Executive Summary / Key Takeaways

• BIT Mining Limited (NYSE: BTCM) is undergoing a profound strategic transformation, pivoting from its historical roots in online lottery services to become a technology-driven cryptocurrency infrastructure company with a significant focus on the Solana ecosystem.
• The company is actively building a Solana (SOL) treasury, launching validator nodes, and introducing DOLAI, a USD-backed stablecoin on Solana, signaling a commitment to next-generation blockchain infrastructure and decentralized finance.
• While historical financial performance was marked by volatility and a complete halt in revenue during its lottery era, recent financials show a return to positive net income in 2024, albeit with declining revenue and negative operating cash flow, highlighting the high-risk, high-reward nature of its current crypto-centric strategy.
• BTCM's competitive positioning is that of a mid-tier player in the crypto mining and blockchain space, leveraging its established data center operations and diversification into technology services, but facing challenges in operational scale and efficiency compared to larger rivals.
• The proposed rebranding to SOLAI underscores management's vision for deep integration into the Solana ecosystem, with future success heavily dependent on effective execution, SOL price performance, and the adoption of its new stablecoin.

A Phoenix Rising in the Digital Frontier

BIT Mining Limited (NYSE: BTCM), once known as 500.com Limited, is charting an ambitious new course, transforming from its origins in online lottery services to emerge as a technology-driven cryptocurrency infrastructure company. This dramatic pivot positions BTCM at the intersection of digital asset mining and the burgeoning decentralized finance (DeFi) landscape, with a strategic emphasis on the high-speed Solana ecosystem. The company's journey reflects a bold adaptation to evolving market dynamics, seeking to capitalize on the growth of blockchain technology and the increasing demand for robust digital infrastructure.

The broader industry landscape is characterized by intense competition among cryptocurrency miners and a rapid expansion of blockchain ecosystems, driven by innovations in areas like artificial intelligence (AI) and decentralized applications. This environment demands both technological prowess and strategic agility. BTCM operates within this dynamic arena, maintaining a cryptocurrency mining data center in Ohio with an 82.5-megawatt power capacity and deploying Bitcoin mining machines. Its strategic shift into Solana, however, represents a significant expansion beyond traditional mining, aiming to build an on-chain intelligent financial infrastructure.

In this competitive field, BTCM positions itself as a diversified player. While larger, more specialized competitors like Marathon Digital Holdings and Riot Platforms often lead in operational scale and mining efficiency, BTCM's unique value proposition stems from its broader technology services and its aggressive move into the Solana ecosystem. This diversification could offer a degree of resilience against the singular volatility of mining operations, though it also introduces new execution complexities.

Technological Edge: Powering the Solana Future

At the core of BTCM's strategic transformation lies a commitment to leveraging and developing differentiated technology. The company's existing infrastructure includes its 82.5-megawatt data center in Ohio, which provides a foundational asset for its cryptocurrency mining operations. This controlled environment is crucial for optimizing the performance and longevity of its Bitcoin mining machines.

The most significant technological differentiator, however, is BTCM's deep dive into the Solana ecosystem. The company has launched its first Solana validator, a critical piece of infrastructure that enables the staking of self-acquired SOL tokens. This not only reinforces BTCM's long-term commitment to the Solana network but also allows it to generate on-chain staking rewards, contributing to the network's decentralization and security. This move positions BTCM to capture value directly from the Solana ecosystem's growth.

Further underscoring its technological ambition is the launch of DOLAI, a U.S. dollar-backed stablecoin built on Solana. This stablecoin is designed to facilitate connections between AI agents, merchants, consumers, and institutional finance within Solana's high-speed blockchain. The strategic intent behind DOLAI is to create new financial pathways and enhance ecosystem integration, with plans for future multi-chain interoperability. This initiative could unlock novel revenue streams and solidify BTCM's role in the evolving landscape of AI-powered decentralized finance. These technological advancements collectively aim to build a competitive moat by diversifying revenue sources, enhancing operational control, and positioning the company at the forefront of blockchain innovation.

From Lottery to Ledger: A Transformative Journey

BIT Mining's history is a testament to its capacity for dramatic reinvention. Founded in 2001 as 500.com Limited, the company initially carved out a niche in online lottery sales in China. A significant milestone was achieved in 2012 when it received approval from the Ministry of Finance to provide online lottery sales services for the China Sports Lottery Administration Center, establishing it as one of only two approved entities. This period saw robust growth, with net revenues increasing by 52.1% year-over-year and total purchase amounts rising by 63.7% in the fourth quarter of 2014. Mobile platforms quickly became a dominant force, accounting for over 46% of total purchases by late 2014 and exceeding 55.5% in the first quarter of 2015.

However, this trajectory was abruptly interrupted in March 2015 when all provincial sports lottery administration centers temporarily suspended online purchase orders in response to a government notice regarding unauthorized online lottery sales. This regulatory intervention had a profound impact, leading to a sequential decrease in net revenues in Q1 2015 and a complete cessation of revenue in Q2 2015. Despite maintaining a healthy cash balance of USD 183.4 million as of June 30, 2015, the company faced significant uncertainty, with management unable to provide a timeline for the resumption of operations.

