The "Infinite Money Glitch" is Invalid! The Survival Battle Between Crypto Giants Strategy and BitMine

The crypto asset company arbitrage model, once hailed as the “infinite money glitch,” is unraveling. This week, despite a sharp contraction in the premium of share prices over net asset value (NAV), the two giants, Strategy and BitMine, have bucked the trend with massive purchases. Strategy spent $962.7 million to acquire 10,624 bitcoins, while BitMine bought 138,000 ethers. However, the core engine that supported their years of expansion—an “everlasting machine” of raising funds by issuing shares at a high premium to buy crypto—is on the verge of failure. Facing the “channel equalization” brought by ETFs, these two companies, which together hold over $72 billion in crypto assets, are being forced into a difficult transformational battle for survival.

The “Infinite Money Glitch” Dries Up: End of the High Premium Era

In recent years, digital asset treasury companies represented by Strategy and BitMine played an astonishing capital game: leveraging their share price’s huge premium over the net value of held crypto assets, they issued new shares to raise funds, then bought more bitcoin or ether at market price. This was like exchanging “expensive paper” (overvalued stock) for “cheaper gold” (crypto assets). Each round would boost per-share NAV, creating a self-reinforcing growth loop. The market jokingly called this the “infinite money glitch.”

But this glitch is rapidly shrinking. As of early December, Strategy’s market cap to NAV ratio has shrunk from more than 2.5 times at its peak to about 1.15, while BitMine’s is down to around 1.17. The collapse of the premium is no accident, but the result of a double blow. On one hand, since bitcoin’s record high of $126,000 in October, it has been consolidating in the $90,000–$95,000 range, weakening asset-side momentum. More critically, with the maturation and popularity of spot bitcoin and ether ETFs, investors can now buy these assets at NAV, without paying hefty company premiums for “indirect exposure.”

This “channel equalization” completely undercuts the DAT model’s core logic—providing scarce compliant access. As premiums vanish, issuing stock to raise funds for crypto purchases shifts from “value accretive” to potential “equity dilution.” This subtle but fundamental change means the old game rules no longer work.

Strategy vs. BitMine: Core Data and Predicaments

Strategy (formerly MicroStrategy):

• Latest increase: 10,624 BTC, worth about $962.7 million (largest single-week purchase in nearly five months).
• Total holdings: 660,624 BTC, more than 3% of total bitcoin supply, worth about $60 billion.
• Unrealized profit: Over $10 billion.
• Current challenge: Share price premium (mNAV) only 1.15, nearing the “dilution threshold” (1.0). If it falls below 1.0, issuing shares to buy bitcoin would erode shareholder value.
• Defensive measures: Raised $1.44 billion in cash to boost liquidity and cope with debt pressure in a low-premium environment.

BitMine:

• Latest increase: 138,452 ETH, worth about $429 million.
• Total holdings: 3.86 million ETH, about 3.2% of circulating supply, worth about $12 billion.
• Current challenge: Share price premium (mNAV) around 1.17, also facing the demise of channel value.
• Transformation strategy: Shifting from passive holding to a “yield-generating sovereign wealth” model, planning to generate over 100,000 ETH in annual staking rewards after 2026.
• Goal: Achieve holdings equivalent to 5% of ether’s circulating supply.

Diverging Survival Paths: Store-of-Value Defense vs. Yield Generation

With the old fuel exhausted, the two giants have chosen radically different transformation paths. Strategy continues to defend its “ultimate store-of-value asset” narrative. Despite narrowing premiums, CEO Michael Saylor interprets recent purchases as a show of strength. Management acknowledges that if the premium falls below 1.0, they will consider selling bitcoin to protect the balance sheet. This reveals a frightening “death spiral” risk: falling share prices could force bitcoin sales, depressing the bitcoin price and triggering further share declines. To counter this, Strategy has stockpiled massive cash reserves, essentially building defenses for this “store-of-value war,” hoping to hold out until the next bull cycle and premium recovery.

Meanwhile, under Tom Lee’s leadership, BitMine is executing a more aggressive “strategic pivot.” The goal is no longer just to hoard ether and wait for appreciation, but to turn these static assets into productive capital generating sustainable cash flow. BitMine plans to deploy validator nodes on a large scale in 2026, earning more than 100,000 ETH per year through staking. This approach builds a self-sustaining repayment model based on future cash flows, reducing reliance on asset appreciation and market premiums for survival.

BitMine’s bet is a deeper wager on the grand narrative of “asset tokenization.” Tom Lee compares stablecoins to “Ethereum’s ChatGPT moment,” believing this is the catalyst for institutions to recognize the utility of tokenized dollars. He predicts Wall Street will want to tokenize almost every financial product—a potential market in the tens of trillions of dollars. BitMine’s transformation is an attempt to shift from an investment company to a core infrastructure participant and beneficiary of the future tokenized economy.

Industry Reshuffling Accelerates: “Tourists” Exit, Giants Face Off

The predicaments of Strategy and BitMine mirror the structural adjustment of the entire digital asset treasury sector. Data shows that almost no new DAT companies have formed in the past month, while some smaller market players have begun trimming their crypto positions. This means that, in the previous cycle, the “corporate tourists” who dabbled in crypto just to chase the trend and attract shareholder attention with token allocations have mostly exited.

What’s left are heavyweights like Strategy and BitMine, with ample capital and the ability to operate at scale. The competitive environment has fundamentally changed. Investors no longer need to pay a premium for “access,” so DAT companies must prove they can deliver excess returns—through financial engineering such as leverage, yield enhancement, or tactical trading—over simply holding a spot ETF. The old story of “buying stock for crypto exposure” is now obsolete.

This reshuffling pushes the industry into a new stage: from wild growth driven by regulatory arbitrage and narratives to fierce competition based on refined operations, cash flow generation, and real ecosystem value. For Strategy and BitMine, their future will hinge on three key variables: whether crypto demand will explode again in 2026, whether share premiums can remain above 1.0 and expand, and whether the expected flood of Wall Street capital into asset tokenization will truly materialize.