Michael Saylor Says Proof Of Reserves Is A Bad Idea, Community Calls It A Red Flag

Strategy founder Michael Saylor has sparked controversy with his surprising comment on ‘proof-of-reserves.’ A viral video shows Saylor calling exchanges and companies publishing on-chain proof-of-reserves a ‘bad idea,’ igniting a heated debate on the X platform.

Saylor Thinks Publishing Proof of Reserves Is Not Good

Earlier today, Bitcoin proponent and analyst Mitchell shared a thread on his official X page, revealing Michael Saylor’s approach to proof-of-reserves. During a May 26 event related to the Bitcoin 2025 conference in Las Vegas, Michael Saylor stated, referring to proof-of-reserves, “It’s a bad idea.”

Significantly, Michael Saylor’s skepticism on the idea is primarily driven by its potential limitations and risks. According to the MicroStrategy founder, by publishing the proof-of-reserves, the companies are exposing themselves to security threats and other vulnerabilities. He posited,

The current, conventional way to publish proof of reserves is an insecure proof of reserves. 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.”

Reflecting on the massive debacles of FTX and Mt.Gox, Saylor asserted that the crypto industry can draw valuable lessons from these collapses. However, he believes that publishing the PoR is not the ideal way. He argues that publishing wallet addresses would make it easy to track transactions back and forth, increasing vulnerabilities for issuers, custodians, exchanges, and investors.

To further corroborate his points, the MicroStrategy founder suggests using AI to analyze the security problems of publishing wallet addresses. He claims the AI would generate around 50 pages of security concerns, highlighting potential long-term risks to a company’s security. He noted, “Go to AI, put it in deep think mode and then ask it ‘what are the security problems of publishing your wallet addresses?’ and ‘how might it undermine the security of your company over time.”

This development comes following MicroStrategy’s latest addition of 4,020 Bitcoins, bringing its total holdings to 580,250 BTC.

Community Finds Saylor’s Comments A Red Flag

Notably, Michael Saylor’s critical comments on proof-of-reserves have sparked widespread attention, with some backing his views and others raising concerns about the potential consequences for the industry’s accountability standards. Despite the growing adoption of proof-of-reserves among crypto exchanges following the FTX collapse, cryptocurrency-related crimes are on the rise. Recently, Hong Kong police have cracked a $15 million cryptocurrency laundering ring, arresting 12 individuals involved in the operation.

In response to Michael Saylor’s comments, the crypto community has shared its views. For instance, many questioned Saylor’s approach to transparency in the crypto space. While many endorse Saylor for his Bitcoin investments, his comments on proof-of-reserves have raised eyebrows. Some twitter users even called this a red flag and

As per Grok, PoR shows assets, it doesn’t account for liabilities, raising concerns about solvency. Security risks are valid, but modern PoR methods, like Merkle trees and audits, mitigate exposure. Despite concerns, there’s no evidence linking PoR to breaches. Transparency builds trust, with exchanges like Kraken adopting PoR. The industry seems to lean toward PoR, but the security vs openness trade-off keeps the debate alive.

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Nynu V Jamal

Nynu V Jamal is a passionate crypto journalist with three years of experience in blockchain, web3, and fintech spheres. She has established herself as a knowledgeable and engaging voice in the cryptocurrency and blockchain space. Her experience as an Assistant Professor in English Language and Literature has further added to her quest for crafting informative, well-researched, and accessible content.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.