MicroStrategy, now known as Strategy, Chairman Michael Saylor made waves by saying he would buy all the Bitcoin if it ever dropped to $1.
While that was likely an exaggeration, Saylor was addressing concerns over MicroStrategy’s leverage and liquidation risk during a market downturn.
“A lot of people don't really think. They're like, ‘Oh, my God, MicroStrategy is gonna get liquidated on Bitcoin.’ It’s like, well, dude, no. Bitcoin could go to $1 a Bitcoin, we’re not getting liquidated. We’re just gonna buy all the Bitcoin,” he said in a podcast in December. “If it goes to $1 a Bitcoin, that’s gonna go back up again.”
Why Bitcoin will never reach $1
Bitcoin is backed by strong fundamentals, institutional adoption, and a fixed supply of 21 million coins. Even during severe downturns, Bitcoin has never experienced a complete collapse in demand.
Major financial institutions and companies hold billions in Bitcoin. Even if prices drop, buyers like BlackRock, Fidelity, and MicroStrategy would step in before it ever reached a fraction of its value.
Bitcoin miners have significant operating costs, making it unprofitable to mine if prices drop too low. A price of $1 per BTC would mean miners would shut down, reducing supply, which in turn would stabilize the price.
Bitcoin's market cap still sits above $1.6 trillion, and it trades billions in volume daily. A collapse to $1 would mean every holder would need to panic-sell, which is simply unrealistic.
Bitcoin’s current market drop
Bitcoin has dropped 10% to $84,000 this week, falling out of its previous trading range between $90K and $110K.
Analysts point to inflation fears and Trump’s proposed EU tariffs as factors driving the downturn.
Paul Howard, Senior Director at Wincent, noted, “This looks like the major price correction we expected following the 'sell the news' event on January 20. CME futures suggest there’s still room for prices to decline, potentially stabilizing in the mid-$70K range.”
Some investors also see a connection between Bitcoin’s price drop and ETF outflows, with a near $1 billion outflow nearing on Tuesday.
As Bitcoin declined, gold surged 10%, raising questions about BTC’s role as a hedge against uncertainty.
“Examining gold ETFs over the past six years, their price movements show little correlation with Bitcoin,” Howard added.
