Bitcoin's Biggest Risk: Prolonged Stagnation Over Sudden Crash

CryptoQuant CEO Ki Young Ju has warned that Bitcoin's biggest risk is not a sudden crash, but rather prolonged stagnation. According to Ju, a prolonged period of weak performance could erode investor conviction and make it harder for the asset to attract fresh capital.

Ju argued that buying more Bitcoin does not solve the underlying issue, as Saylor's Strategy needs to give the market a new reason to believe in the asset's potential. He noted that investors can tolerate sharp drawdowns when they expect a recovery, but extended sideways trading presents a different problem.

The remarks come as concerns surrounding Strategy's financing structure continue to grow. STRC, the company's preferred stock, recently fell to a record low near $82, placing it well below its $100 par value and raising questions about investor demand.

Ju warned that STRC becomes most vulnerable when Bitcoin spends years moving sideways rather than experiencing a short-lived crash. As investor interest fades, he said demand for the company's securities could decline, making fundraising more difficult.