Why Companies Like Strategy and Bitmine Are Betting Billions on Bitcoin and Ethereum

If you've followed crypto headlines this year, you've likely noticed a pattern: alongside the usual price swings, there's a steady drumbeat of announcements from public companies buying enormous amounts of Bitcoin or Ethereum and parking it on their balance sheets. This isn't a side hobby — for a growing number of firms, it's become the entire business model. They're often called "digital asset treasury" companies, or DATs, and understanding how they operate helps explain some of the demand dynamics behind crypto prices right now.

What is a treasury company?

A crypto treasury company raises capital — through stock sales, debt, or preferred shares — for the specific purpose of buying and holding a cryptocurrency, rather than using that crypto to build a product or run a traditional business. The company's stock effectively becomes a leveraged way for investors to gain exposure to that asset, since the firm keeps adding to its holdings over time.

The model was pioneered at scale by Strategy (formerly known as MicroStrategy), which has spent years converting its balance sheet into a Bitcoin reserve. As of this year, Strategy holds more than 845,000 BTC. Notably, even Strategy occasionally sells small amounts of its holdings — including a sale of roughly 3,600 BTC in June to help cover dividend payments on its preferred stock — a reminder that even the largest treasury firms have real financial obligations to manage, not just a one-way accumulation strategy.

The Ethereum version: Bitmine's "Alchemy of 5%"

Where Strategy focuses on Bitcoin, Bitmine Immersion Technologies has taken the same playbook and applied it to Ethereum — with a twist. Bitmine now holds over 5.7 million ETH, roughly 4.8% of Ethereum's total circulating supply, as it pursues a publicly stated goal chairman Tom Lee calls the "Alchemy of 5%": owning 5% of all ETH in existence.

What makes Bitmine's approach different from a pure Bitcoin treasury is that Ethereum can be staked to earn yield. Bitmine has staked the vast majority of its holdings — around 85% — through its own validator network, generating an estimated $235 million in annualized staking revenue. That income is used, in part, to cover dividend obligations on the company's preferred stock, giving the strategy a self-funding element that a pure Bitcoin treasury doesn't have.

Why this matters beyond the two companies

Treasury companies matter to the broader market for a few reasons:

• They're a real source of demand. When spot ETFs saw net outflows for much of this year, sustained treasury-company buying helped offset that selling pressure — genuine buy-side demand that isn't tied to short-term trading sentiment.
• They concentrate supply. Bitmine alone controlling nearly 5% of all ETH is a meaningful concentration in the hands of one company, something worth watching from a decentralization standpoint even as it signals institutional conviction.
• They're exposed to real risk. These strategies rely on continued access to capital markets. If a company's stock price falls far enough relative to its crypto holdings, or if it can no longer raise funds cheaply, forced selling becomes a real possibility — something analysts have already flagged as a risk worth monitoring given Strategy's own partial sale this year.

The bigger picture

Treasury companies are still a relatively new and untested model over long time horizons. It's a strategy built on the belief that Bitcoin and Ethereum will keep appreciating over time, financed in ways that assume continued investor appetite for that story. Whether that holds up through a full market cycle — including a prolonged downturn — remains one of the more interesting open questions in crypto for the rest of this year.