Written by: Wenser (@wenser2010), Planet Daily

As the market continues to decline, Strategy and Bitmine, the two giants of DAT (Digital Asset Management), have both suffered huge unrealized losses.

This morning, BTC briefly fell below $62,000, currently trading around $63,800; ETH fell below $1,800, currently trading around $1,780. Based on current prices, Strategy's unrealized losses have reached a staggering $10 billion; Bitmine's unrealized losses have reached around $9 billion. Suddenly, Michael Saylor and Tom Lee are "in the same boat," and Strategy and Bitmine have become the top two "DAT companies with the largest losses."

However, compared to Strategy, which needs to continuously pay dividends, Bitmine faces less financial pressure and retains the flexibility of raising funds through STRC preferred stock. It is reported that Bitmine plans to raise $300 million through the issuance of perpetual preferred stock, with an annualized dividend of 9.5%. This suggests that Bitmine's ETH acquisition strategy continues; while the sword of Damocles hanging over Strategy's head is—where will the funds for subsequent STRC dividend payments come from? Between the two, which faces greater financial pressure? Odaily Planet Daily will analyze this for its readers.

Bitmine VS Strategy: Vastly Different Paths to Holding DAT

With the sharp drop in BTC today, community members used AI to prank Saylor "promoting" BTC: "A 60-year-old man personally promotes BTC, with the price of his heirloom BTC as low as $62,000 per coin."

Returning to Bitmine and Strategy, currently Bitmine's financial structure appears more secure, while Strategy faces greater leverage pressure.

Bitmine's equity issuance game: Debtless financing DAT gameplay

As of June 1st, Bitmine held 5,416,901 ETH, representing approximately 4.49% of the total ETH supply, close to the "5% cap" repeatedly emphasized by Bitmine Chairman Tom Lee. Yesterday, Bitmine further increased its holdings by 25,000 ETH through BitGo, worth $48 million at the time, bringing its total holdings to 5,441,901 ETH.

Bitmine has the confidence to continue increasing its holdings even during market downturns for several reasons. The most important reason is that Bitmine's funding comes from equity issuance:

When Bitmine launched the ETH Treasury and established DAT company last June, it secured initial seed funding of $250 million, as well as a small amount of PIPE funding.
Since July of last year, Bitmine has primarily relied on ATM equity issuance, gradually increasing this figure from $2 billion to $24.5 billion.

Ample funding gave Tom Lee sufficient confidence, and Bitmine's cash reserves also supported further acquisitions—Bitmine's public announcement on June 1st also mentioned that its stake in Beast Industries was valued at $180 million; its stake in Eightco Holdings was valued at $93 million. The company's total cash holdings amounted to $446 million.

In addition, Tom Lee has also publicly stated that Bitmine's Ethereum treasury generates $1 million in daily staking returns. This refers to the fact that Bitmine stakes approximately 87% (about 4.71 million ETH) of its ETH holdings through its MAVAN staking network, with an estimated annualized return of about 2.73%-3% (about $250-300 million), which also provides a relatively stable cash flow.

In short, Bitmine's financial situation is sound; and its latest preferred stock financing, with an annualized dividend of 9.5%, is expected to raise $300 million, further alleviating its financial pressure. The biggest risks for the company lie in equity dilution (from issuing new shares) and further share price declines due to unrealized losses. A persistent mNVA < 1 could trigger a sell-off.

Strategy's Debt Leverage Game: Convertible Bonds and Preferred Stock Dividend Pressure

Compared to Bitmine's "using investors' money to buy ETH", Strategy faces greater financial pressure in buying BTC because it mainly "borrows money to increase its BTC holdings".

According to Strategy's official website, Strategy currently holds approximately $6.7 billion in convertible debt, plus approximately $9.9 billion in STRC preferred stock and varying amounts of STRD, STRK, and STRF, requiring it to pay substantial dividends and interest annually. At the end of May, after repurchasing $1.5 billion in convertible debt, Strategy's cash reserves decreased to approximately $871 million, enough to cover only about six months of its projected $1.7 billion annual preferred dividend obligation.

Furthermore, Strategy previously initiated a vote to increase STRC dividend payments from once a month to twice a month. The vote began on April 28 and will conclude on the meeting day, June 8. If the proposal is approved, the initial record date under the new schedule will be June 30, and the first dividend payment date will be July 15. Eligible shareholders (both MSTR and STRC shareholders) must have held shares before April 17.

Additionally, it's worth noting that the authorized issuance cap for STRC is approximately $28.3 billion. Possibly influenced by the continued decline in BTC and weakened market confidence, STRC fell below $95 this morning, currently trading at $94.65, representing a drop of over 5% from the $100 target price.

Compared to Bitmine, Strategy currently faces a significant gap between the excessive amount of preferred stock financing and dividend payments due to the continuous decline in BTC prices. Moreover, unlike ETH, which offers staking rewards, BTC lacks an alternative staking ecosystem to obtain more liquidity.

Therefore, after Strategy sold 32 BTC last month, the market began to doubt Strategy's identity as a "diamond hand" that only buys and never sells. With BTC continuing to fall, Strategy may face a series of liquidity crises, making it unable to repay debts and dividends, thus forcing it to sell BTC again to drive down the price. Essentially, Strategy is playing a leveraged debt game of "high-leverage betting that the price of BTC will not fall to a certain level."

Therefore, considering Strategy's current mNAV of 0.83, the market remains highly skeptical about its future stock price performance. Yesterday, its market capitalization fell out of the top 200 US companies by market capitalization. Currently, Strategy (MSTR) stock is trading at $126, a 7% decrease in the last 24 hours; its market capitalization is currently $44.6 billion.

Of course, as a leading DAT (Digital Asset Management) treasury company, Bitmine Chairman Tom Lee remains quite optimistic about Strategy. He previously stated, "Strategy's selling of Bitcoin and ETF outflows are typical bottoming behavior, not a risk signal." At the recent "Proof of Talk 2026" conference at the Louvre Museum in Paris, Tom Lee even boldly predicted, "With artificial intelligence and tokenization driving significant changes in financial infrastructure, ETH could eventually reach $250,000." However, when mentioning "Bitmine's actions after its ETH holdings reach 5% of the total," he also expressed caution regarding increasing his ETH holdings. (See "Tom Lee Recharges His Faith: Crypto Spring Has Arrived, ETH Will Rise to $250,000")

Currently, Bitmine and Strategy are in very similar market situations, but Bitmine is in slightly better financial condition. Strategy faces the choice between "selling more BTC to generate cash flow to pay dividends" and "watching BTC continue to fall and continuing to borrow money to increase its holdings or remaining inactive."

Abraxas Capital closed its short position in HYPE, realizing a profit of $9.07 million.

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