Bitcoin's Slide Below $75K Puts MicroStrategy's Billion-Dollar Bet in the Red

February 1, 2026 – Bitcoin's retreat below the $75,000 mark has delivered a sobering reality check to corporate crypto adopters, none more so than MicroStrategy. The business intelligence firm, now rebranded as Strategy, saw the unrealized loss on its colossal Bitcoin treasury briefly approach $1 billion during the sell-off, casting a spotlight on the risks of its aggressive accumulation policy.

The downturn comes at an inopportune moment for the Michael Saylor-led company, which has signaled no intention of slowing its purchases. Market data shows Bitcoin fell more than 12% over the past week, breaching $75,000 in early Asian trading for the first time since April 2025. While it has since recovered slightly to trade around $75,826, the damage to corporate balance sheets is already apparent.

Strategy holds 712,647 BTC at an average cost of $76,037 per coin. At the session's low of $74,544, the paper loss ballooned to nearly $1 billion. The company is not alone in facing red ink. Data from BitcoinTreasuries reveals other corporate holders are also underwater: Metaplanet's position is down over 30%, while Strive and GD Culture Group show unrealized losses of 28.97% and 35.59%, respectively.

Undeterred, Strategy appears committed to doubling down. Saylor has hinted at further acquisitions, potentially marking a fifth weekly purchase this year. To fund this strategy, the company recently raised the dividend on its Series A Perpetual Preferred Stock to 11.25%, a move designed to attract capital that has already financed the purchase of over 27,000 BTC.

The implications of the pullback extend beyond individual companies. CryptoQuant data indicates Bitcoin is now trading below the average cost basis for U.S. spot Bitcoin ETF investors, meaning many institutional entrants are also sitting on losses. This tests the much-touted "diamond hands" narrative of institutional holders.

Analysts are growing cautious about the near-term trajectory. Popular analyst PlanB noted that Bitcoin's 200-week moving average sits near $58,000, while the network's realized price—the average acquisition cost of all coins—has drifted down to around $55,000. With momentum indicators like the RSI weakening, a retest of the $55,000-$58,000 range is seen as a plausible scenario, which would significantly deepen corporate paper losses.

Market Voices:

"This is the inherent volatility of treating a corporate treasury like a speculative hedge fund," says David Chen, a portfolio manager at Horizon Capital. "MicroStrategy's strategy works brilliantly in a bull market but exposes shareholders to immense balance sheet risk during corrections. Their continued buying feels more like dogma than disciplined investing."

"It's all paper losses until they sell. Saylor has been clear this is a long-term hold measured in decades, not quarters," counters Anya Petrova, a blockchain analyst at Digital Future Group. "The short-term noise misses the point. They are accumulating a scarce digital asset, and this dip might just be another buying opportunity in their view."

"It's corporate malpractice, plain and simple!" exclaims Marcus Thorne, a vocal financial commentator and host of the 'Hard Money' podcast. "Using shareholder capital and issuing high-yield debt to bet the farm on a single, wildly volatile asset? This isn't innovation; it's gross negligence. The board should be held accountable if this ends badly."

"The real story is the ETF cost basis break," notes Dr. Lena Schmidt, an economics professor. "If Bitcoin stays below the average price ETF investors paid, it will be a true test of the 'new institutional demand' thesis. Do they hold, or do they become a new source of sell-side pressure? The next few weeks are critical."

As Bitcoin trades below key institutional cost bases, the conviction of corporate and ETF buyers faces its most significant test since the 2024 bull run began. For Strategy and its peers, the coming weeks will determine whether their treasuries are seen as visionary or vulnerable.