Michael Saylor Is Officially Sitting On $1.5 Billion Bitcoin Loss...

Ricky Gutierrez

17,591 views • 3 days ago

Video Summary

The market experienced a significant downturn, with the NASDAQ closing 1.5% down, recovering from an earlier 2% dip. Several stocks saw substantial losses following earnings reports, including PayPal which dropped 20%, and Chipotle (CMG) which fell 11% after reporting a sharp decline in restaurant traffic and lower guidance. This contrasts with the broader market trading at all-time highs, highlighting a disconnect between corporate performance and stock valuations. The video also discusses Bitcoin's fall below $73,000, leading to $285 million in liquidations, and emphasizes the dangers of leverage, especially with speculative assets. Micro Strategy (MSTR), heavily invested in Bitcoin, faces significant unrealized losses, with its stock hitting lows of $126. An interesting fact is that Micro Strategy is expected to report its first unrealized loss for Q4 2025 under a new accounting rule, after previously reporting profitable earnings based on unrealized gains.

Short Highlights

The NASDAQ market closed down 1.5%, with some stocks experiencing significant sell-offs, such as PayPal (-20%) and Chipotle (-11%) after earnings.
Corporate guidance for 2026 is lower than expected, with predictions of consumer spending slowdowns, contrasting with current market highs.
Bitcoin dropped below $73,000, resulting in $285 million in liquidations from the crypto market in one hour.
The video strongly advises against using leverage, particularly with speculative assets like crypto, citing it as a primary cause of market volatility and investor losses.
Micro Strategy, a major Bitcoin holder, is facing substantial unrealized losses ($1.5 billion on Bitcoin), with its stock hitting lows of $126.

Key Details

Market Sell-off and Corporate Earnings [00:00]

The market experienced a significant downturn, with the NASDAQ closing 1.5% in the red, down from a high of over 2%.
PayPal saw a 20% sell-off after its earnings report.
Chipotle (CMG) fell 11% after reporting earnings, with a notable drop in restaurant traffic and lower guidance, contributing to its bearish long-term direction.
The video highlights a contradiction between companies lowering guidance for 2026 and the broader market trading at all-time highs.

"When in doubt, never be afraid to cash out."

The Disconnect Between Market and Economy [03:04]

A conversation with the LBP team reveals a contradiction: companies are lowering 2026 guidance, yet markets are trading at all-time highs, suggesting a thriving economy.
The stock market does not necessarily represent the actual state of the economy or how Americans are faring.
Consumers are spending less, and slowdowns are expected, making current market highs questionable.
The speaker, while invested in "magnificent seven" stocks, maintains a cash-heavy position to capitalize on potential pullbacks.

"It's so funny how like the markets contradict what these companies are telling us."

Bitcoin's Price Drop and Leverage Dangers [04:31]

Bitcoin fell below $73,000 for the first time since its recent run, with $285 million liquidated from the crypto market in the past 60 minutes.
The speaker, while not trading crypto, focuses on Bitcoin due to shorting Micro Strategy, a company that buys Bitcoin.
A strong warning is issued against using leverage, especially with speculative assets, as it amplifies losses when the market turns.
Unregulated platforms offering high leverage (e.g., 40x on crypto) contributed to previous price surges and subsequent crashes.

"Leverage is a terrible thing when it turns against you."

Micro Strategy's Financial Strain and Reporting Changes [06:06]

Figures like Michael Sailor and Tom Lee, prominent in crypto, are now "in the red" on their investments.
Michael Sailor's Micro Strategy is sitting on approximately $1.5 billion in unrealized losses on Bitcoin.
Micro Strategy is set to report earnings on Thursday, marking the first time it will report an unrealized loss for Q4 2025 under a new accounting rule that allows reporting of unrealized gains.
Previously, Micro Strategy reported profitable earnings by utilizing unrealized gains; now, it must acknowledge unrealized losses.

"Why are you talking about what it has gone up when you're down on your position?"

Upcoming Earnings and Market Themes [09:53]

Key stocks reporting earnings soon include Uber (before market open), Alphabet (after market close), and Amazon and Micro Strategy (after market close on Thursday).
Companies like Super Micro, CMG, and AMD reported earnings with mixed results: Super Micro saw a 4.8% gain, while CMG dropped 6-7% and AMD fell almost 8%.
A common theme across earnings reports is better-than-expected current earnings but lower guidance for 2026, correlating with the Federal Reserve's expectation of only one rate cut in 2026.
The speaker emphasizes focusing on data and numbers rather than hype, and educates beginners on considering both potential gains and losses for informed trading decisions.