Before diving in, I want to address the context of this piece. I don't want it to feel like a hit piece on Strategy or Michael Saylor, and I want us to acknowledge our own emotional biases. Sometimes we feel like we must die on certain hills — but I contend that all of us came to Bitcoin precisely because we had the ability to change our opinions and fight our own cognitive dissonance.
I've spent considerable time absorbing nearly every Bitcoin podcast — from Coin Stories to What Bitcoin Did, The Bitcoin Podcast, and every lesser-known one — because I want to hear every perspective on this subject. We all know Bitcoin has become a rabbit hole beyond money, into consciousness, physics, health, and more. Perhaps Bitcoin represents a measurement of universal truth. And if that holds true, then we must discuss what that means — not only for Strategy and any other Bitcoin treasury company, but for all of us.
Bitcoin as the Sun
Whenever I find myself explaining Bitcoin to a novice and I can see their brain churning through the "What if" scenarios, I stop them and say: Bitcoin is comparable to the Sun. Our politics don't matter to it. Our armies and rockets don't matter to it. Human laws don't matter to it. We bend our knees to it.
I do this to free people from the idea that everything exists within some control mechanism humans can tinker with. It becomes an exercise in understanding certain human limitations — limitations that not only we face, but that anyone, including Michael Saylor, must face. He exists as part of the collective "we." He doesn't get to accumulate Bitcoin, go on long diatribes about it as digital credit, and have that suddenly change what Bitcoin is.
Bitcoin as a Parallel System
Bitcoin exists as a parallel monetary system to what we currently have. That makes it antithetical to the system we live in. Our current system rewards hoarding — forever — until things centralize to a point of no return. Bitcoin acts as the opposite: it becomes a constant redistribution of wealth.
Let that settle in. A group of whales dumps 100,000 coins on the market — yes, the price goes down — but all the new and small participants like us scoop it up, adding more people to the network. Adoption grows and grows. As Brandon Quittem so eloquently described it, Bitcoin acts as the mycelium of money — a self-healing organism.
The wealth constantly redistributes, repeatedly, until Thiers' Law kicks in. It's vitally important to understand what that means.
Thiers' Law
Thiers' Law (often called the anti-Gresham's Law) is an economic principle stating that "good money drives out bad money." It asserts that when a local currency loses significant value or trust, citizens will voluntarily abandon it in favor of a more stable, reliable alternative.
Named after French statesman Adolphe Thiers, the concept operates under one key condition: people must be free to choose their medium of exchange.
The core mechanic: When an economy experiences severe inflation or collapse, the local currency loses purchasing power so rapidly that merchants and workers refuse to accept it.
Citizen choice: Instead of using the rapidly devaluing legal tender, people coordinate on a harder, more stable currency — historically foreign fiat like US dollars or precious metals, and for those of us in the know, Bitcoin.
This means that as the Bitcoin network pulses wealth distribution while fiat currencies fall apart, Thiers' Law forces Bitcoin to become the only acceptable money. The game plays out through human action — akin to standing on a train track with a train coming. You don't stand there and get hit. Instinct and survival kick in.
The Saylor Question
Now let's process what this means for Michael Saylor and Strategy.
We have established that Bitcoin's design is an anti-hoarding mechanism. If this holds true — and I believe most of us feel that way — it means Michael Saylor will absolutely have to part ways with his Bitcoin. Whatever analogies about digital credit he uses, he ultimately faces a choice that Jeff Booth has repeated many times: in a Bitcoin world, you either provide value to the market, or you part ways with your Bitcoin.
Saylor's ability to accumulate Bitcoin exists entirely within the construct of the fiat system — the Rube Goldberg machine of credit mechanisms, perpetual preferreds, and financial engineering built on a house of cards.
I understand the allure of wanting to underpin our system with Bitcoin the way Strategy underpins their company with it. It sounds compelling — pristine collateral — and maybe it softens the blow of the painful transition ahead. However, Bitcoin is not meant to save the Rube Goldberg machine. It exists as a parallel solution. And as these two worlds converge, they give rise to exactly what Strategy and other treasury companies have sold us: give us your capital, we'll buy Bitcoin, which we believe will grow at 44% a year, and we'll give you roughly 12% of those returns. It relies on the idea that you need to feel safe and protected from this transition by staying inside the Rube Goldberg machine of fiat.
Notice I didn't say the Rube Goldberg machine of Strategy. I don't personally see Michael Saylor as an enemy or even a bad actor. He simply operates within the incentives of the existing system.
Think of Saylor's moves as Pac-Man. Pac-Man exists inside a box. He can go up, down, left, right — eating dots, maybe eating some ghosts along the way — but he never leaves the box. His moves are governed by the physics of that box. He exits one side and reappears on the other.
Bitcoin's game theory exists outside of that Pac-Man box. It is not bound by up, down, left, right. It has its own physics that operate above it. It simply doesn't matter how many sats Pac-Man scoops up, because he cannot control the physics of the box itself.
