Standard Chartered warns about Bitcoin (BTC)! "90 Thousand Dollar is Very Critical!"

The large institutional bull MicroStrategy (Strategy) led Bitcoin (BTC) adoption is increasing, and in recent months, an increasing number of companies have started holding Bitcoin on their balance sheets.

This situation highlights the increasing demand for BTC, while Standard Chartered has warned against this situation.

Standard Chartered warned in a note today that if market conditions worsen for Bitcoin and cryptocurrencies, price volatility will increase, which could trigger a wave of forced liquidations.

Standard Chartered digital assets analyst Geoff Kendrick stated that for companies holding Bitcoin, there is a "potential liquidation level at a pain level 22% below the average purchase price."

The bank listed 61 companies that hold Bitcoin reserves. It noted that among these are companies with no relation to cryptocurrencies but holding Bitcoin for balance sheet diversification, stating that these companies collectively hold 673,897 BTC or 3.2% of the total Bitcoin supply.

Kendrick pointed out that half of these firms purchased their BTC at an average price above 90 thousand dollars, stating that Bitcoin is potentially at liquidation risk if it falls below 90,000 dollars.

The analyst cited the collapse of Core Scientific in 2022 as an example of this situation.

"If these companies fall below 22% of the average purchase price of Bitcoin, they could become forced sellers.

At this point, 90 thousand dollars continues to be a critical level for these companies. Because it will be sufficient for the Bitcoin price to return below 90,000 dollars for half of the companies that buy Bitcoin to incur losses.

MicroStrategy, which pioneered the institutional Bitcoin strategy, holds the majority of BTC reserves 86( ) and has a much lower average purchase price of around $70,000. However, new institutional participants are more at risk, Kendrick said, adding, "In the last two months, companies buying Bitcoin have increased, and their average purchase price is higher than MSTR. That means there are more risks." Said.

Finally, Standard Chartered analyst Kendrick said that the main issue is how much pain companies can endure before having to sell their Bitcoins.

*It is not investment advice.

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