Disclosure: The views and opinions expressed here belong solely to the author and do not represent the views and opinions of crypto.news’ editorial.
Michael Saylor plans to burn all of his Bitcoin (BTC), which means he is burning your lifeboat to safety from inflation, and that helps the few, not many. Saylor’s MicroStrategy plans to increase the number of BTC it holds. The accumulation plan again raises questions about Bitcoin’s scarcity, and the questions that arise when few entities acquire such a large percentage of the supply.
Saylor has said himself that he wants to hold one percent of the overall Bitcoin supply. Surely, he is looking to acquire as many BTC as possible for himself. His plan to burn his entire stash should have raised more eyebrows than it has, while also igniting a fervent debate about the implications for Bitcoin’s overall resilience.
Not that it’s any of my business, but I have been thinking lately about all the reasons why Michael Saylor, as a prominent Bitcoin advocate and holder through MicroStrategy, should absolutely not, under any circumstances, destroy his Bitcoin via burning.
It is like burning the lifeboats on the Titanic as it sinks
Burning Bitcoin refers to the process of taking BTC out of circulation forever by sending them to inaccessible addresses that cannot be accessed or used for transactions. Saylor could use his Bitcoin to further his legacy. He could donate the funds to Bitcoin’s developers, build libraries, hospitals, public squares, and more. His name could appear on public spaces the world over.
There are many technical reasons, as well, as to why Saylor should not burn his Bitcoin upon his death, but instead use them to bolster his already impressive legacy and even invest directly into Bitcoin’s future.
Many BTC have already been lost permanently, as a result of lost private keys, hardware issues, and so on. It is estimated that roughly 17-23% of all BTC have been lost, including wallets thought to belong to Satoshi Nakamoto, untouched since 2011. Lost BTC contributes to the asset’s scarcity. Therefore, Bitcoin is even scarcer than the 21 million hardcoded to exist.
Bitcoin is a non-reproducible asset, meaning once they are sent to an irretrievable Bitcoin address, there is no getting them back. You can’t mine more Bitcoin. That’s part of the brilliance of Bitcoin, as has been covered ad nauseum heretofore by the wide-ranging voices of the so-called Bitcoin Community.
Bitcoin is about resistance to centralized control, a hedge against inflation, as well as state overreach. Bitcoin is financial emancipation. Burning Bitcoin symbolically undermines the rebellion. There would be less Bitcoin to save people from inflationary hegemony. Fewer lifeboats.
Bitcoin’s 21 million supply cap is sacrosanct. It mimics gold’s natural scarcity. Saylor destroying his BTC invites speculation about further burns and damages trust in Bitcoin’s predictable issuance, and introduces arbitrariness.
If Saylor were to destroy the Bitcoin, the circulating supply of Bitcoin would be reduced. This would create scarcity that could undermine Bitcoin’s monetary function. Arbitrary supply shocks don’t help Bitcoin’s case for transparency.
Burning his Bitcoin erodes confidence. Saylor supports Bitcoin’s legitimacy by preserving his holdings and putting them to good use. By not destroying his Bitcoin, Saylor encourages adoption and reinforces its value, because his adoption of Bitcoin signals that the digital asset enjoys historical acceptance. Saylor holding onto his Bitcoin and then putting them to some productive use in his will inspires others to also hold Bitcoin.
Saylor should ensure Bitcoin remains part of the economic order for future generations in line with Satoshi’s vision of sound money. If Saylor preserves his Bitcoin by passing it onto heirs or placing them into a trust, Saylor bolsters Bitcoin as a monetary network.
Saylor could use his BTC to support its role as a bulwark against statism and an example of sound money. Burning Bitcoin weakens both Saylor’s legacy and Bitcoin at the same time.
Saylor might consider letting his Bitcoin remain in the market through inheritance or charitable allocation—or otherwise—to preserve private property and economic productivity.
With that said, they are Saylor’s Bitcoin, and he can do whatever he wants with them, including add them to the millions of bitcoins which have already been lost for good in the history of Bitcoin, making the coming supply crunch all the more likely, and bitcoin less likely help the greatest number of people as possible.
