BitMine stock price will be in the spotlight this week as the ongoing Ethereum rebound coincides with a key vote on boosting the number of authorized shares in the near term. The BMNR stock ended the week at $31.20, up from last week’s low of $27.
BitMine shareholder to vote on increasing shares to 50 billion
The BMNR stock price will likely be highly volatile in the coming days as the shareholders vote on authorizing more shares. They will determine whether to boost the outstanding shares from 500 million to 50 billion.
In a statement, Tom Lee noted that the new fundraising will enable it to have selective at-the-money (ATM) and capital raising opportunity over time.
At the same time, he noted that the new authorization will enable opportunistic deals such as mergers and acquisitions (M&A). Most importantly, he noted that the new fundraising will enable the company to execute future share splits as he expects that the Ethereum price will continue rising in the long term.
However, critics have pointed to some major holes in Lee’s argument. First, analysts argue that the new share expansion will be too much, considering that it is nearing its goal of its Ethereum accumulation strategy.
$BMNR I read through the proposal to increase authorized shares from 500M to 50B, as well as Tom’s thread below.
Here are my TOP 3 concerns:
I should start by highlighting that I very much appreciate the transparency of the thread by Tom. In it, he argues this is not about
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It has bought 4.1 million tokens so far and now holds about 3.4% of the ETH supply. As such, it needs to buy 1.6% of the supply, which is smaller than what it has bought so far. At the current price, the company needs to authorize 190 million more shares.
Second, analysts noted that the share split argument is vague as Lee argued that it will happen when Ethereum surges, potentially to $250,000, an event that will happen many years later.
Finally, there are concerns that the company’s market net-asset value (mNAV), which has slumped to 0.93. Increased dilution when the stock is trading below NAV is relatively risky as we have seen with other companies like Michael Saylor’s Strategy, which is selling shares worth billions a month.
Ethereum price technical analysis suggests more upside
Meanwhile, technicals suggest that Ethereum price has more upside in the coming weeks. It has formed a double-bottom pattern at $2,766, its lowest level in December last year. Its neckline is at $3,475, its highest level on December 10.
A double-bottom is one of the most common bullish reversal signs in technical analysis. The token is also about to move above the Supertrend indicator. It has also moved above the 50-day moving average, while the Crypto Fear and Greed Index has moved to the neutral level.
Therefore, the token will likely continue rising as bulls target the next key resistance level at $3,475. A move above that level will point to more gains, potentially to the psychological level at $4,000.
BMNR stock price technical analysis
The daily timeframe chart shows that the BMNR stock price has crashed in the past few months, moving from a high of $160 in July last year to the current $30.
A closer look shows that the stock has remained below all moving averages and the Supertrend indicator, which is a highly bearish sign. However, like Ethereum, the stock has formed a double-bottom pattern with a neckline at $42.
Therefore, the stock will likely rebound this week, potentially to the next key resistance level at $42. A move above that level will be the psychological point at $50.READ MORE: Here’s why BitMine stock price is ripe for a strong comeback
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