Ten Key Questions on Ethereum Microstrategy: A Deep Dive into Four U.S. Public Companies’ ETH Treasury Logic and On-Chain Deployment

Author | Cubone Wu Blockchain

This article does not constitute investment advice. Readers are advised to strictly comply with local laws and regulations and refrain from participating in illegal financial activities.

Since early 2025, four U.S. public companies — SharpLink Gaming, Bitmine Immersion Tech, Bit Digital, and BTCS Inc. — have adopted large-scale ETH purchases and on-chain staking to establish a new model of “Ethereum Microstrategy,” distinct from the Bitcoin-focused strategy pioneered by MicroStrategy. This approach not only reshapes corporate balance sheets but also elevates Ethereum’s role in capital markets narratives. This article systematically outlines the funding paths, on-chain strategies, strategic motivations, and risk governance frameworks of these four companies through ten essential questions.

Q1: Which U.S. public companies currently hold the most ETH? How much do they each hold?

As of July 2025, SharpLink Gaming, Bitmine Immersion Tech, Bit Digital, and BTCS Inc. are the four largest ETH-holding U.S. public companies. SharpLink Gaming holds approximately 358K ETH, followed by Bitmine with around 300.7K; Bit Digital holds about 120.3K, and BTCS Inc. discloses 31.9K ETH in holdings. Although Coinbase holds approximately 137.3K ETH, it does so primarily for operational purposes as a trading platform and is thus not typically categorized under “microstrategy” holdings. These four firms form the core of the emerging “Ethereum Microstrategy” trend in U.S. capital markets.

Q2: What are the core businesses of these four companies, and who leads their Ethereum strategy?

These companies come from diverse business backgrounds, but all have transitioned toward ETH accumulation under the leadership of current CEOs or board members:

• SharpLink Gaming (SBET): Originally a provider of sports prediction and interactive gaming technology, the company began accumulating ETH through PIPE and ATM financing starting in 2025, positioning ETH as a core balance sheet asset. The financing was led by Consensys Software Inc., with participation from Pantera Capital, Electric Capital, ParaFi Capital, and Galaxy Digital. Board Chairman Joseph Lubin (Ethereum co-founder and Consensys founder) is considered the key driver of this strategic shift, leveraging his deep blockchain background to shape the company’s Ethereum reserve vision.

• Bitmine Immersion Tech (BMNR): Formerly focused on Bitcoin mining and immersion cooling hardware across low-cost energy regions such as Texas and Trinidad, the company raised $250 million via a private placement in June 2025, issuing 55.6 million shares at $4.50 each to expand its ETH reserve. Backers included Founders Fund and Pantera Capital. Tom Lee, co-founder of Fundstrat, was appointed chairman to lead the company’s ETH strategy.

• Bit Digital (BTBT): Initially a Bitcoin mining company, Bit Digital has pivoted into a digital asset infrastructure platform, emphasizing ETH validator deployment and staking revenue. CEO Samir Tabar, with prior experience at Merrill Lynch and BitMEX, has led the accumulation and staking of ETH since 2022. As of March 31, 2025, institutional shareholders include BlackRock (3.53%), Invesco (2.12%), and VanEck (1.61%).

• BTCS Inc. (BTCS): A blockchain infrastructure pioneer since 2014, the company shifted toward Ethereum in 2021, developing validator node operations and block construction initiatives. In 2024, it launched Builder+, a block optimization tool, aiming to capture Ethereum staking and block-level revenue. CEO Charles W. Allen oversees the ETH strategy as part of the firm’s long-term commitment to blockchain development.

Q3: What are the main funding sources behind their ETH purchases?

None of the four companies rely on operating cash flow to purchase ETH. Instead, they use a mix of PIPE, ATM equity issuance, convertible debt, DeFi lending, and BTC liquidation to finance their Ethereum strategy — highlighting a shared approach of leveraging the balance sheet to drive on-chain yield.

• SharpLink Gaming raised capital through a combination of PIPE and ATM facilities. In May 2025, the company completed a $420 million PIPE round. On July 17, it submitted a revised registration to the U.S. SEC, raising the ATM ceiling from $1 billion to $6 billion and including the PIPE offering under the same filing. The company has clearly stated in multiple filings that proceeds are earmarked for building its ETH reserve and executing staking strategies.

• Bitmine Immersion Tech completed a $250 million private placement in July 2025 and introduced Founders Fund as a strategic shareholder with a 9.1% stake. The company indicated that all proceeds would be used to build its ETH reserve, including future staking, although no specific on-chain staking deployment has been publicly disclosed to date.

• Bit Digital follows a “BTC liquidation + public offering” hybrid model. In July 2025, it raised $172 million through a public offering and the sale of approximately 280 BTC, earmarked for ETH purchases and staking model development. On July 15, it announced a further $67.3 million capital raise via direct equity issuance to expand ETH holdings.

• BTCS Inc. uses a three-pronged approach: ATM equity issuance, convertible debt, and DeFi lending. It has raised its ETH financing target to $225 million and emphasizes ETH per-share compounding growth with minimal shareholder dilution.

Q4: Why did these companies choose ETH over BTC?

Unlike BTC, which functions as a non-yielding reserve asset, ETH — following its transition to Proof-of-Stake — can be staked to generate predictable on-chain returns, making it akin to a yield-bearing sovereign bond in digital form. Additionally, Ethereum’s ecosystem is still in a distributed narrative phase without a clear monopolistic holder like MSTR for BTC, leaving more room for narrative-driven price expansion. ETH’s broader on-chain utility also enables companies to participate in validator networks, re-staking ecosystems, and modular security collaborations.

Q5: Are their ETH holdings staked? How do their staking strategies differ?

