TL;DR
Bitcoin fell below $95,000, in line with a general downturn in the crypto market, as MicroStrategy announces plans to issue new shares and acquire more BTC.
MicroStrategy has been accumulating BTC for seven consecutive weeks.
The expiration of $43 billion in BTC and ETH options on December 27 could lead to additional volatility in the crypto market.
Bitcoin experienced a price drop, hovering near $95,000, amidst a widespread decline in the crypto market. The plunge coincides with MicroStrategy Inc.’s announcement, one of the leading Bitcoin-accumulating companies, which seeks to expand its ability to purchase more tokens by issuing new Class A and preferred shares.
According to a document filed on December 23 with the U.S. Securities and Exchange Commission (SEC), this measure aims to deepen the company’s aggressive BTC accumulation strategy. The firm has transitioned from being a software developer to becoming a benchmark in cryptocurrency investment.
MicroStrategy’s Weight on Bitcoin
MicroStrategy’s influence can no longer be overlooked. Its consistent Bitcoin accumulation has set a precedent in the industry. The company has been purchasing BTC for seven consecutive weeks. Analysts note that MicroStrategy’s decisions are closely watched by traders and investors due to their impact on market movements.
Despite this drop, Bitcoin has performed exceptionally well in 2024, with a 135% increase in value, significantly outperforming traditional investments such as stocks and gold. However, the short-term outlook remains uncertain. A wave of volatility looms over the crypto market due to the massive expiration of BTC and ETH options scheduled for December 27. The expiration of $43 billion in open interest could lead to significant fluctuations.
Impact on the Crypto Market
The bearish sentiment has spread across large portions of the market. Ethereum (ETH), the second most important cryptocurrency, slipped to $3,360, losing 2.6% of its value. BNB (BNB) suffered a smaller loss, down 1%, trading around $694. XRP (XRP) dropped nearly 4% to $2.18 per unit. Solana (SOL) is trading just above $190 after losing 3.5% of its value. Cardano (ADA) also fell by 3.8%, trading above $0.87 per token. Dogecoin (DOGE) experienced a similar loss, nearing $0.316, while Avalanche (AVAX) took a significant hit, dropping 6.4% and falling below $38
