Michael Burry, the investor famous for predicting the 2008 financial crash, has issued a fresh warning about Bitcoin and its potential spillover effects across the broader financial markets. According to Burry, the recent sharp drop in Bitcoin price may be forcing large institutions and corporate treasuries to sell off precious metals like gold and silver in order to cover crypto-related losses.
In a recent post on Substack, Burry claimed that up to $1 billion worth of gold and silver positions may have been liquidated at the end of January following Bitcoin’s downturn. As crypto prices slid, investors reportedly rushed to reduce risk exposure by selling profitable assets, including tokenized gold and silver futures.
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Bitcoin briefly dipped below the $73,000 level, marking a steep correction from recent highs. Burry believes this decline exposes structural weaknesses in Bitcoin’s market foundation, especially for companies holding large BTC reserves. He specifically warned that if Bitcoin falls toward the $50,000 range, mining companies could face serious financial distress, with some potentially heading toward bankruptcy.
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Burry also challenged the popular narrative that Bitcoin serves as a “digital safe haven” or a true alternative to gold. In his view, Bitcoin has not proven itself as a stable store of value, and recent price gains driven by spot ETF launches are more speculative than fundamental. He argues that institutional inflows do not represent long-term, real-world adoption but rather short-term positioning by large players.
While Michael Burry’s bearish outlook on crypto continues to spark debate, his past predictions have often been accurate during times of excessive market optimism. For investors and traders exposed to Bitcoin, his warning raises an important question: could another major drop in BTC trigger forced liquidations across other asset classes, including precious metals?
