Trump’s love affair with Bitcoin

Original author: Huo Huo, Vernacular Blockchain

On September 15, the Republican presidential candidate and former president of the United States, Donald Trump, escaped another assassination attempt. This was the second assassination attempt Trump encountered in just two months. Just on July 13, Trump was shot at a campaign rally in Pennsylvania, injuring his right ear.

Since Biden announced his withdrawal from the 2024 US presidential election on July 21, Trumps competitor has changed from 81-year-old Biden to Harris, who is nearly 20 years younger and energetic. Harriss support rate has been rising, making the situation that seemed to be a sure win confusing again.

In order to win more support, Trump took the lead in frequently showing goodwill to the crypto industry. At the Bitcoin Conference on July 27, Trump said that if he was re-elected, he would fully support the development of crypto and would be committed to making the United States a Bitcoin superpower. Putting aside the question of How credible are Trumps Bitcoin Conference promises?, he did make many promises to win the support of crypto voters.

From haters to fans, how did Trumps attitude towards the crypto industry come to this point today? What possible impacts will it bring?

01 Trump’s transformation from a hater to a fan of crypto assets

Trump was born on June 14, 1946, grew up in New York City, and graduated from the Wharton School of the University of Pennsylvania. He is the son of real estate developer Fred Trump. With the help of his family business, Trump accumulated considerable wealth and fame in the 1970s and 1980s. His assets involved the real estate market in New York City and multiple commercial projects, including Trump Tower and several luxury hotels and casinos. For details, see Former US President Trump Raids Web3, From Cursing Bitcoin Scams to NFT Really Fragrance in Just One Year?

Trump later became further famous for his role as the host of NBCs reality show The Apprentice, in which he became popular in the public eye with his public image as a shrewd businessman.

In 2015, Trump officially announced his candidacy for the 2016 US presidential election as a Republican candidate. Then in November 2016, he successfully defeated Democratic candidate Hillary Clinton and was elected the 45th President of the United States.

1) Identified anti-fans

During his presidency (January 20, 2017-January 20, 2021), Trumps attitude towards crypto assets was generally negative. His early stance on crypto can be traced back to July 2019, when he publicly criticized Bitcoin and crypto assets on Twitter for the first time. In his tweet at the time, he made it clear that he was not a fan of Bitcoin and other crypto assets, criticized Bitcoin for not being a real currency, and pointed out that it was extremely volatile and based on thin air and would not be surprised if it fell below $6,000; in addition, he expressed concern that Bitcoin and other crypto assets might be used for illegal activities, such as drug trafficking and other illegal activities.

In 2020, Facebook plans to launch the digital currency Libra (now called Diem). Trump criticized Libra on Twitter, saying that the United States has only one real currency, the US dollar, and any other crypto assets that attempt to replace the US dollar should be strictly regulated. He believes that only a regulated financial system based on strong national currencies such as the US dollar can guarantee stability and security.

During Trump’s presidency, his government also adopted a more conservative and strict policy stance on crypto assets:

• Anti-money laundering and terrorist financing: The Trump administrations main concerns about cryptocurrencies focus on their potential illegal uses, including money laundering, tax evasion, and terrorist financing. The Financial Crimes Enforcement Network (FinCEN) under the U.S. Treasury Department has strengthened supervision of crypto asset transactions and requires crypto trading platforms to comply with anti-money laundering (AML) and know your customer (KYC) regulations. Treasury Secretary Steven Mnuchin has also repeatedly stressed that crypto assets pose a threat to national security and require increased supervision.

• Securities Regulation: Under Trump’s leadership, the U.S. Securities and Exchange Commission (SEC) continues to crack down on unregistered crypto asset securities offerings. The SEC has launched enforcement actions against multiple ICO projects, alleging that they failed to register as securities sales. In addition, the Trump administration has also stepped up its scrutiny of crypto trading platforms to ensure that they comply with existing securities laws.

• Homeland Security and Law Enforcement: During President Trump’s term, the U.S. Department of Homeland Security (DHS) and the Federal Bureau of Investigation (FBI) have also increased their monitoring of crypto assets to combat cybercrime and illegal activities. The Trump administration has repeatedly emphasized that illegal activities using crypto assets (such as drug trafficking, cyber attacks, etc.) are a major threat to national security.

