Ethereum is currently severely undervalued and will play a core role in tokenization and AI agent finance in the future.

Source: "Milk Road Show"

Tom Lee, chairman of Bitmine, recently appeared on the “Milk Road Show” to discuss Ethereum's core position in the financial system over the next five years. Tom Lee pointed out that due to the trend of tokenization and the demand for AI agents in on-chain transactions, ETH is in a phase of severe undervaluation. He believes that the current market is experiencing a "course correction," indicating that the ETH/BTC ratio is poised for a significant rebound.

PANews has compiled the highlights of the interview.

Host: What are your thoughts on last week's market trends and the recent surge of Ethereum?

Tom Lee: I know everyone has different opinions on this. But our view this year has been that the fundamentals of cryptocurrency are continuously strengthening. This contrasts sharply with past "crypto winters." Previous crypto winters were often accompanied by project failures, capital withdrawals, and shrinking application scenarios. But this time is completely different. We're seeing asset tokenization gaining tremendous momentum. Many prestigious large financial institutions are building tokenized products and are particularly fond of the Ethereum platform. In addition, as AI capabilities grow, there are increasingly more signs that AI agents do not want to use traditional financial systems, so the crypto track is the most logical choice for them.

Thus, in our view, last week’s surge can be termed a "course correction." Because the market price has finally begun to acknowledge that we should no longer be in a deep crypto winter. As you noted, the large-scale liquidations happening in the market precisely indicate how many people were shorting and completely misjudged the situation. As the famous John Russell said, "All rebounds begin with short covering." So we believe this is just the beginning of a bigger market movement.

Host: Do you think a pullback will happen? Or has a new crypto bull market already been completely opened?

Tom Lee: I think for those currently with no exposure to crypto assets or underexposed, this is clearly a matter of "tactical" buying opportunity. My suggestion is to look back at past crypto cycles and ask yourself a question: If you were allowed to buy within the 4 weeks before the market hit bottom or within 1 week after it hit bottom, what would you do? The answer is obvious; everyone would choose to buy without hesitation during those two windows.

If last week was indeed the bottom, then you are buying a week after the bottom; if the market experiences a pullback next (which is entirely possible), then you will be buying within the 4 weeks prior to the bottom. In any scenario, as long as you make a tactical buying decision, you will be grateful to yourself in the future. I believe anyone trying to perfectly predict the market bottom and only buy during the peak of the rebound will end up missing most of the gains.

We have published a classic statistic that has been validated for over a decade: almost all crypto gains occur during the best 10 days of the year. If you miss those crucial 10 days, your annualized return is effectively negative.

So, how many such super surge days have occurred throughout 2026 so far? Probably only 1 day. This means that there is still tremendous upside potential for cryptocurrencies from now until the end of the year.

Host: Last week, Robinhood's CEO Vlad Tenev published an article calling for attention to the "tokenization supercycle." What is your view on this tokenization supercycle? What does it mean, and how will it change the financial markets we know today?

Tom Lee: I think the "tokenization supercycle" might be the most accurate and vivid description of the technological transformation happening right now. Vlad's statement is highly credible because he is himself a market-validated innovator who disrupts traditional finance and has personally founded and scaled a company to such a massive size.

Robinhood brought a disruptive revolution to traditional stock and asset markets, and the most intuitive innovation is undoubtedly its "zero-commission trading." But what Vlad really did right was completely overhaul and reshape the user experience in finance.

In the past, users had to deal with cumbersome and rigid trade confirmation documents on those old, traditional brokerage apps; but when they switched to Robinhood, they could complete trades with just a swipe of their finger, showcasing Vlad's profound innovative understanding.

Today, our existing financial infrastructure is long overdue for a thorough upgrade aimed at the 21st and even 22nd centuries. Today's financial system is an extremely bloated and complicated machine: it consists of countless stacked intermediaries, outdated legacy systems, and incompatible networks. Completing a transaction requires various interface integrations and massive human intervention.

While many feel that the current system operates quite well (and it indeed can maintain operations at a low speed), its speed, error rate, and operational costs are nowhere near those that can run on blockchain.

