Saylor faces backlash for promoting Bitcoin custody via big banks

Michael Saylor, executive chairman of MicroStrategy, has faced criticism following his comments suggesting Bitcoin (CRYPTO:BTC) holders should consider entrusting their assets to “too big to fail” financial institutions instead of relying on self-custody. 

In an Oct. 21 interview, Saylor dismissed fears of government confiscation of Bitcoin, labeling them as myths promoted by “paranoid crypto-anarchists.” 

He argued that large banks, designed to safeguard financial assets, could be reliable custodians. 

This perspective contrasts sharply with Saylor’s previous endorsement of self-custody. 

After the collapse of FTX in 2022, he had warned that without self-custody, custodians could amass excessive power, potentially abusing it. 

He had stated, “If you can’t self-custody your coin, there’s no way to establish a decentralized network.” 

However, Saylor’s recent remarks suggested there was little risk in transferring Bitcoin to large institutions. 

This shift led to backlash from within the Bitcoin community. 

Simon Dixon, author of Bank to the Future, questioned Saylor’s motives, speculating that he is positioning MicroStrategy for a future role as a Bitcoin bank offering loans. 

John Carvalho, CEO of Synonym, also expressed concerns, highlighting Saylor’s past rhetoric that “Bitcoin is hope.” 

Some, however, supported Saylor’s view. 

Julian Figueroa, host of Get Based, emphasised that his advice seemed directed at institutions, stating, “Small businesses and individuals can use hardware wallets, but larger institutions and funds will need bitcoin banks.” 

MicroStrategy, which holds 252,220 BTC valued at nearly $17 billion, remains a significant player in the Bitcoin market. 

The company’s evolving stance on custodianship could influence broader industry practices as discussions around custody options continue.

At the time of writing, the Bitcoin price was $67,353.00.