On November 21, 2025, the cryptocurrency market experienced the most intense volatility of the year: Bitcoin's price plummeted from $88,000 to $81,000 within 24 hours, a single-day drop of over 8%, marking a new low in three months. This round of collapse was not coincidental, as market attention was sharply focused on the world's largest corporate Bitcoin holder—MicroStrategy.

Original author: 3 Point Blockchain Jay Zhou

At this time, rumors about the company being removed from the MSCI index intensified, and the rebalancing actions of institutions like BlackRock further fueled the narrative that "Bitcoin is just one step away from the $70,000 mark."

On November 1, 2025, I published an article on my public account titled When Will the Four-Year Bitcoin Bull Market End?, concluding with a strong statement: "Now is the end of the crypto market's carnival, and there are only a few days left for altcoins," and I also wrote Bear Markets Are the Cash Machines: 6 Strategies to Help You Earn 10 Times Against the Trend.

To understand the essence of this crisis, one must first penetrate the surface and see the true nature of MicroStrategy—it is not a born "Bitcoin believer," but rather a radical transformer that has been deeply rooted in the traditional technology industry for over thirty years, ultimately betting on crypto assets. Its fate is deeply intertwined with Bitcoin, representing both a gamble and a reflection of global capital's anxiety towards the traditional financial system.

MicroStrategy: From BI Giant to Radical Turn as a "Bitcoin Public Company"

Before becoming the "first Bitcoin stock," MicroStrategy was already a benchmark enterprise in the business intelligence (BI) field.
Founded in November 1989 by a 24-year-old Michael Saylor in Delaware, and headquartered in Tysons Corner, Virginia, the company quickly grew into the world's largest independent BI service provider through its forward-looking layout in data analysis technology.

1. The Glory and Bottleneck of Traditional BI

MicroStrategy's core business is to provide data analysis, mobile services, and security software solutions for enterprises. Its three core products—MicroStrategy 10, MicroStrategy Analytics, and MicroStrategy Mobile—have built a complete enterprise-level data service ecosystem.
Among them, the MicroStrategy 10 version was the first to integrate business intelligence with data discovery, and its adaptation to the Red Hat Linux platform further expanded its market boundaries, keeping it among the top five BI tool vendors in Gartner's Magic Quadrant for a long time.

With its technological advantages, MicroStrategy's clients include most Fortune 500 companies, as well as government and educational institutions. The company has over 2,000 employees globally, with operations in more than 20 countries and regions, and annual revenue consistently exceeding $500 million.
In 1998, the company went public on NASDAQ (stock code: MSTR), and during the peak of the internet bubble in 2000, its stock price surged 16 times from the issue price, with a market value approaching $18 billion, making it a star company among tech stocks at that time.

However, behind the glory lies the hidden worry of growth bottlenecks.
In the second decade of the 21st century, competition in the BI industry intensified, with giants like SAP and Oracle entering the fray, gradually squeezing MicroStrategy's market share.
More critically, its reliance on software subscription fees for profit growth became weak; before 2020, the company's revenue hovered in the $500-600 million range for several years, with net profit fluctuating dramatically. After the internet bubble burst in 2002, its market value plummeted by 98% to $40 million, exposing the weak cyclical resistance of traditional tech companies.

2. Saylor's Faith Revolution: From Software Vendor to Bitcoin "Evangelist"

The turning point in MicroStrategy's fate is entirely tied to the personal beliefs of its founder, Michael Saylor.
This MIT graduate has always had profound thoughts on macroeconomics and monetary systems.
After the outbreak of the COVID-19 pandemic in 2020, the Federal Reserve launched a massive quantitative easing policy, expanding its balance sheet by trillions of dollars in just a few months, which led Saylor to extreme anxiety about the devaluation risk of fiat currency.

