As the dust settles on the 2024 U.S. presidential election, it has been less than a month since Trump returned to the White House. For Trump, managing the economy is still the top priority, and regarding the current $36 trillion U.S. national debt, Trump seems to have some 'new ideas.'

After all, he even expressed during his campaign a desire to make Bitcoin a national strategic reserve currency. Now, some states in the U.S. have begun taking relevant actions. Coupled with a recent statement from a key industry insider that Bitcoin could rise to $500,000, contingent upon the U.S. government's involvement, this aligns perfectly with Trump's intentions. If this were to happen, the U.S. might really be able to use Bitcoin to resolve its massive debt, but will things really be that simple?

Trump's dream of saving the country with Bitcoin

Since Trump's victory, Bitcoin prices have generally surged, indicating that the market is quite sensitive to Trump's remarks. After all, while Trump can be unreliable at times, he is quite action-oriented.

Moreover, last month, Pennsylvania, a major economic hub on the East Coast, passed the (Bitcoin Rights Act), marking the first step for U.S. state governments to reserve Bitcoin. This move has naturally provided a strong boost to the market.

A few days ago, a state representative from Texas submitted a similar proposal.

Clearly, regardless of whether Trump takes action in the future, it is highly likely that these states will start to move one after another.

As mentioned earlier, Bitwise's CIO, Matt Hogan, has been promoting the idea that Bitcoin will rise to $500,000.

He stated:

Of course, one could say he is just boasting, but overall, it isn't that far-fetched.

However, after the Federal Reserve Chairman recently made it clear that they do not intend to hold Bitcoin, the price began to plummet, which was expected.

Clearly, this asset lacks the backing of national credit, and people are still very cautious.

But since Trump can have this idea and many states in the U.S. are moving, it proves that there is at least some feasibility behind it. So what is the logic behind this?

First of all, it can relieve pressure on the dollar, which is something Trump values highly.

Once the U.S. government starts to embrace Bitcoin, it could indeed reap numerous short-term benefits.

Moreover, as Matt Hogan said, once the U.S. government bets on Bitcoin, most governments around the world will likely follow suit, causing Bitcoin prices to skyrocket.

This will attract the inflow of international capital, thereby creating a reservoir effect for the dollar and helping to alleviate inflationary pressures in the U.S.

Additionally, theoretically, the U.S. government could manipulate the Bitcoin market to achieve debt resolution and cleansing, by first promoting and pushing up the price of Bitcoin, then shorting at the right time for profit, completing a debt restructuring.

However, all of the above is very idealistic; if it were to be realized, there would be numerous issues.

Ultimately, it is groundless water.

Even though Trump's hints have driven Bitcoin prices to continue rising, a single statement from Powell has caused a significant drop. The unpredictable and uncontrollable nature of Bitcoin's price is quite evident.

Once the market or politics experiences turbulence, or even just tighter economic regulation, its price could undergo huge fluctuations.

Powell's clear stance on Bitcoin and interest rate cuts will clearly be a direct obstacle for Trump to achieve his wishes.

Currently, Bitcoin prices are generally on the rise, and many countries and investors are eyeing it.

But the issue is that this price increase is mostly driven by speculation, not because it is genuinely worth that much money.

As a result, Bitcoin has become like a bubble that keeps expanding, posing significant risks.

Everyone believes they can make money from Bitcoin, rushing in to buy and sell, hoping for quick gains, which makes the market even more unstable.

Although some places have started to regulate cryptocurrencies like Bitcoin, such as China, there still isn't a complete legal framework to restrain it, which easily allows for fraud and money laundering.

Moreover, the Bitcoin network itself isn't that reliable or indestructible.

If the system is hacked or experiences any faults, that money could truly be lost, and the entire market could collapse.

Therefore, if the Trump administration still hopes to help the U.S. by promoting Bitcoin, it might indeed attract some foreign money in the short term, which would benefit the dollar and U.S. debt, alleviating significant economic pressure.

However, this could also make global financial markets more tumultuous, greatly increasing the probability and difficulty of a financial crisis.

As the world's leading economy, the U.S.'s position in the global market goes without saying.

If it deliberately stirs the market for its own interests, it could tarnish its reputation, and whether the dollar's hegemony can be maintained would be another question.

Furthermore, even if Trump were to do this, countries observing the large Bitcoin market would definitely strengthen regulation.

So ultimately, while Trump's idea certainly has feasibility, even if everything goes smoothly, it would only yield temporary gains.

That said, given Trump's personality and the absence of pressure for re-election, it is not entirely impossible for him to act purely for short-term benefits.

After all, no one understands Bitcoin better than Trump.

Recently, I plan to invest in a potential cryptocurrency that is ready to explode, doubling my investment should be quite simple. I also intend to find some promising coins to hold until the end of the year, expecting a return of over 10 times is not a problem. If you want to follow my lead, leave a message, follow, and like me.