Michael Saylor Rejects Proof-of-Reserves Over Security Risks
- Michael Saylor says public proof of crypto reserves can lower institutional safety.
- Critics argue that proof of reserves can be made securely without risk to assets.
- MicroStrategy leads the corporate Bitcoin holdings with over 576K Bitcoin secured.
Michael Saylor, the executive chair of Strategy, warned that institutions publishing on-chain proof-of-reserves is a “bad idea” due to security concerns. Speaking on May 26 during the Bitcoin 2025 conference in Las Vegas, he stated that publicly sharing wallet addresses compromises the security of issuers, custodians, exchanges, and investors.
I asked @saylor if @MicroStrategy has any plans to publish on-chain proof of reserves
— Mitchell
His answer will SHOCK you
“It’s a bad idea.”
– Security Risk
– Irrelevant without also having Big 4-audited liabilities
Check it outpic.twitter.com/tIxUckgbEp
(@MitchellHODL) May 27, 2025
He explained, “The current, conventional way to publish proof of reserves is an insecure proof of reserves,” adding, “It actually dilutes the security of the issuer, the custodians, the exchanges, and the investors.” He continued further and emphasized that no institutional-grade or enterprise security analyst would consider publishing all wallet addresses since this makes tracing and targeting easier over time.
He went on to argue that even artificial intelligence, if queried, would generate extensive documentation outlining the security problems caused by public wallet disclosures. According to Saylor, these exposures could undermine companies’ security profiles significantly, increasing risk to all parties involved
Bitcoin Community Debates Transparency Versus Security
Saylor’s comments sparked backlash within the Bitcoin community, especially from advocates of transparency. Stefan Jespers, known as “WhalePanda” on X, criticized Saylor’s position, calling it a “serious red flag” and comparing public wallet disclosure to exposing phone numbers or bank accounts. Jespers stated, “The whole point of Bitcoin is its transparency.” Critics argue that proof-of-reserves can be conducted securely without exposing sensitive information.
For example, Bitwise’s crypto exchange-traded products (ETPs) use a “proof of holdings” mechanism that safeguards assets while ensuring transparency. Cryptocurrency exchanges regularly prove reserves without jeopardizing security.
Proof-of-reserves verify that crypto exchanges hold enough reserves to cater for customer deposits and that funds, such as crypto-tracking ETFs, possess the required crypto assets. Although the industry has learned from collapses like FTX and Mt. Gox, Saylor maintained that proof-of-reserves alone is not a comprehensive or secure solution for institutions.
Related: Strategy Secures $427M to Expand Bitcoin Treasury to $40B
Strategy’s Bitcoin Holdings and Market Overview
According to BitcoinTreasuries.NET, Strategy remains the largest corporate Bitcoin holder globally, with 576,230 BTC valued at $62.6 billion. MARA Holdings, a Bitcoin mining firm, holds 48,137 BTC and is one of over 110 publicly listed firms worldwide that own Bitcoin.
Source: CoinMarketCap Furthermore, CoinMarketCap reported Bitcoin (BTC) trading slightly lower on May 27 at $109,157, reflecting a daily decline of 0.72%. The market capitalization hovered around $2.16 trillion, down 0.71%.
Meanwhile, the 24-hour trading volume rose 3.5% to $50.02 billion, with a volume-to-market cap ratio of 2.26%. The fully diluted valuation remained steady at $2.29 trillion. Bitcoin’s circulating supply remained at 19.87 million out of a maximum supply of 21 million. Price volatility included a peak near $109,880 and lows around $108,000. The token seems to be demonstrating resilience amid moderate price swings.
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