• SharpLink: Nearly all ETH holdings are staked, earning an annualized yield of 3%–4%. As of July 2025, the company has earned over 415 ETH in staking rewards.

• Bit Digital: Actively engaged in native staking, with around 21,568 ETH staked as of Q1 2025 — roughly 88% of holdings — yielding approximately $600,000 in quarterly staking income.

• BTCS: Uses a diversified strategy. About 10,460 ETH is staked via Rocket Pool and solo staking, with another 4,382 ETH queued. The company also uses Aave to generate borrowing income from ETH collateral, building a multi-pronged yield approach.

• Bitmine: Although staking has not yet been disclosed, the company has publicly stated it will begin staking ETH following the completion of its financing round.

Each firm demonstrates varying trade-offs in staking methods, validator control, and on-chain strategy.

Q6: Do these companies disclose ETH P&L or provide transparent on-chain data?

• SharpLink: The only company with publicly traceable ETH addresses, offering complete transparency on inflows and staking activity via platforms like Arkham. The company disclosed a $2,825 average purchase price and an unrealized gain of approximately $260 million as of July 2025.

• Bit Digital: Does not disclose addresses but regularly updates ETH holdings and staking earnings in financial reports, offering basic transparency.

• BTCS: Also does not disclose addresses, but its website and SEC filings detail ETH allocation across Rocket Pool, solo staking, and Aave, providing clear asset visibility.

• Bitmine: Recently disclosed holding 300,657 ETH (worth over $1 billion) , funded by its July private placement. Staking details and addresses remain undisclosed.

Overall, SharpLink leads in transparency and P&L disclosure, while the other three companies offer key metrics in public filings, forming a baseline for traceability.

Q7: How significant is ETH in their asset structure? Has it become a core reserve?

Based on July 2025 data and an ETH price of $3,573, the current ETH holdings are valued as follows:

• SharpLink: $1.278B (≈ 44% of $2.9B market cap)

• Bitmine: $1.074B (≈ 32% of $3.4B market cap)

• Bit Digital: $429M (≈ 35% of $1.23B market cap)

• BTCS: $114M (≈ 74% of $153M market cap)

These figures reflect the rapidly growing weight of ETH in their balance sheets. However, part of this may be driven by speculative narrative boosts. Given the absence of stable operating cash flows, the sustainability of this strategy will depend on financial disclosures around cash flow health, financing cadence, and staking deployment progress.

Q8: Has the ETH Microstrategy fueled share price growth? How has the market responded?

As of July 18, 2025, all four companies experienced substantial share price surges due to their ETH Microstrategy — but also underwent steep corrections, reflecting high volatility:

• SharpLink Gaming (SBET): Rose from $2.58 in late May to a peak of $124.12 in early June, then fell sharply to $28.98 by July 18 — a 92.5% drawdown.

• Bitmine Immersion Tech (BMNR): Spiked to $161.00 shortly after its June IPO, but dropped to $42.35 by July 18 — a 73.7% decline, indicating early speculative fervor.

• BTCS Inc. (BTCS): Climbed from $1.35 in April to a high of $8.49, up 528%, before settling at $6.57, with interim corrections of over 20%.

• Bit Digital (BTBT): Rose from $1.69 to $4.49 before retreating to $3.84 — a cumulative gain of 127% but with multiple pullbacks.

In sum, “ETH Microstrategy” has indeed been a key catalyst for short-term price rallies, but the small-cap nature of these firms means valuations are highly sensitive to on-chain holdings. Extreme price swings — like SharpLink and Bitmine’s >70% retracements — highlight the speculative and volatile nature of this narrative.

Q9: What are the main risks of this strategy? Is it sustainable?

The ETH Microstrategy model entails several core risks:

• Price and Liquidity Risk: ETH’s volatility can lead to significant mark-to-market losses. Staked assets are illiquid, exacerbating liquidity pressure during downturns.

• On-Chain and Re-Staking Risk: To boost yields, companies may engage in staking and re-staking, exposing themselves to smart contract bugs, slashing penalties, and validator errors. Systemic issues in on-chain infrastructure could cause sudden devaluation or asset lockup.

• Financing Structure Risk: Most firms rely on at-the-market equity issuance (ATM) to fund ETH purchases. If market sentiment turns, such financing may stall, and continued dilution could impact shareholder returns.

• Staking Yield Compression: As validator counts rise, PoS yields face downward pressure. Without operating cash flow, falling yields may make ETH strategies hard to sustain.

• Execution Risk: The ability to rebalance dynamically, manage cash flow, and coordinate on-chain/off-chain strategy execution will determine whether such strategies can operate sustainably over the long term.

Q10: Could any of these companies become the “Ethereum MicroStrategy”? Why hasn’t a clear leader emerged?

SharpLink and Bitmine have begun to gain reputational traction as “ETH Microstrategy” leaders, but they remain far from achieving MicroStrategy-level narrative dominance in the BTC market. Several factors contribute:

• Complex ETH Asset Attributes: ETH combines yield and programmable utility, unlike BTC’s fixed-supply reserve role. Its composite identity makes it harder for companies to anchor a simple, compelling narrative.

• Higher Operational Barriers: Executing an ETH Microstrategy requires validator operations, staking management, and complex on-chain deployments. This is more technically demanding than holding BTC, limiting broad replication.

• Small Market Caps & Limited Financial Tools: These firms are still small-cap, lack valuation premiums, convertible bond mechanisms, or media flywheels like MSTR.

• Absence of a Unifying ETH Bellwether: The ETH market still lacks a widely accepted, leverage-efficient corporate proxy. To become the “Ethereum MicroStrategy,” a company must not only accumulate ETH but also master capital raising, on-chain operations, narrative leadership, and valuation transmission.

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