Bitcoin maximalist and investor Michael Saylor has warned about the potential for BRC-20 tokens to become unregistered securities. However, Saylor is still generally bullish about their wider adoption. In the midst of a BRC-20 craze that nearly crashed a network, a sophisticated understanding of their uses and abuses is critical.
Michael Saylor is the CEO of MicroStrategy and a well-known Bitcoin maximalist. He has made headlines with MicroStrategy’s significant investments in Bitcoin and his persistent defense of the original cryptocurrency.
Michael Saylor’s Nuanced Take
Although, in a recent interview with DeCrypt, Saylor sounded a cautious note. He worried about some of the potential uses of Bitcoin Ordinals and BRC-20 tokens.
“If BRC-20 tokens are viewed as fungible tokens to issue unregistered securities, there’s a lot of objection to that, because it’s unethical. It’s illegal. And you can’t blame [the community] for objecting to that,” Saylor told DeCrypt.
Bitcoin Ordinals actively enable the inscription of satoshis (the smallest Bitcoin units) with non-financial information, making them similar to non-fungible tokens (NFTs).
BRC-20 tokens, on the other hand, are a new token standard on the Bitcoin network. They incorporate a specific type of embedded text. Serving as ordinal inscriptions that establish a set of rules and specifications for creating and managing the tokens.
BRC-20s use Ordinals, but not all Ordinals are ERC-20s.
BRC-20s Could Be Unregistered Securities
BRC-20 tokens could, in certain cases, represent shares in companies or projects. However, their lack of registration with regulators opens the door to potential fraud and market manipulation. Additionally, this situation attracts unwelcome attention to the Bitcoin network.
“What if I was using them to tokenize all of the stocks and ETFs trading on NASDAQ so that individuals can take personal custody of their shares of stock instead of leaving them locked up with a centralized custodian,” Saylor said. “If it was presented that way, then Bitcoiners would love it.”
However, Saylor is generally bullish about their creation and believes it can help drive adoption. “Every time someone builds an application that’s cool on Bitcoin, like all the Ordinals and inscriptions and whatever that are driving up transaction fees, it’s a catalyst,” Saylor told the PBD Podcast.
“The whole idea of burning a piece of data on the blockchain opens the door to the possibility that I might burn a digital signature, or I might burn a registration, or I might burn a hash of a document,” Saylor said.
Earlier this month, the BRC-20 craze overwhelmed the Bitcoin network. The popularity of Ordinals also led to Binance halting BTC withdrawals.
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.
Be the first to comment