Remarks made by a popular Bitcoin development company executive advocating for enormous financial institutions to take custody of Bitcoin, disappointed cryptocurrency community.
MicroStrategy CEO Michael Saylor is currently at the center of bulky criticism after stating that Bitcoin would be better off under the care of “too big to fail” banks rather than controlling it on his own.
A controversial comment
In the podcast interview, Saylor advised against investors and traders approaching the custody of Bitcoin on their own, while introducing the idea of custodyship through enormous financial institutions such as banks.
He believes that enormous and established financial institutions can better serve Bitcoin holders because their role is to secure financial assets.
In the aforementioned interview, Saylor debunked the possibility of any government seizure of Bitcoin as a “trope,” saying the risk of confiscation increases when the cryptocurrency is controlled by a “bunch of crypto-anarchists” who reject government authority and are not familiar with taxes and reporting requirements.
Vitalik Buterin didn't like Michael Saylor's Bitcoin comments. Illustration: Darren Joseph; Photos: Shutterstock
He explained that unlike these “crypto-anarchists”, financial institutions comply with legal and tax obligations, arguing that this reduces the risk of any government intervention.
Many analysts in the cryptocurrency space were surprised Saylor’s position and it is tough for them to swallow the concept pushed by the director.
BTCUSD trading at $66,265 on the 24-hour chart: TradingView.com
The idea of ”Batshit-Madness”.
Ethereum co-founder Vitalik Buterin criticized Saylor for his controversial approach to Bitcoin custody, saying the idea is “fucking crazy.”
Buterin sharply criticized the banks taking over the coin, arguing that Saylor’s comments are no longer valid as there have been many technological developments that have completely changed the “compromise space”.
I’ve probably done more than most to perpetuate the “mountain man” trope (BTW, I think my points are obsolete; snarks and AA have completely changed the space for compromise), and I’m cheerful to say that I think @salorthe comments are totally crazy.
He seems to be clearly in favor of…
— Vitalik.eth (@VitalikButerin) October 22, 2024
The Ethereum co-founder does not believe that the approach promoted by Saylor to protect cryptocurrencies will be successful, saying that this is not what cryptocurrencies are about.
“There are many precedents for the failure of this strategy,” he added.
The Bitcoin community rejects this idea
Bitcoin supporters, who are robust advocates of self-care, disagree with the idea and reasoning raised by Saylor regarding adopting Bitcoin care through banks.
21st Capital co-founder Sina G said the idea could result in Bitcoin becoming an “investment rock” and warned it could lead to the cryptocurrency being discontinued as a currency.
Sina G called Saylor’s outlook “terrible,” viewing him as a spokesman for the government and financial institutions.
If you’re surprised by Saylor’s recent comments, you haven’t been paying attention. https://t.co/Tf7CDM4LqT pic.twitter.com/GTAr2oXjEC
— Jameson Lopp (@lopp) October 21, 2024
Jameson Lopp, chief security officer at Casa HODL, said the bank’s custody of BTC has long-term implications for the cryptocurrency space.
Lopp argued that the centralization of digital money has increased the risk of loss and seizure, increasing the possibility of disenfranchising Bitcoin users due to governance activities such as trade forks and running nodes.
He emphasized that self-care is vital for further strengthening and improving the network, and is not just a matter of interest for individual owners.
Featured image from Shutterstock, chart from TradingView
