“The FTX collapse is an expensive ad for Bitcoin,” said former MicroStrategy CEO and Bitcoin (BTC) bull Michael Saylor.
In a tweet on Monday, Saylor argued that the only future for the crypto industry that is actually viable is “registered digital assets trading on regulated digital exchanges.”
He shared these comments in light of the FTX disastrous collapse. In an interview with Yahoo Finance, Saylor compared the now-former FTX CEO Sam Bankman-Fried (SBF) to Jordan Belfort, aka ‘The Wolf of Wall Street’ – an American entrepreneur and former stockbroker who, in 1999, pleaded guilty to fraud and related crimes in connection with stock-market manipulation and running a boiler room as part of a penny-stock scam.
As reported, FTX filed for Chapter 11 bankruptcy late last week.
In this interview, Saylor said,
“The collapse of FTX and FTT [the exchange’s native token] represents a corrupt crypto bank collapse, fueled by an inflationary fiat cryptocurrency.”
He went on to argue that the vast majority of cryptocurrencies currently in existence are unregistered securities, backed by nothing, trading on unregulated exchanges, which are often based offshore. These, he said, are like fiat currencies. Proof-of-stakes (PoS) tokens, too, are backed by nothing, Saylor added. Notably, Ethereum (ETH) famously transitioned to the PoS mechanism.
Therefore, he said, referring back to the FTX fall,
“This is simply a very expensive lesson for the crypto ecosystem and [on] the difference between crypto and bitcoin. This is going to be really helpful for bitcoin, because this is an educational moment and people are realizing the benefits of buying a cryptoasset that’s backed by the world’s most powerful computing network.”
Asked about this divergence between bitcoin and other cryptos and how many of the thousands of projects would survive, Saylor stated that “you’re gonna see a massive shakeout” and that 99% of the unbacked tokens will disappear.
It’s not only the market that will squeeze out the unsuitable projects but the ever-growing regulations will as well. Saylor said,
“This crash accelerates regulatory intervention. […] This is going to bring in the SEC [US Securities and Exchange Commission] and the CFTC [Commodity Futures Trading Commission] at a much greater rate. And the future of the entire crypto industry is […] registered digital assets trading on regulated exchanges.”
The benefits of the digital space are many, he added. However,
“A good idea pursued in an unethical, irresponsible fashion is a bad idea. […] What needs to replace it are ethically sound, technically sound, economically sound digital assets. The industry needs to grow up.
Meanwhile, Saylor added that BTC is currently moving from weak to strong hands and that there is an “extraordinary” institutional and investor interest in the asset class.
This is not the first time Saylor shared this view, as just recently, he joined CNBC’s ‘Squawk on the Street’ where he argued that the fallout of FTX could benefit bitcoin and spark further growth in the crypto industry.
At 9:30 UTC, BTC was trading at $16,931, up 1.3% in a day and down 18% in a week. Meanwhile, FTT was changing hands at $1.7, up 12% in a day and down 92.3% in a week.