Bitcoin is not doing well, which fell by $ 25,000 from all-time high, but it can be much worse. There are leverage shares (leverage) for micro strategy, which have fallen by 81% since November. Over the past three trading days, they already lost around 40% of their value.
Playing with leverage is playing with fire
It can sometimes be tempting to play with leverage shares because they can generate even faster returns. But the disadvantage is of course that they can also explode in your face, and that has happened to many people in recent days.
While the normal shares of micro strategy fell by 20% in the last three days, the lever shares went down by more than 40%.
“Leverage ETFS see gigantic falls,” said The Kobeissi Letter.
MicroStrategy is in itself a huge risk -rising share, because in principle they already buy Bitcoin with borrowed money. Bitcoin is volatile, micro strategy is more volatile than Bitcoin and that naturally makes a leverage of micro strategy completely an explosive.
MicroSstratey bought $ 33 billion in Bitcoin
MicroStrategy, which has recently started living as a strategy, can be seen as a kind of hedge fund that adopted a Bitcoin strategy from August 2020.
Where the company was originally known as a software company, you can now state that it is a kind of Bitcoin-Hedgefonds. They do everything they can to collect more Bitcoin and are basically more than all-in on the future success of the digital currency.
Even on the rate of $ 83,870 currently on the signs for Bitcoin, MicroStrategy is not yet in trouble. They bought their bitcoin for an average rate of $ 66,000 per coin.
In that respect, they are still fairly safe, although people will gradually become anxious about the course of the last days. Do you think Bitcoin’s bullrun will be continued, or should we really prepare for a bear market?
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Source: https://newsbit.nl/leveraged-aandelen-microstrategy-81-gedaald-sinds-november/
