Michael Burry warns: A sharp decline in Bitcoin could trigger a wave of bankruptcies

Renowned hedge fund manager Michael Burry recently issued a warning, stating that companies holding large amounts of Bitcoin are facing a risk test. According to industry reports, the current Bitcoin price fluctuates around $69,890, and Burry believes that under the pressure of a sharp price decline, these companies could face bankruptcy.

Bankruptcy Warning from a Notable Investor

Michael Burry gained fame for successfully shorting the real estate market during the 2008 financial crisis, and his investment views are always closely watched. This time, he has issued a warning about the cryptocurrency market, pointing out that Bitcoin’s value proposition as “digital gold” has diminished. Under this premise, if Bitcoin’s price experiences a significant correction, companies that have it as a major asset allocation could face immense pressure and even risk bankruptcy.

Concerns Over Systemic Risk

Burry’s warning points to a deeper market risk—that corporate bankruptcies could trigger a chain reaction, evolving into a systemic financial crisis. This means that difficulties faced by individual companies are not isolated issues but could pose a potential threat to the entire financial system. As more companies incorporate digital assets into their balance sheets, the sensitivity to such risks increases, and Bitcoin’s price volatility could impact broader market stability.