Tom Lee’s BitMine is facing approximately $7.3 billion in paper losses in the Ethereum vault as Ether (ETH) investors consider deteriorating sentiment, ETF outflows and a bearish chart setup pointing to $1,600.

Key takeaways:

• Bitmine continues to buy ETH even as its losses mount amid a 57% price decline from its August 2025 high.
• ETH price technicals warn of a 25% decline, which would push Bitmine’s losses to over $10 billion.

Bitmine’s ETH vault panel. Source: DropStab.COM

Lee continues to purchase ETH despite mounting losses

Ether is down more than 57% from its October 2025 high near $4,955 on Coinbase, and the selloff has also reduced Ethereum’s market share. ETH’s (ETH.D) dominance has dropped to around 10%, down from around 15% in August 2025.

ETH.D vs. Daily Performance Chart ETH/USD. Source: TradingView

BitMine began building its Ethereum vault in July 2025, days after closing a $250 million private placement to fund the strategy. Until July 14, the company revealed he owned 163,142 ETH, worth approximately $500 million at the time.

As of last week, BitMine held 5.28 million ETH, or approximately 4.37% of Ethereum’s total supply, making it the world’s largest publicly traded Ether treasury. This means that Tom Lee’s company continued to accumulate ETH during the withdrawal even as its losses increased.

Lee did not treat losses as a reason to retreat. In February he he argued that a acute drop in ETH could offer another buying opportunity, citing Ethereum’s history of V-shaped recoveries after declines of more than 50%.

Related: Ether withdrawal was an ‘attractive opportunity’ to buy 71,672 ETH: Lee from Bitmine

In May, BitMine stated that it would moderate the pace of ETH purchases but would not abandon this strategy.

The company still expects to achieve its goal of having 5% of Ethereum’s total supply by December, signaling that Lee’s strategy remains focused on long-term accumulation despite mounting paper losses.

Bitmine’s losses could rise to over $10 billion if ETH falls further

BitMine could see Ethereum paper losses grow to over $10 billion if the prevailing bearish ETH setup plays out as expected.

Since Sunday, ETH has been hovering near the lower trend line of the dominant rising wedge, a bearish reversal pattern that often signals weakening buying momentum.

ETH/USD daily chart. Source: TradingView

A confirmed break below this support could result in a material move towards the $1,600 area, down about 25% from current prices, by July or August. The target results from subtracting the maximum height of the wedge from the break point.

Conversely, a mighty bounce from the lower boundary could escalate the probability of a 19-20% upside towards $2,530, coinciding with the upper boundary of the wedge and the 200-day exponential moving average (200-day EMA, blue line).

The crash scenario would raise BitMine’s unrealized losses to nearly $10.1 billion, based on its reported 5.28 million ETH holdings and an average purchase price of $3,513.

Ethereum Traders Are Going Bearish

Compounding Ether’s bearish technical setup are several other headwinds, such as the recent departure of the Ethereum Foundation, continued ETH ETF outflows, and weakening social media sentiment.

According to online data platform Santiment, sentiment on ETH deteriorated sharply in May, with the ratio of bullish to bearish comments dropping from over 2:1 in slow April to almost 1:1.

Etherum social media sentiment. source: Santiment

“Historically, this type of deterioration has typically occurred when investors lose confidence in the near-term direction of an asset,” the report said. he said Friday’s report added:

“Crypto traders tend to be very emotional during periods of underperformance, and ETH is increasingly viewed as ‘dead money’ compared to assets that have shown much greater momentum in 2026.”