This is the vision Vlad points out: if the financial system were to fully migrate to crypto tracks, it would not only unlock faster, lower-threshold financial channels but more importantly, it would create unimaginable spaces for innovation.

Because once you can move assets in a purely digital form and at high speed, many things we have never defined as "currency" will instantly become circulatable digital money. This is a true nuclear-level release.

Today, a dollar transforms into a stablecoin, evolving into a digital dollar; stocks are also evolving into "software" running on the blockchain through tokenization. And once you turn stocks and currencies into software, we can convert many things that traditionally never belonged to currency into digital money, such as membership points, personal credit, influence, sponsorship rights, and even discounted future contracts. They have been hard to monetize in the past, but now they will be completely financialized and monetized.

How big of a market can this create? You can calculate it like this: today’s traditional financial system is extremely large, holding over $150 trillion in liquid assets. But this vast empire is fundamentally driven by just two very singular asset classes: bonds and stocks. All financial products for other transactions are, without exception, derivatives of these two fundamental assets.

If tokenization is implemented, the potential market we face will no longer be merely the $150 trillion existing stock; it will skyrocket to over $500 trillion. This includes intellectual property, future licensing rights, unexploited resources, and more. Therefore, the term "supercycle" is not only not exaggerated but may in fact underestimate the tremendous scale of this wave of technological innovation in crypto.

Host: As the world rapidly marches towards an "agent-dominated everything on-chain" era, how does Ethereum maintain and continue to expand its absolute dominance in this ecosystem?

Tom Lee: When facing the future, there are some things we can be 100% certain of and some things filled with uncertainty. One thing we can absolutely be certain of is that over the next 5 years, the autonomy and financial decision-making capabilities of AI agents will undergo a tremendous leap.

Another certainty is that the current traditional financial channels (like Visa, banking systems) were designed entirely for "humans," and all risk control and multi-tiered credit grants are intended to guard against credit risk during transactions between people. They cannot adapt to the economic activities of AI agents.

But how could an AI agent possibly swipe a physical Visa card? Traditional payment systems require verification through 24 different systems back and forth for each transaction, while an AI agent might be executing a tiny transaction worth just a few cents, or even fractions of a cent at high frequency, which traditional digital and transactional systems simply cannot accommodate, and the speed of traditional tracks cannot support the high-frequency needs of AI. So they absolutely will not use traditional financial systems.

Therefore, the remaining paths are reduced to two: either use crypto channels (like the Ethereum network) or create an entirely new currency system that belongs to the AI agent world out of nothing. If AI agents truly create their own autonomous currency system, that will mark the beginning of disaster and fear for all of humanity. Because this would mean that humanity would be entirely kicked out of the control chain of the economic cycle. Just imagine, if AI agents trade entirely within their own created closed-loop economy, using their own issued credit mediums, only occasionally redeeming them into dollars when purchasing physical hardware or resources from humans—what a chilling future that would be?

Thus, whether from the perspective of top-level design safety or due to strict regulatory policies from the government, humanity must be forced to embed itself into the financial decision-making closed loop of AI agents.

Globally, today the only thing capable of achieving this and providing underlying mathematical rules is the crypto network. We can set firm behavioral boundaries and credit limits for AI agents on-chain via smart contracts, giving them financial autonomy while thoroughly eliminating systemic risks of them absconding with funds.

Host: Why buy ETH every week without fail? Why recently initiate a stock buyback for the company?

Tom Lee: When we founded Bitmine a year ago (on June 27, 2025), our mission was very pure: to play a core, fundamental role in the reconstruction of the future global financial system. We firmly bet that Ethereum will undoubtedly become the ultimate settlement layer for global finance in the future.

We hope to acquire Ethereum shares that are neither too large to centralize the Ethereum network nor too small to allow us to enjoy a massive network value yield. After precise calculations, 5% is the perfect golden balance point.

This goal has received high recognition and support from the Ethereum Foundation and several founders. Because at this scale, Bitmine can act as an extremely powerful "market stabilizer" for the entire Ethereum network while guiding and empowering the development of the entire ecosystem in a healthy manner. For example, we have played an extremely important foundational role in assisting and anchoring a series of external entities split out by the Ethereum Foundation.

