Bitcoin King Michael Saylor urges governments to step in and regulate crypto’s ‘parade of horribles

Bitcoin King Michael Saylor urges governments to step in and regulate crypto’s ‘parade of horribles.

The world’s largest public holder of Bitcoin called on regulators to finally tackle a laundry list of risky, immature crypto industry practices, or “parade of horribles”, unfairly weighing on its asset’s price.

Microstrategy CEO Michael Saylor argues that the over 19,000 cryptocurrencies and digital tokens in circulation must be viewed as “unregistered securities” that cannot be likened to a hard commodity like Bitcoin—which has no issuer, no management, no employees, no product cycle and only a finite supply.

Speaking in a webcast with NorthmanTrader founder Sven Henrich, Saylor said Bitcoin was being caught in the crossfire of a collapsing crypto market since it often served as collateral on margin loans for less proven tokens.

“What you have is a $400 billion cloud of opaque, unregistered securities trading without full and fair disclosure, and they are all cross-collateralized with Bitcoin,” he argued.

He added that mainstream financial institutions often won’t touch an asset like Bitcoin “because of the slime that gets onto the asset class from all the unregistered securities.”

Nouriel Roubini, a respected economist and one of the few to predict the 2008 global financial crisis, branded crypto a Ponzi scheme collapsing upon its weight on Saturday.

It’s attitudes like these that make Saylor, otherwise critical of government intervention in the free market during the pandemic, believe regulators should and will eventually step in to protect investors from the bad apples.

Bitcoin King Michael Saylor

Bitcoin King Michael Saylor

The parade of horribles

“If I make a list of the parade of horribles,” Saylor said, “they’re all going to reverse in the next ten years reasonably.”

He claimed even rock-solid multinationals like Apple would see more volatility in their share price if there were no regulations that, for example, prevent wash trading, a practice of artificially inflating prices by trading between two wallets owned by the same party.

He cited crypto hedge funds like Three Arrows Capital, or 3AC, as a hindrance rather than a facilitator to cryptocurrency adoption.

“The general public shouldn’t be buying unregistered securities from wildcat bankers that may or may not be there next Thursday,” Saylor said, whose company owns 129,218 Bitcoin as of March.

3AC is at risk of complete collapse, partly due to a busted bet on the value of Luna, the governance token that backed the TerraUSD stablecoin that failed.

Last week crypto lender Celsius froze all withdrawals and transfers amid a liquidity crunch, and speculation continues as to whether the ongoing bloodbath in the market will only claim this trio as victims or whether more will eventually emerge.

“The crypto exchanges, offshore and onshore, are unregistered, unregulated and offer 20x leverage; they don’t have mature Chinese walls,” Saylor said, referring to a common practice of keeping various financial services separate to prevent inherent conflicts of interest.

From buying the dip to ‘enjoy life.’

Saylor himself is hurting as his company borrowed $205 million in March to buy more Bitcoin, pledging part of its existing holdings as security, and fears emerged last month that Silvergate Bank would demand further proof that his company was creditworthy.

Henrich did not ask him about the loan status or whether Microstrategy received a margin call from Silvergate.

In August 2020, Saylor turned his business software company into a bet on the future price of Bitcoin and is now facing impairment charges of over a billion dollars under U.S. accounting rules after the price tumbled below $18,000 this past week.

Over the weekend, El Salvador president Nayib Bukele seemed to back away from a month-old pronouncement, urging investors to buy the dip.

This weekend, the first man to make Bitcoin legal tender in his country urged enthusiasts to “enjoy life” instead of watching the value of their investment tumble.

Also, Check

U.S. chipmaker Qualcomm wins fight against $1 Billion EU antitrust fine

The U.S. is calling Brittney Griner “basically a political prisoner” now in Russia

Coinbase lays off 18% of its workforce as executives prepare for a recession and ‘crypto winter

Bitcoi and Ethereum Fall Continues, Does inflation to blame?

Follow us or bookmark us for more Bollywood news box office collection report celebrities trailers and promos

Join us on Facebook 

Join us on Twitter

Leave a Reply

Your email address will not be published.