Michael Saylor Criticizes Proof-of-Reserves, Cites Security Risks
Michael Saylor, co-founder of Strategy and Bitcoin advocate, has raised concerns about proof-of-reserves (PoR) during a recent interview. He described PoR as risky, arguing that disclosing on-chain reserve data could lead to security vulnerabilities.
- Saylor stated that revealing reserve wallet information may expose issuers, exchanges, custodians, and retail investors to exploitation.
- He emphasized that current PoR methods disclose excessive information, increasing the risk of malicious fund tracking and hacking.
- Saylor cited previous crypto failures, such as FTX and Mt. Gox, highlighting the need for caution in the industry.
- Strategy has recently acquired 4,020 BTC for approximately $427 million, holding a total of 580,250 BTC, or 2.76% of Bitcoin's supply.
- With a Bitcoin price of $109,500, Strategy's holdings value around $63.8 billion, resulting in over $23 billion in unrealized gains.
The remarks have elicited mixed reactions within the crypto community. Some critics argue that Saylor's stance undermines trustless verification mechanisms essential to Bitcoin’s ethos. Others suggest that modern PoR techniques, like Merkle tree audits, address security issues while promoting transparency.