The core premise of our unwavering weekly investments is that, within our sovereign valuation system, Ethereum is still extremely undervalued. It will not only perfectly capture all the spillover dividends from the future finance migration to blockchain but will also serve as the ultimate firewall protecting human wealth and regulating the behavior of AI agents.

So, what sort of valuation should this bring to Ethereum? For us, Ethereum's intrinsic present value is far higher than the current $2,500. Even the previous historical high of about $5,000 did not reflect Ethereum's true potential.

A very simple indicator to consider is the price ratio of Ethereum to Bitcoin. Currently, this ratio is languishing around 0.03. At the peak of the 2021 bull market, this ratio reached 0.08. But remember, the underlying drivers of that 2021 boom were merely some vaporous meme coins and speculative NFTs.

And what are we talking about today? It's about the “全面代币化” of tens of trillions of traditional assets and a trillion-scale "AI agent finance." Therefore, this time, the exchange rate of Ethereum to Bitcoin will not only easily recover the high ground of 0.08 but could potentially even challenge parity levels of 0.25 or even 1:1. This means that the current ETH is practically a free chip on the ground.

This is why we buy without hesitation every week. Through this action, we have effectively forced the market to drain 5% of Ethereum's liquidity, creating a massive "liquidity sedimentation black hole."

In the future, this massive, highly concentrated Ethereum position will release extremely formidable strategic and ecological barriers: it can be used to seed capital to incubate and encourage numerous pioneering innovations in DeFi; in the upcoming next crypto cycle, dozens of unicorn companies valued in the tens of billions, built on the new crypto financial track, will undoubtedly emerge, and Bitmine will have a unique capital advantage to deeply engage with or even directly create them.

As for the company stock buyback you mentioned, we previously passed an authorization for a stock buyback of up to $4 billion. At the time the buyback just started, this amount of money was even enough to buy 50% of the company’s outstanding shares. The core intention behind initiating the buyback was to prevent our company's stock price from excessively deviating from the fundamental value of the company (that is, the net value of Ethereum represented by each share). When we initiated this program, we found BMR's stock price very attractive; by repurchasing and destroying shares, we could significantly increase the amount of Ethereum anchored by each share.

In the past 5 weeks, we executed the largest stock buyback in the history of the entire crypto industry: accumulating nearly 20 million shares of company stock in the open market at an average price below $15. Now, our stock price has soared to $26. From any financial dimension, this is a textbook-level successful capital operation.

Host: This year, the Ethereum Foundation underwent structural splits, evolving into more functionally defined, independently operating external organizations like ETH Labs, ETH Systems, and Ethereum Institutional. Bitmine has become a cornerstone supporter of almost all these emerging institutions. As a long-term investor, how should this significant evolution of Ethereum's governance structure and ecological landscape be understood? What is the top-level strategy behind it?

Tom Lee: This indeed goes back to a major transformation that took place within the Ethereum Foundation earlier this year. The Ethereum Foundation had gradually evolved into an enormous, bloated organization burdened with too many missions. As Ethereum matures, it no longer makes sense to cram all these diverse efforts into one basket called the foundation.

For example, should business development work like engaging large corporate clients be led by a neutral nonprofit foundation? Or should the foundation act as backend support with dedicated entities established independently in the front to engage with Wall Street? The same reasoning applies to privacy protection technology and even cutting-edge technology research like ETH Labs. They ultimately reached a very wise conclusion: these functions should be separated and designated operating entities should be established outside the foundation. This brings two enormous strategic advantages:

One is the ability to introduce external collaborations that cannot be achieved within the framework of the foundation. This includes significant external financial institutions, tech giants, and more. The second is the ability to attract numerous outstanding core Ethereum developers to directly hold shares and participate, without having to be crammed into the nonprofit foundation as employees.

When this historical restructuring occurred, we felt that Bitmine should play a "stabilizing anchor" role, providing initial support for each independent entity. In our view, some of these entities are "public good investments." We do not measure their success based on "how much direct financial return and dividends this entity can bring us." We support it solely because it is an incredibly correct necessary path for the long-term prosperity of Ethereum and enables Ethereum to stand undefeated in future global competition.