This challenging period ultimately catalyzed a fundamental strategic shift. In April 2021, the company rebranded as BIT Mining Limited, signaling its pivot to the cryptocurrency mining sector. This new direction was solidified through strategic acquisitions, including the first closing of cryptocurrency mining data centers and Bitcoin mining machines in Ethiopia on December 9, 2024, followed by the completion of the second phase on July 14, 2025.

The most recent and aggressive phase of this transformation began in July 2025, with the announcement of a strategic expansion into the Solana ecosystem. This initiative includes plans to build an SOL treasury of up to $300 million. The company demonstrated this commitment with an initial purchase of 27,191 SOL (approximately US$4.89 million) on August 5, 2025, and a further acquisition of 17,221 SOL on September 11, 2025, bringing its Solana treasury to 44,412 SOL, valued at approximately $9.95 million. This strategic evolution is further highlighted by the company's intention to rebrand as SOLAI, reflecting its ambition to become a broader digital assets company focused on blockchain infrastructure, decentralized finance, and smart contract innovation.

Financial Performance: A New Chapter, Emerging Metrics

BIT Mining's financial narrative has shifted dramatically alongside its business model. The lottery era, particularly in 2015, saw its revenues plummet to zero due to regulatory suspensions, resulting in significant operating and net losses. For instance, in Q2 2015, the company reported zero net revenues, an operating loss of USD 15.5 million, and a net loss of USD 13.1 million. Despite these challenges, the company maintained a strong liquidity position, with USD 183.4 million in cash and cash equivalents, USD 2.0 million in restricted cash, and USD 64.9 million in time deposits as of June 30, 2015, providing a crucial buffer during its transition.

In its current incarnation as a cryptocurrency infrastructure company, recent annual financial data (as of 2024) reveals a company in flux. Annual revenue for 2024 stood at $32.92 million, a decline from $43.10 million in 2023 and $57.02 million in 2022. However, a notable achievement in 2024 was a return to positive net income of $12.07 million, a significant improvement from losses of -$28.71 million in 2023 and -$155.41 million in 2022. This suggests a potential improvement in cost management or favorable crypto market conditions impacting its mining operations.

Despite the positive net income, the company's operating cash flow remained negative at -$32.74 million for 2024, and free cash flow was also negative at -$33.68 million. These figures indicate that while the company may be achieving profitability on an accounting basis, its core operations are not yet generating sufficient cash to fund its activities and investments.

Key TTM (trailing twelve months) financial ratios further illustrate this picture: a gross profit margin of 13.78%, an operating profit margin of -17.03%, and an EBITDA margin of 7.56%. The net profit margin, at 56.46%, appears robust, likely influenced by non-operating factors or specific accounting treatments in the volatile crypto sector.

The company's debt-to-equity ratio is low at 0.04, suggesting a relatively unleveraged balance sheet, while its P/E ratio of 0.29 and P/S ratio of 0.21 indicate a valuation below book value and modest sales multiples.

Strategic Vision and Growth Catalysts: Betting on Solana's Speed

BIT Mining's strategic vision is now firmly anchored in the Solana ecosystem, marking a critical milestone in its long-term growth trajectory. The company's expansion into Solana is designed to capture emerging opportunities across the broader blockchain value chain and attract investors seeking exposure to this rapidly developing ecosystem. A central pillar of this strategy is the plan to raise up to $300 million to build a substantial SOL treasury, which will be managed with a long-term holding approach.

The launch of its first Solana validator and the initial purchase of 27,191 SOL, followed by an additional 17,221 SOL, are concrete steps in operationalizing this strategy. These actions not only establish a growing SOL treasury but also reinforce the company's commitment to supporting the Solana network's infrastructure. Management views this as a foundational step, demonstrating belief in Solana's potential and a dedication to building meaningful infrastructure within it.

The proposed rebranding to SOLAI (NYSE: SLAI) further underscores this strategic transformation. This new brand identity reflects an evolution from a pure-play cryptocurrency miner into a broader digital assets company focused on next-generation blockchain infrastructure, decentralized finance, and smart contract innovation. The launch of DOLAI, a USD-backed stablecoin on Solana, is a key initiative within this new framework, aiming to integrate AI agents, merchants, consumers, and institutional finance. While specific forward-looking quantitative guidance for revenue or profitability in this new strategic direction has not been provided, the underlying assumption is that the success of the Solana ecosystem, coupled with BTCM's execution of its treasury operations, validator services, and stablecoin adoption, will drive future growth and shareholder value.

Competitive Arena: Carving a Niche in a Crowded Field

BIT Mining operates in a highly competitive and rapidly evolving landscape, facing both direct and indirect rivals. In the core cryptocurrency mining sector, direct competitors include major players like Marathon Digital Holdings (MARA), Riot Platforms (RIOT), Hut 8 Mining Corp. (HUT), and CleanSpark (CLSK). These companies are characterized by their focus on scaling Bitcoin mining operations, often with significant investments in hardware and energy infrastructure.

