{"id":32412,"date":"2024-12-27T16:52:20","date_gmt":"2024-12-27T16:52:20","guid":{"rendered":"http:\/\/ci02f01946700027e8"},"modified":"2025-02-19T11:06:27","modified_gmt":"2025-02-19T16:06:27","slug":"michael-saylor-doesnt-understand-bitcoin","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/takes\/michael-saylor-doesnt-understand-bitcoin","title":{"rendered":"Michael Saylor Doesn\u2019t Understand Bitcoin"},"content":{"rendered":"<div id=\"bsf_rt_marker\"><\/div><figure><img decoding=\"async\" src=\"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2025\/01\/1_takes-banner.png\" title=\"\"><\/figure>\n<p>On a <a href=\"https:\/\/www.galaxy.com\/insights\/podcasts\/galaxy-brains\/michael-saylor-on-btc-at-100-k-and-the-future-of-micro-strategy\/\" target=\"_blank\" rel=\"noopener\">recent episode of the Galaxy Brains podcast<\/a>, Michael Saylor made the case that bitcoin isn\u2019t a currency and that it\u2019s best to think of it as capital and capital only.<\/p>\n<p>He also shared that Tether (USDT) and Circle\u2019s USD Coin (USDC) are the real digital currencies and unveiled his \u201cevil genius strategy\u201d (his own words) to get the world to adopt the U.S. dollar stablecoins as opposed to bitcoin.<\/p>\n<p>In this\u00a0<a href=\"https:\/\/bitcoinmagazine.com\/takes\/bitcoin-magazine-introduces-opinion-takes\">Take<\/a>, I\u2019ll cite some of Saylor\u2019s own words from the podcast before breaking down why many of the points he made are off base.<\/p>\n<h2>Capital, Not Currency<\/h2>\n<p>\u201cIt\u2019s not a currency, it\u2019s capital,\u201d said Saylor about halfway through the episode.<\/p>\n<p>\u201cYou just have to come to grips with it \u2014 it is not digital currency. It is not cryptocurrency. It is digital capital. It is crypto capital,\u201d he added.<\/p>\n<p>I searched the <a href=\"https:\/\/bitcoin.org\/bitcoin.pdf\" target=\"_blank\" rel=\"noopener\">Bitcoin Whitepaper<\/a> to see how many times the word \u201ccapital\u201d showed up.<\/p>\n<p>It isn\u2019t mentioned once.<\/p>\n<p>However, in both the title and abstract of the text, bitcoin is referred to as \u201celectronic cash.\u201d While cash can of course also be capital, it\u2019s not only capital. To think of bitcoin only as capital is to deny certain of its most essential properties \u2014 like the ability to use it to transact with anyone anywhere in the world permissionlessly.<\/p>\n<p>To deny bitcoin as a currency is to deny a large part of its value proposition. Bitcoin\u2019s roles as a Store of Value (SoV) and a Medium of Exchange (MoE) are inextricably linked. For more on this, I\u2019d advise you (and Michael Saylor) to read Breez CEO Roy Sheinfeld\u2019s piece <a href=\"https:\/\/bitcoinmagazine.com\/culture\/bitcoins-false-dichotomy-between-sov-and-moe\">\u201cBitcoin\u2019s False Dichotomy between SoV and MoE\u201d<\/a>.<\/p>\n<p>As the episode proceeded Saylor continued to (poorly) make the case for why bitcoin is capital and not currency.<\/p>\n<p>\u201cThere are a lot of maxis who are like \u2018No, we want it to be a currency. We want to be able to pay for coffee with our bitcoin. Pay me in bitcoin,\u2019\u201d he said. \u201cIt\u2019s like \u2018Pay me in gold. Pay me in a building. Pay me with a slice of your professional sports team. Pay me with a Picasso.\u2019\u201d<\/p>\n<p>It\u2019s actually not like that at all.<\/p>\n<p>Sure, bitcoin is scarce, somewhat like gold, Manhattan real estate, sports teams or famous paintings, but it has a number of other properties that make it far different from any of these other assets.<\/p>\n<p>To illustrate a dimension of that point, I\u2019ll cite my colleague Alex Bergeron:<\/p>\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">I invite anyone who thinks Bitcoin is like gold to launch a custodial gold wallet.<\/p>\n<p>I\u2019ll wait.<\/p>\n<p>&mdash; Alex B (@bergealex4) <a href=\"https:\/\/twitter.com\/bergealex4\/status\/1870671827493966206?