Michael Saylor on Sam Bankman-Fried and Crypto Regulation

05:46 Saylor: …so that stuff’s got to go. And what needs to replace it is ethically sound, technically sound, economically sound digital assets. The industry needs to grow up.

05:53 Interviewer: Michael as a statesman in this industry, those words comparing SBF to Jordan Belfort, those are some big words here. So, is there another way to look at it, in that, you view SBF as a corrupt player in this industry and he needs to be made an example of. Put in jail for what he has done to this space.

06:08 Saylor: He was using counterfeit money and stolen money to lobby against all the virtues in the industry. Against proof of work, against Bitcoin. He was working to corrupt regulations, corrupt the political process. When you have actors that use corrupt, counterfeit, stolen money in order to undermine the industry, its not good for anybody. And so, yea, I think people need to decipher this.

FTX generated an FTT token… if you trade your own token on your own exchange, with wash trading, with leverage, you can park the price at any number you want. So, you want to make a billion dollars, you jack the price by three bucks by wash trading with yourself. Then you generate a billion dollars of collateral, then you look for a bank that will loan you money against the collateral. Of course, nobody in their right mind should be loaning money against an air token that you manipulated yourself, but of course, Sam happened to be CEO of a bank that made loans.

So he applied for a loan from his own bank and he granted it to himself, and then he took real assets, like bitcoin, from his honest customers and then he rehypothecated them, traded them, lost them. And so this is just an egregious ethical lapse and it can’t go on. These exchanges cannot continue to be unregistered, unregulated, offshore.