Journalist
Posted:
The idea of ’buying the dip’ has become as silent as Bitcoin [BTC] continues to struggle. At the time of writing, Bitcoin was trading around $66,131, down almost 3% in just 24 hours.
At the same time, the Crypto Fear and Greed Index has dropped to 5 out of 100, indicating “extreme fear.” This is one of the lowest levels since 2019.
Source: Alternative.me
Simply put, investors are scared right now. But the bigger story is what happens to big companies that have made big bets on Bitcoin.
Nakamoto’s Bitcoin strategy failed
An important example is Nakamoto Inc. This company has built its entire strategy around owning Bitcoin alone. At one point this approach was praised as smart and daring, but now it seems very risky.
Over the past 280 days, Nakamoto Inc lost more than 99% of the market value. About $23.6 billion has disappeared.
The company bought 5,398 Bitcoin at an average price of $118,000, near the top of the market. Today, the company has incurred approximately $270 million in unrealized losses as a result of that decision.
In simple terms, they bought when prices were very high, and now they are left with heavy losses.
The Director of the Coin Bureau intervenes
Nic Puckrin, Coin Bureau co-founder and chief market analyst, has warned that this could create a risk of contagion. This means that problems in one company can spread to other companies that are also heavily dependent on Bitcoin.
In an email to AMBCrypto, Puckrin further noted:
“Digital asset treasuries (DATs) are starting to show signs of stress due to the sharp sell-off in Bitcoin, which is impacting their stock prices.”
He added:
“Overall, Bitcoin Treasury holdings just recorded three consecutive weeks of selling – the first time in their admittedly short history.”
Stock price action and more
In addition, Nakamoto Inc. also shares fallen almost $0.24 and has lost approximately 97% of its value in just six months.
In addition to corporate balance sheets, daily activity on the Bitcoin network is also slowing down. The number of active addresses is dropping, which means fewer people are sending or receiving Bitcoin.
Source: Glassnode
At the same time, open interest in futures and options markets is declining. This means that traders close their positions instead of opening new ones.
Source: CoinGlass
This further coincided with US President Donald Trump recently announcing a sudden 15% global tariff on February 21, and Bitcoin reacted as a risky tech stock.
Looking ahead, what’s next for Nakamoto Inc. and similar companies therefore find it difficult.
With the Fear and Greed Index stuck at extreme fear levels and corporate finances under pressure, the market is no longer hoping for a quick recovery. We have to wait until prices reach a clear low.
Final summary
- The extreme fear in the market suggests that most investors are focused on protecting capital rather than chasing short-term profits.
- Buying Bitcoin near market peaks has left many treasuries trapped in heavy, long-term losses.