Encryption Asset Reserve Strategy: A New Paradigm of Value Creation for Listed Companies

Introduction

The capital market is always full of astonishing stories, and the rise of Bitmine Immersion Technologies (BMNR) is undoubtedly one of the most remarkable scenes. In June 2025, this once-obscure company saw its stock price soar from $4.26 to $161 in just a few days due to the announcement of its Ethereum reserve strategy, an increase of nearly 37 times. This dramatic event not only shocked the market but also revealed a profound transformation quietly rising in the business world.

This transformation began in 2020 with MicroStrategy pioneering the way, transforming publicly traded companies into encryption asset investment tools. However, the case of Bitmine marks the entry of this model into version 2.0—a new phase that is more radical and has greater narrative impact. It not only chose Ethereum as the underlying asset but also cleverly elevated well-known analyst Tom Lee to the position of chairman, creating an unprecedented combination of market catalysts.

This article will delve into this phenomenon, from MicroStrategy's "Bitcoin Standard" to the different fates of global followers, and then to the market mechanisms behind the surge of Bitmine, attempting to reveal the truth of this alchemy in the digital age.

Chapter 1: Genesis - The Forging of MicroStrategy and the "Bitcoin Standard"

The starting point of this wave is the vision of MicroStrategy and its CEO Michael Saylor. In the summer of 2020, the world was shrouded in monetary easing policies triggered by the COVID-19 pandemic. Saylor keenly realized that the company’s cash reserves of $500 million were facing serious inflation erosion, comparing it to "a melting ice cube."

On August 11, 2020, MicroStrategy announced the purchase of 21,454 bitcoins for $250 million as a primary corporate reserve asset. This decision was not only a bold innovation in the financial management of publicly traded companies but also provided a blueprint for future adopters.

MicroStrategy is set to upgrade its strategy to utilize the capital markets as a "cash machine" for Bitcoin. By issuing convertible bonds and "market price issuance" stocks, the company has raised billions of dollars to continuously increase its Bitcoin holdings. This model has created a unique flywheel effect: leveraging soaring stock prices to obtain low-cost funds, which are then invested in Bitcoin, while the rising Bitcoin prices further drive up the stock prices.

Despite the severe test that the cryptocurrency market winter in 2022 brought to this model, MicroStrategy ultimately persevered. By mid-2025, its Bitcoin holdings had exceeded 590,000, and the company's market value had surged from under $1 billion to the hundreds of billions.

MicroStrategy's real innovation lies in reshaping its entire corporate structure into a "Bitcoin development company," providing investors with a unique, tax-advantaged, and institution-friendly exposure to Bitcoin. Saylor even likened it to a "leveraged Bitcoin spot ETF," creating a new class of publicly traded companies—encryption asset proxy tools.

Chapter Two: Global Disciples - A Comparative Analysis of Transnational Cases

MicroStrategy's success has ignited the imagination of the global business community. From Tokyo to Hong Kong, and to North America, a group of "disciples" has begun to emerge, unfolding a series of captivating capital stories with various endings.

The Japanese investment company Metaplanet is known as the "Japanese version of MicroStrategy." Since launching its Bitcoin strategy in April 2024, its stock price has increased more than 20 times. Metaplanet's success is attributed to Japanese tax laws that make it more advantageous for local investors to invest in Bitcoin indirectly through stock holdings rather than holding it directly.

The case of Meitu Inc. serves as an important warning. After announcing the purchase of encryption currencies in March 2021, the company not only failed to achieve the expected surge in stock prices but also fell into financial reporting difficulties due to old accounting standards. The company's CEO later reflected that this investment distracted the company's focus, leading to a negative correlation between its stock price and the encryption market.

In the mainland United States, the medical technology company Semler Scientific is a representative of radical transformation, almost completely mirroring the script of MicroStrategy, resulting in a sharp rise in its stock price. In contrast, the fintech giant Block has adopted an earlier and more moderate integration approach, with its stock price performance being more closely linked to its core fintech business.

Japanese gaming giant Nexon provides a perfect contrast case. In April 2021, it announced the purchase of $100 million in Bitcoin, but clearly defined this as a conservative financial diversification move, resulting in a very subdued market reaction. The example of Nexon proves that it is not the "buying of coins" itself that ignites stock prices, but the aggressive stance of the company deeply binding its fate with encryption assets.

Chapter 3: Catalyst - Deconstructing the Surge Storm of Bitmine

The success of Bitmine (BMNR) is not coincidental, but rather the result of a carefully crafted "alchemy recipe".

First, there is the differentiated narrative of Ethereum. Against the backdrop of Bitcoin no longer being a novel story as a corporate reserve asset, Bitmine's choice of Ethereum provides a new narrative with more futuristic and application prospects for the market. Secondly, there is the power of the "Tom Lee Effect." The appointment of Fundstrat founder Tom Lee as chairman instantly injected tremendous credibility and speculative appeal into this small-cap company. Finally, there is the backing of top institutions. This private placement was led by well-known institutions, with participants including several top crypto venture capital firms and organizations, greatly boosting the confidence of retail investors.

This series of operations indicates that the market for encryption proxy stocks is highly "reflexive," where the driving force of value is not only the assets held themselves but also the "quality" of the stories they tell and their "viral potential". The true driving force is a perfect narrative cocktail composed of "novel assets + celebrity effect + institutional consensus."

Chapter Four: The Invisible Engine Room - Accounting, Regulation, and Market Mechanisms

Behind the wave of new corporate cryptocurrency purchases in 2025, the most important structural catalyst is the new regulation ASU 2023-08 issued by the Financial Accounting Standards Board (FASB) in the United States. This regulation requires companies to measure held encryption assets at fair value, with value fluctuations being directly recorded in the income statement each quarter, clearing a significant obstacle for companies to adopt encryption asset strategies.

The core operation of these encryption proxy stocks lies in the "net asset value premium" flywheel. Company stock prices typically trade at prices far above the net asset value of the held encryption assets, giving them strong "magic": they can issue more stock at high prices to purchase more encryption assets, creating a positive feedback loop.

In 2024, the approval of the Bitcoin spot ETF achieved great success, fundamentally changing the landscape of encryption investment. This poses complex implications for corporate reserve strategies: on one hand, the ETF is a direct competitive threat, while on the other hand, it brings unprecedented institutional funds and legitimacy to Bitcoin, making the act of incorporating it into corporate balance sheets less aggressive.

Summary

The corporate encryption reserve strategy has evolved from a niche tool for hedging against inflation to an aggressive new paradigm of capital allocation that reshapes corporate value. It blurs the lines between operating companies and investment funds, turning the public equity market into a super leverage for large-scale accumulation of digital assets.

This strategy demonstrates an astonishing duality. On one hand, pioneers have created a tremendous wealth effect in the short term by skillfully mastering the "net asset value premium" flywheel. On the other hand, its success is inextricably linked to the extreme volatility of encryption assets and market speculation sentiment, and the inherent risks are equally substantial.

Looking ahead, with the full implementation of the new accounting standards by FASB, and the successful demonstration of a new script by Bitmine, the next wave of corporate adoption may be brewing. We may see more companies turning their attention to a more diverse range of digital assets and employing more mature narrative techniques to attract capital. This grand experiment taking place on corporate balance sheets will undoubtedly continue to profoundly reshape the intersection of corporate finance and the digital economy.