US hedge fund manager Michael Burry, known for predicting the 2008 US housing collapse, has now sounded an alarm about Bitcoin. Burry believes the recent drop in the largest and most popular cryptocurrency could have ripple effects across markets, particularly in gold and silver.
Bitcoin has fallen to its lowest level since US President Donald Trump took office in January 2025. The price briefly slumped below the $72,000 mark, a level last seen nearly 15 months ago.
On Wednesday, the price slumped to $71,739 in New York, and the token is down nearly 17% in 2026, with the broader crypto market losing over $460 billion in value the previous week.
In a 2 February Substack post, Burry said that the cryptocurrency’s decline may have forced the institutional investors and corporate treasurers to unload positions in other assets to cover losses.
Pointing towards the end-of-January dip in gold and silver prices, he added, “It looks like up to $1 billion in precious metals were liquidated at the month’s very end as a result of falling crypto prices.”
On Tuesday, Bitcoin fell below $73,000, marking a nearly 40 per cent decline from its recent highs of over $126,000 in October 2025. This plunge, according to Burry, exposes the currency’s weak foundation, further adding that it has failed in its pitch as a digital haven and an alternative to gold.
Michael Burry’s prediction
The hedge fund manager portrayed in The Big Short believes mining firms could face bankruptcy if the prices fall to $50,000 and warned that the market for tokenized metals futures could “collapse into a black hole with no buyer.” Dismissing the idea that institutional holdings or corporations would provide lasting support to the currency, he said that there’s nothing permanent about treasury assets.
Several other analysts have echoed Burry’s warnings. According to Bloombergthe largest cryptocurrency may fall a lot further. Citing data from Polymarket, a prediction platform, the report adds that there is an 82% chance that Bitcoin will fall to $65,000 in 2026.
Bloomberg analyst Mike McGlone also warned that 2026 could mirror a financial crisis similar to that of 2008. McGlone believes that Bitcoin could potentially lose 87% of its value, dropping to $10,000.
Crypto market sentiment under pressure
According to Bloombergthe sentiment in the crypto market has been under pressure since October 2025, when a surprise weekend crash triggered billions of dollars in liquidations. The value of the crypto market now stands at nearly $2.5 trillion, down from its over $4 trillion valuation in October.
Reasons behind Bitcoin’s fall
Reports suggest that Bitcoin’s decline comes despite expectations that it would benefit from the ongoing geopolitical tensions and dollar weakness, the same factors that have made gold and silver touch record highs. Fading Equity Traded Fund (ETF) inflows and tighter liquidity are some of the key drags mentioned by analysts.
US gold and silver rates today
According to reutersUS gold was up marginally by over 1%, and it hovered near a week’s high. Spot gold was also up 1.1% at $5,016.89 per ounce, as of 0039 GMT. Bullion reached a record high of $5,594.82 last Thursday.
Spot silver climbed 2.1% to $89.88 an ounce. It reached a record high of $121.64 last week. Spot platinum was up 2.1% to $2,272.55 per ounce after hitting an all-time high of $2,918.80 on 26 January, while palladium added 0.7% at $1,787.55.
