Bit Digital Raises $150M for Ethereum Staking as Shares Plunge 19%
Bit Digital has shifted from Bitcoin mining to an Ethereum staking and treasury model, announcing a $150 million secondary offering of 75 million shares at $2 each. The share sale will fund additional ETH purchases, potentially boosting the company’s holdings to around 42,000 ETH (≈$103 million) once its 417 BTC reserves are converted. Following the announcement, the stock initially fell nearly 4%, then dropped 15% on the offering day, culminating in a 19% weekly decline. Traders are cautious about short-term dilution but eye potential long-term rewards from Ethereum staking, as the move underscores Bit Digital’s commitment to its new business strategy. Ethereum staking is now at the core of Bit Digital’s operations, highlighting a clear strategic pivot.
Bullish
Bit Digital’s pivot to Ethereum staking and its planned $150 million share sale to buy more ETH are likely to increase institutional demand for ETH. The firm’s commitment to staking—along with converting its BTC reserves—could exert upward pressure on ETH prices over the medium to long term, despite short-term market jitters. While traders are wary of dilution effects on BD stock, the emphasis on Ethereum staking suggests stronger network support and demand, which is bullish for ETH.