Saylor goes full maxi, slamming everything that isn’t Bitcoin

MicroStrategy CEO Michael Saylor has thrown altcoins under the bus by calling on regulators to do their part in tackling risky crypto industry practices.

Speaking to the founder of technical analysis platform Northman Trader, Saylor told Sven Henrich that a “parade of horribles” is weighing down on Bitcoin and regulators must act accordingly.

A “parade of horribles is dragging down Bitcoin”

In explaining the “parade of horribles,” Saylor listed three factors that negatively impact the price of Bitcoin.

First is the prevalence of wash trading in the crypto space. Unlike stocks, there are no specific regulations that address the wash trading of digital assets.

Wash trading is a form of market manipulation involving simultaneously buying and selling an asset. This practice can create a false picture of what is happening in the market, such as artificially high volume.

This leads to the next factor, which Saylor said was the effect of unregulated exchanges and the market volatility they bring. Expanding further, the MicroStrategy boss talked about a conflict of interest in exchanges acting as both market makers and token holders, in conjunction with wash trading and trading with high leverage.

“If you had 20x leverage trading on Apple stock with no wash trading rules, Apple would be a lot more volatile asset and so would the Nasdaq.”

Finally, Saylor turned to altcoins and said only Bitcoin is a commodity because it has no issuer. He added that the 19,000 other cryptos are unregistered securities. The result is a multi-hundred-billion “cloud” trading without fair disclosure that is “cross-collateralized” with Bitcoin.

“What you have is a $400 billion cloud of opaque, unregistered securities trading without full and fair disclosure, and they are all cross-collateralized with Bitcoin.”

Split in the regulatory treatment of crypto on the cards

On May 18, Securities and Exchange Commission (SEC) Chair Gary Gensler told the House Appropriations Committee that Bitcoin is a commodity “maybe.”

Currently, in the U.S., crypto-assets are governed under the jurisdiction of the SEC and treated under applicable securities laws.

Speaking to CNBC on May 16, the Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam said it makes sense to go through all the cryptocurrencies, classifying each as a commodity or security, and designating the appropriate agency authority accordingly.

“Within this space, in my view, it makes sense for commodities to be regulated by the Commodity Futures Trading Commission and securities to be regulated by the SEC.”

Behnam said that Bitcoin and Ether fit the definition of a commodity in his opinion. But there are also “plenty” of other tokens that fall within that category.

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