Today’s Corporate Bitcoin Investors Could Face Forced Selling Tomorrow, Says StanChart

Standard Chartered Flags Risk of Forced Sales Among Corporate Bitcoin Holders Amid Price Volatility

A total of 61 publicly traded companies now collectively hold 673,897 bitcoins, accounting for 3.2% of the total bitcoin supply, according to a recent report by Standard Chartered’s digital assets analyst, Geoff Kendrick.

While these corporate bitcoin treasuries are currently fueling buying momentum, Kendrick warns that a sharp downturn in bitcoin’s price could trigger forced liquidations among these firms.

Much of this corporate bitcoin ownership is concentrated in Michael Saylor’s MicroStrategy (MSTR), which controls 580,955 bitcoins on its balance sheet.

Kendrick draws parallels to the 2022 bear market scenario faced by Core Scientific (CORZ), where a price drop exceeding 22% below average acquisition cost led to distressed selling. In June 2022, Core Scientific sold 7,202 bitcoins at an average price of $23,000, raising approximately $167 million under creditor pressure, marking a forced liquidation point just 22% below their production cost.

If bitcoin prices fall below the $90,000 threshold, Kendrick notes that nearly half of the corporate-held bitcoin would be underwater, potentially forcing a wave of sell-offs and amplifying market volatility.

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