“No Organic Reason to Stop”: Michael Burry Predicts Bitcoin Could Collapse to $50,000

Michael Burry, the investor best known for predicting the 2008 financial crisis, has sounded the alarm on Bitcoin’s latest selloff, arguing that the damage may already be spreading well beyond digital asset markets. 

In a sharply worded Substack post published Monday, Burry said Bitcoin’s decline could be forcing institutional investors and corporate treasurers to liquidate positions in gold and silver to cover losses elsewhere.

Bitcoin’s pullback comes after a prolonged rally fueled by spot ETF launches and renewed institutional interest. But Burry believes the recent downturn exposes deeper fragilities in the crypto market and threatens to unwind positions across multiple asset classes.

Bitcoin Losses And Precious Metals Liquidations

According to Burry, the end-of-January weakness in gold and silver may not have been driven by fundamentals in the precious metals market, but by stress originating in crypto portfolios. 

He estimated that as much as $1 billion worth of precious metals positions were liquidated during the final days of the month as BTC prices slid.

“It looks like up to $1 billion in precious metals were liquidated at month’s very end as a result of falling crypto prices,” Burry wrote. 

He suggested that investors who had accumulated profits in gold and silver, including through tokenized futures products, rushed to de-risk and raise cash as crypto losses mounted.

The argument challenges the idea that gold and Bitcoin reliably move independently during periods of market stress. Instead, Burry’s view implies that when crypto exposure becomes large enough within institutional portfolios, losses in digital assets can force selling even in traditional hedges.

A Steep Bitcoin Decline Raises Systemic Concerns

Bitcoin briefly dipped below $73,000 on Tuesday, marking a decline of roughly 40% from its recent highs. 

BTC price (Source: CoinGecko)

For Burry, the speed and scale of the move highlight what he sees as the cryptocurrency’s lack of a solid foundation.

“There is no organic use case reason for Bitcoin to slow or stop its descent,” he wrote, warning that further downside could have cascading effects. If prices were to fall toward $50,000, Burry argued, Bitcoin mining firms could face bankruptcy as margins compress and financing dries up.

He also warned that the market for tokenized metals futures could “collapse into a black hole with no buyer” if forced liquidations accelerate, underscoring his concern about leverage and interconnectedness across modern financial products.

Corporate Treasuries And The Strategy Question

Burry reserved particular criticism for the notion that corporate and institutional ownership of Bitcoin provides durable price support. 

Companies with large BTC treasuries, including Strategy, have often been cited as evidence that the asset is becoming embedded in long-term balance sheets.

Burry pushed back on that assumption, arguing that treasury assets are inherently flexible and can be sold quickly under pressure. “There’s nothing permanent about treasury assets,” he wrote, dismissing the idea that corporate holdings would prevent a prolonged downturn.

In his view, firms that accumulated BTC during the rally could become forced sellers if prices fall far enough, adding to downside momentum rather than stabilizing the market.

Challenging Bitcoin’s Safe Haven Narrative

A central theme of Burry’s warning is that Bitcoin has failed to live up to its pitch as a digital safe haven or a reliable alternative to gold. Rather than protecting portfolios during volatility, he argues, Bitcoin’s recent behavior has exacerbated stress and triggered selling in other assets.

While the launch of spot BTC ETFs marked a milestone for mainstream access, Burry sees these inflows as cyclical rather than structural. He believes they reflect speculative demand and momentum chasing, not widespread adoption tied to real-world utility.

A Warning Investors Can’t Ignore

Burry’s bearish outlook is likely to divide opinion, as his past calls have been both highly prescient and, at times, controversial. Still, his focus on second-order effects is what makes this warning resonate. The concern is not just where BTC trades next, but how further declines could ripple through portfolios that blend crypto with traditional assets.

For investors with exposure to digital assets, Burry’s message raises a broader question: if Bitcoin continues to fall, will the next wave of selling hit markets that were once viewed as safe, uncorrelated, or insulated from crypto volatility?