2026 has opened on a brutal note for crypto and even longtime Bitcoin believers are feeling the chill.
On Feb. 3, Bitcoin (BTC) plunged below $73,000, marking its steepest decline since early November 2024 and deepening losses from the flash crash that rattled markets on Oct. 10 last year.
For Michael Saylor's MicroStrategy, now known as Strategy (NASDAQ: MSTR), the timing couldn't be worse.
Related: MicroStrategy struggles ahead of earnings after latest Bitcoin crash
The company's average Bitcoin purchase price was $76,052 . This means that at Bitcoin's current price of $72,680 at press time, Strategy's entire corporate treasury is underwater ahead of its fourth-quarter 2025 earnings report due after markets close on Feb. 5.
With crypto winter now firmly in place, even bullish analysts are recalibrating expectations, not abandoning them, but tempering their optimism.
Analyst slashes price ahead of MSTR earnings report
In a note to clients on Feb. 4, Joseph Vafi of Canaccord Genuity slashed his price target on Strategy's stock by more than 60%, lowering it from $474 to $185.
That's a huge revision, but the analyst isn't exactly throwing in the towel. Despite the downgrade, Vafi maintained a "buy" rating, arguing that the new target still implies about 40% upside from Feb. 3's closing price of $133.
At the time of reporting, MSTR shares are down 19% year-to-date, 64% year-over-year, and 72% from their record high in November 2024.
Vafi called Bitcoin's current phase an "identity crisis," still resembling a long-term store of value, yet behaving like a speculative risk asset.
The October flash crash exposed that contradiction, as forced liquidations accelerated the sell-off and reminded traders how closely Bitcoin remains tied to market liquidity.
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Though Bitcoin is often compared to gold, it has failed to track the precious metal's 2025 rally. As gold climbed on geopolitical tensions and economic uncertainty, Bitcoin lagged, reinforcing its dependence on risk appetite rather than safe-haven flows.
Still, Vafi's note described Strategy as "built to weather volatility."
Preferred dividends, he said, are manageable even with the stock's shrinking premium to its BTC holdings.
But with Strategy's value now tied almost entirely to Bitcoin's trajectory, fourth-quarter results may prove largely symbolic, and a fresh reminder that even the most bullish analysts can turn cautious when the market freezes over.
Related: Cardano founder predicts Bitcoin could hit $250K by 2026 — Is it realistic?
This story was originally published by TheStreet on Feb 4, 2026, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.
