat sheet. If you take a look at the very bottom after adding everything up, so I have the math there, but the main line is at the very bottom. BMR's MNAV in cash multiple is now at a point 93. It's continuing to fall week after week after week under one times MNAV. We've gone from 0.99 to 0.97 to 0.95 now 93. Meaning even as Ethereum's price is going up, BMRs is decoupling. we're not raising nearly as much and then whenever Ethereum goes down, BMR stock will go down even faster. Even if we look at the most recent week, Ethereum is now down 2.74% and as of the last day, it's down 1.1%. Whereas BMR is down 4% as of the most recent day, and over the whole week, we're down 4.6%. It's completely different than Ethereum even though it should be less volatile than Ethereum because of the amount of cash that we actually have on the balance sheet. Let alone we do have Open AI and Beast Industries. So there can be some collapse there if people think that OpenAI just had a bad story today talking about how they might miss revenue targets and stuff like this. But OpenAI represents a sliver of their overall holdings. What's happening here is extremely simple. the Ethereum on your books that you're diluting to raise capital is worth more than the Ethereum that you're going out and actually buying. Meaning, they should be looking to buy back stock, not go out and dilute shareholders even further whenever you're below a onetime ZNAV. Now, Tom Lee and the team see this. They're fully aware of the consequences here. However, what I think that they're trying to do is just get up to 5% total Ethereum holdings because at that point, Tom Lee and the rest of its team see large bonuses. They have stockbased compensation tied to the percentage of total ETH holdings, not a matter of what BMR will be worth at that period. That's the scary part to me that there are reverse incentives with management versus what shareholders ourselves are actually worried about. But they did end up seeing this as well, increasing their REApp purchase program from $1 billion to $4 billion a few weeks ago. But they haven't done anything with it. They're still raising new capital and as of the last two weeks they raised like $600 million under one times MNAV. It's terrible for shareholders and now we are facing the consequences. But hopefully they end up taking some of that cash and buying back shares instead of diluting shareholders to buy Ethereum. Or if you have cash, you can go out and buy Ethereum. That's perfectly fine. But don't continuously raise more capital in order to do so. Tom Lee continues to show off how high of a traded volume BMR has. It's like we were top 50 before, if not even higher. We're falling down. We're below Nike. We're below CH and United Airlines in terms of total traded volume. The fact that they are showing this just shows that investors are getting sick of what's happening at BMR. They don't want to deal with it and they're actually done with trading this name. Now, this can come back very quickly if Ethereum's price starts to climb up. But like I said, Ethereum might end up doing better than BMR. So, while BMR will likely still do well if crypto ends up coming back, it might not do better than holding the actual coin itself and staking it on your own. But we should talk about BMR staking because this is one of the highlights this week where we ended up seeing a large increase in the total amount of Ethereum now at 3.7 million total Ethereum being staked for BMR, bringing up the total amount of earnings to $257 million a year, meaning that a lot of the stockbased compensation and expenses at BMR are actually being paid for by the Ethereum staking protocol. And it was another milestone because of the percentage of overall Ethereum climbed up to 73% a new record which is quite exciting. They're holding it. And overall Ethereum has now surpassed marking the highest time of total stake. Roughly onethird of all Ethereum is being locked away which is really good for the price over time. It's also really good for the network and the safety of the network. So while I've been bearish on BMR, I am still bullish on Ethereum. The bullcase is completely intact. As Tom Lee says here, Ethereum continues to benefit from the dual tailwinds of Wall Street tokenization on the blockchain and from agentic AI systems increasingly needing public and neutral blockchains. In our view, there is a lot of meaning to ETH being the best wartime store of value and ETH being the asset leading since the war started, which you can actually see ETH has done well since the Iran war. But this is more of a highlight to Ethereum, which is also good for BMR, but I want to make sure that BMR does better than Ethereum. I want them to be an an advantage on Ethereum's moves, not a disadvantage if they're diluting shareholders well under one time. So, while I'm still a fan of Ethereum, I'm losing my sanity here following BMR's footsteps, which are seemingly, you know, good for the community, always buy the dip and stuff like this, but it's not actually good whenever you're being a steward of capital and you're essentially running a fund, right? A digital asset treasury should do best by shareholders and they're not doing that right now. I know a lot of people want them to just continuously add to overall Ethereum and the more percentage of supply of Ethereum that gets locked away the higher chance that ETH has a you know better chance of climbing up but along the way they need to be good stewards of capital and during under one times MNAV it's better to buy back the stock and I know that there are some comments that disagree with me on that but it's not even something that you can disagree with it's a pure math equation and ETHzilla and ETH machine and all of those companies have all agreed that that's their plan well waiting for Ethereum M to pop back up. The reason why you see Sharlink Gaming and ETHZilla and all these companies stop adding to ETH is not because they don't like the thesis anymore, it's because they'd be diluting under one time ZNAV, which just doesn't make any mathematical sense. But yet BMR continues to do it. And that's to our disadvantage. We're paying the price for that as shareholders. But ladies and gentlemen, that's it from me and my rant. Until next time, thank you all so much for watching. Really do appreciate your time. Bye for now.