In a recent interview with journalist Madison Reidy, MicroStrategy CEO Michael Saylor sparked significant controversy within the Bitcoin community over his comments on custody and regulation. Responding to concerns about the risks of large amounts of BTC being held by third-party custodians and large institutions, Saylor argued against self-custody and downplayed fears of an increase in seizures or confiscation.
Saylor stated that BTC is safer when it is in the hands of regulated public entities such as BlackRockFidelity and JPMorgan Chase, rather than by unregulated private holders. He said: ‘I think it’s the opposite. I think when Bitcoin is in the hands of a bunch of crypto-anarchists who are not regulated entities, who don’t recognize the government, don’t recognize taxes or don’t recognize reporting requirements, that increases the risk of seizure.”
The importance of Bitcoin self-custody
The BTC community’s response was swift and intense, Bitcoinist said reported. Even Ethereum co-founder Vitalik Buterin labeled Saylor’s declaration as “batshit insane,” reflects strong disapproval from prominent figures in the crypto space.
Faced with mounting criticism, Saylor appears to have softened his stance. Through X, he clarified: “I support self-custody for those who are willing and able, the right to self-determination for all, and the freedom to choose the form of custody and custodian for individuals and institutions worldwide. #Bitcoin benefits from all forms of investment by all types of entities and should welcome all.”
Gabor Gurbacs, founder of PointsVille and strategist at Tether, noted that Saylor’s updated position “shouldn’t be a controversial position” and considered it “just common sense.”
However, not everyone was convinced by Saylor’s clarification. Bitcoin lawyer Max Keizer expressed They worry that the importance of self-control – a defining aspect of BTC’s value proposition – was not adequately communicated. He highlighted the high risks associated with others taking custody of Bitcoin, noting that self-custody and the separation of state and money are key features that define it.
“To be clear, El Salvador is opening Bitcoin banks, with caveats that clearly state that self-custody – and the separation between state and money – are key features that define Bitcoin. Bitcoin transforms money and also the concept of the nation state; as it has been understood for 300 years,” he added.
Industry analyst James Van Straten speculated that MicroStrategy is positioning itself as a BTC bank, in line with Hal Finney’s 2010 predictions. While advocating for self-custody, Van Straten acknowledged that institutional involvement and ease of access, such as through ETFs, are key drivers for BTC adoption.
“Saylor plays a completely different game than the average pleb. Depending on the next US administration, he must position himself carefully. I’d say positioning oneself as a crypto-anarchist is even more stupid. If he believes that returns are necessary, then so be it. Had a good first four years,” Van Straten writes via X.
Joe Burnett of Unchained gave a succinct version: “Incredibly based.” Conversely, Joel Valenzuela, involved in business development and marketing for Dash, noted of X: “Capitulation. But you showed your true colors.”
At the time of writing, BTC was trading at $67,700.
Featured image from YouTube, chart from TradingView.com