Clear Crypto Regulations Can Speed Institutional Adoption Says Bitcoin Evangelist, Michael Saylor
Bitcoin evangelist Michael Saylor says clear crypto regulations would speed institutional adoption. Tighter government crypto regulations would actually be a positive catalyst for bitcoin, MicroStrategy co-founder and CEO Michael Saylor told CNBC on Wednesday.
“Additional regulatory clarity from the [Biden] administration is going to benefit bitcoin and accelerate institutional adoption of that asset,”
Saylor said on “Squawk on the Street”, stressing as a major bitcoin believer and holder he’s looking for “clear, bright line definitions of digital property versus a digital security versus a digital currency and the operating rules of the digital exchange.” U.S. Securities and Exchange Commission Chairman Gary Gensler said last month that the agency is planning to crack down on Wall Street, including by creating and enacting rules for cryptocurrency markets. Back in August, Gensler said Congress needs to grant the SEC additional powers to regulate crypto.
“The most important [catalyst] would be a spot [exchange-traded fund] approval,” Saylor said.
“It’s going to be a big deal when that happens because it will really accelerate the pace of adoption especially with institutional investors.” MicroStrategy is an early investor in bitcoin, holding 125,051 bitcoins as of January 31. At current prices around $37,400 per coin that stake was worth nearly $4.7 billion. The firm’s average purchase price was $30,200 per unit including fees and expenses, CFO Phong Le said on Tuesday’s earnings call.
Saylor was less bombastic in Wednesday’s interview compared to past CNBC appearances, where he predicted one day bitcoin will be worth $100 trillion. Bitcoin, which is the world’s largest digital currency, had a total market value around $709 billion on Wednesday according to CoinMarketCap, with the entire crypto market only worth $1.7 trillion.
Incidentally, this lack of clarity has also stymied institutional investors from entering the crypto market. Speaking to CoinDesk, Michael Saylor , CEO of MicroStrategy and Capital Holdings, explained that an important prerequisite to mass-market adoption is for authorities around the world to offer clear regulations surrounding cryptocurrencies.
Saylor said: “The US should lead by setting high standards for disclosure rules which require exchanges and other players in cryptocurrency markets to reveal material information about their operations.” He added that he expects America will set out clear guidelines before any other country.
Compared with other countries, Britain can be seen as a global pioneer when it comes to cryptocurrency regulation; its Financial Conduct Authority (FCA) among the first regulatory bodies worldwide to develop a comprehensive regulatory apparatus for cryptocurrencies.
Saylor noted that regulators should ensure adequate consumer protections, and at the same time avoid stifling innovation by approving only “proven” technology in this regard. He added: “Regulators need to coordinate and cooperate with each other to allow new technology and tools in areas such as data analytics and blockchain.”