After extensive research on various assets, Saylor focused on Bitcoin.
He firmly believes that fiat currency, due to the government's unlimited printing ability, is bound to depreciate, while Bitcoin, with its total supply limit of 21 million coins and decentralized algorithm design, possesses the natural anti-inflation properties of "digital gold," making it the "ultimate value storage asset."
This belief is not mere talk; Saylor even elevated Bitcoin to the status of the "Holy Grail of Value in Digital Civilization," publicly stating that "the longer you hold Bitcoin, the more pronounced the compounding effect," and he plans to destroy the private keys of his 17,000 Bitcoin holdings after his death, permanently removing this portion of assets from circulation.

In August 2020, Saylor pushed MicroStrategy to make a decision that would change the company's fate: announcing the purchase of 21,454 Bitcoins with $250 million of its own funds, at an average price of about $11,700, officially starting the journey of "corporate Bitcoinization."
This move caused a stir in the tech industry at the time, with skeptics claiming it was "speculation deviating from the main business," but Saylor responded to the controversy with continuous accumulation, gradually attracting companies like Tesla and Block to follow suit, pushing Bitcoin into a new era of institutional allocation.

3. The Leverage Frenzy: Betting $27.6 Billion on 640,000 Bitcoins

If the initial purchase was a trial, the subsequent operations showcased Saylor's aggressive nature.
To expand its Bitcoin holdings, MicroStrategy abandoned the conservative strategy of "increasing holdings with its own funds" and instead raised funds on a large scale through issuing convertible bonds and stock offerings, forming a "leverage on leverage" hoarding model.
As of June 2025, the company had raised over $27.6 billion through various financing channels, all used for Bitcoin purchases.

The scale of this "coin hoarding competition" is staggering.
According to the latest data disclosed by the company, as of November 18, 2025, MicroStrategy had purchased an additional 51,780 Bitcoins for $4.6 billion (average price $88,627), bringing its total holdings to officially exceed 649,870 Bitcoins, accounting for over 3% of the total Bitcoin mined globally, firmly maintaining its position as the world's leading corporate Bitcoin holder.
In terms of cost, the total cost of the company's holdings is about $27.9 billion, with an average purchase price of $62,428. Based on the market price of $81,000 on November 21, 2025, the paper profit still stands at $11.7 billion, which is also the basis for its continued accumulation.

However, behind the shiny data lies a huge risk exposure.
In MicroStrategy's financing structure, the debt ratio is extremely high; the company raised $3 billion through issuing high-yield convertible bonds, with a leverage ratio exceeding 16 times, and annual interest expenses alone amount to $185 million.
Even more concerning is the "strong binding" relationship between the company's market value and Bitcoin price—when Bitcoin's price rose in February 2024, its stock price surged 40% in three days; during the Bitcoin downturn in November 2025, the company's stock price fell 22% simultaneously. This linkage effect means that once Bitcoin's price falls below a critical support level, it could trigger a "stock price drop → loss of financing ability → forced sale of Bitcoin → further decline in coin price" death spiral.

Today, MicroStrategy is no longer a purely BI company.
Financial reports show that Bitcoin now accounts for 77% of its balance sheet, far exceeding the scale of traditional business assets. The U.S. SEC has even begun to scrutinize whether its "de facto ETF" business model poses securities violation risks, while ESG investors have strongly criticized its Bitcoin mining-related business for its high energy consumption (annual electricity consumption equivalent to that of the entire country of Norway).
This once tech giant has become a "testing ground" for Saylor's Bitcoin faith.

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Crisis Erupts: Countdown to Index Removal and Institutional Selling Resonance

The Bitcoin crash on November 21, 2025, appears to be a concentrated release of market sentiment, but it is actually the inevitable result of MicroStrategy's potential crisis and institutional rebalancing actions working together.
Among them, the MSCI index removal event became the "last straw" that broke the market's confidence.

1. Rule Kill: MSCI's "50% Red Line" and $9 Billion Selling Pressure

MSCI (Morgan Stanley Capital International), as the world's most important index provider, directly influences the flow of trillions of dollars in passive funds through its index component adjustments.
Its rules clearly state that when a company's cryptocurrency assets exceed 50%, it will no longer be classified as a "public company" but as an "investment fund," thus being removed from core indices like the MSCI Global Index and S&P 500.

