"The Big Short" issues a stern warning! Continuous plummeting of Bitcoin may lead to "value destruction" Worst-case scenario is approaching.

Famous investor and "The Big Short" Michael Burry has issued a stern warning that Bitcoin has recently broken through several important technical levels, which could trigger a chain reaction, leading to massive value evaporation and causing "contamination" in the broader financial markets. Burry pointed out that Bitcoin has been proven to be a "pure speculative asset," and has not truly established itself as a hedge against currency devaluation like gold and silver. This contradicts the logic that its long-time supporters have claimed that its "fixed supply makes it comparable to gold." Recently, the price of Bitcoin has continued to fall, dropping to the lowest level since the "tariff impact" last year over the weekend, and dropping below the $73,000 mark on Tuesday, wiping out all gains since Trump's re-election in November 2024. Data shows that Bitcoin hit a low of $72,949.94 in the past 24 hours, the lowest point in 15 months, but then rebounded to above $76,000. Burry wrote, "The sickening situation is now within reach." He warned that if Bitcoin falls another 10%, one of the most aggressive Bitcoin "corporate treasury" companies, Strategy (MSTR.US), could incur billions of dollars in unrealized losses, and financing channels could be almost closed off by the market. Since achieving an all-time high in early October last year, Bitcoin has fallen by more than 40%. Analysts believe that the disappearance of inflows of funds, a contraction in market liquidity, and a weakening attraction of the macro narrative are important reasons for this decline. In addition, some native crypto traders are turning to prediction markets and event betting platforms, cooling off the token economy's heat. It is worth noting that Bitcoin has not benefited from a weakening US dollar or rising political risks like traditional safe-haven assets. Instead, both gold and silver have recently reached record highs, further weakening the core narrative of Bitcoin as a "depreciating trade." Galaxy Digital's head of research Alex Thorn also pointed out that Bitcoin's structural weakness and lack of short-term catalysts could further drop to around $58,000 near the 200-week moving average. Simultaneously, selling pressure in the crypto market is rapidly spreading. Ethereum and Solana fell by 9.6% and 7.1% respectively in the past 24 hours, dropping to $2,118 and $97.10, respectively, below the market's bottom levels in April last year, with retracements of 57% and 67% from their 2025 highs. Data from CoinGlass shows that liquidations in the crypto market reached $659 million in the past 24 hours, with Bitcoin long liquidations accounting for approximately $234 million, being the main source of forced liquidations. Burry further warned that the emergence of a Bitcoin ETF not only reinforces its speculative nature but also increases its correlation with the stock market. He pointed out that Bitcoin's correlation with the S&P 500 has recently approached 0.50. In addition, Bitcoin spot ETFs saw the largest single-day outflow since November last year at the end of January, with three large-scale withdrawals in just 10 days. However, some market views still believe that the volume of crypto assets is not enough to trigger a systemic financial crisis. Bitcoin's market cap is currently below $1.5 trillion, limited exposure in household sectors, and narrow adoption by companies, so the wealth effect may be under control. But Burry believes that if Bitcoin continues to fall below key levels, it may force corporate risk management departments to sell assets and affect derivative markets such as "tokenized precious metal futures." He said that the recent decline in gold and silver was partly due to the decline in the crypto market, forcing speculative funds to deleverage, leading to a "spiral of collateral death." He warned that if Bitcoin falls to $50,000, mining companies may go bankrupt on a large scale, and tokenized metal futures without physical support could "fall into a black hole." Meanwhile, the sentiment in the prediction markets has also experienced a drastic reversal. Data from Decrypt's platform Myriad shows that traders are currently betting that Bitcoin will first fall to $69,000 with a probability as high as 75%, whereas just a week ago, the market widely believed that the probability of Bitcoin hitting $100,000 was over 70%. In Burry's view, the decline in Bitcoin is not just a routine adjustment, but it could be the beginning of "value destruction" after the speculative bubble bursts.