The Network State Podcast #12 – Michael Saylor

Date: July 16, 2025
Host: ns.com (Balaji Srinivasan)
Guest: Michael Saylor

1. Main Theme & Purpose

“What comes after Google, Facebook, Bitcoin, and Ethereum?”
In this episode, Balaji interviews Michael Saylor about his newly published “Digital Assets Framework,” a vision and roadmap for legitimizing and scaling tokenized assets in the U.S. and beyond. They explore a taxonomy for digital assets, principles for legitimacy and compliance, and a vision for enabling global, low-friction capital markets, ultimately proposing that the U.S. can and should lead in creating the regulatory and technical infrastructure for a next-generation “network state” based on open, programmable digital assets.

2. Key Discussion Points & Insights

A. The Digital Assets Framework: Motivation & Goals

• Observation of Crypto Debate:
  Saylor observed years of fragmented debate and regulatory friction around digital assets, advocating for a structured framework to move debate and innovation forward (00:32–01:58).
• US-Centric Vision, Global Impact:
  By leading in digital asset regulation, the U.S. could provide a template for other countries (Middle East, Singapore, Japan, Europe, South America).

B. Taxonomy of Digital Assets

Six Types Defined (02:15–03:20):

1. Digital Commodity: No issuer, backed by digital power (e.g., Bitcoin)
   • Quote (Michael Saylor, 03:39):
     “It’s a very high hurdle to issue a digital asset without an issuer. It’s very hard, right?... The real key is if you want to create a commodity, you need to create a network, disclaim beneficial ownership.”
2. Digital Security: With issuer, backed by security (e.g., tokenized stocks)
3. Digital Currency: With issuer, backed by fiat (e.g., USDC)
4. Digital Token: Fungible asset with issuer, digital utility
5. Digital NFT: Non-fungible, with issuer, unique digital right
6. Digital ABT (Asset Backed Token): With issuer, backed by physical asset (e.g., tokenized gold, oil)

• Balaji’s Framing (04:53):
  “Let’s say for now at least, digital commodity is sui generis, that’s Bitcoin. And then for your other things, all the other five categories have an issuer...”
• On Tokenizing Capital Markets:
  Saylor emphasizes the ultimate goal is “tokenizing the capital markets. Each one of these is a different form of property.” (03:20)

C. Examples & Implications for Each Asset Class

• Digital Security (“Crypto Equities”):
  E.g., tokenized Apple or MicroStrategy stock, private company equity, venture capital, small businesses (05:28–07:57)
  • Quote (Saylor, 07:57):
    “Existing capital markets... require you to take four years and $40 million to create equity which trades with a four-letter ticker. And that’s the 20th century... what if we could do it in four hours for 40 bucks?”
• Digital Currency:
  E.g., stablecoins like USDC and the benefits of programmable money for accounting, cross-border payments (09:21–10:33).
• Digital Token/NFT:
  Discussion of spectrum from fungible (Ethereum, Solana) to non-fungible (NFTs as tickets, art, “superfan tokens”) and the innovation potential beyond digital art (12:47–17:52).
  • Quote (Saylor, 13:54):
    “If you just characterize them as digital art, you’re kind of underselling them. I think we got to think of them as a unique digital right.”

D. Legitimatizing Digital Assets: Actors & Rights (20:24–23:21)

• Three Main Actors:
  1. Issuers
  2. Exchanges
  3. Owners
• Rights & Responsibilities:
  • Issuers: Right to create/issue assets, responsibility for fair disclosure and ethical behavior
  • Exchanges: Right to custody/trade, responsibility for disclosures and client asset protection
  • Owners: Right to self-custody and trade, responsibility to comply with local laws
• Principle-Based Regulation:
  Saylor advocates for “Ten Commandment” style rules:
  • “Nobody has the right to lie, cheat or steal.” (23:21–27:41)
  • Regulatory bloat is largely redundant if these basic principles are enforced.

E. Structural Innovation in Capital Markets (29:25–34:47)

• Critique of Current System:
  • Current markets (e.g., NYSE/NASDAQ) don’t allow direct asset transfer or global access.
  • “If you have 1,500 digital exchanges in every place in the world... you could have competition.” (Saylor, 31:21)
• Globalization of Capital Formation:
  • Tokenization could enable even small businesses and creators to raise capital globally, similar to how e-commerce enabled global sales (33:51).

