Why is Bit Digital All in on the Ethereum Treasury Strategy?
Written by: KarenZ, Foresight News
This week (July 7), Nasdaq-listed mining company Bit Digital (BTBT) announced the completion of its full transition to an Ethereum treasury strategy, accumulating over 100,000 ETH in its holdings.
This move not only marks a complete shift in its business focus from Bitcoin mining to the Ethereum ecosystem, demonstrating a strong confidence in the long-term potential of the Ethereum ecosystem, but also reflects the increasing institutional appeal of Ethereum.
This article will analyze Bit Digital's development history, the background of its transformation, and the core motivations for its shift to Ethereum.
The Past and Present of Bit Digital
Former Identity: The "First Chinese Car Loan Stock" in Crisis
Bit Digital's predecessor can be traced back to Golden Bull Limited. Founded in November 2015 in Shanghai, Golden Bull focused on auto collateral loans.
According to the International Financial News, Golden Bull disclosed on its official website that in January 2016, it received 20 million yuan in angel investment (from Zeng Erxin and Liu Xiaohui); in May 2016, it completed Series B financing with joint investments from two state-owned enterprises, Huishi Equity Investment Fund (Shanghai) Co., Ltd. and Shaanxi Xifeng Investment Co., Ltd.; in December 2016, it secured another 200 million yuan in Series C financing. However, there were also allegations of "fraud in three rounds of financing" and "false advertising."
In March 2018, it was listed on Nasdaq under the stock code "DNJR," claiming to be the "first Chinese car loan stock."
However, good times did not last long. In 2019, with the domestic P2P industry facing a crisis and regulatory cleanup, Golden Bull was investigated by the Shanghai Public Security Bureau in July 2019 for allegedly illegally absorbing public deposits, leading to criminal coercive measures against 17 suspects. The actual controller was also placed on the "Red Notice" list. The company's stock price plummeted, nearing delisting. In October of the same year, the board of directors removed the original chairman and CEO Zeng Erxin, CFO Leng Jing, and director Liu Xiaohui, subsequently forming a new management team.
Transformation: Auto Leasing and Bitcoin Mining Business
After the collapse of its P2P business, Golden Bull gradually transitioned to auto leasing and Bitcoin mining.
In the third quarter of 2020, Golden Bull changed its name to Bit Digital, Inc., and its Nasdaq trading code was changed to "BTBT," while divesting its original P2P lending business. The company headquarters was then relocated to New York, USA.
In September 2020, Bit Digital registered a wholly-owned subsidiary, Bit Digital USA, Inc., in Delaware, USA, planning to operate its mining machines in the U.S. and accelerate the strategy of relocating mining machines from China to North America.
In June 2021, following China's comprehensive ban on cryptocurrency mining activities, Bit Digital suspended its remaining mining operations in China, further accelerating its strategy to migrate to North America.
From 2020 to 2021, Bit Digital expanded its scale through multiple rounds of financing for mining machine procurement and capacity expansion. By the first quarter of 2021, Bit Digital had a total of 40,965 mining machines distributed across Xinjiang, Sichuan, and Yunnan provinces in China, as well as Texas, Nebraska, and Georgia in the U.S. Bitcoin mining became the core revenue source for Bit Digital, with mining revenue reaching $43.95 million in the first quarter. However, later on, with the migration of miners, production restrictions, and the overall increase in Bitcoin network hash rate, Bit Digital's revenue decreased.
It is worth mentioning that in April 2020, Yu Hong, who initiated the "Three O'clock Sleepless Blockchain" WeChat group, joined Golden Bull as Chief Strategy Officer and Director. However, in February 2021, with a major management overhaul at Bit Digital, Yu Hong resigned from her positions. In April of the same year, Golden Bull also acquired its wholly-owned subsidiary XMAX Chain Limited in Hong Kong, which operated all Bitcoin mining businesses in mainland China. Yu Hong was an early investor in XMAX Chain and had previously supported the project but later announced her disassociation from XMAX Chain. Of course, Golden Bull later clarified that Yu Hong had no connection with XMAX Hong Kong.
Diversification Exploration: Ethereum + Cloud Services + High-Performance Computing
Starting at the end of 2022, Bit Digital began to reduce its reliance on single Bitcoin mining and initiated a diversified layout.
In December 2022, Bit Digital launched its Ethereum staking business.
In 2023, Bit Digital established a subsidiary, WhiteFiber AI, Inc. (formerly Bit Digital AI, Inc.), venturing into cloud services.
In June 2024, it founded WhiteFiber HPC, Inc. (formerly Bit Digital HPC, Inc.), focusing on high-performance computing (HPC) business. In October of the same year, it acquired Canadian Enovum Data Centers Corp to strengthen its HPC data center capabilities.
In March of this year, Bit Digital established WhiteFiber Canada, Inc., forming a multi-regional collaborative HPC and cloud services network.
