Trump finally realized that it was easier to make money from Bitcoin than from his previous businesses such as real estate, hotels, entertainment, media, and retail.
During his first term as president, Trump fiercely attacked Bitcoin, arguing that Bitcoin was not a real currency. Unexpectedly, he gradually changed his tune in recent years, strongly supporting Bitcoin and planning to establish a national strategic reserve of Bitcoin. What happened?
1. Trump has already entered the "circle" Trump has actively participated in the crypto market after losing the election in 2020. He not only holds crypto assets, but also accepts donations from the crypto industry during the 2024 campaign, authorizes personal portraits to participate in the sale of non-fungible tokens (NFT), and even directly launches the "World Free Financial Token". The token is expected to sell $300 million and is valued at $1.5 billion. This series of actions shows that Trump has penetrated into the crypto economy and seeks to profit from it.
2. Trump's cryptocurrency plan Trump said at the Bitcoin Conference in July this year (2024), "...I will outline plans to ensure that the United States becomes the global cryptocurrency capital and Bitcoin superpower. Immediately after taking office, I will establish a Presidential Advisory Committee on Bitcoin and Cryptocurrency. If elected, my administration will retain all Bitcoin currently owned and acquired by the U.S. government in the future. I hope you will succeed. If cryptocurrency is going to define the future, I hope it will be mined, minted, and produced in the United States..."
Next year, with Trump taking office as president, it is expected that Gary Gensler, chairman of the U.S. Securities and Exchange Commission, who has called for stricter cryptocurrency regulation, will be replaced. Cryptocurrency may usher in spring, and the price of Bitcoin has also risen sharply, heading towards the milestone of $100,000.
3. Bitcoin Act This bill was introduced by Senator Loomis on July 31 this year. In simple terms, its core content is that the US government plans to purchase and store a large number of Bitcoins to strengthen its fiscal position and cope with economic uncertainty and monetary instability. In essence, the government will establish a strategic Bitcoin reserve. The purchase plan of the bill is as follows: The US government will purchase up to 200,000 Bitcoins per year for 5 years, with a total of up to 1 million Bitcoins. But the problem is that once the government starts buying Bitcoin, its price may soar, and we can foresee that it will be hundreds of billions or even trillions of dollars in funds.
4. Conclusion I have already said in the previous article that the essence of the Ponzi scheme is to maintain the illusion of high returns by constantly attracting people to join the game and using new funds to pay old investors. In simple terms, it is a "buy short and sell short" model, and the online people maintain operations by attracting offline people. In principle, Bitcoin and Ponzi schemes are similar (it depends on one's own opinion): as long as you own cryptocurrency, you become an "upline", and then you start to promote this as a future trend to attract offline investment. Therefore, at the moment when Bitcoin is popular, we must also be wary of the risk of speculative bubbles.