F. Practicality: Efficient, Industry-Led Compliance (35:09–38:40)

• Prioritizing Innovation Over Bureaucracy:
  • Start with clear principles (don’t lie/cheat/steal), then define standard data structures for each asset class.
  • Industry, not regulators, should handle compliance and disclosure—reduces friction, costs, and makes compliance affordable.
  • Quote (Saylor, 37:32):
    “If you wanted to raise $100 million, you definitely can’t spend more than $1 million. Not 1%. It’s kind of like saying you gotta buy a $10 million insurance policy to publish a website or express opinion on X.”

G. Historical Context & Regulatory Critique (38:48–44:20)

• Origins of SEC Regulations:
  • Regulation since 1933 (SEC Acts) created a cartel of “approved” capital allocators, excluding small or innovative businesses.
• Data on Listings:
  • Number of U.S. listed companies peaked in mid-90s; dropped by 70% due to rising cost and complexity (42:11).
• Impact on Innovation:
  • Quote (Saylor, 41:10):
    “Are you going to let adults take risks and lose their money?”
    • Excessive safety measures (costly compliance) block most innovation and capital formation.

H. The Renaissance: Tokenizing Everything (57:19–66:57)

• Saylor’s Vision:
  • Lower costs to issue assets ($10–$100k instead of $10M+)
  • Increase issuer base from 4,000 to 40 million in the U.S.
  • Enable vast asset class expansion (art, real estate, collectibles, digital rights, IP, etc.)
  • Quote (Saylor, 59:33):
    “With the right framework, we can usher in a renaissance where you can tokenize hundreds of trillions of dollars of assets... there’ll be a whole range of products and services that come to life on top of those digitized assets.”
• Market Competition:
  • Thousands of exchanges should compete globally, benefiting the “long tail” and democratizing access to capital.
  • “Scale is actually good for the small because if there’s only 10 lenders... but if there’s 10,000, then one of them may actually want to take a chance on that small business.” (Balaji, 33:51)

I. Principles for 21st Century Digital Capitalism

• Core Idea:
  • “The overriding principle is not paperwork... it’s just don’t lie, cheat and steal.” (66:03)
• New Administration, New Opportunity:
  • The U.S. could lead in building this regulatory and technical network state for global benefit.

3. Notable Quotes & Memorable Moments

• On Regulatory Bloat:
  Saylor (23:21):
  “If you simply made those three observations and noted that participants are civilly and criminally liable for their actions, you might eliminate 100,000 pages of regulations... and years of review.”

• On Cryptocurrency Categories:
  Saylor (10:33):
  “We need to break them into four different categories so that people understand they’re four different things for four different purposes.”

• On Innovation Stagnation:
  Saylor (56:37):
  “I haven’t seen an innovation in the way my stock trades on NASDAQ since we came public. Not one. It trades the same way. It’s literally the same thing for 26 years.”

4. Important Segments (Timestamps)

• Introduction & Framework Overview: (00:00–02:15)
• Digital Asset Taxonomy: (02:15–18:57)
• Practical Policy: Rights & Responsibilities of Actors: (20:24–27:41)
• Market Mechanics, Capital Formation, Exchange Competition: (29:25–34:47)
• Practicality & Cost of Compliance: (35:09–38:40)
• Regulatory History, Public Markets Decline: (38:48–44:20)
• The Big Vision: Bringing All Assets On Chain: (57:19–66:57)

5. Recap & Closing

Recapitulation by Balaji (66:03):

• Six asset categories
• Three types of actor (issuer, exchange, owner)
• Overriding principle: Don’t lie, cheat, or steal
• Vision: Any individual or business should be able to raise capital on-chain with minimal friction

“The overriding principle is just don’t lie, cheat, and steal. And this 21st century securities and markets regulation... would be something where any mom and pop could raise money, any asset can go on chain, people can raise debt. All these things that are obvious, that should happen and could happen.” (66:03)

Saylor’s Confirmation: “Yeah, that is a fair summary.” (66:57)

6. Tone & Language

• Analytical, historical, and ambitious, with advocacy for open, permissionless innovation.
• Saylor’s approach: methodical, drawing on personal experience, both skeptical and optimistic.
• Balaji’s style: incisive, explanatory, occasionally polemical, focused on system design and the potential of technology to reshape markets.

If you haven’t heard the episode, this conversation is a robust, high-level discussion between two leading thinkers on how to bring the next trillion (or trillionS) in capital markets innovation, unlocking wealth and participation for millions through clear frameworks, digital identity, and a truly global financial system.