Strategy founder Michael Saylor says bitcoin’s recent drawdown reflects the normal growing pains of transformative technology, not a broken thesis, and he has the corporate war stories to prove it.
Saylor: Bitcoin Volatility Is a Feature, Not a Flaw
In a wide-ranging with , Saylor compared bitcoin’s roughly 45% decline from its all-time high to similar pullbacks endured by dominant technology stocks, arguing that innovation rarely travels in a straight line. He noted that it has been 137 days since the last peak, framing the period as a routine “valley of despair” rather than a structural failure.
Saylor pointed to ’s multiyear recovery cycle following a 45% drop in 2012-2013, saying the market often undervalues breakthrough technology before ultimately repricing it. In his telling, bitcoin is following a similar arc, with institutional acceptance lagging conviction among early believers.
He argued that underestimate how long it can take for conventional finance to embrace a new asset class. Banks, he said, may need four to six years to fully custody, lend against, and integrate bitcoin into mainstream credit systems.
“You have a situation where the banking establishment is embracing bitcoin at a progressive, but a slower rate than people with short attention spans would like,” Saylor told Brunell. “It’ll take the banks four years, five years, six years before they embrace an entirely new asset class. People would like for bitcoin to be recognized in four months,” he added.
That gap, according to Saylor, constrains bitcoin’s monetization. He explained that while traditional equities can be pledged at major banks for low-cost loans, bitcoin holders often face limited credit access or high borrowing costs. In some offshore arrangements, he warned, collateral can be rehypothecated multiple times, amplifying selling pressure and dampening price action.
He described this as a structural friction, not a flaw in the asset itself. In his view, the absence of a fully formed, non-rehypothecating credit system restrains price discovery. Saylor told Brunell:
“I think what holds down the price of the asset is the lack of a fully formed non-rehypothecating credit system.”
, however, remains central to his thesis. Saylor said bitcoin’s price swings reflect its global utility, operating 24 hours a day, seven days a week. Traders, he suggested, inject capital precisely because the asset moves when other markets are closed.
For long-term investors, he maintained, short-term fluctuations are largely noise. Those focused on a four-year horizon, he said, should view episodic drawdowns as part of a broader upward trajectory.
Saylor reiterated his long-term outlook, projecting approximately 29% annual returns over a 21-year horizon. He acknowledged that returns may come in waves, but he framed that serpentine pattern as inherent to transformative assets.
Beyond price forecasts, Saylor emphasized Strategy’s financial engineering efforts aimed at broadening bitcoin’s appeal. Through various preferred equity offerings, the company has sought to strip volatility from bitcoin exposure while extracting yield.
He described this approach as “ volatility engineering,” reducing price swings in certain instruments while concentrating them in common equity. The objective, he said, is to create products that resemble stable, income-generating accounts rather than roller-coaster equities.
Retail adoption, he argued, hinges on packaging bitcoin’s growth potential into simpler structures. Many investors, in his assessment, prefer predictable double-digit yields with tax advantages over higher-return assets accompanied by steep drawdowns.
Saylor also addressed existential concerns, including quantum computing. He said the broader cybersecurity consensus suggests any material threat remains more than a decade away. Should that risk emerge, he added, global systems — including bitcoin — would likely adopt post-quantum cryptography upgrades.
Saylor insisted that the “consensus of the cyber security community broadly held is that quantum risk, if it exists, is more than ten years out. It’s not a this-decade thing.”
The Strategy CEO added:
“Should a quantum risk materialize at that point then you’re going to see an upgrade in the software that runs the global banking system, the global internet, consumer devices, all the crypto networks, the Bitcoin network — everything digital — they’re going to get upgraded with post-quantum resistant cryptography.”
Throughout the interview, Saylor struck a familiar tone: upbeat, combative and unshaken. He acknowledged that media sentiment can swing from exuberance to gloom, but argued that constant price discovery makes bitcoin and Strategy inherently “interesting” to markets.
In his view, that intensity is not a liability. It is the byproduct of plugging what he calls “digital capital” directly into a public balance sheet.
FAQ 🔎
- Why does Michael Saylor compare bitcoin to Apple? He argues that both endured steep drawdowns before achieving broad institutional validation.
- What does Saylor say is holding bitcoin’s price back? He points to limited traditional bank lending and rehypothecation in shadow markets.
- What is Strategy’s approach to volatility? The company designs preferred instruments to reduce and provide defined yields.
- Is quantum computing an imminent threat to bitcoin? Saylor says that current consensus suggests any material quantum risk is likely more than a decade away.
Author: Jamie Redman
Source: Bitcoin
Reviewed By: Editorial Team