This rule is a "fatal blow" to MicroStrategy.
As mentioned earlier, its Bitcoin asset ratio has reached 77%, far exceeding the 50% threshold. MSCI announced in October 2025 that it would officially remove the company from relevant indices on January 15, 2026.
This decision means that global passive funds tracking these indices, such as pension funds and index ETFs, must complete the liquidation of MicroStrategy's stock before the deadline.

According to Goldman Sachs' estimates, the passive fund scale involved in this index removal is about $9 billion.
Although these funds are selling MicroStrategy's stock rather than directly selling Bitcoin, the market's anxiety has already spread.
Investors generally believe that if MicroStrategy faces cash flow tightness due to a stock price crash, its 640,000 Bitcoins may become "liquidation assets."
More critically, the sale of 640,000 Bitcoins would amount to 15% of the global daily trading volume of Bitcoin, and if released in a concentrated manner, it would have a devastating impact on the market.

This "anticipatory panic" peaked on November 21.
On that day, market rumors suggested that a large institution had begun to sell MicroStrategy shares in advance, triggering retail investors to follow suit, causing the company's stock price to drop by 15% during the trading session. Meanwhile, the Bitcoin market saw a surge in stop-loss orders, with the price quickly falling from $86,000 to below $81,000, marking the largest single-day drop since the 2024 halving.

2. Institutional Exit: BlackRock's Rebalancing and Market Confidence Collapse

MicroStrategy's crisis was merely the spark, while the rebalancing actions of institutions like BlackRock further amplified market panic.
As the world's largest asset management company, BlackRock's Bitcoin ETF, approved in 2024, once managed over $80 billion, and its movements are seen as a "barometer" of institutional attitudes towards cryptocurrencies.

In mid-November 2025, data disclosed by BlackRock showed a reduction of 12,000 Bitcoins in its ETF holdings, sparking market rumors of a "giant exodus."
Although BlackRock later clarified that this was merely "normal rebalancing," with the reduction accounting for only 1.5% of total holdings, and that it had simultaneously increased its positions in Ethereum and other crypto assets, this news was magnified under the prevailing panic.

More concerning is the rising risk-averse sentiment among institutional funds.
Data from the U.S. Treasury shows that as of November 2025, the U.S. federal debt had surpassed $40 trillion, and the Federal Reserve may initiate an interest rate hike cycle in 2026 to curb inflation.
Against this backdrop, several hedge funds, including Bridgewater and Soros Fund, began to reduce their allocations to risk assets, with Bitcoin, as a high-volatility asset, naturally becoming a target for reduction.
CoinShares data indicates that in the third week of November, outflows from cryptocurrency investment products reached $1.8 billion, the highest weekly record since the 2022 bear market.

The crisis at MicroStrategy and the institutional sell-off created a "resonance effect": ordinary investors worried about the risk of MicroStrategy's sell-off, while institutional investors contracted their positions due to macroeconomic considerations. The combination of these factors led to a brutal "longs killing longs" situation in the Bitcoin market.
On November 21, the cryptocurrency derivatives market saw a liquidation amount of $3.2 billion, with Bitcoin-related liquidations accounting for over 70%, forcing many leveraged long positions to be liquidated, further exacerbating the price decline.

Revisiting the Holding Logic: Saylor's "Peak Theory" Misconception and Long-Term Gamble

In the face of the market's violent fluctuations, a core question arises: Did MicroStrategy really believe that the current price was at its peak when it continued to accumulate Bitcoin at prices between $80,000 and $100,000?
The answer is quite the opposite—Saylor's holding logic is not short-term speculation but a long-term gamble based on faith.

