Bitcoin crashes, Strategy suffers a loss of $12.6 billion! Founder passionately proclaims "HODL" and unwavering faith

The world’s largest corporate Bitcoin holder, Strategy (NYSE: MSTR), announced its earnings report on Wednesday, revealing that due to a sharp decline in Bitcoin prices, the company’s Q4 balance sheet evaporated hundreds of billions of dollars, resulting in a net loss of $12.6 billion, marking one of the largest single-quarter losses ever for a publicly listed U.S. company. According to the financial report, Strategy’s Q4 operating loss was approximately $17.4 billion, almost entirely due to unrealized losses (paper losses) on its large Bitcoin holdings; the net loss attributable to common shareholders was $12.6 billion, a nearly 20-fold increase compared to a loss of $671 million in the same period last year.

As Strategy’s earnings were released, the cryptocurrency market experienced a wave of sell-offs, with Bitcoin plunging overnight from $71,000 to a low of $60,255, a nearly 15% drop in a single day, and market sentiment was extremely panic-stricken. In terms of stock price, Strategy also took a hit, opening Wednesday at around $120, closing at $107, and trading after hours further declined to about $102. Compared to a year ago, Strategy’s stock price has fallen over 70%, and the high valuation premium investors once assigned due to Strategy’s aggressive HODL strategy has now vanished along with the crypto price collapse. Research firm Messari’s analyst had earlier predicted that Strategy’s Q4 loss would reach $17.4 billion, which aligns with the final reported operating loss figure. Some analysts even compared Strategy’s losses to those during the 2008 financial crisis—back then, institutions like AIG, Fannie Mae, and Freddie Mac also reported similarly staggering losses. What is even more concerning is that this nightmare may not be over. Analysts warn that if the ongoing decline in Bitcoin prices since February is included, Strategy’s unrealized losses could increase by another $14 billion. As of early February this year, Strategy held a total of 713,502 Bitcoin on its balance sheet, making it the largest publicly traded company holding Bitcoin. Most of these Bitcoins were purchased during last year’s bull market when prices surged to $126,000. However, as the market reversed, this massive position quickly turned from a “printing press” into a heavy burden. With an average holding cost of about $76,000 per Bitcoin, Strategy’s current Bitcoin holdings have turned into over $9.2 billion in unrealized losses (paper losses). In contrast, just four months ago, when Bitcoin was still oscillating near its all-time high, Strategy still held over $31 billion in unrealized gains (paper profits).