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"noopener\">December 22, 2024<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>And then Saylor cited \u2014 wait for it \u2014 Fed Chair Jerome Powell\u2019s take on bitcoin in efforts to drive home his point that bitcoin is capital, not currency.<\/p>\n<p>\u201cThe reason bitcoin rallied past $100,000 is because Jerome Powell on stage said to the world, bitcoin does not compete with the dollar, it competes with gold,\u201d he said.<\/p>\n<p>Oddly enough, Saylor said this without acknowledging that the man who said this is the head of the institution that Bitcoin should theoretically replace.<\/p>\n<h2>USDT, Not BTC<\/h2>\n<p>In the interview, Saylor also drove home the point that the real digital currencies are U.S. dollar stablecoins.<\/p>\n<p>\u201cThe cryptocurrency, the digital currency, is Tether (USDT) and Circle (USDC),\u201d he said. \u201cIt\u2019s a stablecoin U.S. dollar \u2014 that\u2019s the digital currency.\u201d<\/p>\n<p>This is when I started to get nauseous.<\/p>\n<p>For those who don\u2019t yet know this, Bitcoin came into the world in the wake of the Great Financial Crisis of 2008, when the U.S. government in conjunction with the U.S. Federal Reserve opted to print U.S. dollars <em>en masse<\/em> (debase the currency) to bail out failing banks, the burden of which was laid both on the U.S. taxpayers and U.S. dollar holders worldwide.<\/p>\n<p>Bitcoin is a decentralized money that was created as an alternative to the U.S. dollar and all other fiat currencies. Trying to convince people that bitcoin is not this is disingenuous at best, deeply manipulative at worst.<\/p>\n<p>But this isn\u2019t even the worst of what Saylor had to say on the episode.<\/p>\n<p>He went on to propose that the banks that got bailed out in the 2008 financial crisis issue their own stablecoins, which would help prop up the U.S. debt market.<\/p>\n<p>\u201cThey ought to just create a normal regime to issue digital currency backed by U.S. treasuries,\u201d said Saylor.<\/p>\n<p>\u201cThe U.S. ought to have a framework so Tether relocates to New York City. That\u2019s what you want, right? And then you ought to basically have a free-for-all where JP Morgan or Goldman Sachs can issue their own stablecoin,\u201d he added.<\/p>\n<p>No, Michael Saylor, that\u2019s not what I want. In fact, it\u2019s very far from what I want.<\/p>\n<p>I don\u2019t want Tether anywhere near New York City (my hometown) and I don\u2019t want JP Morgan and Goldman Sachs issuing U.S. dollar stablecoins that they control, essentially the equivalent of CBDCs.<\/p>\n<p>When I think about Goldman Sachs, the first thing that comes to mind is award-winning writer Matt Taibbi\u2019s description of the institution from his <em>New York Times<\/em> bestseller <a href=\"https:\/\/www.amazon.com\/Griftopia-Bankers-Politicians-Audacious-American\/dp\/0385529961\" target=\"_blank\" rel=\"noopener\"><em>Griftopia<\/em><\/a><em>.<\/em><\/p>\n<p>\u201cThe first thing you need to know about Goldman Sachs is that it&#8217;s everywhere,\u201d began Taibbi in the book. \u201cThe world&#8217;s most powerful investment bank is a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.\u201d<\/p>\n<p>Goldman Sachs, much like the U.S. Federal Reserve, is an institution that sucks the life force from humanity. Bitcoin was designed to take power away from such institutions, not strengthen them.<\/p>\n<p>Toward the end of the episode, Saylor laid out his master plan for bitcoin and U.S. dollar stablecoins.<\/p>\n<p>Here it is:<\/p>\n<p>\u201cEverybody outside the U.S. would give their left arm to be capitalized on U.S. bonds. So, my strategy would be \u2014 and I really think it\u2019s an evil genius strategy; it\u2019s so good that our enemies would hate us, but our allies would complain, too. And the U.S. would make $100 trillion in a heartbeat.