MicroStrategy wipes $30B in biggest 4-day drop amid Bitcoin correction
2024-11-27

MicroStrategy’s market capitalization saw its largest four-day drop in history, sparking questions about its position as a leveraged Bitcoin investment vehicle.
The company’s market value fell by more than 35% from its Nov. 21 peak, erasing over $30 billion. 
This marks the largest four-day decline ever for the business intelligence firm, according to the Kobeissi Letter, which highlighted the drop in a Nov. 26 X post:

While MicroStrategy’s stock price has increased, it saw a short-term decline along with this week’s Bitcoin BTCUSD correction. MicroStrategy’s price fell over 7.5% over the 24 hours leading up to 9:52 am UTC on Nov. 27 to trade at $354.1, TradingView data shows.
MicroStrategy: still a leveraged Bitcoin trade?
The decline coincided with Bitcoin’s correction after hitting a record high of around $99,800 on Nov. 22.
Since Bitcoin’s peak on Nov. 22, the cryptocurrency has dropped over 7%, while MicroStrategy’s stock price has fallen more than 14%.
However, both Bitcoin and MicroStrategy have posted robust gains on a wider timeframe. Over the past month, Bitcoin rose 44% while MicroStrategy rallied over 32%. On the yearly chart, Bitcoin rose 146% while MicroStrategy is up by more than 599%.
Numerous investors are looking at MicroStrategy as a leveraged bet on the Bitcoin price, which is expected to outperform the returns of the world’s first cryptocurrency. 
However, MicroStrategy’s recent 35% drop — more than four times Bitcoin’s correction — raises concerns about the volatility of its stock as a Bitcoin proxy.
MicroStrategy volatility caused by retail investors
This growing volatility is a function of increasingly more retail traders according to the Kobeissi letter, which wrote:
Retail investors bought nearly $100 million worth of MicroStrategy stock during the past week, with growing interest partly driven by the firm’s $2.6 billion note offering. 
Some of the world’s largest traditional institutions are investing in Michael Saylor’s company, including Allianz, the second-largest insurance provider in Europe, which acquired over 24% of MicroStrategy’s $600 million note offering in March.