The ongoing Bitcoin acquisition of MicroStrategy has upset investment banking giant HSBC. Although HSBC is one of the largest business intelligence companies in the world, MicroStrategy is now a “cryptocurrency product”, a term similar to a fictitious Bitcoin ETF linked to a company in a huge Bitcoin account. (BTC) Balance.
Since August 2020, MicroStrategy has been actively acquiring bitcoins and now has over $ 5 billion in bitcoin. Michael Sailor, the company’s CEO, has become an avid supporter of Bitcoin. The sailor’s preaching about bitcoin included trying to get other listed companies to add BTC to the balance sheet. In fact, some other US companies have modeled Sailor’s Bitcoin adoption.
As the corporate adoption of Bitcoin becomes commonplace, the conversation seems to shift towards corporate life, annual profits and government wealth funds to see where the next wave of institutional BTC investments will emerge. For older players such as HSBC, bitcoin and cryptocurrencies in general, this is still a curse, even if the measures taken so far seem random.
MicroStrategy shares blacklisted by HSBC
HSBC blacklisted MicroStrategy shares, preventing customers of the bank’s Canadian online trading platform from buying shares in the company. While HSBC did not respond to Cointelegraph’s request for confirmation of the report, the bank publicly confirmed the news using similar phrases included in the original message customers shared on Twitter.
In a message sent to HSBC InvestDirect customers who already own shares in MicroStrategy (MSTR), the bank said that further MSTR purchases on the platform will no longer be possible. The statement said that these customers could own the current balance of MicroStrategy shares or sell their shares.
According to HSBC, the blacklist was in line with the bank’s cryptocurrency restrictions imposed in 2018. An excerpt from the bank’s policy contained in a letter to HSBC InvestDirect or HIDC, customers read: “HIDC will not participate in facilitating (buying and / or exchanging) a virtual currency product or related products, or indicating the effectiveness of a virtual currency.
In response to the news, Stuart Hoogner, Advocate General for Bitfinex, a cryptocurrency trading platform, told Cointelegraph that the decision was a “step back” in the context of the growing appeal to cryptocurrencies in general, adding:
Instead of opting out of virtual currency-related products, HSBC must focus on providing optimal services to its customers, with many paying high fees and interest costs on bank loans and credit card products. In fact, it is precisely the potential of blockchain technology – by eliminating intermediaries – that can increase the level of inclusion, availability and transparency of financial products. ”
Understand the whole theme
On instruction from MicroStrategy, HSBC referred to the company as a “cryptocurrency product”, hence the decision to ban customers from buying MSTR. However, HDIC lists the shares of several companies heavily involved in cryptocurrencies, including Tesla, Square and Hut 8 Mining, to name a few.
Tesla, electric car maker Elon Musk, bought $ 1.5 billion in bitcoin in February. Hut 8 is a Bitcoin mining organization, and Square runs the Cash app, a way to buy BTC that also contributes significantly to Square’s bottom line.
Unlike MicroStrategy, which has bitcoin on the balance sheet but also operates as a business intelligence company, some of the shares traded on the HDIC platform are owned by companies such as Hut 8, which derive value directly from cryptocurrencies.
Jeffrey Wang, president of the US Army for the cryptocurrency group Amber, told the Cointelegraph: “This is a very slippery slope for HSBC, commenting on the lack of clarity in HSBC’s decision. Will they publish a clear set of rules that regulate what they consider to be companies that benefit from virtual currencies? ”
He also asked: “Why did they not impose these trade restrictions on other companies that publish bitcoin holdings such as Tesla? Will they ban trading on Coinbase? As an HDIC customer, Wang also expressed dissatisfaction with HSBC’s uneven enforcement of anti-crypto policies and added:
“I think this is HSBC, unrelated to the retail offering. If the company is officially listed on Nasdaq and meets regulatory requirements, the decision to purchase these shares should be left to the discretion of the end user and not the broker. “