1 Company Now Holds Nearly 5% of All Ethereum. That's An Obvious Sell Signal
BitMine has, as planned, amassed a large position in Ethereum, a high-risk bet on a single cryptocurrency.
Overview
What is Ethereum (CRYPTO: ETH) worth? That's the big question facing BitMine (NYSE: BMNR) shareholders today. How you answer that question will likely predict whether you think owning BitMine is a good or bad idea. For me, the fact that BitMine owns nearly 5% of all of the Ethereum created is a signal to sell the stock and avoid the cryptocurrency. Here's why.
When you buy shares in a company, you are buying a part of an operating business. The business is what backs the valuation of the stock. Sure, in a worst-case scenario, a company may go bankrupt. But there are still physical assets that can be sold to repay creditors and, if anything's left, return some value to shareholders. That isn't the case with a cryptocurrency.
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Originally published at www.fool.com.