Bitcoin Slump Shakes Companies That Jumped on Crypto-Hoarding Bandwagon
February 5, 2026, New York — The recent downturn in Bitcoin prices is severely impacting companies that had aggressively accumulated cryptocurrencies like Bitcoin on their balance sheets, stirring concerns about potential broader troubles in the digital asset sector. This slump is affecting the shares of numerous firms that embraced crypto investments last year, during a period when optimism around cryptocurrencies surged.
Crypto Investments Sparked by Trump’s Policies
The surge in publicly traded companies investing in cryptocurrencies was initially fueled by the crypto-friendly stance of former U.S. President Donald Trump. Investors drew inspiration from high-profile cases like billionaire Michael Saylor’s firm Strategy (formerly MicroStrategy), which pivoted from software development to actively purchasing and holding Bitcoin starting in 2020. However, this wave of enthusiasm hit a rough patch as uncertainties about the Federal Reserve’s monetary policy, especially the path of interest rate adjustments, unsettled risk assets including cryptocurrencies. Compounding this, skepticism over the valuation of artificial intelligence firms added pressure on markets.
Strategy Inc. Bears the Brunt
Strategy, the best-known corporate Bitcoin holder, witnessed a dramatic plunge in its stock value, tumbling from $457 in July 2025 to a low of $111.27 on Thursday, marking its worst performance since August 2024. The day’s trading saw the stock drop over 11%.
In December, Strategy had to significantly reduce its earnings forecast for 2025 due to weak Bitcoin performance. The company announced plans to establish a reserve fund aimed at supporting dividend payments amid the volatility. Their revised full-year earnings guidance now ranges from a $6.3 billion profit to a $5.5 billion loss, sharply down from the previously anticipated $24 billion net profit.
Strategy’s management has not issued a recent comment in response to the stock’s decline.
Other Crypto-Holding Firms Suffer Similar Losses
The ripple effect extends beyond Strategy. Shares of the UK’s Smarter Web Company, another bitcoin investor, plunged nearly 18% on Thursday. Other firms like Nakamoto Inc. and Japan’s Metaplanet also experienced declines of approximately 9% and over 7% respectively.
Bitcoin itself has dropped nearly 20% since the start of 2026, reaching its lowest levels since November 2024. A significant catalyst for recent selling pressure was Trump’s nomination of Kevin Warsh as the next Federal Reserve Chair. Analysts suggest this appointment could signal a smaller Fed balance sheet in the future, a scenario generally unfavorable for riskier assets like cryptocurrencies.
Market Experts Weigh In
Nic Puckrin, investment analyst and co-founder of crypto analysis platform Coin Bureau, commented on the market situation: “As Bitcoin continues its slide below the psychological barrier of $70,000, it’s clear the crypto market is now in full capitulation mode. If previous cycles are anything to go by, this is no longer a short-term correction, but rather a transition—and such transitions typically take months, not weeks.”
Broader Impact on Crypto Treasury Companies
While institutional investors can purchase tokens directly, Digital Asset Treasury (DAT) companies provide an alternative by allowing more cautious investors to gain cryptocurrency exposure through regulated public firms. However, persistent share price pressures may hamper these companies’ ability to raise capital necessary for further crypto acquisitions—the core of their business model.
Executives at such firms emphasize the importance of making astute investment decisions and are actively exploring strategies to enhance shareholder value amid the current volatility.
Altcoins Also Feeling the Downturn
It is not just Bitcoin-focused firms that are struggling. Companies holding other cryptocurrencies also saw their shares drop. Alt5 Sigma, which disclosed plans last year to stockpile the Trump family’s WLFI token, fell 8.4%. SharpLink Gaming, an Ethereum holder, dropped 8%, and Forward Industries, which holds Solana, declined nearly 6%.
Bitcoin Loses Gains Made Since Trump’s Election
Bitcoin’s current price is $67,651, having swung downward enough to erase all gains recorded since Trump’s election in 2024, when he campaigned on promises to overhaul digital asset policies.
As the crypto market enters this uncertain phase, companies and investors alike are bracing for a potentially prolonged adjustment period, as the sector recalibrates amid evolving regulatory and monetary dynamics.
Reporting by Hannah Lang in New York; Editing by Nia Williams
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About the Author:
Hannah Lang is a financial technology and cryptocurrency reporter for Thomson Reuters, covering industry developments and regulatory policies. She is based in Washington, DC.