Wall Street strategist Tom Lee: Corporate treasury models are superior to traditional ETFs

Author: Tom Lee, Chairman of the Board of Bitmine; Translated by Fairy, ChainCatcher

Editor's Note:

Ethereum may be experiencing its own "sovereignty narrative moment."

In just one month, Bitmine acquired 830,000 ETH, approaching 1% of the global supply. While most institutions are still on the sidelines, it has become the world's largest ETH treasury company. This is not only a bet on asset prices but also a strategic position in the future of financial infrastructure.

This interview with Bitmine Chairman Tom Lee provides an in-depth analysis of Bitmine's grand vision and meticulous execution, and explores Ethereum's key role in financialization, compliant staking, and the AI era. This is not only an insight into digital asset allocation, but also a forward-looking interpretation of the next round of institutional cycles and financial ecosystem transformation. The following is the transcript of the conversation, compiled and edited by ChainCatcher. Host: Bitmine currently holds 833,000 ETH, representing nearly 1% of the global ETH supply, making it the world's largest publicly listed ETH treasury. How does that feel? Tom Lee: The pace was indeed very fast. From the announcement on June 30th to the completion on July 8th, we quickly acquired a large amount of ETH in just 27 days. MicroStrategy has proven the success of the treasury strategy, with its stock price soaring from $13 in August 2020 to its current level, a 30-fold increase. Bitcoin has risen from $11,000 to $120,000, with asset appreciation alone resulting in a 20-fold return. I believe Ethereum is a major macro trade for the next decade, and we hope to hold as much ETH as possible while the price is still around $3,500, anticipating explosive growth similar to Bitcoin's over the past five years. Host: After Bitmine announced its ETH treasury strategy, other companies like Joe Lubin's SBET and Sharpling Gaming quickly followed suit, announcing similar plans almost simultaneously. Why did these ETH treasury companies emerge within a single two weeks? Tom Lee: Perhaps it's "great minds think alike." Sharpling was the first company to announce a treasury strategy, publicly announcing its plan as early as May. We followed suit a bit later. Ethereum is suitable as a treasury asset for several reasons: First, if you believe in the long-term value of ETH, a treasury strategy is more attractive than an ETF because you can buy and hold it over time. Secondly, Ethereum is based on Proof-of-Stake (PoS), which allows for native returns of over 3% through staking, essentially giving these companies a stable revenue stream similar to that of infrastructure operators. Finally, scarcity is key. Bitmine's goal is to hold 5% of the total ETH supply. We have a very clean balance sheet, with $1.6 billion in daily trading volume, making us the 42nd most liquid stock in the US market, comparable to Uber. However, our market capitalization is only $4 billion, far less than Uber's $184 billion. Host: You mentioned that Bitmine's goal is to hold 5% of the ETH supply. Do you really plan to reach 5%? What's the execution path? Tom Lee: MicroStrategy has set a goal of holding 1 million bitcoins, approximately 5% of the supply. This can be seen as a sovereign call option, which is strategically significant for the ecosystem. If the US government wanted to build a Bitcoin reserve, direct market purchases would drive up the price, potentially even pushing Bitcoin to $1 million. MicroStrategy, with its large BTC holdings, would become an easier acquisition target. A similar logic applies to ETH. Bitmine currently adds 0.8 to 10,000 ETH per day, a rate of increase 12 times that of MicroStrategy. If we maintain the current pace, we expect to reach our 5% target within 1-2 years. Our operations are entirely within the US and strictly adhere to US laws and regulatory frameworks. Ethereum is currently the most compliant blockchain, meeting the infrastructure requirements of Wall Street and governments. With the rise of asset tokenization, ETH's financialization will continue to increase. Just as gamers buy Nvidia stock, Wall Street will also need to hold ETH and ensure its collateralization is compliant. Host: If Wall Street and AI both turn to Ethereum, is it possible to create a scenario similar to "sovereign call options"? Tom Lee: It's not impossible, but we're not simply building a position for this "sovereign option." Imagine a future where the US passes legislation (such as the hypothetical Genius Act) to push the financial system onto blockchains. Ethereum would become the most important compliant underlying blockchain, supporting not only the US but also potentially adopted by other countries. In this context, the US would naturally want to have a certain degree of dominance on Ethereum. Furthermore, AI and asset tokenization place extremely high demands on the security of the underlying blockchain. Bitmine, with its clean balance sheet and compliant operating model, will play a key role in areas like staking. We will soon announce our staking plan, which will strictly adhere to US GAAP and all regulatory requirements. The ETH Treasury Company is not only an asset holder but also a builder of new financial infrastructure, generating staking income and other business models in the future. Host: Bitmine bought $3 billion worth of ETH in just one month, but the price hasn't broken through $4,000. Where did all this ETH come from? Why hasn't the market seen significant fluctuations? Tom Lee: In the short term, ETH prices are influenced by a variety of factors, such as liquidation structures, trade hedging, and even some who still believe Ethereum is a "dead chain" and are shorting it. A similar situation occurred with Bitcoin in 2017, when the price hovered around $1,000 before experiencing a significant surge. I believe ETH is at a similar stage now, with Wall Street just beginning to truly pay attention to it. In the long term, ETH's fair value is far higher than its current level. Host: Why choose an ETH Treasury company over a treasury company for Bitcoin or other assets? Tom Lee: I'm very bullish on Bitcoin and believe it has the potential