As Bitcoin continues to attract institutional treasury capital, Ethereum-focused companies are beginning to run out of dry powder, making the asset a potential shorting opportunity for investors looking to hedge their exposure to the digital asset sector.
That was one of the key takeaways from a recent 10x Research report, which argued that shorting Ether (ETH) could be a smart hedge against Bitcoin (BTC).
According to the report, Bitcoin remains the primary focus for institutional investment, while Ether exhibits structural weaknesses. The analysts said that “digital asset treasury” narratives around Ethereum have led institutions to accumulate ETH and later distribute it to retail investors — a pattern now breaking down amid a lack of transparency in private investment in public equity (PIPE) disclosures and uncertain capital flows.
10x Research cited treasury company BitMine as a case study, noting that its strategy “enabled institutional investors to accumulate ETH at par and later distribute it to retail buyers at a premium — a feedback loop that continued to drive prices higher.”
The researchers also pointed to several technical indicators suggesting Ether’s price could decline sharply if support near $3,000 fails, potentially falling to around $2,700.
“As we also noted, the weekly stochastics are flashing a clear topping pattern, while the multi-year wedge formation has revealed a false breakout, mirroring the false breakdown seen back in March 2025,” the researchers said.
Related: Ethereum’s price chart targets sub-$3K as spot ETF demand cools
There are currently 15 Ether-focused digital asset treasury companies holding a combined 4.7 million ETH, according to industry data.
BitMine is by far the largest, with about 3.3 million ETH on its balance sheet. It’s followed by SharpLink, which holds about 859,853 ETH, and Bit Digital with 150,244 ETH.
Despite recent volatility in the Ether market, including waning demand from US spot exchange-traded funds (ETFs), BitMine chair Tom Lee has maintained a bullish outlook. In remarks last month, Lee reiterated his view that Ether’s price could reach $10,000 this year, arguing that the asset has been establishing a solid base since 2021.
Despite Lee’s optimism, a broader sense of caution has taken hold in the market following the Oct. 10 crash, which wiped out about $19 billion in crypto positions — the largest liquidation event on record. Since then, Ether and the wider digital asset sector have struggled to regain momentum.