BTCM's data center operations, particularly its 82.5-megawatt facility in Ohio, provide a direct point of comparison with these rivals. However, BTCM may lag in sheer operational scale and efficiency compared to the aggressive expansion and optimized hardware deployment seen in companies like Marathon. While BTCM produced 41.55 Bitcoin in March 2025 (6.59 BTC self-mined) and 42.56 Bitcoin in February 2025 (5.708 BTC self-mined), these figures suggest a more moderate scale of self-mining operations compared to industry leaders.

A key differentiator for BTCM is its strategic diversification. Its historical involvement in online gaming and its current technology services segment provide alternative revenue streams that many pure-play miners lack. This broader focus could offer greater financial stability during periods of cryptocurrency market volatility. However, this diversification might also mean that BTCM's core mining operations are not as hyper-efficient or as rapidly scalable as those of more specialized competitors. For instance, CleanSpark emphasizes sustainable and energy-efficient operations, potentially giving it an edge in cost-sensitive and environmentally conscious segments.

The pivot to the Solana ecosystem further distinguishes BTCM. By building an SOL treasury, launching validators, and developing a stablecoin like DOLAI, BTCM is venturing into areas of blockchain infrastructure and decentralized finance that extend beyond the scope of many traditional Bitcoin miners. This move positions BTCM to compete with a different set of players in the DeFi space, while also attracting investors seeking exposure to the Solana ecosystem. The company's competitive advantages lie in its established data center infrastructure, which provides operational control, and its strategic diversification into technology services and the Solana ecosystem, which could foster proprietary expertise and expanded revenue streams.

However, BTCM faces competitive disadvantages, including potential dependencies on hardware suppliers and exposure to energy costs, which are common vulnerabilities across the mining industry. These factors can impact its cost structure and profitability, making it challenging to compete solely on efficiency with larger, more established miners. The high capital requirements, regulatory hurdles, and need for access to energy infrastructure also act as significant barriers to entry in the cryptocurrency mining sector, which can both protect existing players like BTCM and favor those with superior capital and operational efficiencies.

Investment Risks: Volatility and Execution on the Horizon

Investing in BIT Mining Limited carries inherent risks, primarily stemming from the volatile nature of the cryptocurrency market and the ambitious scope of its strategic transformation. The company's past experience with the abrupt suspension of its online lottery operations in China serves as a stark reminder of regulatory risks, which are equally pertinent in the evolving global cryptocurrency landscape. Changes in regulations pertaining to cryptocurrency mining, trading, or stablecoins could materially impact BTCM's operations and financial performance.

The company's direct exposure to the price fluctuations of Bitcoin and Solana tokens introduces significant market risk. A downturn in cryptocurrency prices could adversely affect the value of its mining output, its SOL treasury, and the overall profitability of its operations. Furthermore, the successful execution of its ambitious Solana strategy, including the growth of its SOL treasury, the effective operation of its validator nodes, and the adoption of its DOLAI stablecoin, is subject to considerable execution risk. Any missteps in technology development, market adoption, or strategic partnerships could hinder its ability to realize the anticipated benefits.

Ongoing dilution also remains a key risk for investors. As the company plans to raise up to $300 million for its Solana strategy, future equity issuances could dilute existing shareholder value. Operationally, while BTCM has improved efficiency and narrowed losses, its negative operating and free cash flow indicate that it is still reliant on external funding. Sustained negative cash flow could strain its liquidity and necessitate further capital raises. The competitive intensity of the cryptocurrency mining and blockchain infrastructure sectors also poses a continuous challenge, requiring BTCM to consistently innovate and optimize its operations to maintain and grow its market position.

Conclusion

BIT Mining Limited stands at a pivotal juncture, having dramatically reshaped its identity from a Chinese online lottery operator to a technology-driven cryptocurrency infrastructure company with a bold vision for the Solana ecosystem. This strategic pivot, marked by the establishment of a Solana treasury, the launch of validator nodes, and the introduction of the DOLAI stablecoin, represents a high-stakes bet on the future of decentralized finance and blockchain innovation. While the company's history is punctuated by significant regulatory challenges and financial volatility, its recent return to positive net income in 2024 signals a potential turning point in its financial trajectory.

The core investment thesis for BTCM hinges on its ability to effectively execute its Solana strategy, leveraging its technological advancements to carve out a sustainable competitive advantage in a crowded market. Its diversified approach, combining Bitcoin mining with a deep dive into Solana's high-speed ecosystem, offers a unique value proposition. However, investors must weigh the speculative upside of its Solana initiatives against the inherent risks of cryptocurrency market volatility, ongoing dilution, and the formidable competitive landscape. The proposed rebranding to SOLAI underscores management's conviction in this new direction, positioning BTCM as a company to watch for those seeking exposure to the evolving frontier of digital assets and intelligent financial infrastructure. The success of this transformation will ultimately be determined by the company's operational efficiency, strategic partnerships, and the broader adoption of the Solana ecosystem.