BitGo CEO Mike Belshe: Combining All Services Under One Company Is Dangerous for the Crypto Industry

BitGo CEO Mike Belshe has a warning for the crypto industry: putting every service in one company is a bad idea. Speaking at Korea Blockchain Week 2026 on October 2, he said that digital asset firms that combine many functions could cause a collapse similar to the 2008 failure of Lehman Brothers.

His timing is clear. He spoke just weeks after the Clarity Act stalled in the US Senate, leaving the market without the rules many people expected.

Belshe’s main point is that key roles should be kept separate. He believes exchanges, brokerages, and custodians should be separate companies, not parts of the same company.

He compared this to traditional finance. He said that in the usual model, exchanges do not hold customer assets.

To show the risk, he asked readers to imagine the New York Stock Exchange failing. If the exchange also held everyone’s assets, the whole market could fall with it.

He also said a crypto version could be even worse than Lehman. Lehman’s collapse was severe, but he suggested crypto could have wider effects across the market.

Belshe highlighted two main dangers. The first is custody risk.

In crypto, control depends on private keys, which are the credentials that allow access to funds. If a custodian mishandles those keys, users could lose their assets forever.

The second danger is counterparty credit risk. When one firm does many things, customers are exposed to the firm’s overall financial condition, not just the single service they wanted.

Belshe said crypto firms are building these combined businesses without the safety systems found in other markets.

He mentioned Coinbase as an example of this direction. Coinbase has multiple licenses that let it run connected activities across different parts of the market.

This is legal under today’s rules. But Belshe said legal does not always mean safe, especially without the separation rules used in traditional markets.

His position also matters. BitGo focuses on custody, so a system where trading and custody are separate also fits BitGo’s business.

The Clarity Act did not reach the 60 Senate votes needed and stalled on September 15, 2026.

Belshe’s warning comes in that gap. Without a law that clearly separates business roles, firms can keep building combined platforms, and regulators have fewer ways to require separation.

Bringing up Lehman Brothers is intentional. The 2008 collapse became a symbol of what happens when connected financial risks fall apart at the same time.

Crypto has often presented itself as a safer alternative to weak points in traditional finance. Belshe argued that parts of crypto may be rebuilding those same weak points, but without some of the protections.

For investors, the practical issue is where their assets really are. If coins are held on a platform that also trades, lends, or brokers, the user is exposed to all of that platform’s activities, even if they do not realize it.

Belshe’s message gives both retail and institutional users a simple check. Who controls the keys, and what else does that company do with its balance sheet?

On the policy side, the debate about separating trading from custody will likely grow as lawmakers return to market structure bills. A new version of the Clarity Act, or a replacement bill, could become the main place where this debate happens.

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