<\/p>\n<p>Here\u2019s the strategy: You dump gold, demonetize the entire gold network. You buy bitcoin \u2014 5 million or 6 million bitcoin \u2014 and you monetize the bitcoin network. All the capital in the world, sitting in Siberian real estate or Chinese natural gas or every other currency derivative that\u2019s held as a long-term store of value \u2014 Europeans, Africans, South Americans, Asians, they all just dump their crappy property and their crappy capital assets and they buy bitcoin. The price of bitcoin goes to the moon.<\/p>\n<p>The U.S. is the big beneficiary. U.S. companies are the big beneficiary. And while you\u2019re doing that, you normalize and support digital currency, and you just define digital currency as the U.S. dollar backed by U.S. dollar equivalents in a regulated U.S. custodian that\u2019s audited. What happens next?<\/p>\n<p>$150 billion of stablecoins goes to $1 trillion, $2 trillion, $4 trillion, $8 trillion, probably somewhere between $8 and $16 trillion, and you create $10 to $20 trillion of demand for U.S. sovereign debt.<\/p>\n<p>While you\u2019re taking away a little bit of the demand because the capital asset of bitcoin grows, you\u2019re adding back the demand to back the stablecoin. [The digital U.S. dollar then] replaces the CNY, the Rubble. It replaces ever<br \/>\ny African currency. It replaces every South American currency. It replaces the euro.<\/p>\n<p>If you really believe in U.S. world reserve currency and U.S. values, every single currency in the world will actually just merge into the U.S. dollar if it was freely available.\u201d<\/p>\n<p>At this point, I stopped listening to the episode and projectile vomited all over the New York City subway car in which I was sitting.<\/p>\n<p>I didn\u2019t come into the Bitcoin space to help the U.S. run a scheme in which it acquires a large percentage of the bitcoin while hooking the world on its trash currency, and it deeply saddens me that someone that many in the Bitcoin space look up to would come up with such a conniving plan.<\/p>\n<h2>Bitcoin Is Money<\/h2>\n<p>Bitcoin is money. It\u2019s a type of money that cannot be censored or debased that has spectacularly grown in value over the past decade, making it one of, if not the most, powerful tool ever created for individuals.<\/p>\n<p>To think of it as anything less, or to try to convince people that a new iteration of an incumbent version of money is better than it, is to be deeply misinformed.<\/p>\n<p>While bitcoin is capital, that\u2019s not all it is, and please don\u2019t let Michael Saylor or anyone else convince you otherwise.<\/p>\n<p><em>This article is a <\/em><a href=\"https:\/\/bitcoinmagazine.com\/takes\/bitcoin-magazine-introduces-opinion-takes\"><em>Take<\/em><\/a><em>. Opinions expressed are entirely the author&#8217;s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Saylor is convinced that bitcoin is capital, not currency, and would like to see the whole world adopt the U.S. dollar as money instead.<\/p>\n","protected":false},"author":2510,"featured_media":31573,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[76,246,207,185,64,2012,926],"class_list":{"0":"post-32412","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-takes","8":"tag-bitcoin","9":"tag-fed","10":"tag-federal-reserve","11":"tag-michael-saylor","12":"tag-takes","13":"tag-usdc","14":"tag-usdt"},"author_data":{"id":2510,"name":"Frank Corva","nicename":"frank-corva","avatar_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2025\/03\/Frank_Corva-1.jpg"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2025\/01\/will-bitcoin-etfs-surpass-1-million-btc-before-2025.jpg","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/32412","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2510"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=32412"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/32412\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/31573"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=32412"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=32412"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=32412"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}