Jim Chanos, the renowned short-seller who once called Bitcoin a “libertarian fantasy,” has unveiled a fresh trading strategy that has the crypto community buzzing. At the Sohn Investment Conference held in New York this week, Chanos announced his latest maneuver: shorting shares of Strategy, formerly known as MicroStrategy, while simultaneously buying Bitcoin. His rationale? A perceived price mismatch he likens to “buying something for $1 and selling something for $2.50.”
Chanos’ Bold Strategy
Chanos isn’t mincing words. He argues that companies like Strategy, which hold significant Bitcoin reserves, are enjoying an inflated market premium simply by acting as corporate conduits for Bitcoin investment. “It’s ridiculous,” he told CNBC, highlighting what he sees as a speculative bubble driven by retail investors eager for indirect Bitcoin exposure. This skepticism comes amid Strategy’s ambitious plans to expand its Bitcoin holdings, as detailed in Strategy’s $84B Bitcoin Expansion Plan Backed by Wall Street Analysts.
The investor’s move suggests that purchasing Bitcoin directly is a more prudent approach than investing in a company’s stock for indirect exposure. This standpoint reflects a broader skepticism about the sustainability of companies following Strategy’s lead in amassing Bitcoin assets. As it stands, Strategy holds approximately 568,840 Bitcoin, valued at an eye-popping $59 billion. Since it began its Bitcoin buying spree in 2020, Strategy’s stock price has soared by 1,500%, putting the S&P 500’s gains to shame.
The Risk of Shorting Strategy’s Stocks
However, this isn’t the first time investors have bet against Strategy. In 2024, short-sellers faced a staggering $3.3 billion in losses as the company’s stock defied bearish forecasts and continued its upward trajectory. Despite these cautionary tales, Chanos appears undeterred, viewing the market’s current dynamics as ripe for his contrarian play. This comes as Strategy continues to raise substantial funds to increase its Bitcoin reserves, as reported in Strategy Raising Another $21B to Buy Bitcoin, Posts Large Q1 Loss on BTC Price Decline.
Not everyone agrees with Chanos, though. Strategy analyst Jeff Walton, in a recently released Financial Times documentary, confidently predicted that the company’s Bitcoin holdings would eventually make it the “number one publicly traded equity in the entire market.” Yet, Chanos’ bet raises questions about whether the market has overextended itself in valuing Bitcoin reserves held by public companies.
Chanos’ Shifting Perspective on Bitcoin
Chanos’ evolving stance on Bitcoin is noteworthy. In 2018, he dismissed the cryptocurrency as a “libertarian fantasy,” skeptical about its viability as a store of value in dire economic scenarios. He argued that in a true financial apocalypse, tangible goods like food would be far more valuable. His criticisms didn’t stop there—he lambasted the crypto sector for enabling illicit activities, labeling it “the dark side of finance” in a 2023 interview.
Despite his earlier skepticism, Chanos now seems to perceive Bitcoin as a viable asset, particularly when contrasted with investing in public companies holding large BTC reserves. His comments reflect a nuanced shift, possibly indicating a broader acceptance of Bitcoin’s potential beyond speculative trading.
A Legacy of Contrarian Bets
Chanos’ name is synonymous with successful short positions, most famously against Enron before its collapse in 2001. That move cemented his reputation and brought considerable profits to Kynikos Associates, the firm he founded. But not all of his predictions have aged well. His bearish take on Tesla proved costly, as the stock’s meteoric rise from 2015 to 2021 inflicted significant losses on his fund, which eventually transitioned into a family office in 2020.
Chanos’ latest strategy on Bitcoin and Strategy is more than a mere financial play—it’s a commentary on current market exuberance and the speculative nature of retail investing. Whether his contrarian bet will pay off remains to be seen. With the crypto market’s inherent volatility, the outcome is anything but certain.
As we navigate through 2025, Chanos’ actions serve as a reminder that the cryptocurrency landscape is continuously evolving, and so too are the strategies of those who seek to profit from its unpredictable nature. Whether his latest bet will be another Enron or a Tesla remains an open question, one that captures the speculative spirit of today’s financial markets.
Source
This article is based on: Jim Chanos takes opposing bets on Bitcoin and Strategy
Further Reading
Deepen your understanding with these related articles:
- Crypto Daybook Americas: Robinhood’s Crypto Growth Presages Riot, Strategy Even as Tariffs Hit GDP
- Metaplanet Registers U.S. Treasury Arm to Grow Its Bitcoin Reserve Strategy
- Metaplanet to open US arm, plans to raise $250M for Bitcoin strategy
Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
