Prominent short-seller Jim Chanos, once a vocal critic of Bitcoin and cryptocurrencies, revealed a new trading play that involves shorting shares of Strategy (formerly MicroStrategy) and buying Bitcoin. At the Sohn Investment Conference in New York, Chanos told CNBC he’s “selling MicroStrategy stock and buying Bitcoin.” The investor described the move as buying something for $1 and selling something for $2.50, referring to what he sees as a significant price mismatch. Chanos argued that Strategy is selling the idea of buying Bitcoin ( BTC ) in a corporate structure, and that other companies are following suit in hopes of receiving a similar market premium. Chanos said this was “ridiculous.” He described his trade as “a good barometer of not only just the arbitrage itself, but I think of retail speculation.” Selling Strategy stock to buy Bitcoin Chanos’ recent move assumes investors overpay for Bitcoin exposure through corporate wrappers like Strategy and other firms that follow its Bitcoin accumulation blueprint. The investor’s move reflects a stance that purchasing Bitcoin directly would be better than purchasing Strategy’s stocks for indirect Bitcoin exposure. Chanos’ move suggests that holding Bitcoin through companies reflects excessive speculation and risk mispricing. It assumes that retail investors’ idea of having Bitcoin indirectly through corporate wrappers can inflate the company’s stock valuations. While shorting Strategy may seem like a good idea, investors have already lost billions shorting Saylor’s company. In 2024, investors who bet against the firm lost about $3.3 billion as the stock rose. As of May 2025, Strategy holds about 568,840 Bitcoin, valued at around $59 billion . Since the company started accumulating Bitcoin in 2020, its stock price has surged by 1,500%, outperforming the S&P 500’s gains during the same period. In a recently released documentary from the Financial Times, Strategy analyst Jeff Walton said that the company’s Bitcoin holdings would help it become the “number one publicly traded equity in the entire market” in the future. Chanos previously called Bitcoin a “libertarian fantasy” Chanos has not always been favorable toward Bitcoin. In a 2018 interview, Chanos described Bitcoin as a “libertarian fantasy.” Chanos said that having digital currency as a store of value in the worst-case scenario wouldn’t work. The investor said that if fiat currency brings the world down, the last thing he’d want to own is Bitcoin. “Food would work the best,” he said. He also criticized Bitcoin for enabling illicit activity, calling the crypto sector “the dark side of finance” in a 2023 interview, and accusing the industry of facilitating tax evasion and money laundering. Chanos also expressed skepticism about spot Bitcoin exchange-traded funds (ETFs), saying that Wall Street needs to keep the public interested in crypto to profit from the fees. Despite those critiques, Chanos now appears to see value in holding Bitcoin directly, particularly in contrast to investing in public companies with large BTC treasuries. Related: $1B Bitcoin exits Coinbase in a day as analysts warn of supply shock Chanos’ history in short-selling Chanos is best known for his short position against the energy company Enron before the firm filed for bankruptcy in 2001. The move generated profits for Kynikos Associates, a firm that he founded. A short position involves borrowing assets from a broker, selling them at the current price, and then repurchasing the assets once the value falls to give back what is owed to the broker. Short sellers profit when the asset’s value declines, but face losses when the asset appreciates. While the investor profited from short-selling Enron, Chanos’ predictions weren’t always correct. Chanos was bearish on Tesla and announced a short position in 2016. Tesla stock skyrocketed by 2,200% between 2015 and 2021. The event caused major losses to Chanos’ fund. In 2020, the fund ended with $405 million in assets under management after having over $900 million the previous year. The fund was converted into a family office, and external assets were returned to investors. Magazine: Danger signs for Bitcoin as retail abandons it to institutions: Sky Wee