Bitcoin Sudden stop below $80,000 The past 24 hours have seen one of the most violent liquidations in cryptocurrency history. While traders are digesting the fallout from the collapse, much attention is being paid to the strategies of large institutional holders, particularly Michael Saylor. Michael Saylor’s strategy has huge Bitcoin positions currently trading close to average acquisition costs.
Why this Bitcoin crash turned so quickly and brutally
Currently, the entire cryptocurrency industry is I witnessed one of the most brutal clashes. Throughout history, Bitcoin and Ethereum have led the way. Notably, approximately $2.51 billion in leveraged positions was wiped out in a single session, making it one of the top 10 liquidation streaks ever recorded in the cryptocurrency market. For context, the Corona-era collapse resulted in approximately $1.2 billion in liquidations, while the FTX collapse resulted in approximately $1.6 billion in liquidations.
Cryptocurrency liquidation history. Source: @AshCrypto On X
According to Arkham Intelligence, large corporations aggressively moved Bitcoin to exchanges in the hours following the crash. Kraken alone put about 17,030 BTC on the market, followed by Binance with about 12,147 BTC, and Coinbase adding 9,093 BTC. Wintermute, a major market maker, dumped 3,491 BTC, while wallets labeled Trump Insider and Bybit dumped 2,543 BTC and 2,471 BTC, respectively.
These transfers resulted in the subsequent liquidation of positions, sending the price of Bitcoin down $80,000. Without much resistance.
Notable Bitcoin outflows. Source: Arkham Intelligence
Strategy’s Bitcoin Box and Current Position
As one of the largest corporate holders of Bitcoin, Strategy felt the impact of the recent crash more directly than most, with its Bitcoin positions hovering just above loss territory.
that The company currently owns 712,647 BTC, worth $55.72 billion based on current price levels. These holdings accumulated to an average of $76,037 per Bitcoin, and the strategy’s breakeven point after the selloff was only about 1.8%.
that The margin of error has been greatly reducedHowever, the holding is still technically profitable for now. To put this in context, Strategy’s stash was worth about $81 billion when Bitcoin peaked at about $126,000, despite the company holding about 70,000 fewer BTC at the time.
that Now 2000 days have passed Since Strategy officially adopted the Bitcoin standard. The decision gradually linked the company’s financial performance to Bitcoin’s price action.
As of this writing, Bitcoin is trading around $78,500. A further 3% decline from current levels would be enough to push Strategy’s Bitcoin position into paper red and change the narrative from unrealized profits to unrealized losses. In this scenario, the company may soon find itself defending Bitcoin. Strategies in a bearish environment.
Featured image from Unsplash, chart from TradingView
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