The Medium of Exchange Question
For all his analogies about digital capital, Saylor never once addresses Bitcoin becoming the medium of exchange — and I've yet to see a single podcaster challenge him on this. The question is simple: what happens when Bitcoin becomes the only accepted money? What happens to MSTR perpetual preferreds and MSTR stock as that transition unfolds?
When the world realizes the real rate of inflation sits at 10–15%, these products essentially break even with their success. Some contend we already live in that world — another break-even instrument in a market that cannot co-exist with Bitcoin's future. The Rube Goldberg machine continues to spin inside the Pac-Man box.
Here's another thought worth sitting with: say Michael Saylor ends up right, and physics and entropy end up wrong. Bitcoin becomes digital capital and never the medium of exchange. Wouldn't that represent a massive failure? Bitcoin — captured. That means we all lose, including Saylor. Part of Bitcoin's value proposition comes from its constant redistribution of wealth. We would have simply repeated gold. Now he sits on massive Bitcoin holdings in a world that can't transact because fiat has destroyed itself.
The fact that fiat is designed to destroy itself is precisely where Thiers' Law kicks in and thrusts Saylor into an inevitable decision. Saylor — a far more intelligent man than I will ever be — must understand this on some level.
People will run for the exits of fiat based on game theory. In that scenario, you must imagine everything fiat-adjacent becomes a fire hazard — including products aligned with Bitcoin when they're wrapped in fiat-based structures and wrappers.
Bitcoin-Backed Loans: The Most Elegant Fiat Trap Ever Designed
I want to address Bitcoin-backed loans specifically, because I believe they represent the most sophisticated fiat trap we will encounter during this transition — and the most dangerous precisely because they feel so aligned with Bitcoin principles.
The pitch is perfect: get fiat liquidity without selling your sats. Keep your Bitcoin exposure, pay back the loan later, never trigger a taxable event. To a Bitcoiner, this sounds like winning. It sounds like having your cake and eating it too.
But look carefully at what is actually happening.
You are using Bitcoin — the hardest money ever created — as collateral to extract fiat, the very currency that is in the process of destroying itself. You are paying interest denominated in a depreciating asset on collateral that is appreciating. And most critically, you are extending your dependency on the fiat system you came to Bitcoin to escape. You haven't left the Pac-Man box. You've just gotten a longer leash inside it.
There is also the matter of liquidation risk. If Bitcoin's price drops significantly during your loan term, your lender will sell your Bitcoin to protect themselves — at exactly the worst moment, at exactly the price you least want. The fiat system's physics are now acting directly on your sats. You handed them that lever.
And then there is counterparty risk. These are centralized entities holding your keys. Not your keys, not your coins. We learned this lesson with exchanges. We are apparently prepared to learn it again.
But the argument I find most compelling operates at a higher level. If Bitcoin-backed loans scale — if millions of people use their Bitcoin as collateral to keep living in fiat — they become a mechanism that props up the fiat system longer than it would otherwise survive. They delay Thiers' Law. They slow the transition. The very tool that feels like Bitcoin-aligned living becomes the instrument that keeps the Rube Goldberg machine spinning a little while longer.
Here is the question I would ask anyone considering one of these products: what happens to your loan when fiat collapses mid-term? What happens to your lender? The contract you signed was written in the language of a system that may not exist by the time it matures. The collateral you posted may not be returned. You built your plan inside the box, and the box has its own expiration date.
These products will feel responsible. They will feel clever. They will feel like you found the cheat code — all the upside of Bitcoin, none of the sacrifice of spending fiat. But the fiat system has always been brilliant at creating instruments that keep you tethered to it. Bitcoin-backed loans are simply the newest, most Bitcoin-flavored version of that long tradition.
Stay humble. Stack sats. And be very careful what you use as collateral for a system you believe is going to zero.
Proceed With Caution
Personally, I find myself perplexed by how many intelligent Bitcoiners want to remain in this construct. If everything stated above holds true, these instruments become another Rube Goldberg machine trap designed to keep people in fiat. I totally understand never wanting to sell your coin — but think again about Thiers' Law. Eventually, you either part ways with your coin by spending it, or you provide value to the world. The Sun's laws kick in again. Our goal here is not to become the new masters of the universe. The goal is for the world to see everything priced in Bitcoin — for products to approach utility cost, or even free.
Jeff Booth recently told a room full of people in Prague that many of them would part ways with their Bitcoin during this transition. I could feel the room's energy recoil — heads quietly saying "that's not me." But Jeff didn't mean it as criticism. I believe he meant it in the context of the fiat system doing everything to keep you trapped — using financial instruments like Bitcoin-backed loans that seem so appealing. He meant it in a more game-theoretic way. Probably why he runs a fund focused on the medium-of-exchange and privacy layers of Bitcoin.
In conclusion, I want to issue a "proceed with caution" memo to all of us — including myself. So many shiny objects will appear in our path during this transition. All of it is part of the journey of reaching toward the Sun and getting burned, over and over, until we stop and acknowledge that this force is far bigger than us.
Stay humble. Stack sats. And remember — you will spend your sats one way or another.
See what Bitcoin's physics actually look like in numbers.
Run the Calculator →— Mike