Comprehensive Transition to Ethereum Treasury Management Strategy Company
In early July 2025, Bit Digital announced the completion of its transition to an Ethereum treasury management strategy, recently raising approximately $172 million in total revenue and using net capital to purchase Ethereum. Additionally, Bit Digital sold about 280 Bitcoins and used the proceeds to increase its ETH holdings.
Adding to the previously held 24,434 ETH (as of March 31, 2025), Bit Digital's total ETH holdings reached 100,603.
Meanwhile, Bit Digital's official profile was also updated: "Bit Digital is a publicly listed digital asset platform focused on Ethereum-native asset management and staking strategies."
Regarding the HPC business, in February 2025, Bit Digital officially renamed its HPC business to WhiteFiber, Inc., encompassing its GPU cloud services and HPC data center platform Enovum Data Centers.
Why All in on Ethereum?
Bit Digital CEO Sam Tabar clearly stated: "We believe Ethereum has the ability to rewrite the entire financial system. Ethereum's programmability, increasing adoption rate, and staking yield model represent the future of digital assets. Bit Digital is aligning itself with Ethereum's long-term potential and positioning itself as an Ethereum fund management platform. Bit Digital plans to actively increase its holdings, ultimately becoming a leading global ETH holding company."
In Bit Digital's view, Ethereum is becoming a new strategic corporate asset class, akin to historical gold and government bonds, but more dynamic—relying on the largest developer ecosystem globally (far surpassing other blockchains), Ethereum's technological innovations continue to iterate.
Of course, Bit Digital, originally focused on Bitcoin mining, is transitioning to the Ethereum ecosystem. This strategic adjustment is influenced not only by macro trends in the cryptocurrency industry but also by internal financial and operational considerations.
Profitability Pressure in Bitcoin Mining
Intensified hash rate competition + Bitcoin halving: The difficulty of Bitcoin mining continues to rise, leading to a decline in miners' marginal profits.
Bitcoin mining heavily relies on cheap electricity, and Bit Digital was forced to relocate to North America in 2021 due to China's crackdown on mining, significantly increasing operational and compliance costs.
Bit Digital's digital asset mining profitability continues to weaken: In the first quarter of 2025, Bit Digital's digital asset mining revenue was $7.77 million, a 64% decrease compared to $21.89 million in the first quarter of 2024. Meanwhile, the costs consumed by digital asset revenue dropped from $12.98 million in the first quarter of 2024 to $6.12 million. According to the cost-to-income ratio reflecting profitability, it was 59% in the first quarter of 2024 and rose to 78% in the first quarter of 2025, excluding depreciation and amortization expenses (totaling $7.24 million across all businesses). A higher cost-to-income ratio indicates that the cost corresponding to unit revenue is higher, meaning weaker profitability.
The company's business structure is unbalanced, with the proportion of digital mining revenue continuously declining: In the first quarter of 2025, this business's revenue accounted for only 31% of total revenue, down from 72% in the same period of 2024, urgently needing new growth points to support performance.
The Appeal of the Ethereum Ecosystem
In 2024, ETH staking revenue was $600,000, a 72% increase compared to the same period last year. As of March 31, 2025, Bit Digital had staked approximately 21,568 ETH in native staking protocols. After increasing its Ethereum holdings to 100,603, Bit Digital stated that it is not just purchasing tokens but allocating its reserves to a protocol.
Ethereum's staking mechanism allows holders to earn relatively stable annual returns by locking tokens, providing more predictable returns compared to the high energy consumption and uncertainty of Bitcoin mining. High-energy mining activities are restricted under carbon neutrality goals, while Ethereum's proof-of-stake mechanism consumes very little energy, aligning better with global sustainable development trends.
Institutional allocation is shifting towards diversification: As the adoption rate of the Ethereum ecosystem increases, institutional investors are gradually shifting from Bitcoin-dominated allocations to diversification, beginning to value Ethereum's long-term value.
In summary, Bit Digital's development history is a process of transformation and breakthrough from adversity: from a crisis-ridden Chinese P2P platform to being listed on Nasdaq, then transitioning to a Bitcoin mining company, laying out HPC and AI, and finally fully transitioning to Ethereum when mining revenue fell short of expectations. Its strategic adjustments have always kept pace with trends. However, this bet on Ethereum also faces new challenges—performance will be highly tied to Ethereum's price.
For the crypto industry, Bit Digital's transformation is both a reflection of the increasing appeal of the Ethereum ecosystem and an indication that the allocation logic of institutions and mining companies towards digital assets is evolving from "mining for profit" to "long-term asset holding." In the future, as the Ethereum ecosystem matures further, more institutions may join this track.
免责声明：本文章仅代表作者个人观点，不代表本平台的立场和观点。本文章仅供信息分享，不构成对任何人的任何投资建议。用户与作者之间的任何争议，与本平台无关。如网页中刊载的文章或图片涉及侵权，请提供相关的权利证明和身份证明发送邮件到support@aicoin.com，本平台相关工作人员将会进行核查。
