On January 16, 2026, Eastern Eight Time, large chips surrounding Ethereum are being rearranged. The institution BitMine, known for its Ethereum treasury operations, has purchased an additional 24,068 ETH through the broker FalconX, with a transaction size of approximately $80.57 million, continuing its consistent strategy of "large-scale staking." Currently, BitMine has over 1.7 million ETH locked in staking contracts, accounting for about 40% of its total holdings of approximately 4-4.17 million ETH. On paper, this portion of the position has an unrealized loss of about $2.3 billion compared to its historical acquisition cost. Nevertheless, the company continues to use this batch of chips to generate an expected pre-tax cash flow from staking of over $400 million annually, hedging against price fluctuations with time and cash flow. Meanwhile, in both the on-chain and derivatives markets, there are whales shorting ETH with high leverage, and established large holders transferring chips to exchanges, with the divergence between short-term speculation and institutional long-term locking reinforcing market uncertainty.

4 Million Chips Pressing on the Ethereum Side

● Position Size: Public chain and market data show that BitMine currently holds approximately 4-4.17 million ETH, which constitutes the most core crypto asset exposure on its balance sheet.
● Staking Scale: Of the total holdings, over 1.7 million ETH (approximately $5.65 billion) are participating in Ethereum staking, accounting for about 40%, significantly higher than the short-term liquidity management ratio of ordinary institutions.
● New Purchases: Around January 16, 2026, BitMine added 24,068 ETH through FalconX, with a transaction amount of about $80.57 million, opting not to reduce positions or hedge, but rather to further strengthen its bullish stance.
● Position Orientation: The staking ratio and direction of new purchases indicate that BitMine clearly views ETH as a long-term core asset, rather than a trading chip that can be liquidated at any time, making this structure more akin to a "treasury + quasi-fixed income" allocation model.

$400 Million Annual Staking Interest to Hedge Price Losses

BitMine's current ETH treasury is under significant unrealized loss pressure on one hand, while on the other, it continuously provides substantial staking cash flow for the company. According to public interviews and market research reports, various estimates, including those from analyst Tom Lee, indicate that BitMine's Ethereum holdings, valued at around $10 billion, are expected to generate over $400 million in pre-tax staking income annually. This figure corresponds to the stable income range formed by its over 1.7 million ETH participating in staking at current price levels. However, the same data also shows that if the current price is traced back to BitMine's historical acquisition cost, its ETH position has an overall unrealized loss of about $2.3 billion, highlighting the sunk cost reality of "buying at higher levels and holding through a complete downturn cycle." The high cash flow from staking provides the company with significant time value—under the premise that the unrealized loss has not been forced to be realized, it can hedge part of the price risk by continuously obtaining staking returns, extending the window for waiting for Ethereum's long-term appreciation to materialize. It is important to emphasize that the above figures regarding staking income scale and unrealized loss amount come from specific public market and research institution estimates and are not disclosed data from BitMine's official financial reports; investors should be aware of potential statistical and measurement differences when interpreting them.

From Card Payments to MrBeast's Traffic Bets

BitMine's bet on Ethereum is not only reflected in on-chain holdings and staking data but also extends to a multi-line layout in payment networks and content traffic. According to single-source data from the on-chain analysis platform Artemis, its leading crypto card business has reached a monthly transaction volume of $15 billion, and this business, in collaboration with Visa-related networks, contributes over 80% of on-chain transaction volume, dominating payment activities on Ethereum and related networks. While locking in large amounts of ETH on the asset side, BitMine is also deepening its binding to Ethereum payment scenarios on the application side. Additionally, the company has invested approximately $200 million in the media company of well-known creator MrBeast, with management publicly stating that this move is a "no-brainer decision," reflecting its high regard for youthful traffic entry points and brand spillover effects. The dual investment in payment networks and leading content IP essentially points to the same business logic: building a closed value flywheel around Ethereum and token payments, allowing the large amount of ETH held to accumulate more transaction and scenario stickiness beyond its financial attributes, thereby continuously empowering its long-term staking and holding strategy.

Bullish Deadlock and Leverage Short Hedge Collision

On the asset side, BitMine chooses a low-leverage strategy of "heavy spot + large-scale staking" to lock in long-term on-chain returns, which naturally leans towards a defensive bullish stance, closer to the traditional institutional thinking of "yield curve + balance sheet stability." However, in the concurrent market, a starkly opposite high-risk preference is also emerging—on-chain monitoring data indicates that a certain whale has opened a $60.56 million 25x leveraged short position on ETH, and such high-leverage directional bets amplify short-term bearish sentiment and liquidation risks. Meanwhile, the on-chain behavior of the established address 0xB3E8 transferring 13,083 ETH to the exchange Gemini is also seen as a potential signal of selling pressure or preparation for institutional transactions. With one side having millions of ETH locked in staking for the long term, and the other side having high-leverage shorts and potentially imminent transactions frequently speculating in the secondary market, the structural opposition between long-term spot locking and short-term leveraged trading is bound to amplify price volatility and liquidation chain reactions in future markets. Once volatility intensifies, the risks of unilateral cascading and chain liquidations will also be simultaneously magnified.

How Staking Economics Reshape Ethereum's Chip Structure

With over 1.7 million ETH locked in staking contracts, this portion of chips is unlikely to directly exert selling pressure through concentrated selling in the short term, creating a certain degree of tightening effect on the supply elasticity of the spot market. However, staking is not permanently locked; once large-scale unstaking occurs or staking returns are re-staked, such position adjustments will change the supply structure of freely circulating ETH on-chain, thereby affecting price elasticity, Gas fees, and the economic behavior paths of the overall ecosystem. For institutions like BitMine, whether to continue increasing holdings, maintain, or phase out largely depends on the stability of staking returns and changes in the on-chain interest rate environment. When the staking return curve is relatively predictable, staking resembles a "quasi-fixed income curve," providing large institutions with a cash flow anchor that spans cycles. However, this model also inadvertently amplifies their dependence on Ethereum's security, fee income, and overall on-chain activity. If the network's security budget or transaction demand experiences structural weakening, the downward trend of the staking return curve will inversely affect institutional position decisions, triggering a new round of chip redistribution and price reassessment.

Institutional Long-Term Locking and Short-Term Volatility Depth Game

Against the backdrop of an unrealized loss of about $2.3 billion, BitMine still chooses to continue increasing and staking ETH, sending a strong signal of long-term value betting, demonstrating its confidence in Ethereum's future pricing and ecological expansion. The expected annual staking income of over $400 million indeed provides the company with a considerable time buffer, allowing it to digest price fluctuations and cyclical pullbacks over a longer time dimension. However, this does not mean that the risk of price decline has been eliminated; it merely transforms the expression of risk from "immediate loss" to "time and path uncertainty." In the short term, high-leverage shorts represented by the $60.56 million 25x leveraged short position, as well as potential selling pressure behaviors like 0xB3E8 transferring over 10,000 ETH to exchanges, may still dominate the directional volatility, causing prices to experience sharp fluctuations within localized ranges. Over a longer time scale, the ultimate determinants of ETH pricing power will still be the growth of Ethereum's own ecosystem, the balance of fee and security budgets, and the speed of application layer demand expansion. For ordinary investors, it is essential to deliberately distinguish between institutional "cash flow thinking" and retail "market cap/unrealized profit thinking": the former focuses more on staking returns, debt costs, and holding periods, while the latter is often swayed by paper profits and short-term volatility. Whether to choose to follow such heavy positions and long-term locking behaviors depends on individual assessments of cycle spans, risk tolerance, and liquidity needs; any simple "copying homework" may amplify one's risk exposure when volatility increases.

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