The popular strategy where companies accumulate bitcoins in their corporate reserves may turn out to be a short-term trend, and its lifecycle may be significantly shorter than most investors expect. This opinion was expressed by Glassnode's chief analyst James Check.
Not competition, but a sustainable strategy
According to him, the market is entering a new phase where the mere fact of accumulating bitcoins will no longer be sufficient for a company's success. A key factor becomes the presence of a sustainable business model capable of supporting this strategy in the long term.
'It's not about competition, about who has more. It's about how serious and sustainable your product and strategy are to support accumulation,' Check noted.
In his opinion, 'casual players' who started buying bitcoin only during the wave of popularity will find it increasingly difficult to maintain a high valuation of their holdings without a clear niche and long-term vision.
Survive the 'crypto winter'
James Check also added that although retail speculators are actively buying shares of such companies, their financial resources are limited. He contrasted new players with the company MicroStrategy, which, in his opinion, has a significantly greater buffer.
'I believe that only a few companies will be able to implement this strategy long enough to survive the crypto winter,' he concluded.
What is 'crypto winter' and why are investors afraid of it
'Crypto winter' is a slang term used to describe a prolonged bear market in the crypto industry. This period is characterized by:
A sharp and prolonged decline in prices: The value of major cryptocurrencies, such as bitcoin, can fall by 80% or more from their historical highs.
A decrease in trading activity: trading volumes on exchanges are significantly reduced.
Loss of interest: the hype disappears in the media and among retail investors.
Historically, the market has experienced several such 'winters', particularly in 2018-2019 and 2022-2023. During these periods, many cryptocurrency projects and companies that lacked a sustainable business model or sufficient funding went bankrupt. That is why the ability to 'survive the crypto winter' is considered the main test of viability for any project in this field.
