The CEO of MicroStrategy and a celebrity bitcoin (BTC) bull, Michael Saylor, in a recent interview met Bloomberg about the current state of the crypto markets. According to Saylor, there are a number of key factors to note that contribute to the recent downward price pressures and the massive volatility of the crypto markets.
Saylor mentions two things that he believes contribute to lower investor confidence and high volatility. First of all, that is the uncertainty regarding possible regulation of the crypto industry. Especially regulation of the stablecoin sector and whether these cryptocurrencies can be seen as securities, or effects, creates an uncertain situation.
“I think there’s a lot of dynamics here. If you look at the whole crypto ecosystem you have a lot of regulatory uncertainty, especially regulatory uncertainty around stablecoins and crypto tokens and whether they are securities or not. And that creates a bit of anxiety.”
Also the fact that the use of is widely traded leverage, or leverage, says Saylor means that crypto market volatility can be problematically high.
“You have a lot of leverage offshore. You have many crypto exchanges that can trade with leverage up to 20x. And those crypto exchanges have many, many tokens that are cross-collateralized. Between them and the decentralized finance (DeFi) exchanges, you can get much higher than 20x leverage. So that’s the second source of volatility.”
Buy the dip?
Michael Saylor does not seem to care much about the current bitcoin price, despite the fact that he and his company have suffered considerable losses. He believes the current price point is a great opportunity for investors to stock up on bitcoins cheaply.
According to Saylor, especially large institutional investors are very interested in taking a bitcoin position at the current price. They see that bitcoin and crypto are embraced by respected investors, regulators, senators and publicly traded companies. This ensures that little by little the confidence to invest is cultivated, says Saylor.