Bitcoin (BTC) is facing new downside risks as tensions rise between corporate Bitcoin holder Strategy (MSTR) and index provider MSCI, potentially impacting BTC’s pricing structure.

Key Takeaways:

• BTC faces a risk of a fall to $77,400 if the bear flag pattern is confirmed.
• The ongoing tensions between Strategy and MSCI may lead to added institutional pressure on an unstable market.

Bear Flag Setup Could Mean BTC Prices Drop to $77.4K

As of Wednesday, Bitcoin has formed a bear flag, indicating a short-term recovery often seen after a significant sell-off. This pattern usually leads to a continuation of the previous trend. Current trading activities show that sellers are consolidating rather than exiting their positions, while BTC remains beneath both its declining 100-day and 200-day moving averages.

A decisive breach below the flag’s trendline could solidify the bearish scenario, paving the way for a move toward the $77,400 mark.

Conversely, BTC could disprove this bearish outlook if it surpasses the 50-4H exponential moving average, around $88,655, and also clears the flag’s upper trendline near $90,000.

BTC/USD four-hour chart. Source: TradingView

Is Strategy Being Targeted with a ‘Hit Job’?

Apart from technical patterns, the decline in Bitcoin’s price could also stem from increasing uncertainty around Strategy, a major corporate Bitcoin holder. This uncertainty arises from MSCI’s upcoming decision on whether to exclude companies whose digital assets dominate their balance sheets, expected by January 15, 2026.

CryptoQuant’s GugaOnChain mentions that should MSCI exclude MSTR from its indexes, it would trigger significant share sell-offs by passive investment funds.

According to an X post, Adrian asserts:

“They are trying to kill $MSTR to engineer a migration to their products for Bitcoin leverage exposure.”

The company reassured the market regarding its financial strength, stating that it would maintain a robust asset coverage of 5.9 times its convertible debt, even if Bitcoin’s price drops to around $74,000.

This article does not offer investment advice. Every financial decision carries risks; conducting personal research is recommended.