Binance CEO Changpeng Zhao and MicroStrategy CEO Michael Saylor discussed Bitcoin. The CEO of MicroStrategy realized that Bitcoin is the ultimate store of value for all investors in the world.
Earlier this year, MicroStrategy CEO Michael Saylor announced that the company would buy Bitcoin as part of its investment strategy.
Many members of the crypto market have debated the company’s move. Firstly, it did so because of what that meant for the cryptocurrency and, secondly, because the company benefited from Bitcoin’s huge appreciation.
Changpeng Zhao, CEO of one of the largest crypto exchanges on the market, wanted to talk with Michael Saylor. Binance Regional CEO Josh Goodbody served as a moderator between them.
Bitcoin as a Safe Haven
Saylor admitted that he had not paid attention to the crypto industry until last March. The reason why he took notice of it is that the US economy experienced a significant expansion of the money supply.
“The most important monetary event is the expansion of the M2 money supply. There was an expansion of 5.5% per year for a decade, but this year the jump was about 24%. In the future, the expansion will be 15% each year for the next five years,” explained Saylor.
For that reason, “if the expansion does not exceed the money supply with its returns and investments, it cannot preserve wealth. It is not possible to store value, since a bond that does not yield 15% loses its value”, explained the CEO of MicroStrategy.
The executive suggests that fiduciary investments may lose value through inflation. In particular, he notes that everyone will lose half of their wealth if there is no solution to the problem.
In this sense, Changpeng Zhao says that he does “not own any significant amount of fiat money” but has invested all his funds in cryptocurrencies instead. He adds that he does not buy fiat money with his crypto assets, which he uses directly to pay for goods and services.
Welcoming Bitcoin
Based on what Saylor explained, it is possible to understand why there is an unbridled struggle to find a store of value.
“We know that cash will not work and that the rate of expansion of money supply will degrade bonds, real estate, and securities or fiduciary instruments. When looking for gold, we finally settled on the idea of a perfectly engineered digital gold, something superior to gold in all respects,” explained Saylor.
Therefore, when he found Bitcoin he thought that it was “the ultimate safe-haven asset and store of value for all investors worldwide.” Concerning gold, Saylor discards it as it is obsolete.
Zhao agrees with Saylor in that pension funds and sovereign funds will eventually lose their value, while Bitcoin will remain a good store of value. He says that individuals and public companies are now investing in crypto, so they “will have to abandon the ship [of funds] and hold some Bitcoin.”
Institutional Investors Fall in Love with Cryptocurrencies
One of the most frequent questions in the crypto market before 2020 was: “When will institutional investors join the crypto market?”
MicroStrategy was one of the pioneers but others joined it. This year, the crypto market has seen institutional investors come together and demand the pioneering cryptocurrency.
The CEO of Binance initially saw cryptocurrencies from an individual’s perspective rather than from an institution’s point of view. However, he considers that the current wave of institutional investment “is something refreshing” for the ecosystem.
The Bitcoin Market Will Expand
Changpeng Zhao says that he first heard of Bitcoin in 2013 and started buying it in October that year. In December, he even sold his house for fiat money and quit his job to invest in Bitcoin. He became a little anxious as Bitcoin’s price dropped very quickly at that time.
Saylor said that “what happened in March was a wake-up call. In April, I searched for the truth to rethink everything that I believed about macro investments. In May, it was clear to me that Bitcoin was the future.”
The CEO of MicroStrategy explained that Bitcoin will have three types of investors: those who put their money in gold (about USD 10 trillion), those who have bonds (about USD 17 trillion), and those who invest in great technologies.
“Those three types of people are looking for a store of value. Among these three types of investors, there is USD 150 million.” Therefore, Saylor notes that there is room for growth in the market capitalization of Bitcoin.
By Alexander Salazar
