Bitcoin: According to Michael Saylor, it is better to hold it than to use it for purchases

A study published by the Bank for International Settlements estimates that Bitcoin does not have the necessary architecture to become a currency for everyday use. Michael Saylor arrives at a similar conclusion but advocates a different solution: to hold BTC as capital and build credit products on top of this asset.

In brief

• The BIS estimates that Bitcoin cannot become a currency for everyday use without a credit system and public guarantees.
• Michael Saylor views BTC as digital capital rather than a means of payment.
• He proposes building private credit products backed by Bitcoin.
• The BIS favors support from central banks to ensure financial stability.
• The bankruptcies of Celsius, BlockFi, and FTX remind us of the risks of crypto-backed credit.

The BIS finds Bitcoin unsuitable for daily payments

Economist Iñaki Aldasoro published a study titled "Money and the Architecture of Trust" on October 14. This 43-page document presents money as promises based on trust, credit, and support from public institutions.
As the market has just plunged again, the author believes that a currency cannot function on a large scale without banks, deposit insurance, and a lender of last resort. He considers that Bitcoin rejects this organization because it does not depend on any issuer and its supply cannot adapt to economic needs.

His reasoning is based on several main ideas:

• Money allows for the definitive settlement of an obligation;
• Credit constitutes a promise of future payment;
• Banks create means of payment through credit;
• The central bank provides liquidity in times of crisis;
• The state and deposit insurance distribute potential losses;
• Bitcoin has no equivalent public mechanism.

"Bitcoin aspires to become a currency without the architecture that allows money to function," writes Iñaki Aldasoro. According to him, its limited supply of 21 million units prevents the system from responding to a sudden increase in liquidity demand.

The economist also recalls the difficulties faced in El Salvador and the Central African Republic after adopting BTC as legal tender. In both countries, its daily use has remained limited. However, this observation is not sufficient to demonstrate that Bitcoin will never serve for payments in other contexts.

The document is also a personal analysis. The BIS clarifies that the opinions expressed are those of the author and do not necessarily represent its official position or that of its member central banks.

Michael Saylor sees BTC as digital capital

Michael Saylor no longer presents Bitcoin as a currency intended to directly settle every purchase. The executive chairman of Strategy considers it primarily as rare digital capital, comparable to a reserve asset on which financial products can be built.

His position thus partially aligns with that of the study. Both approaches recognize that BTC does not yet fulfill the role of a daily currency or unit of account. Salaries, contracts, and prices remain primarily expressed in national currencies.

Saylor, however, wishes to develop a private credit layer above bitcoin. Users would retain BTC as a base asset, while preferred stocks, bonds, or less volatile digital currencies would serve for payments and yield seeking.

"Digital capital forms the foundation of digital assets and digital credit," he stated. He particularly advocates for a dollar-indexed product that would combine bitcoin-linked credit instruments with cash equivalents.

This organization recalls the historical role of gold. The metal remained in vaults, while banks issued claims used for payments. The BIS study describes this model as a "credit superstructure," but it does not consider that Bitcoin could replace gold or central currency in this system.

The Disagreement Concerns Trust and Crisis Management

The BIS and Michael Saylor agree on the need for a credit layer. However, they diverge on the institution responsible for ensuring its stability.

For Aldasoro, large-scale trust requires public support. A central bank can inject liquidity when private lenders withdraw. The state can also protect deposits and prevent an isolated bankruptcy from destabilizing the entire system.

Saylor prefers a private organization. In his model, shareholders and holders of the riskiest products absorb bitcoin's fluctuations first. Each instrument then offers a different level of yield and protection.

Recent history, however, invites caution. Celsius, BlockFi, and FTX had already built credit activities around cryptos before their collapse in 2022. Their disappearance showed that a claim backed by a digital asset can fail if leverage, governance, or reserves are poorly managed.

The debate is therefore no longer just about bitcoin's ability to pay for a coffee. It concerns the solidity of intermediaries that will transform a volatile asset into usable credit. The scarcity of BTC may support its role as a reserve, but it does not guarantee either the solvency of issuers or the security of the proposed yields.