If the price of Bitcoin sinks below crypto bull Michael Saylor’s $21,000 margin call, it will not destroy the billionaire, as has been widely speculated, but it could cause market panic, according to a popular crypto trader.
A crypto trader who goes by the name Crypto Feras and shares trading tips on YouTube and Twitter @FeraSY1 said he believes that crypto whales – investors with large amounts of coins – will not sink the price of Bitcoin to less than $21,000 — Saylor’s MicroStrategy portfolio margin call.
A margin call happens when the level of an investor’s crypto holding value falls below the broker’s required amount in a case where the coins were bought using borrowed money.
“I will be really surprised if Bitcoin whales won’t take BTC below Microstrategy margin call price. The biggest liquidity collection opportunity we ever seen in #crypto history,” Feras tweeted.
“… but tapping that 21K would create enough panic in the market with headlines effect,” Feras added in another tweet.
Saylor borrowed money to buy Bitcoin and recently said that he would get a margin call if the world’s largest cryptocurrency tumbled to $21,000. This would force him to start selling his Bitcoin stockpile.
SEC filings show that Saylor’s company, MicroStrategy, owns 129,218 Bitcoins for which it paid $3.97 billion, or $30,700 per coin.
The price of Bitcoin went as low as $25,401.29 after the collapse of TerraUSD, a so-called stablecoin defended by Bitcoin reserves. Investors, worried that billions of dollars in Bitcoin could be dumped into the market by crypto wales, rushed to sell their holdings.
Feras said that while Saylor’s position might not “get liquidated”, the drop in price and a margin call on his Bitcoin holdings could attract “bad players” who want to buy when blood is on the streets.
“It’s all about money, it’s all a ‘liquidity’ game and bad players are ALWAYS there to get the advantage of such public info & expected headlines/panic at such areas,” Feras tweeted.
“Saylor is not a noob to get liquidated like you. But having his position and loans details shared to public is going to attract ton of bad players (and there are many) knowing how borrowing is getting more and more expensive.”
Photo: Michael Saylor, chairman and CEO of MicroStrategy, speaks during a panel discussion at the Bitcoin Conference, April 7, 2022, in Miami Beach. (AP Photo/Rebecca Blackwell)