Michael Saylor, executive chairman of MicroStrategy and a well-known Bitcoin supporter, recently addressed the possibility of an 80% drop in Bitcoin’s value by the end of its current cycle. While Saylor considers this scenario unlikely, he acknowledged that it cannot be entirely ruled out.
Speaking with Yahoo Finance, he reflected on Bitcoin’s history of steep corrections and shared his perspective on the current market conditions.
Could Bitcoin Face Another Major Crash?
Saylor highlighted Bitcoin’s past cycles, particularly the dramatic decline from $66,000 to $16,000 in 2022—a sharp 80% drop. He explained that these corrections were triggered by the collapse of poorly managed companies like FTX, Celsius, and Genesis, which caused widespread instability in the market.
However, Saylor noted that today’s market is stronger, with fewer weak players that could spark such a crash. Still, he cautioned that Bitcoin’s historical four-year cycle often includes significant corrections after market peaks, which remains a factor to watch.
MicroStrategy’s Big Bet on Bitcoin
MicroStrategy, under Saylor’s leadership, has built a reputation for its bold Bitcoin acquisition strategy. The company buys Bitcoin regularly, regardless of price, using funds raised through debt and issuing shares. As of December 2024, MicroStrategy owns 402,100 BTC, purchased at an average price of $58,219.
This approach has brought significant rewards. Saylor revealed that the company’s Bitcoin holdings have delivered a 63.3% return to shareholders, generating approximately $12.3 billion in profits. He described MicroStrategy as the “most profitable and fastest-growing company on the Bitcoin Standard.”
Bitcoin’s dramatic price swings have everyone talking—read our Bitcoin price prediction to find out what’s next for the crypto king!
Risks of Betting Big on Bitcoin
Despite these impressive gains, MicroStrategy’s strategy comes with risks. The company has taken on $4.57 billion in debt to fund its Bitcoin purchases. If Bitcoin were to experience another major downturn, similar to past cycles, it could severely impact the company’s financial health.
Still, Saylor continues to believe in Bitcoin’s long-term potential. He has been buying Bitcoin for his holdings as well, showing his commitment to the cryptocurrency even in uncertain times.
Only time will reveal if history repeats or if this cycle charts a new path—but Saylor is ready for either outcome.
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FAQs
MicroStrategy regularly buys Bitcoin using debt and shares, owning 402,100 BTC as of December 2024, with an average purchase price of $58,219.
MicroStrategy’s Bitcoin holdings have delivered a 63.3% return, generating about $12.3 billion in profits for shareholders.
While unlikely, Bitcoin’s history of steep corrections means an 80% drop cannot be entirely ruled out, according to Michael Saylor.
