Biggest institutional bitcoin holder names five culprits in downfall, calls for regulation

For Michael Saylor, founder of MicroStrategy, the lack of regulation in the cryptocurrency industry is the main reason for the high volatility of Bitcoin. His speech took place last Saturday (18) during a conversation with Sven Henrich.

Using the stock market as a comparison, the billionaire says Apple shares would be much more volatile if they weren’t protected by such strict rules. Moreover, he took the opportunity to criticize companies such as Celsius and Three Arrows Capital (3AC).

Saylor’s comments come after his company is with $1 billion in losses unrealized as Bitcoin plunges into the $20,000 region. Therefore, it seems that the billionaire was not so interested in this topic before, when bitcoin was recording new highs.

Michael Saylor outlines the reasons that caused Bitcoin to fall

While he firmly believes that Bitcoin is the best asset in the world, even better than gold, Michael Saylor is not happy with the market’s lack of regulation. quoting the “parade of the horrible”, the billionaire highlighted the reasons that caused Bitcoin to fall.

lack of regulation

The first one One of them would be the lack of regulation against sham trading, where fake volumes are created, which can lead to volatility in the markets, as traders can sell their positions to buy them back at a lower price.

“You can wash Bitcoin and there are no rules about it. This leads to volatility […] this could be corrected by Congress.

Then he mentions that this is only possible due to the large number of exchanges that are not registered, i.e. do not fulfill any legal obligations.

“Offshore and onshore cryptocurrency exchanges are unregistered and unregulated and offer 20x leverage […] sometimes they create a market, in some cases they own some of these tokens, they unilaterally decide when to list them, there are information leaks.

Michael Saylor compared Bitcoin to Apple

By Michael Saylor, oh second The reason for Bitcoin’s downfall also has to do with the lack of regulation in the industry. After all, in addition to wash trading, they also offer giant leverage options to their clients.

“If you had 20x leverage on Apple shares with no washout trading rules. Apple would be much more volatile. Unregulated cryptocurrency exchanges are therefore the second reason.

Tokens are securities, not registered

Already the third The reason for Bitcoin’s downfall is believed to be the thousands of tokens in which investors have no legal cover and their creators can do whatever they want.

“The third [motivo] are the tokens, there are 19,000 unregistered titles. If you look at the top 25 by market cap, they’re all bonds. »

Explaining the link between Bitcoin and these tokens, the billionaire cites the case of Terra (LUNA), possibly the main culprit of the stock market crash after the Discharge of 80,000 bitcoins.

“All are counter-collateralized with Bitcoin. When LUNA soared into the sky they bought BTC and when they crashed they sold BTC.

Unregistered hedge funds and ignorance

Finally, in addition to LUNA, Saylor also cites the bankruptcy of companies such as Celsius e Capital of the Three Arrows (3AC) had a big impact on the recent Bitcoin crash.

“LUNA was one, but Celsius, there’s a whole list, Three Arrows Capital is breaking”, said Michel Saylor. “In some cases, you take the deposits of two million people and then bet on a DeFi protocol. They are therefore unregulated banks.

“It’s a risk for Bitcoin. You have wild banks that evaporate, so the fifth liability is ignorance.

As such, Saylor believes that greater regulation of the cryptocurrency industry would be enough to address Bitcoin’s volatility issues.

However, it is curious that the billionaire did not complain about these factors when bitcoin hit all-time highs.

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