The adoption of bitcoin has gained momentum in recent times as investors continue to accumulate more of the digital money. Various market analysts have offered their perspectives on the primary catalyst for this resurgence, and Michael Saylor, the former CEO of MicroStrategy, has also shared his thoughts on the subject.
During a recent interview with CNBC, Saylor pointed out two factors that are driving the widespread adoption of bitcoin. The first of these, according to him, is the apprehension regarding inflation. Saylor is of the opinion that such concerns lead to a decline in trust in traditional fiat currencies, prompting investors to shift towards risk-averse assets such as bitcoin.
He stated: “There’s the macroeconomic concern about inflation and as inflation takes place, people lose confidence in fiat currencies. That means they start to realize that everything valued on cash flow is a currency derivative and bitcoin is not valued on cash flows.”
According to the bitcoin advocate, the recent spate of banking crises, which includes the collapse of financial institutions like Silvergate Bank, Signature Bank, Silicon Valley Bank, and most recently, First Republic Bank, has eroded investors’ confidence in the banking system.
“The failure of the banks… causes people in the Western world to start to lose a little bit of faith in the banking system and they remember that bitcoin is a bank in cyberspace run by incorruptible software… So the combination of that concern about inflation and counterparty risks with banks is driving bitcoin’s adoption,” he added.
Saylor restated MicroStrategy’s unwavering belief in bitcoin’s potential. He emphasized that despite experiencing significant paper losses on its portfolio of around 140,000 BTC at one stage, the business intelligence and software company intends to keep accumulating more of the digital money.