May 30, 2024 - Economy

Trump's head-spinning turnabout on cryptocurrency

Photo illustration of Donald Trump hugging a golden crypto coin.

Photo illustration: Aïda Amer/Axios. Photo: Al Drago/Bloomberg via Getty Images

Former President Trump likes cryptocurrency now — a lot, which is a surprise to anyone who has been following the industry's political fortunes.

Why it matters: The cryptocurrency industry, which may not have that many people but definitely has a lot of money, has never been more politically organized as the U.S. heads into a presidential election.

  • This contrasts the administration of President Biden, which has been seen as primarily hostile to cryptocurrency so far.
  • However, at the congressional level, there's been a sudden thawing of frosty opinions on crypto. Leaders on both sides of the aisle appear to be following Trump's lead in wooing the industry.

The latest: "Our country must be the leader in the field. There is no second place," Trump wrote on Truth Social this week.

  • The former president invited holders of his NFT series to his home in Florida, at Mar-a-Lago, where he committed to end the regulatory hostility to the industry if re-elected.
  • Then at the Libertarian national convention, he made promises to free Ross Ulbricht, convicted for creating the Dark Web marketplace, the Silk Road.
  • He also promised he would free Julian Assange, the embattled creator of the website Wikileaks.

By the numbers: In filings last year, Trump disclosed a million dollars in holdings of ether, with a few million more dollars in cryptocurrency income.

  • Arkham Intelligence, which attempts to link digital addresses to real people, said that a wallet it believed to be Trump's now holds assets worth more than $10 million.
  • The most valuable asset in that wallet is actually holdings of the Trump (MAGA) token, which is up almost 50X this year (not to be confused with the Solana memecoin, TREMP).

Flashback: In July 2019, then-President Trump tweeted that he was no fan of Bitcoin. He said the dollar was the only real currency in the USA.

  • It went further than that. Late in his presidency, the Financial Crimes Enforcement Network (FinCEN) proposed a regulation that would have required financial firms to collect the identity of any cryptocurrency wallet a user sent funds to (in government parlance, an unhosted wallet).

At the time, then-Treasury Secretary Steven Mnuchin said: "As the President has said, Bitcoin is highly volatile and based on thin air. We are concerned about the speculative nature."

  • The initiative ultimately went nowhere.

Zoom out: Congress has shown itself as more willing to consider voting on comprehensive cryptocurrency legislation.

What we're watching: Whether or not the crypto community donates a lot of its coins to the Trump campaign, now that he is actually accepting such contributions.

  • And how many other campaigns will also open up to cryptocurrency donations.
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