Michael Saylor Thinks Onchain Proof-of-Reserves is a “Bad Idea” – Here’s Why

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Well, well, well, Michael Saylor, the executive chair of the big ol’ Bitcoin-buying outfit Strategy (formerly known as MicroStrategy, in case you missed the memo), has a *hot take* on onchain proof-of-reserves. Buckle up, folks, because this one’s a doozy: Saylor says it’s a “bad idea.” Yes, you heard that right—bad idea, with a capital B.

When asked at the Bitcoin 2025 conference in Las Vegas about institutions adopting the oh-so-trendy proof of reserves, Saylor dropped this nugget of wisdom: “The current, conventional way to publish proof of reserves is an insecure proof of reserves.” Fancy that, huh? The way we’ve been doing things all this time is, apparently, as safe as leaving your front door wide open with a sign that says “Please rob me.”

“It actually dilutes the security of the issuer, the custodians, the exchanges, and the investors. It’s not a good idea, it’s a bad idea.”

Now, if you’re wondering whether Saylor’s own company, Strategy, would be publishing its proof-of-reserves, don’t hold your breath. He gave a firm “no comment” when asked by Mitchell Askew, head analyst over at Blockware Solutions. Guess we’ll all just have to keep guessing, huh?

I asked @saylor if @MicroStrategy has any plans to publish on-chain proof of reserves

His answer will SHOCK you

“It’s a bad idea.”

– Security Risk
– Irrelevant without also having Big 4-audited liabilities

Check it out 👇

— Mitchell ✝️🇺🇸 (@MitchellHODL) May 27, 2025

Proof-of-reserves are kind of like a badge of honor in the crypto world. They’re meant to show that exchanges have enough crypto stashed away to cover their customer deposits. Think of it like a bank showing it has enough cash in the vault to cover the checks it’s handing out. But according to Saylor, proof-of-reserves is a bit like flashing your wallet in a dark alley—probably not the smartest idea if you care about your security.

Saylor did give credit where credit is due, though. He acknowledged the lessons the industry had learned (the hard way) from the spectacular collapses of crypto exchanges like FTX and Mt. Gox. But let’s be clear: proof-of-reserves isn’t the golden ticket to avoid disaster, at least not in Saylor’s book.

“No institutional-grade or enterprise security analyst would think it’s a good idea to publish all of the wallet addresses, such that you could be traced back and forth.”

And if you need more convincing, just take Saylor’s advice: “Go to AI, put it in deep think mode, and ask it ‘what are the security problems of publishing your wallet addresses?’ and ‘how might it undermine the security of your company over time?’” Spoiler alert: AI will write “50 pages of security problems.” Sounds like a thrilling read!

Proof-of-reserves increasingly adopted after FTX collapse

After FTX’s dramatic implosion in 2022, many crypto exchanges, custodians, and even exchange-traded fund issuers jumped on the proof-of-reserves bandwagon, eager to show they weren’t the next ones to go belly up. Transparency, they said! Trust us, they said! But Saylor’s over here like, “Nah, not so fast.”

For the record, Saylor’s Strategy isn’t just any old Bitcoin holder. It’s the world’s largest corporate Bitcoin hoarder, sitting on a whopping 576,230 Bitcoin, which is worth around $62.6 million. Yes, you read that right. If anyone knows a thing or two about holding assets, it’s him.

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2025-05-27 07:42