Trump did not talk much about crypto assets during the 2020 presidential election, but his administration has taken a tougher regulatory stance on crypto assets. Treasury Secretary Steven Mnuchin and other government officials have repeatedly stressed the need for strict regulation of crypto assets and mentioned that these assets could pose a threat to financial stability.

Overall, Trump’s early comments reflected his highly skeptical and negative attitude toward crypto assets.

2) Gradually turn haters into fans

After leaving office, Trump has repeatedly criticized Bitcoin and crypto assets in media interviews. He believes that these digital assets may be used to undermine the US financial system and national security. But at the same time, he also acknowledged the rapid growth of the crypto market, and mentioned that the government should take measures to strengthen the supervision of crypto assets to prevent them from being used for illegal activities. But this tone is milder than his previous opposition during his presidency, and it also shows his attention to this field:

Attitude softened

In an interview with Fox Business in 2021, Trump said he hated Bitcoin because it was competing with the US dollar, viewed it as a competing currency, hoped that the US dollar would become the currency of the world, believed that they could facilitate criminal activities, and stressed that the government should regulate it more strictly.

In an interview with One America News, Trump called crypto assets a dangerous investment and warned investors to be careful.

Changing stance

According to relevant news, Trump announced on November 15, 2022 that he would participate in the 2024 presidential election. Subsequently, using his personal brand and influence, Trump launched a series of NFTs with his own image as the content, which marked Trumps entry into the crypto asset and digital collectibles market:

• December 2022: Trump launched his first NFT series, which totaled 45,000 pieces and sold for $99 each. These NFTs showcase Trumps various virtual images, such as superheroes, historical figures, etc., which also marked his official entry into the crypto market.

• June 2023: He launches the second series of NFTs, which continues to focus on Trump’s image, but adds some designs and themes and introduces some rare versions.

• March 2024: The third series of NFTs goes online, once again emphasizing scarcity and limited edition features, while providing more interactive opportunities, such as tickets to virtual events and online meetings with Trump.

When launching NFTs, Trump called them precious collectibles. He acknowledged the uniqueness and scarcity of NFTs and took the opportunity to attract the attention of supporters and investors while providing fans with a new way to interact with him. In addition, in an exclusive interview with Trump by Bloomberg Businessweek on July 16 this year, he said that he would soon launch a fourth NFT series with his image as the content.

Go on the field to canvass for votes

In 2024, Trump frequently appeared in the crypto circle and publicly issued crypto-friendly declarations many times. However, before exploring the reasons behind it, we need to understand the US presidential election system. The US presidential election (also known as the US general election) is held every four years and is divided into five steps: primary election, national convention, presidential election, electoral vote, and US Congress confirmation. Take this years election as an example:

• Primary election: From mid-January to June 2024, the Republican and Democratic parties will hold primaries or caucuses in each state to select the party candidates supported by the state.

• National Conventions: The Republican National Convention will be held from July 15 to 18, 2024, and the Democratic National Convention will be held from August 19 to 22. The two parties will select their respective presidential candidates and officially announce their vice presidential candidates.

• Presidential election: will be held on November 5, 2024, and citizens can vote for any presidential candidate (regardless of their political party, whether they participated in the primary election, or who they voted for previously).

• Electoral vote: The US presidential election adopts the Electoral College system. Each state allocates electoral votes based on population. A candidate who wins the majority of popular votes in a state can win all the electoral votes in that state. A candidate who wins more than 270 electoral votes can be elected president. The Electoral College vote is held in each state on December 17. Before January 3, 2025, the electoral votes are archived and transferred to Congress.

• The U.S. Congress confirmed: According to U.S. federal law, the U.S. Congress must hold a meeting on January 6, 2025 to count and announce the results of the Electoral College vote, and the winner will hold the presidential inauguration ceremony at the Capitol on January 20, 2025.

This also explains why Trump has frequently made many promises in favor of the development of cryptocurrencies in all presidential campaigns so far in 2024. As a candidate, he supported accepting donations from crypto assets early this year and attended the 2024 Bitcoin Conference on July 27 and gave a speech. The specific statements or promises about Bitcoin or crypto assets are as follows:

A. Bitcoin has developed independently. More and more people want to use Bitcoin for payment and are beginning to prepare to accept Bitcoin, but some supervision is needed.

B. If re-elected as president, his administration will not crack down on the use of Bitcoin or other crypto assets through regulators, and he expressed the hope that U.S. crypto businesses will not be driven overseas.