1. Not a Peak Theory, but an "Endgame Theory"

Saylor has never believed that the current Bitcoin price is at its peak; on the contrary, he even predicted in a public speech in June 2025 that Bitcoin would surpass $1 million within the next five years.
His core reasoning is based on three points: first, the continuous growth of institutional demand, with Bitcoin ETF holdings from giants like BlackRock exceeding 150% of annual miner output, creating a supply-demand gap that will drive prices up; second, the fragility of the fiat currency credit system, with U.S. debt surpassing $40 trillion, leading to capital flowing into anti-inflation assets like Bitcoin; third, Bitcoin's scarcity, with the block reward dropping from 6.25 to 3.125 coins after the 2024 halving, further tightening supply growth and reinforcing its scarcity.

This "endgame theory" mindset gives MicroStrategy's accumulation strategy a clear "counter-cyclical" characteristic.
During the bear market of 2022, when Bitcoin's price fell to $16,000, most institutions chose to wait and see, while MicroStrategy spent $1.9 billion to acquire 120,000 coins; in November 2025, when the price dropped to the $80,000 range, the company again increased its holdings by 50,000 coins. This "buying on dips" approach is less about chasing short-term gains and more about practicing a long-term strategy of "hoarding coins for appreciation."

From a cost perspective, MicroStrategy's average holding cost is $62,428, and the current price of $81,000 still has a 30% profit margin, indicating that there is no "liquidation" pressure in the short term.
Saylor emphasized in a social media post on November 22: "Our Bitcoin holdings are a long-term allocation to combat fiat currency inflation and will not change strategy due to short-term price fluctuations," attempting to stabilize market confidence.

2. Risk Underlying: The "Achilles' Heel" of Leverage Strategy

Despite Saylor's firm stance, MicroStrategy's leverage strategy still carries significant risks.
As mentioned earlier, the company must pay $185 million in debt interest annually, while its traditional BI business can only contribute about $500 million in revenue each year. After deducting operating costs, the funds available for interest payments are about $120 million, resulting in a funding gap of $65 million.
This means that if Bitcoin's price remains stagnant or declines for an extended period, the company will face cash flow issues.

Even more dangerous is the "collateral chain reaction."
Some of MicroStrategy's financing is secured by stocks or Bitcoins as collateral; if Bitcoin's price falls below $70,000, the value of its collateral will not be sufficient to cover the debt, and lenders may require additional margin. If this cannot be met, forced liquidation will occur.
Goldman Sachs estimates that MicroStrategy's "margin of safety" corresponds to a Bitcoin price of $68,000; if it falls below this level, it will trigger the first forced sale, potentially amounting to 50,000 Bitcoins.

Market concerns about this risk have already been reflected in derivatives data.
The Bitcoin options market shows a surge in open interest for put options expiring in December at the $70,000 strike price, with open contracts reaching 23,000, an 80% increase from a week ago, indicating that many investors are hedging against the risk of Bitcoin falling below the $70,000 mark.

Bitcoin Price Prediction: The Defense and Offense at the $70,000 Threshold and Long-Term Value Anchor

In light of MicroStrategy's crisis and institutional sell-off actions, will Bitcoin briefly fall below the $70,000 mark? What will the long-term trend look like?
Combining technical, funding, and fundamental analyses, we can examine support levels, downside potential, and long-term logic from three dimensions.

1. Short-Term Support: The "First Line of Defense" at $75,000-$78,000

From a technical perspective, the $75,000-$78,000 range is an important support level for Bitcoin.
This range is not only a dense trading area from the first half of 2025, accumulating a large number of institutional and retail cost bases, but it is also the starting point after the 2024 Bitcoin halving, providing strong psychological support.

Funding data indicates that there are signs of bottom-fishing capital entering this range.
When Bitcoin fell to $81,000 on November 21, the premium rate of the Grayscale Bitcoin Trust (GBTC) rose from -2% to 0.5%, indicating that institutions began to accumulate through trust products at low levels; Middle Eastern sovereign funds and family offices also increased their holdings during the same period, with the Abu Dhabi sovereign fund disclosing that its Bitcoin holdings increased from 12,000 to 15,000 coins, with an average price of about $80,000.

Additionally, MicroStrategy's short-term actions will also affect the stability of the support level.
If the company can raise more funds through a stock offering in December or reach a debt extension agreement with lenders, it will alleviate concerns about "forced selling," thereby providing support for Bitcoin prices.
The market expects Saylor to announce a new financing plan in early December to stabilize investor confidence.

