Trump Throws Shade On Crypto

So Trump did that tweet thing again last night. Not that I am surprised, but President Trump tweeted about his dislike of BTC and other cryptocurrencies. Perhaps that is the reason twitter was down hours before. Jack was updating their servers to be able to handle the massive tweet volume following this event.

There is a lot to digest from these tweets. First of all, I for one am not surprised that Trump tweeted his stance on Crypto, nor that it is a negative one. Why would he outright support something that undermines the system that he represents? The United States, which once was a symbol of freedom and inclusion, now represents support for the 1% and is moving towards an Orwellian state.

BTC, whether you like it or not, represents true economic freedom and the ability to move money around the United States—and the world—without censorship. Trump knows that BTC could eventually battle the USD, so there is no reason for him to come out and publicly support it. I find it interesting that his comments came out the same day as the Federal Reserve Chairman Powell stated that “Almost no one uses Bitcoin for payments, they use it more as an alternative to gold. It's a speculative store of value, like gold.” This isn’t a coincidence. BTC is becoming increasingly on their radar.

I have no idea what they plan to do with it. BTC right now is rolling with its “digital gold” or digital store of value theory at the moment, and rightfully so. Look at the price of BTC vs the price of the USD since Trump became President.

A Store of Value (SOV) thesis doesn’t directly compete with the USD as a currency—at least not at the moment. This is where the 2nd tweet in Trump’s crypto thread becomes interesting. Trump directly attacks Facebook’s Libra coin, stating that “If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National and International.”

This to me says that Trump is not going to allow Libra coin to come to fruition easily. They will have to jump through a lot of hoops to put this into fruition. I think Trump knows that BTC is decentralized and cannot be shut down, but Libra is centralized and can be shut down before it even gets started.

And now for Trump’s 3rd point about how the USD is the most dominant currency in the world and will stay that way. All we need for that point is to show one chart…

purchasing power.jpg

Overall, I think there is a couple of points to take away from Trump’s tweets. He is giving cryptos and BTC credibility just by acknowledging them. If they weren’t something to be worried about or a big deal he wouldn’t even waste time tweeting about them. Secondly, it seems as if he is not going to make it easy for “corporate coins” to succeed and sees them as a bigger threat to the USD than BTC. It seems that Powell and Trump view BTC more like gold than actual currency and I think they continue to treat them like gold.