Bitcoin concept stocks collapse! MicroStrategy hits a new low, funds fleeing to energy and precious metals

The global cryptocurrency market has recently experienced intense volatility, with Bitcoin and other crypto assets repeatedly declining, following a sharp correction in high-tech stocks. Bitcoin fell below $86,000 in a single day, and multiple Hong Kong Bitcoin spot ETFs also declined by over 7%. Bitcoin-related stocks such as MicroStrategy (MSTR) and Metaplanet have both hit nearly one-year lows. Under the pressure of risk asset correction, many institutional and retail funds are gradually shifting back into energy, precious metals, and growth stocks.

Bitcoin-related stocks MicroStrategy and Metaplanet hit annual lows

(Source: Trading View)

This wave of decline was initially driven by the previous bullish rally fueled by favorable global regulation and capital inflows into crypto assets. However, after a large-scale sell-off last month that liquidated $19 billion in leveraged positions, market liquidity dried up, panic sentiment surged sharply, dragging down companies known for their Bitcoin holdings such as MicroStrategy and Metaplanet, both of which hit nearly one-year lows.

MicroStrategy is the world’s largest corporate Bitcoin holder, with a business model centered on issuing bonds and stocks to finance Bitcoin purchases. As of November 2025, MicroStrategy holds over 400,000 Bitcoins, with an average cost basis of around $40,000. When Bitcoin’s price plummeted from a high of $125,100 to $86,000, MSTR’s unrealized gains significantly shrank, naturally putting pressure on its stock price.

Metaplanet, Japan’s “Asian version of MicroStrategy,” also employs a Bitcoin treasury strategy. The company began large-scale Bitcoin acquisitions in 2024, making it its main asset. Its stock price is highly correlated with Bitcoin, and during sharp declines, its stock often falls even more, as the market worries not only about unrealized losses on holdings but also about potential liquidation risks due to its high leverage.

Both companies’ stock prices hitting nearly one-year lows mark the temporary end of the golden era of Bitcoin-related stocks. In 2024, these companies were market favorites; MicroStrategy’s stock soared multiple times during the Bitcoin bull run. However, as Bitcoin entered a bear market, this high beta characteristic turned into a double-edged sword, with declines far exceeding Bitcoin’s own. For investors, this provides an important lesson: Bitcoin-related stocks offer leveraged exposure but also carry additional company-specific and financing risks.

Market analysis indicates that Bitcoin’s gains since the start of the year have been fully retraced, now down about 8% for the year, with Ethereum down more than 16%. This reflects that the 2023 crypto bull market may have come to an end, with investors shifting funds out of crypto into stocks with high cash flow and high dividends, seeking stable returns and hedging. This capital rotation pattern is common in market cycles: during bull markets, funds chase high-risk, high-reward growth stocks and cryptocurrencies; during bear markets, funds retreat into defensive value stocks and high-dividend payers.

Capital flows into energy, precious metals, and high-dividend stocks for hedging

Under the pressure of risk asset correction, many institutional and retail investors are gradually rotating funds into energy, precious metals, and growth stocks. For example, Canadian energy giant Canadian Natural Resources Limited (NYSE:CNQ) and the cash flow platform Franco-Nevada Corporation (NYSE:FNV) attract long-term investment with stable dividends and diversified large assets.

CNQ continues to increase its natural resource holdings, demonstrating flexibility in capital allocation amid energy price fluctuations, while FNV maintains a debt-free structure, high-quality cash flow, and expansion through acquisitions of precious metals, maintaining 18 consecutive years of dividend growth. Franco-Nevada’s business model is highly defensive: as a provider of liquidity for precious metals, it does not directly operate mines but provides funding to mining companies in exchange for a share of future production. This model avoids the high costs and operational risks of mining while benefiting from rising precious metal prices.

Additionally, the green energy sector is also benefiting from capital inflows. Global renewable energy giant Brookfield Renewable Partners L.P. (NYSE:BEP) has recently raised its target prices. The company plans to invest over $10 billion over five years to expand capacity and projects an annual profit growth rate of around 10%, making it a stable high-dividend stock. Brookfield Renewable’s appeal lies in combining green growth narratives with stable cash flow distribution, aligning with ESG investing trends and offering defensive income.

