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Ethereum co-founder Vitalik Buterin slammed Michael Saylor’s suggestion that investors should store their crypto with big banks, calling the idea “batshit insane.”
“I’ll happily say that I think Saylor’s comments are batshit insane,” the Ethereum co-founder said in an Oct. 22 post on X post.
Vitalik Buterin Says Bitcoin Custody Through Banks Can Fail
Buterin said Saylor is arguing for a ‘’regulatory capture’’ approach to protecting crypto. Some argue that has advantages because when regulated entities like BlackRock and Fidelity custody crypto assets, lawmakers and law enforcement arms are, as Buterin acknowledged, ” invested in those entities.’’
Still, the Ethereum co-founder is unconvinced it’s the best way forward.
“There’s plenty of precedent for how this strategy can fail, and for me it’s not what crypto is about,” he said.
Crypto was built to decentralize power, not hand it over to entities like Blackrock or Fidelity, Montana G said in a post on X.
“While some see institutional adoption as a way to legitimize and protect the space, it also risks steering the whole movement away from its original ethos,” he added. “The idea of regulators and lawmakers being too invested in centralized entities does create a slippery slope.”
Vitalik Buterin Comments Add To Backlash Against Saylor
Buterin’s comment adds to the backlash the MicroStrategy founder has faced from the crypto community after backing banks over self-custody.
In an Oct. 21 interview with a financial markets reporter, Saylor said crypto investors should transfer their funds to banks that are “engineered to be custodians of financial assets.” Saylor also said that anyone who thinks a state-sanctioned Bitcoin seizure is possible is just a “paranoid crypto anarchist.”
Saylor’s comments are a U-turn from earlier remarks he made when he championed self-custody. In an August 2023 interview, he told crypto investors to remember their 12-word seed phrase for their wallets and defend their Bitcoin from anyone who tries to take their holdings.
MicroStrategy Holds Over 250K BTC As Saylor Tries To Create The Leading Bitcoin Bank
Data from Saylortracker shows that MicroStrategy currently holds 252,200 Bitcoin valued at $16.99 billion. With the large amount of BTC on hand, Saylor recently told Bernstein that the end goal for the firm is to become the leading Bitcoin bank with a valuation of $1 trillion.
Let me translate:
“I’m downplaying the importance of #Bitcoin in self-custody because I’m about to offer you a collateralized loan through my new bank.” @saylor#Bitcoin anarchists: keep helping people gain freedom from banks, governments & central banks pic.twitter.com/T4v13JvDRF
— Simon Dixon (@SimonDixonTwitt) October 21, 2024
Some of the criticism towards Saylor’s recent comments about Bitcoin custody suggest that his remarks have to do with his plan to turn MicroStrategy into a BTC bank.
Simon Dixon, author of “Bank to the future,” speculated that Saylor is undermining the importance of self-custody because it does not benefit his long-term Bitcoin bank vision.
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