Bit Digital, Inc. (NASDAQ:BTBT) signaled a decisive shift in its business model after a surge in Ethereum (CRYPTO: ETH/USD) staking rewards fueled stronger third-quarter revenue, underscoring the company’s accelerating pivot away from Bitcoin (CRYPTO: BTC/USD) mining and toward building a large, yield-generating ETH treasury.
H.C. Wainwright & Co. analyst Kevin Dede maintains his Buy rating and $7 price forecast on Bit Digital, asserting that the company’s third-quarter 2025 results provide additional support for his positive long-term view of the business.
Dede highlights that Bit Digital’s ~70% stake in WhiteFiber Inc. (NASDAQ:WYFI) continued to boost consolidated performance, with revenue rising to $30.5 million and ETH staking rewards jumping to $2.9 million from $0.4 million in the second quarter, driven by ETH holdings growing to ~122,127 ETH.
The analyst estimates that average quarterly holdings of ~76,425 ETH imply a ~1% yield, though he notes the company cited closer to 3% on its earnings call.
By Oct. 30, Bit Digital’s ETH treasury reached ~153,547 ETH valued at ~$486 million, and Dede argues the company’s ~$775 million market cap undervalues the combined worth of its ETH holdings and its WhiteFiber stake (~$483 million).
Dede models staking revenue conservatively, assuming rewards are reinvested into validator nodes under a flat ETH price. He points out that Bit Digital has not committed to running its own validators—an operational shift he believes could increase returns by ~100 basis points.
On the Bitcoin mining side, the analyst forecasts fleet capacity declining from ~1.9 EH/s to ~1.2 EH/s by mid-2026, which drives his expectation for lower mining revenue next year.
He simultaneously raises his WhiteFiber revenue estimates, increasing fiscal 2026 to $252.1 million (from $208.0 million) and fiscal 2025 to $112.6 million, both reflected in Bit Digital’s consolidated outlook.
Dede’s thesis centers on Bit Digital’s expanding ETH treasury strategy, WhiteFiber’s HPC-AI positioning, and financial flexibility supported by its approximately $135 million unsecured convertible, while noting risks including crypto-market volatility, dilution, competitive mining pressure, and governance concerns.
Price Action: BTBT shares were trading lower by 5.19% to $2.285 at last check Monday.
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