What the data tells us

Today's US open was quite rough, sea of red everywhere. But despite the bloodbath, onchain and social metrics aren't showing anything resembling bottom yet.

Liquidations in DeFi protocols are nowhere to be seen yet, and even on the contrary, total debt is rising slightly, which is not a good sign for price upside.

On the social side nothing is happening either, social volume hasn't spiked and sentiment is within the neutral band. All this is pointing towards more downside before a bottom formation can be considered.

Important observations

Two weeks ago Microstrategy raised almost $1.5 billion in cash for future dividend payments to "squash the FUD" around them having to sell BTC to fund dividends. And then they followed that up with 2 consecutive weeks of buying a billion dollars worth of BTC, 95% of that raised by selling MSTR stock. There's a few important things to notice here:

1) Saylor is viewing the current price as a deep value discount - "this has to be the bottom"

2) They are not afraid to sell the stock at mNAV even below 1

In my view, that indicates serious FOMO on Microstrategy's side, as they rush to buy as much BTC as fast as possible, which raises serious questions about their long-term stability. Imagine what can happen if the price goes to their cost basis.

Conclusion

Microstrategy continues to provide exit liquidity for bitcoin whales, accelerating their BTC purchases and simultaneously (in my opinion) their path toward bankruptcy. Their most hyped up preferred STRC can not reclaim par value however many dividend raises they do, which means the market is pricing in the risk of those dividends not being paid for very long, and also there's likely not much demand for this product.

Data is pointing to more down, until both onchain and social show serious capitulation signs.