Ethereum co-founder Vitalik Buterin sharply criticized MicroStrategy’s Michael Saylor for advocating Bitcoin custody through large financial institutions, calling his views “batshit insane.”
Ethereum co-founder Vitalik Buterin has strongly criticized Michael Saylor, the executive chairman of MicroStrategy, for his recent views on Bitcoin custody. Buterin called Saylor’s position “crazy.” This marks one of the most direct confrontations between two major figures in the crypto world. Saylor wants big banks to keep Bitcoin safe. Many people in the crypto world don’t like this idea.
Vitalik Buterin Slams Michael Saylor’s Custody Choice
Vitalik Buterin criticized Michael Saylor after Saylor suggested that Bitcoin holders should use big banks for custody instead of keeping their Bitcoin themselves with hardware wallets. In a recent interview, Saylor downplayed worries about government seizures of Bitcoin. He even mentioned the 1933 ban on private gold holdings in the U.S. Saylor called these fears “myths” and described people who spread them as “paranoid crypto-anarchists.”
Instead, Saylor argued that established financial institutions like BlackRock or Fidelity would be better suited to safeguard Bitcoin holdings. Many people who love Bitcoin think it’s important to hold it yourself. Saylor wants to change that and have big banks hold it. This is making a lot of people, including Vitalik Buterin, really angry.
Vitalik Buterin Challenges Saylor’s Custody Argument
Michael Saylor has long been a vocal advocate of Bitcoin, having led MicroStrategy in accumulating over 252,200 BTC as part of the company’s strategy to hedge against inflation. Saylor used to think people should hold their own Bitcoin. But now, he’s saying big banks should do it instead. This is a big change in his opinion.
In the interview with financial markets reporter Madison Reidy, Saylor downplayed the risk of government confiscation of Bitcoin and proposed that large banks could provide more secure custody solutions. Saylor thinks it’s safe to give your Bitcoin to big banks because they’re too big to fail. But this goes against the idea that people should control their own money.
When asked about the possibility of governments repeating history by seizing Bitcoin as they did with gold in 1933, Saylor dismissed such fears, calling them irrational and unfounded, He called people who worry about this “paranoid crypto-anarchists,” This means he thinks their concerns are not real.
Vitalik Buterin Responds to Saylor’s Comments
Vitalik Buterin, who knows a lot about blockchain and doesn’t like too much power in one place, disagreed strongly with what Saylor said. Buterin was surprised that Saylor would trust big banks to keep Bitcoin safe. He called this idea “batshit insane.”
Buterin recognized that he had previously helped promote some ideas about Bitcoin. He said, “I probably did more than most to spread the ‘mountain man’ idea.” However, he emphasized that new technologies, like zero-knowledge proofs (snarks) and account abstraction (AA), have changed the security landscape. Because of these advancements, it is no longer necessary to rely on banks for Bitcoin custody.
Buterin also took issue with Saylor’s apparent endorsement of a regulatory capture approach. Saylor’s suggestion that regulated institutions should hold Bitcoin to gain political protection troubled Buterin, who pointed out the numerous ways in which this strategy could fail. Buterin said, “He seems to be arguing for a regulatory capture approach to protecting crypto.” He added that this is not what cryptocurrency is meant to be. Buterin believes this approach goes against the core principles of decentralization and individual empowerment that Bitcoin was built on.
Saylor’s Response and MicroStrategy’s Bitcoin Holdings
After receiving a lot of criticism, including sharp comments from Vitalik Buterin, Michael Saylor posted a mysterious tweet on social media. The tweet showed him holding a red rose. It was captioned, “Spread Bitcoin with love.” Many people saw it as a quiet response to the backlash he faced for his comments.
Although there are arguments about it, Saylor and MicroStrategy still believe in their Bitcoin plan. MicroStrategy has a lot of Bitcoin – about 252,220 coins. These coins are worth about $16.95 billion right now. MicroStrategy has made a lot of money on Bitcoin, about $6.9 billion.
MicroStrategy’s latest Bitcoin acquisition occurred on September 20, 2024, when it purchased 7,420 BTC for $458 million, which is now showing an unrealized gain of $39.3 million. This follows a prior purchase of 18,300 BTC on September 13, 2024, for $1.11 billion.
Vitalik Buterin and Michael Saylor disagree about Bitcoin. Buterin wants people to keep their Bitcoin themselves, while Saylor wants big banks to keep it safe. This shows a big debate in the crypto world: should people control their own money, or should big institutions? The future of Bitcoin will depend on how this debate is solved.
Also Read: Michael Saylor’s “Crypto Anarchist” Controversial Comment Triggers 3.13% Bitcoin Price Fall