In a world where digital currencies are rapidly gaining traction, Michael Saylor, Executive Chairman and Co-Founder of MicroStrategy, firmly believes that Bitcoin is poised to eclipse gold as a leading asset.”
In a recent interview with Kitco News at the Bitcoin 2023 conference in Miami, Saylor shared his views on the future of Bitcoin, gold, and banking.
Saylor presents a highly bullish stance on Bitcoin, suggesting it will outperform gold, leading to a complete transition of gold investors to Bitcoin. He bases his argument on the digital nature of Bitcoin, viewing it as the “digital synthetic successor to gold,” with faster appreciation rates, lower costs of custody, and no counterparty risks. He also highlights the decentralized nature of Bitcoin’s blockchain network, which offers protection against inflation and a store of value due to its limited supply cap.
MicroStrategy’s investment in Bitcoin since August 2020 has proven successful, with a 140% increase in the asset’s value, significantly outperforming other indexes and commodities. Saylor contrasts this performance with gold, which he sees as a failure due to its slow technological progression, centralizing tendency, high holding costs, and constant debasement by gold miners.
Saylor, describing himself as a “Bitcoin realist,” predicts that the future of Bitcoin will involve large institutions, corporations, and churches, indicating the need for custodial and banking infrastructure for Bitcoin. He explains that due to regulatory requirements, it’s not feasible for corporate leaders to self-custody Bitcoin.
The interview also touched on the topic of bank failures, which Saylor views as political decisions rather than economic inevitabilities. He points out that politicians can choose to support failing banks or allow them to collapse, thereby affecting creditors and equity-holders. He cites the recent failures of Silvergate, Silicon Valley Bank, Signature, and First Republic Bank as examples, noting that the federal government and Federal Reserve bailed out depositors while the banks were allowed to fail.
Saylor ended with a cautionary note on banking, advising against keeping money in weak banks or banks located in countries with weak currencies. Despite this, he expressed confidence in U.S. deposits but showed skepticism towards the securities of smaller banks.