C. If re-elected, he will commute the sentence of Silk Road founder Ross Ulbricht and firmly support the development of the crypto industry.

D. He proposed at the Bitcoin Conference to create a national Bitcoin reserve and set up a Bitcoin and Crypto Asset Advisory Committee to support the development of the industry. He also said that if elected, he would fire Gary Gensler, the current chairman of the U.S. Securities and Exchange Commission (SEC), to end his persecution of the crypto industry.

E. will secure all Bitcoin jobs in the United States during his presidency, promote innovation and economic growth, and will never allow the creation of a central bank digital currency (CBDC).

F. In an interview, Trump mentioned that Bitcoin mining could be the last line of defense against CBDCs and wants Bitcoin to be made in the United States to help achieve energy dominance.

G. Crypto assets will not disappear. The U.S. crypto industry has a solid foundation, but it is still in its early stages. He emphasized that he does not want other countries to dominate this field.

H. Plans will soon be formulated to make the United States the global crypto asset capital.

I. In addition, in February of this year, Trump’s campaign team announced that it would accept donations of crypto assets. Supporters can donate any crypto assets through the Coinbase Commerce product. The crypto assistant of Trump’s campaign team revealed that he had asked whether Bitcoin could be used to solve the U.S. debt problem.

J. On September 16, Trump and his son also announced the co-founding of a new crypto platform, World Liberty Financial, which aims to become a decentralized finance (DeFi) platform that provides lending, digital asset storage and other services.

As the US election (early November) approaches, it can be seen that Trumps attitude towards encryption has changed from suspicion and opposition to acceptance and support. This is because he has gradually realized the importance of encrypted assets in the political, economic and technological fields, and incorporated them into political strategy, proposing a number of policies and suggestions to support the development of encryption.

Trumps pro-crypto stance has indeed attracted a portion of Republican voters and supporters of the crypto industry, and his campaign has received a lot of financial support from the crypto industry, which suggests that he may further promote the development of the crypto industry in the future.

Trump has also had some impact on the crypto industry. In May of this year, after Trump made comments on crypto assets, the Trump-themed memecoin MAGA (TRUMP) soared 78% on May 9. In addition, during Trumps speech at the Bitcoin Conference, the crypto market fluctuated violently. The price of Bitcoin first fell by $1,200, falling below $67,000, and then rebounded quickly at the end of the speech, breaking through $69,000, approaching the high of $70,000 in March this year.

02 Summary

In general, in order to gain more support from crypto voters, Trump has repeatedly emphasized that if he is re-elected as president, he will adopt a more relaxed crypto policy, support the establishment of a clear regulatory framework, set up a Bitcoin and Crypto Advisory Committee to develop transparent regulatory guidelines, and oppose the establishment of a central bank digital currency (CBDC). Specifically, he will fire the current chairman of the U.S. Securities and Exchange Commission to end the persecution of the crypto industry, and establish a national Bitcoin reserve to enhance the United States leadership in the global digital financial field.

But there is no love without reason in the world. Trumps attitude change from crypto-hate to crypto-friendly, from calling Bitcoin a scam to viewing it as a technological innovation, the most direct purpose behind this change is to win votes for crypto bosses and the political forces they mobilized.

David Berry, the organizer of the Bitcoin 2024 conference and CEO of Bitcoin Magazine, pledged to raise $100 million in donations for Trump and mobilize more than 5 million voters to support him. Although this may be a negotiation strategy for business cooperation, such a large-scale Bitcoin conference itself shows its political power that cannot be ignored, especially among young people and people of color, who are the main supporters of encryption and are also the vote base that Trump is eager to win, which is an important support base for the Democratic Party.

Therefore, whether it is fundraising or votes, Trumps clear attitude is one of his strategies to seize the initiative, strike his opponents, and gain the support of crypto voters. This will also prompt his opponents to adopt more friendly policy responses. Well-known investor and crypto supporter Mark Cuban once said that Harriss advisory team had consulted him about the crypto industry. On September 22, Harris publicly expressed his support for increasing investment in artificial intelligence and the crypto industry for the first time.

It can be said that no matter who is elected in the future, the increasing importance of crypto voters in the US election will further promote the compliance development of the crypto industry. Under the premise of paying attention to national security and financial stability, more friendly crypto policies will be promoted to a certain extent.