- Micahel Saylor believes that Bitcoin’s sound, ethical, economic & technical foundation can solve many issues in DeFi.
- Saylor believes that Bitcoin is the future of money and Lightning is the future of payments.
Bitcoin maximalist and MicroStrategy CEO Michael Saylor believes that Bitcoin can come to the rescue of the fragile decentralized finance (DeFi) market. Saylor’s comments came while responding to an article from Bloomberg explaining the current trend in the DeFi space.
The article talks about two major recent events – the collapse of the Terra ecosystem and the liquidity issues of Celsius Network – which have shaken investors’ trust in the market. These activities suggest some major ground levels issues with DeFi and the growing pains of this young industry. Mahin Gupta, founder of Liminal, a digital-asset custody platform said:
What is happening with Celsius will have serious repercussions for the industry. It’s a not-insignificant player, and its apparent failure will have ripple effects.
Both the episodes – Terra and Celsius Networks – have coincided with the recent market collapse which could also likely bring a bad name to the DeFi space. However, Saylor jumped into saying that Bitcoin holds the ability to solve these issues. He wrote:
The sound ethical, economic & technical foundation for DeFi is Bitcoin. The next generation of DeFi will be built using the #Lightning protocol and the BTC token.
Michael Saylor – Lightning is the future of payments
One of the biggest issues with the Bitcoin blockchain is it offers limited scalability. The average transaction time on the Bitcoin blockchain is 10 minutes thus, it’s not quite reliable as a means of payment for daily transactions.
However, Michael Saylor has full trust in Lightning Network, the Layer-2 scalability solution for Bitcoin. Lightning allows the Bitcoin network to scale its ability to do transactions more efficiently. Thus, Saylor believes that Bitcoin is the future of money and Lightning is the future of payments. He said:
If you’re going to do payments and transactions high speed, you’re going to need a base layer that’s ethically sound, economically sound, and technically sound. That’s what Bitcoin is. But then billions and billions of transactions are going to go on a layer 2 like Lightning.
MicroStrategy, the company led by Michael Saylor has been one of the biggest corporates with a massive quantity of BTC on its balance sheet. The company started buying BTC in August 2020 and so far it has acquired nearly 130,000 Bitcoins. The company is sitting on a loss of close to $1 billion on its Bitcoin holdings after the recent price crash. However, that hasn’t affected Saylor to reconsider his decision. Last month, Michael Saylor said that he will continue to buy Bitcoin even at the top.
Related: MicroStrategy risks margin call as BTC tanks under $21,000, El Salvador denies any financial risk