Bitmine Immersion Technologies (BMNR), chaired by Tom Lee, disclosed that its internal controls over financial reporting remained ineffective at the close of the latest fiscal year. This marks the second consecutive year the company has reached this conclusion in its annual disclosures.
ETH holdings and market performance
Bitmine filed its annual report (Form 10-K) with the Securities and Exchange Commission on November 10, covering the twelve-month period ending August 31, 2026. According to the filing, the company’s treasury held 5,901,837 ETH at year-end, with a reported fair value of $14.56 billion against a cost basis of $19.95 billion. This difference places Bitmine’s ETH holdings approximately $5.4 billion below cost as of the fiscal year end.
The 10-K shows Bitmine approaching its long-stated target of holding 5% of the circulating ETH supply. As of August 31, the company’s stake was about 4.9%. A holdings update published on November 9 put Bitmine’s ETH at 6,070,092, corresponding to 4.97% of the total supply.
Austin Campbell, founder of Zero Knowledge Group, referenced Tom Lee’s position during an episode of Unchained’s Bits + Bips in October, noting that Lee does not intend to hold more than 5% of the ETH supply.
Internal controls and auditor changes
Management first identified material weaknesses in internal controls as of August 31, 2025, covering all segments of the COSO internal-control framework. During the following fiscal year, Bitmine enlisted external advisors, implemented an enterprise resource planning system, and increased accounting staff.
Despite these measures, the company stated that “management concluded that material weaknesses continued to exist as of August 31, 2026” since the new controls had not operated long enough to demonstrate effectiveness. In April, Bitmine replaced its previous auditor, Bush & Associates, with KPMG.
For the twelve months ending August 31, 2026, Bitmine reported a net loss of $6.31 billion, compared to net income of $348.6 million the prior year. The loss was primarily driven by unrealized markdowns on the value of its cryptocurrency holdings, with revenue rising to $124.8 million, almost entirely from staking and validation activities.
Business agreements and operational updates
Bitmine ended its management services agreement with Ethereum Tower LLC after the fiscal year closed, effective September 3, without paying a termination fee. On September 4, MAVAN, Bitmine’s Ethereum staking platform, entered a new 10-year advisory arrangement with American Validator LLC, an affiliate of Ethereum Tower, specifying compensation of 1.5% of staking rewards on Bitmine’s staked ETH. The company described this as a simpler and lower-cost fee structure.
In addition to reporting a net loss on digital asset derivative contracts totaling $143.7 million—with no such contracts open at year-end—Bitmine is transitioning its fiscal year-end to December 31. A transition report covering the period from September 1 to December 31, 2026, is expected to be filed as part of this change.
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After fiscal year-end, Bitmine terminated its agreement with Ethereum Tower LLC and formalized a longer-term advisory deal for staking rewards, aiming for a streamlined cost structure on ETH operations.
