Bit Digital Inc. (BTBT) Tumbles 8%: IPO Jitters & Ethereum Gamble Spook Investors

Another day, another crypto stock getting slapped by Wall Street’s mood swings. Bit Digital’s shares nosedived 8% as traders balked at its dual-pronged volatility cocktail—fresh IPO ambitions and an all-in Ethereum bet.

The IPO elephant in the room

Nothing screams ‘risk appetite’ like a crypto miner chasing public funding during a regulatory monsoon. The filing’s timing—amid the SEC’s ongoing crusade against staking services—had analysts reaching for antacids.

Ethereum’s make-or-break moment

Doubling down on ETH infrastructure as the network battles scaling headaches and Layer 2 chaos? Either visionary or recklessly early—Wall Street’s voting with sell orders today.

Cynic’s corner: When your stock moves inversely to your press releases, maybe reconsider the comms strategy. Just saying.

TLDR

• BTBT stock dropped 8% after IPO and ETH staking news stirred investor concerns.

• WhiteFiber IPO filing adds uncertainty with no clear timeline or valuation disclosed.

• BTBT pivots from Bitcoin mining to Ethereum staking, aiming for Web3 alignment.

• Earnings miss and falling Bitcoin income weigh on investor confidence.

• Strong growth in cloud services offsets losses, but market remains cautious.

Bit Digital Inc.(BTBT) shares declined 3.69% to $2.35 during trading and fell another 4.67% after hours to $2.24. This 8% total drop occurred amid heightened volatility following key announcements involving a confidential IPO filing and new ETH-related moves. BTBT faced a sharp midday decline, suggesting uncertainty despite strategic developments in its HPC business and ethereum operations.

Bit Digital Inc. (BTBT)

WhiteFiber IPO Filing Brings Uncertainty

BTBT announced that its wholly-owned subsidiary, WhiteFiber Inc., has submitted a draft FORM S-1 to the SEC. The confidential submission allows the company to begin the IPO process without disclosing full offering details publicly. However, the absence of share count, price range, or timeline has created uncertainty around execution.

BTBT stated the IPO depends on market conditions and the SEC’s review, which adds an element of unpredictability. The company has not confirmed whether it will retain a majority stake in WhiteFiber after the IPO. This raises questions about how the separation could affect future revenue streams and operational control.

WhiteFiber, BTBT’s high-performance computing arm, recently secured $43.9 million in financing to expand its Canadian operations. The company also purchased a 96-acre property in North Carolina to build an AI data center campus. These developments position WhiteFiber for future growth, yet they require significant upfront capital investment.

Ethereum Staking Strategy Gains Focus

BTBT launched a public share offering to support its Ethereum accumulation strategy. The company intends to use net proceeds from the offering to purchase Ethereum, continuing its pivot from Bitcoin mining. BTBT now operates a staking infrastructure involving validator services, custody, governance, and ETH yield optimization.

BTBT has described this shift as a long-term MOVE toward Ethereum-native services, aligning with evolving Web3 protocols. The platform previously announced that it began staking Ethereum in 2022 and is scaling operations across validator nodes. Despite the ambitious plan, BTBT did not disclose the size or pricing of the new offering.

The company’s liquidity remains solid with a current ratio of 3.9, and it holds more cash than debt. Still, financial data shows high cash burn, which may affect its ability to scale the Ethereum infrastructure. Market participants responded negatively, possibly due to lack of clarity and uncertainty surrounding ETH asset accumulation.

Financial Performance and Market Reaction

BTBT stock has exhibited high volatility, with a 5.37 beta rating, reflecting strong price swings on news developments. The company recently reported a sharp earnings miss, posting an EPS of -$0.32 against estimates of -$0.03 for Q1 2025. Revenue fell 17% year-over-year to $25.1 million due to a 64% drop in Bitcoin mining income.

Despite the revenue drop, BTBT saw cloud services revenue rise 84%, signaling momentum in its computing division. However, the broader financial picture remains pressured, especially as the company shifts from mining to staking. BTBT’s long-term strategy includes creating separate public entities and aligning capital toward scalable operations.

BTBT shares declined as Moody’s downgraded the U.S. credit rating, creating wider market volatility across digital asset firms. The company’s underwritten offering is being led by B. Riley Securities, with three other firms acting as co-managers. Terms of the share sale will be finalized in a prospectus supplement to be filed soon.

BTBT’s market cap stands at approximately $488.7 million, and the share price may face continued pressure as plans evolve. The company has positioned itself as an Ethereum-native digital asset platform, but execution risks remain. While the IPO and Ethereum strategy aim to unlock value, the market reaction shows a wait-and-see attitude.