Three major directions for capital hedging

Energy stocks: CNQ and other traditional energy giants provide stable dividends and commodities hedging

Precious metals stocks: FNV and other gold liquidity providers benefit from safe-haven sentiment and gold price increases

Green energy stocks: BEP and other renewable energy companies combine growth potential with stable dividends

This capital rotation reflects a fundamental shift in investor risk appetite. When Bitcoin concept stocks and AI tech stocks face sell-offs due to high valuations and uncertainty, traditional value stocks with predictable cash flows and dividends regain favor.

AI tech stocks correct but long-term fundamentals unchanged

Despite the short-term headwinds in cryptocurrencies and tech sectors, AI concept stocks such as NVIDIA (NVDA) and Microsoft (MSFT) are still viewed by some analysts as long-term beneficiaries. Especially amid industry restructuring and the US onshoring wave, AI-related companies are considered to have higher growth potential and lower systemic risks. However, as risk sentiment rises, investors should also be cautious of valuation retracements and rebalancing risks.

NVIDIA reported strong earnings, but its stock performance post-earnings has been tepid, reflecting market skepticism about the sustainability of AI investments. Currently, NVIDIA’s P/E ratio remains at a historic high, making it highly sensitive to any negative news. Microsoft, as a major investor in AI infrastructure with its Azure cloud services and partnership with OpenAI, is a long-term growth driver but also faces valuation pressures in the short term.

The distinction between AI and Bitcoin concept stocks lies in the fact that the former is supported by actual revenue and profits, whereas the latter mainly depends on Bitcoin price volatility. This gives AI stocks relatively stronger resilience during market adjustments. However, both are high-valuation growth stocks and will face selling pressure when risk appetite declines.

The US onshoring trend provides additional support for the AI industry. Government subsidies and policies make building AI data centers and chip manufacturing plants in the US more economically feasible, creating long-term growth opportunities for companies like NVIDIA and Microsoft. Nevertheless, these long-term fundamentals are often overlooked during short-term market panic.

Market at a critical turning point for capital reallocation strategies

In summary, as market volatility intensifies and bullish sentiment cools, companies with high dividends, strong cash flows, and diversified assets—such as energy, precious metals, and renewable energy leaders—are becoming new safe havens for capital. AI-related growth US stocks still hold long-term potential, but short-term risks require cautious assessment. The market is at a crucial turning point for capital strategy rebalancing, with the next phase hinging on Federal Reserve policy shifts and global capital flows.

Cryptocurrency market capitalization has evaporated over @E5@ in the past six weeks, roughly 30% off its peak, erasing over $1.2 trillion in wealth. This scale of wealth destruction impacts not only direct crypto investors but also the sentiment toward overall risk assets. When investors see the crypto market plunge, confidence in other high-risk assets such as small caps, biotech stocks, and high-valuation tech stocks also diminishes.

Furthermore, several Hong Kong-listed Bitcoin spot ETFs have also declined by over 7%. The performance of Hong Kong Bitcoin ETFs is a bellwether for the Asian market. Their decline not only reflects falling Bitcoin prices but also a weakening demand for Bitcoin among Asian investors. As an Asian financial hub, Hong Kong’s ETF market often leads regional trends.

Currently, the market is experiencing a classic risk preference reset. During the 2023-2024 bull market, investors became overly aggressive, pouring large amounts of capital into high-risk assets. Now, with increasing macroeconomic uncertainty (diminishing Fed rate cut expectations, geopolitical tensions, overvaluation), investors are reassessing risks and reallocating funds from speculative assets to defensive assets.

This shift has a profound impact on Bitcoin-related stocks. In the short term, these stocks may continue under pressure until Bitcoin stabilizes and attracts fresh capital inflows. Long-term, if Bitcoin’s fundamental logic (scarcity, institutional adoption, strategic reserves) remains valid, Bitcoin-related stocks may again lead the next bull run. However, investors need patience and risk tolerance to navigate this adjustment phase.