Ethereum co-founder Vitalik Buterin has strongly criticized MicroStrategy’s executive chairman Michael Saylor’s comments on Bitcoin custody.
The comments were following Saylor’s recent controversial stance advocating for Bitcoin custody through “too big to fail” banks instead of self-custody.
Saylor’s controversial pivot
In a recent interview with financial markets reporter Madison Reidy, Saylor suggested that Bitcoin holders have nothing to lose by transferring their BTC to major financial institutions.
When he was questioned about potential state-sanctioned Bitcoin seizures, similar to the 1933 illegalization of gold holdings, Saylor dismissed such concerns as unfounded.
“It’s a myth and a trope that goes on over and over again,” Saylor stated. He also labeled those concerned about such scenarios as “paranoid crypto-anarchists.”
Instead of using hardware wallets, he proposed that “too big to fail” banks, which he believes are designed to be custodians of financial assets, would provide safer custody solutions.
This shift away from advocating self-custody has triggered major backlash within the Bitcoin community.
Vitalik Buterin responds to Saylor’s comments
Vitalik Buterin’s responded to Saylor’s comments while acknowledging his own role in previously promoting certain Bitcoin narratives.
Buterin stated, “I probably did more than most to spread the ‘mountain man’ trope.” However, he considers those remarks outdated due to technological developments like snarks and AA changing the “tradeoff space completely.”
Buterin specifically criticized Saylor’s regulatory capture approach, referring to his comments about regulated entities like BlackRock and Fidelity holding assets to ensure lawmaker support.
I probably did more than most to spread the “mountain man” trope (btw I consider those remarks of mine outdated; snarks and AA changed the tradeoff space completely), and I’ll happily say that I think @saylor’s comments are batshit insane.
He seems to be explicitly arguing for a…
— vitalik.eth (@VitalikButerin) October 22, 2024
“He seems to be explicitly arguing for a regulatory capture approach to protecting crypto,” Buterin noted, adding that “there’s plenty of precedent for how this strategy can fail, and for me it’s not what crypto is about.”
Buterin also stated that he believes Saylor’s comments are batshit insane.
Casa HODL’s Chief Security Officer, Jameson Lopp, provided a comprehensive critique of institutional custody’s long-term implications. Lopp outlined several critical concerns.
These include the centralization of coins increasing systemic risk of loss and seizure, Bitcoin holders becoming disenfranchised from governance activities like running nodes or trading forks, the strengthening of ossification arguments due to institutions’ disinterest in advanced cryptographic features, and the deprioritization of permissionless scaling in favor of trusted third-party IOUs.
“Self custody is not merely important to individual Bitcoin holders,” Lopp emphasized. “It’s important for the continued strengthening and improvement of the entire network.” Vitalik’s tweet also came as a response to Jameson’s tweet.
Following the interview and as a potential response to the criticism, Saylor put out a tweet that included a picture of him holding a red rose. The tweet caption reads, “Spread Bitcoin with love.” The tweet could likely be his response to the hate he was getting for his recent comments.
Spread #Bitcoin with Love 🧡 pic.twitter.com/4OVpladoCh
— Michael Saylor⚡️ (@saylor) October 22, 2024
MicroStrategy holds 252,200 Bitcoin
According to the latest data from Saylortracker, MicroStrategy currently holds 252,220 Bitcoin. As per the current market price of Bitcoin at $67,000, this BTC stash is valued at $16.95 billion.
The Bitcoin stockpile is currently sitting at an unrealized gain of 70.2%, or $6.9 billion. As per the data, the company acquired the 252,220 Bitcoin for $9.953 billion.
Source: Saylortracker
MicroStrategy’s last Bitcoin purchase was on September 20, 2024, when the company purchased 7,420 BTC for $458 million. The single purchase is currently showing an unrealized gain of $39.3 million.
Prior to that, on September 13, the company scooped up 18,300 BTC for $1.11 billion. That purchase has an unrealized gain of $117 million at press time.
Despite Bitcoin’s struggle to break past the $69,000 resistance, Saylor and MicroStrategy remain steadfast in their long term Bitcoin game.