Bitcoin whale Michael Saylor urges governments to intervene and regulate “horror parade” of cryptocurrencies

The world’s largest public Bitcoin holder has called on regulators to finally tackle a list of dangerous, immature crypto industry practices or “horror parades” that are unfairly burdening the value of its assets.

Microstrategy CEO Michael Saylor argues that the more than 19,000 cryptocurrencies and digital tokens on the market should be considered “unregistered securities” that cannot be likened to a hard commodity like Bitcoin — which has no publisher, no administration. , employees, product cycle and finite supply only.

Talking on a webcast with the founder of NorthmanTrader Sven HeinrichSaylor said Bitcoin had been trapped in the crossfire of a collapsing crypto market, as it often served as collateral for marginal loans for less proven brands.

“What you have is a cloud of $ 400 billion in opaque, unregistered securities transactions without complete and fair disclosure, and everything is securely crossed with Bitcoin,” he said.

He added that major financial institutions often do not touch an asset such as Bitcoin “because of the mud that enters the asset class from all unregistered securities”.

Nouriel Roubini, a respected economist and one of the few who predicted the global financial crisis of 2008, described crypto on Saturday as a ponzi scheme that is collapsing under its own weight.

Such behavior makes Saylor, otherwise critical of government intervention in the free market during the pandemic, believe that regulators must and will eventually intervene to protect investors from bad apples.

The parade of horrors

“If I make a list of the horror parade,” Sailor said, “all the next 10 years will be reversed.”

He argued that even stable multinationals such as Apple would see greater share price volatility if there were no regulations that, for example, prevent wash trading, a practice of artificially inflating prices through trading between two owned wallets and two in the same place.

He cited hedge encryption funds such as Three Arrows Capital or 3AC as an obstacle to facilitating the adoption of cryptocurrencies.

“The general public should not buy unsigned securities from wildcat bankers who may or may not be there next Thursday,” said Sailor, whose company has owned 129,218 Bitcoin since late March.

3AC is in danger of collapsing, in part due to a bet that has collapsed on the value of Luna, the governing badge that backed the failed TerraUSD fixed currency.

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

“Encryption exchanges, offshore and land, are unregistered, unregulated and leverage 20 times, they do not have mature Chinese walls,” said Saylor, referring to a common practice of maintaining different financial services to avoid inherent conflicts.

From the diving market to the “enjoy life”

Saylor himself was hurt as his company borrowed $ 205 million in March to buy more Bitcoin, pledging some of its existing assets as collateral, and fears surfaced last month that Silvergate Bank would require further proof that his company was creditworthy. .

Henrich did not ask about the status of the loan 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 now faces impairment charges of more than $ 1 billion under U.S. accounting rules after the price fell below $ 18,000. last week.

Over the weekend, El Salvador’s president Nayib Bukele appeared to back away from a statement a month ago that tacitly urged investors to buy the dip.

This weekend, the first person to make Bitcoin legal money in his country simply urged fans to “enjoy life” instead of watching the value of their investment fall.

This story was originally featured on Fortune.com

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