Michael Burry, the mastermind behind the iconic film 'The Big Short', has issued a dire warning about the potential impact of Bitcoin's decline on the precious metals market. According to Burry, a $1 billion sell-off in gold and silver is on the horizon if Bitcoin continues its downward spiral.
In a recent Substack post, Burry highlighted the speculative nature of Bitcoin, suggesting that its correlation with precious metals has led to 'sickening' scenarios. He argues that Bitcoin's failure to act as a safe-haven asset, like gold, could have severe consequences for companies holding large BTC reserves. With Bitcoin's price dropping 3.17% in the past 24 hours and a 14.44% weekly decline, the situation is dire.
Burry's concerns are further emphasized by the potential impact on Michael Saylor's Strategy, the largest corporate BTC treasury firm. If Bitcoin drops another 10%, Strategy could face millions in losses, as it sees an 'existential crisis' at $60,000. This could lead to significant losses for other BTC hoarders, causing risk managers to become more aggressive in their strategies.
The situation is critical, as there is no apparent organic use case to stop Bitcoin's descent. Unlike silver or gold, Bitcoin has not responded to geopolitical risks, and its treasury firms and spot crypto ETFs are insufficient to maintain its price. With nearly 200 public companies holding Bitcoin, Burry warns that risk managers will advise companies to sell their Bitcoin stash if the price continues to fall, potentially triggering a massive sell-off in precious metals.