to reach $1 million or even $1.5 million. However, the two have different positioning: Bitcoin is digital gold, focusing on storing value; Ethereum is a foundational blockchain for finance and AI, with more platform attributes. For many US institutions, an ETH ETF may not meet fund investment parameters, but Treasury Securities offers a compliant and efficient alternative. Renowned institutions like Cathie Wood and Bill Miller support Bitmine precisely because it allows them to directly participate in ETH's macro opportunities. Furthermore, Ethereum's DeFi ecosystem provides more tools for treasury strategies, such as further increasing holdings through staking or on-chain yield strategies, which is currently unavailable with Bitcoin. Host: Where does the MNAV (Net Market Asset Value) premium come from? Why does it exist? Tom Lee: The MNAV premium primarily stems from three factors: yield, growth rate, and liquidity. Taking Bitmine as an example, assuming the market views us as an ETF, our valuation would be 1x NAV. But we earn an annualized 3% return on ETH by staking, equivalent to net profit. Based on a 20x P/E ratio, this alone brings a 0.6x valuation increase, totaling 1.6x NAV. The second is the "speed premium." We grew from $4 ETH per share to $23, far exceeding MicroStrategy's growth rate. MicroStrategy increases its holdings by approximately $0.16 worth of Bitcoin daily, earning a 0.6x NAV premium. We increase our holdings by $0.80-$100 per day, nearly 12 times faster, and theoretically should command a higher premium. Secondly, liquidity. Our stock's daily trading volume reaches $1.6 billion, second only to MicroStrategy. This high liquidity naturally brings a valuation premium. Host: Can this growth rate be sustained? Where does the liquidity come from? Tom Lee: High liquidity supports high growth. Our team and investor background are key: Mosaics (a macro hedge fund) led the investment, attracting top institutions such as Founders Fund and Stan Druckenmiller. Furthermore, my long-term public support for the crypto industry since 2017 has reinforced the market's confidence in our vision. In 2017, Bitcoin transitioned from a retail asset to an institutional asset; in 2025, Ethereum is experiencing a similar moment. Host: You mentioned Bitcoin's turning point in 2017. How does this compare to Ethereum's current situation? Tom Lee: Our research at Fundstrat in 2017 found that Bitcoin's price surge from $100 to $1,000 was primarily driven by the number of wallets and activity, demonstrating strong network effects. At that time, there was almost no institutional participation, and we were questioned and even lost clients, but Bitcoin eventually rose to $120,000. Ethereum is in a similar situation today: many on Wall Street remain skeptical, questioning whether it is a "main chain." But the reality is that Ethereum has experienced 10 consecutive years of zero downtime, with on-chain activity reaching record highs. Circle's IPO, Coinbase, and Robinhood's Layer 2 solutions are all built on Ethereum. Wall Street is beginning to realize that Ethereum is becoming the core infrastructure for financialization and tokenization. Host: What are your thoughts on ETH prices this year or in this cycle? Tom Lee: In the short term, ETH should at least return to the $4,000 level seen in December of last year. Based on the ETH/BTC ratio of 0.05 at the time, and at the current Bitcoin price, ETH should be around $6,000. If macroeconomic factors like continued purchases by other Treasury securities and potential Federal Reserve rate cuts are factored in, ETH could potentially reach the $7,000 to $15,000 range by the end of the year. In the long term, Bitcoin has experienced a hundredfold increase. As a core asset in the era of financialization and AI, ETH's future potential is even greater, with the potential to surpass Bitcoin. Host: How should ETH be valued? Based on transaction fees, DeFi storage value, or staking demand? Tom Lee: It's difficult to accurately predict the fair price of ETH using a spreadsheet, just as it's difficult to accurately predict the long-term performance of Bitcoin or the S&P 500. Market pricing reflects expectations for the next five to ten years rather than current trading data. ETH is currently severely undervalued. While analogies like "digital gold" for Bitcoin and "digital oil" for Ethereum are valuable, we shouldn't be bound by these models. Host: Will the ETH Treasury Company overheat? Is there a risk of a bubble burst similar to the investment trust or GBTC bubble of the 1920s? Tom Lee: Bubbles require a consensus bullish market, but currently, the prevailing sentiment for both ETH and Bitcoin remains cautious or even pessimistic. As long as the Treasury Company doesn't abuse leverage, especially by adopting a compliant debt structure like MicroStrategy, it won't pose a systemic risk. At this stage, the market is more like "overly skeptical" than "overly optimistic," which is precisely the fertile ground for price increases. Host: What are your macroeconomic concerns? Tom Lee: I'm concerned about the politicization of institutions, particularly the questioning of the independence of the Federal Reserve and the Bureau of Labor Statistics (BLS). However, the overall economy is actually very strong, despite the misconception among many institutional clients that we're in a recession. For the past 30 years, no one has accurately predicted a recession. Businesses are generally cautious now, with the ISM index having been below 50 for 29 consecutive months. Events like the "tariff shock" have restored market confidence and helped to curb overheating. I believe we're still mid-cycle, or even early-cycle. Host: What's the biggest misunderstanding Wall Street has about Ethereum? Tom Lee: They rely too much on spreadsheets and focus on details like gas fees and stablecoin transaction volumes, leading to "analysis paralysis." The real problem isn't what the models say, but a lack of strategic perspective. Ethereum's value as a compliant blockchain is growing increasingly important, just like the undervalued S&P 500 back then. It will become the infrastructure of the financialized and AI era, yet the current market price is far below its true potential.