As it turns out, since the establishment of these independent entities, they have achieved numerous beautiful victories in the market. This is undoubtedly a tremendous success.

Host: From your perspective, how can Ethereum begin to turn its vision into reality? What do you think is the next biggest challenge on the road to this goal?

Tom Lee: Much of what I’m about to share belongs to my personal industry observations and opinions and does not represent absolute facts.

I have spent almost my entire career on traditional Wall Street. I understand the internal ecology and pain points of these institutions very well. We need to recognize a brutal but critical reality: just because the technology you develop far exceeds existing solutions in scale, does not mean that traditional financial systems will adopt it.

When will they display rapid adoption? Only when they see viable, killer application scenarios with clear investment return ratios.

Traditional institutions prefer to deal with organizations capable of completely understanding and meeting their compliance and business needs. I believe these newly established independent entities (the entities split from the Ethereum Foundation) possess such qualities, as their core team members have been deeply engaged in this institutional market for many years.

The more crucial point is that these entities are well aware of the conditions under which Wall Street will compromise: that is, this new technology must bring a tenfold improvement to their current business. The crypto track obviously provides a tenfold leap in technical performance and clearing costs. But we must also ensure that these institutions can immediately see a tenfold return and effect on their financial statements or business profits.

Host: In the remaining time of 2026, what do you believe are the core driving forces pushing ETH to return against BTC? Do you think this historic breakthrough can stabilize and continue to ferment?

Tom Lee: I firmly believe that the ETH/BTC ratio will continue to soar in the near future, with a return to the historical high of 0.08 being just the first target.

I still hold a very strong belief in the long-term prospects of Bitcoin. In my eyes, Bitcoin is not just digital gold; it functions and performs much better as a gold substitute than physical gold. Bitcoin still has several multiples of growth potential in the future. However, if we were to write the grandest, most core story about the entire cryptocurrency world over the next 5 years, that story would undoubtedly be about the "comprehensive tokenization supercycle" and the "reconstruction of human wealth by AI agent finance."

As Vlad mentioned, the vast majority, if not nearly all, of this super wave will occur and settle on Ethereum. This is the underlying logic of Ethereum's imminent resurgence.

Specifically, from now until the end of this year, I believe there are four golden catalysts that will ignite the market:

First, the Clarity Act is expected to officially pass in September. Many people feel that the crypto world does not need regulation. But this bill is a "safety cushion" that is a matter of life and death for traditional financial institutions. Once there is a clear regulatory subject and black letter compliance rules, Wall Street's massive compliance funds can legally and formally establish trillion-dollar businesses on the crypto track. Even without this passage, the crypto industry has already proven it can innovate wildly in the absence of regulation, but that will not prevent it from bringing nuclear-level super support once it passes.

Second, the vast shorts and waiting capital that have been suppressed in the over-the-counter market are now flooding in aggressively. A large amount of capital had been waiting for the so-called October bottom, sticking to the "crypto four-year cycle law." And now, with only 5 weeks left until October, those who were short, held massive cash, or had exited to speculate on AI concept stocks are suddenly waking up: cryptocurrencies are essentially the most core clearing landscape downstream of the AI boom.

Third is the strong return of international funds represented by Asia. Asian markets, such as Korea, previously madly chased domestic stocks, and now they are rapidly shifting their focus back to crypto assets.

Fourth is the performance competition of the world's top financial institutions. This is a cold statistical fact: since June 30 of this year, the best-performing asset worldwide has been none other than cryptocurrencies. Ethereum soared 54% during this period, while gold only increased 13%, and U.S. stocks saw single-digit gains. Just imagine, when the September 30 quarterly settlement comes, if Ethereum still tops the global asset return rankings, what kind of madness for forced buying and position chasing will occur among global fund managers to avoid trailing their peers from September 30 to December 30 in the entire fourth quarter?

Under these four catalysts, the ETH/BTC exchange rate will easily break through the year's highest level. Even if we take a very conservative and restrained financial valuation, assuming the exchange rate only recovers to 0.04, as long as Bitcoin reaches $150,000 as expected, Ethereum's price will be locked directly at $6,000. Considering that 0.08 is its historical ratio high, this is obviously an extremely conservative figure.