Mike Smith
Apr 8
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Large publicly traded companies are facing significant unrealized losses after the rapid collapse of Bitcoin's value below the $80000 mark. This downturn is once again raising questions about the advisability of corporate investment in cryptocurrencies.
The beginning of the week was marked by a major drop in the cryptocurrency market, which many analysts characterized as “Black Monday.” According to BeInCrypto, Bitcoin lost 9.6% of its value overnight, dropping to $75089.
The scale of liquidations is impressive: according to Coinglass, Bitcoin liquidations reached $474 million, with $405.7 million in long positions and $68.2 million in short positions.
Corporations that have included Bitcoin in their reserves have felt the negative impact of the market downturn. The NGU ratio, which reflects the difference between the cryptocurrency's current value and its cost to companies, moved into negative territory for many organizations.
Metaplanet (3350.T), which owns 4,206 BTC with a total value of about $314.7 million, recorded an unrealized loss of 12.4%. The average purchase price was $85483 per coin.
The Blockchain Group (ALTBG.PA) with a portfolio of 620 BTC valued at $46.39 million lost 14.4%. The company purchased the cryptocurrency at an average price of $87424.
Semler Scientific (SMLR), which has 3,192 BTC worth $238.9 million, faced a loss of 14.7%. The average purchase price was $87850.
Even Strategy (MSTR), a pioneer of corporate investment in Bitcoin, is having difficulties. Since August 2020, the company has purchased 528185 Bitcoin totaling $39.5 billion with an average price of $67485. Despite an overall gain of 10.9%, all purchases made since November 2024 at prices between $83,000 and $106,000 are now unprofitable.
The fall of Bitcoin has negatively affected the shares of investor companies. Quotes of 3350.T fell by 20.2%, ALTBG.PA - by 15.8%. SMLR showed relative resilience with a drop of just 0.6%, while MSTR shares were down 11.2% in the pre-trading session.
Economist Peter Schiff, a known Bitcoin skeptic, took advantage of the situation to criticize investment strategies. He ironically advised the head of MSTR to increase investments in Bitcoin to prevent it from falling below the average purchase price, while predicting the company's potential bankruptcy.
Schiff also questioned Bitcoin's status as a protective asset, noting that the cryptocurrency's significant decline relative to other assets makes it an unreliable means of preserving value during periods of market turbulence.
