Bitcoin (BTC) is, as Frank Giustra puts it, in great danger since the talkative Canadian billionaire has once again made his opinion very clear this week. He cautioned that the digital currency might be on its way to a tough downfall. His worry is not based on the hype or news which are always there. It is based on leverage and the associated risks of borrowing money.

According to Giustra, the major companies that hold Bitcoin as a treasure have taken a huge amount of loans in order to acquire the asset at high prices. This risky operation can be maintained only if the prices continue to go up. When the pressure comes, the operation fails. The interest on the loans has to be paid. Cash has to be raised. BTC, as per his words, will be sold in a considerable quantity.

Giustra said, “If the Bitcoin treasury companies get into trouble, there will be an unwinding. Bitcoin will trade a lot lower.” He remarked that his being wrong would not have any impact on his life. For him, caution is not a sign of pessimism. It is a shield against what he names gambling.

The remarks were made after a heated debate on X where a political expert said that those who have a negative outlook toward BTC for 2026 are simply making a big mistake. Giustra had a different opinion. He insinuated that the markets do not pay attention to the certainty of the investors.

Also Read: Bitcoin’s Secret Strength: Galaxy Digital CEO Mike Novogratz Explains

Bitcoin Treasury Risk and Forced Selling Fears

The caution is not just a theory. Last year, the most prominent Bitcoin treasury company, Strategy, was one such illustration. Its stock price went down more than half in 2025. Giustra has been opposing the company’s methods for a long time and has even called its head, Michael Saylor, a “Bitcoin charlatan.”

The fundamental risk is pretty straightforward. Companies that take loans to invest in Bitcoin are hit by price drops in two ways. Quite simply, their asset values drop and their debt remains unchanged. If lenders are not willing to take the same risk or investors become impatient, then selling would be the only option left.

In such a case, there would be a huge influx of BTC on the market at a time when the market is least favourable. This is the process through which a crash gets accelerated. It is not just fear that causes it but also the structure of things.

Bitcoin Technical Signals Echo Bearish Fundamentals

The technical data, which now points to the same direction as Giustra’s concerns, has been released. According to Bloomberg Intelligence analyst Mike McGlone, Bitcoin is facing a down year. His attention is on the 50-week moving average, a long-term trend line that is closely monitored by institutional traders.

In the past, there have been quite a few occasions when BTC’s prices were drastically higher than this average and as a result, there were sharp corrections. McGlone refers to the possibility of a “lower trough near a 55% rebate.” From the recent levels of about $87,000, it would mean that BTC would be somewhere between $45,000 to $50,000.

It would indeed be a difficult situation. The loss of billions on paper would be the result of the activities of the treasury firms. The process of fast weakening of balance sheets would be the next consequence. The sales that Giustra is afraid of would become mandatory.

McGlone sees a similarity with the 1980 silver bubble that ended up with a 52% price drop after being overdone. At that time, the use of borrowed money made the situation worse. The pattern indeed seems to be repeating.

Also Read: Bitcoin Cash (BCH) Surges to $599: Could Hit $804 by 2026!

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Filed under: Bitcoin - @ January 2, 2026 10:00 pm