2. Extreme Scenario: The Defense and Offense at the $70,000 Threshold and Downside Limits

If market panic continues to escalate, Bitcoin may test the $70,000 threshold, which corresponds to MicroStrategy's "margin of safety line" and the stop-loss line for a large amount of leveraged funds.
If it falls below $70,000, it could trigger twofold impacts: first, some of MicroStrategy's collateral may be forcibly liquidated, releasing selling pressure of 50,000 Bitcoins; second, retail investors may follow suit, further amplifying the decline.

However, even if it falls below the $70,000 mark, the downside potential is relatively limited.
Historical data shows that Bitcoin's lowest price in the 12 months following a halving cycle typically does not fall below the pre-halving high (the pre-halving high in 2024 was $65,000), and the $68,000-$70,000 range will form a "value bottom," attracting long-term capital to enter the market in large quantities.

In extreme scenarios, Bitcoin's price may briefly touch $65,000, but this situation would only occur in the event of a "systemic risk outbreak in the global financial market" (such as a more than 20% drop in U.S. stocks) or "massive defaults by MicroStrategy."
While the global economy currently faces inflationary pressures, there are no signs of a systemic crisis, making the probability of such extreme situations less than 5%.

3. Long-Term Logic: "Dual Support" from Scarcity and Institutional Allocation

Setting aside short-term fluctuations, the long-term upward logic of Bitcoin has not been undermined, with core support coming from "strengthened scarcity" and "deepened institutional allocation."

From the perspective of scarcity, after the 2024 halving, Bitcoin's annual inflation rate has dropped from 1.7% to 0.85%, lower than gold's annual mining rate of 1.6%, further highlighting its scarcity as "digital gold."
As the next halving in 2028 approaches, expectations of supply contraction will gradually be reflected in prices, which is one of the core logics behind Saylor's willingness to hold long-term.

From the perspective of institutional allocation, although institutions like BlackRock have made short-term adjustments, the long-term logic of incremental capital remains unchanged.
Data shows that global institutional allocation to cryptocurrencies is still less than 1%, far below traditional assets like stocks and bonds.
A report from Fidelity Investments predicts that by the end of 2026, global pension funds will allocate about $50 billion to Bitcoin, a scale sufficient to support Bitcoin prices returning above $100,000.

More importantly, MicroStrategy's crisis may accelerate the "de-leveraging" and "regulation" of the cryptocurrency market.
Regulatory agencies may introduce clearer rules regarding "corporate large-scale holdings of crypto assets" to prevent similar leverage risks from reoccurring; institutional investors will also be more inclined to allocate Bitcoin through compliant ETF products rather than relying on high-risk vehicles like MicroStrategy.
This structural change will make the Bitcoin market more mature, laying the foundation for long-term appreciation.

Conclusion: A Financial Experiment on Faith and Rules

MicroStrategy's Bitcoin gamble and the short-term fluctuations in Bitcoin prices essentially represent a collision between traditional financial rules and emerging assets.
Saylor is practicing his Bitcoin faith through the fate of a public company, while the market oscillates between panic and rationality.

For investors, in the short term, it is essential to be vigilant about the battle at the $70,000 threshold and to pay attention to MicroStrategy's financing progress and the subsequent impact of MSCI index adjustments; in the long term, it should be recognized that Bitcoin's scarcity and institutional allocation demand have not changed, and short-term fluctuations are merely a "normal correction around value."

As the January 15, 2026, deadline for MSCI index removal approaches, the fate of MicroStrategy and Bitcoin will reach a critical juncture.
The final outcome of this experiment will not only determine the life and death of a company but may also reshape global capital's perception of crypto assets, rewriting the wealth logic for the next decade.
Regardless of the outcome, MicroStrategy's radical transformation has already left a significant mark in financial history—it has paid a hefty "tuition fee" for the institutionalization of cryptocurrencies through its own risks.

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