Michael Saylor’s proposal to incorporate Bitcoin reserves into regulated banking
Michael Saylor, Executive Chairman of Strategy, has proposed that national governments explore a new type of financial system: regulated digital banking platforms supported by Bitcoin reserves and tokenized credit instruments.
These remarks, made during Saylor’s keynote at the Bitcoin MENA conference in Abu Dhabi, align with his broader perspective that digital assets can be integrated into mainstream financial systems.
Saylor’s suggestion comes as Strategy continues to grow its Bitcoin holdings, including a recent acquisition of 10,624 Bitcoin (BTC) valued at around $962.7 million. The firm now possesses 660,624 BTC, reinforcing Saylor’s belief that digital assets have a lasting role in financial ecosystems.
Saylor’s vision is rooted in Strategy’s experiences with Bitcoin-linked financial tools. Earlier in 2025, the company launched STRC, a preferred share designed to function like money market instruments. With a variable dividend rate, STRC aims to maintain a stable price near its par value.
STRC has achieved a market cap of approximately $2.9 billion. While reflecting elements of Saylor’s vision, it still operates under conventional market constraints, including shifts in liquidity and investor sentiment.
Saylor’s framework: A structured Bitcoin-backed digital banking model
Saylor envisions a system where licensed national banks provide digital accounts backed by a combination of overcollateralized Bitcoin, tokenized debt instruments, and fiat reserves.
Saylor proposed an 80% allocation to tokenized credit and 20% to fiat, along with an additional 10% reserve buffer designed to enhance liquidity and stability, though the exact structure would depend on regulatory definitions of reserves and safeguards.
For the crypto component, he suggests a 5:1 overcollateralization ratio, meaning collateral would significantly exceed the underlying credit obligations.
As Saylor envisions it, these structures could serve as digital banking products that grant regulated exposure to new types of collateral. He argues that countries adopting such models could draw international savers seeking diversified, regulated options. In his presentation, he positions the model as a potential alternative for policymakers.
Did you know? Michael Saylor co-founded Strategy (formerly MicroStrategy) in 1989, initially establishing the company as a vendor of enterprise business intelligence and analytics software. Over time, it gained notoriety for its extensive Bitcoin strategy.
Why countries may need to consider alternatives
Countries may need to reevaluate the structure and performance of their traditional banking systems, especially in regions where deposit yields remain consistently low. This may lead policymakers to explore whether digital asset collateral could play a role in expanding options available to investors and institutions.
Persistently low returns on traditional deposits in key markets
Saylor noted that deposit interest rates in areas like Japan, parts of Europe, and Switzerland are nearly zero. In higher-rate environments such as the US, depositors compare bank rates against alternatives like money market funds.
He argues that this situation has prompted some investors to pursue higher yields through options like corporate bonds. As a result, Saylor suggests that governments may want to evaluate whether digital-asset-backed models could widen the range of secure, regulated savings choices.
Increasing global competition for investment capital
Saylor emphasizes how global capital flows depend on elements like clear regulations, trustworthy institutions, and diverse offerings. He contends that a jurisdiction with strong digital banking regulations could attract cross-border investors.
Saylor anticipates that a nation adopting this framework could attract between $20 trillion and $50 trillion in capital, effectively positioning itself as a digital banking center.
Did you know? Before entering the crypto space, Saylor gained notoriety for authoring “The Mobile Wave,” a book that posited that mobile technology would transform global communication and commerce.
Potential implications of Saylor’s proposals for the financial landscape
If a country explores Bitcoin-backed digital banking models, several outcomes may ensue. Here’s a brief overview:
Innovation in financial product design: A regulated digital bank with hybrid collateral pools would introduce a new type of financial product. It would merge traditional credit markets with digital asset reserves, creating a unique model.
Strategic positioning in digital finance: Countries experimenting with Bitcoin banking could evaluate whether these frameworks strengthen their financial systems. The results would depend on regulatory, economic, and technological factors.
Evolution of banking infrastructure: Establishing Bitcoin banks would necessitate updated supervisory frameworks, new auditing standards, and stress-testing methodologies. It would also need to align with existing digital asset regulations.
Did you know? Strategy ranks among the world’s largest corporate holders of Bitcoin, having acquired hundreds of thousands of BTC over the years through periodic purchases.
Skepticism and considerations surrounding Saylor’s proposal
Saylor’s proposal has generated discussions within financial circles. Several factors related to Bitcoin banks require careful consideration:
Bitcoin’s price volatility
As of Dec. 12, 2025, Bitcoin has been trading below $100,000, fluctuating around $90,000, roughly 29% lower than its October 2025 all-time high of about $126,080. Despite this, compared to Dec. 15, 2020 (about $19,420), that represents an approximate gain of 360%. Bitcoin’s inherent volatility must be considered in any digital-asset banking model.
Liquidity and market stress risks
There are concerns regarding whether Bitcoin-backed credit instruments could endure rapid withdrawal scenarios. Former Salomon Brothers trader Josh Mandell has raised issues about liquidity risk in STRC-like instruments if market conditions change suddenly. These concerns highlight the necessity for thorough stress testing and strong safeguards in any banking model involving Bitcoin collateral.
Regulatory and operational challenges
To introduce a Bitcoin-backed national banking system, countries would face substantial policy and operational challenges.
