Donald Trump Is an Unlikely Ally for Cryptocurrencies: Bitcoin’s Power Embodied in Satoshi Nakamoto founding documentis that it frees participants from vague judgments of trust, instead building on a foundation of evidence.
Bitcoin is real. So it was cosmically strange to hear attendees at the Bitcoin 2024 conference in Nashville last week enthusiastically hailing a former president who was one a meticulously compiled accountlied 390,573 times during his one term in office. Believers in the mathematically indisputable blockchain poured out hosannas when Donald Trump he made a speech seething with falsehoods, fabrications, and fantasies. They cheered when he took credit for bitcoin’s meteoric rise in value during his administration—even though they surely knew he had criticized the idea of cryptocurrency until recently.
“Bitcoin, that sounds like a scam,” he said he said in 2021. “I don’t like it because it’s another currency competing with the dollar.” Now Trump has suddenly become the darling of the cryptocurrency world, even though no one believes he has any idea how the tokens work or even what they are. “Staple coins… stablecoins,” Trump said at one point, correcting himself because he was probably looking at the prompter, then paused. “Do you know what a stablecoin is? Does anyone?”
Trump clearly doesn’t. That hasn’t stopped him from making promises that only someone who deeply misunderstands Bitcoin both technically and philosophically would make. He compared Bitcoin to the steel industry of a century ago, a stunning incongruity between an icon of the industrial revolution and a cutting-edge movement of the digital world. He then pledged to make the United States “the crypto capital of the planet and the bitcoin superpower of the world.”
This sentiment, as conference attendees surely know, reverses the basic premise of cryptocurrency and blockchain — a sovereign system that operates without regard to the interests of any nation. To quote cryptocurrency theorist Eric Casona: “Bitcoin offers a radical new hope by which man can free himself from the cage that is every nation-state today.” Trump’s promise that the United States will dominate Bitcoin is a slap in the face to Satoshi.
One of Trump’s proposals is a bitcoin reserve where the U.S. would hold and HODL billions of dollars worth of tokens, which experts say is of questionable value to taxpayers but could boost the currency’s value, which would enrich the Nashville crowd. Again, manipulation by a government superpower is anathema to the value of the blockchain revolution. Another promise from Trump was to pardon Silk Road owner Ross Ulbricht, who is currently serving a life sentence in federal prison for running a massive cryptocurrency operation in illegal drugs and money laundering. So much for being tough on crime.
Despite the oddities, Trump’s alliance with his bitcoin brethren seems all but certain. The cryptocurrency world is chafing at government regulation and sees Donald Trump as an opportunity to ease the state’s grip, perhaps to the point of affable tickling. Trump has encouraged this thinking by meeting with key funders and investors and embracing their views. As if to cement the thinly disguised deal, cryptocurrency players are pouring hundreds of millions of dollars into Trump’s campaign coffers. It’s no wonder Trump promised at a conference in Nashville that he would put an end to “left-wing fascists and totalitarians who are determined to destroy cryptocurrency.” He was cheered enthusiastically for this sentiment. Trump also pointed out that Kamala Harris is one of those “fascists.” “She’s against cryptocurrency, by the way,” he said. “She’s very much against it.” (In reality, Harris hasn’t made her policy clear and has been reaching out to cryptocurrency companies.) The loudest cheers came when Trump announced that on his first day in office he would fire Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), which monitors risky cryptocurrency schemes.
A legitimate question: Does the current White House “hate crypto,” as the industry and Trump seem to believe? I did some digging and found that early in the administration, crypto policy — which admittedly was a relatively low priority during the pandemic — was indeed up for grabs, with some officials viewing it as a fraudulent technology. Ultimately, however, the administration charted a course that attempted to strike a balance between encouraging innovation in the space and enforcing existing securities laws.