The political game between Trump and Bitcoin
As the 2024 U.S. presidential election approaches, the political climate becomes increasingly tense and voters are increasingly focused on the economy and technology. The United States is currently facing challenges such as continued inflation, de-dollarization risks, geopolitical tensions, and a polarized political environment. Amid this uncertainty, the role of cryptoassets has become one of the focal points for voters.
According to a Grayscale survey in June, nearly half of voters now expect to include cryptocurrencies in their investment portfolios. This interest is particularly pronounced among younger voters, with 62% of Gen Z and Millennials believing cryptocurrencies are the future of finance. As the election approaches, cryptocurrencies appear to be tilting toward Trump. What's the reason behind this trend? Could Trump’s return herald a bull run in the crypto market?
Trump and Biden’s different stances on cryptocurrencies
Former President Trump was a vocal critic of cryptocurrencies, describing Bitcoin as a "fraud" and calling cryptocurrencies a "disaster." However, Trump recently changed his attitude and stated on social media that he has a "very positive and open attitude" towards cryptocurrency companies and related industries. The shift in stance signals Trump's desire to align himself with the growing number of voters who support cryptocurrencies. He even criticized Biden for creating high inflation and denying young people opportunities for development.
On the other hand, current President Joe Biden’s administration maintains a more skeptical attitude toward cryptocurrencies. Biden has vetoed a resolution passing Congress to overturn a U.S. Securities and Exchange Commission (SEC) decision (SAB 121) that would have imposed stricter regulations on financial institutions holding crypto assets. Biden stressed that this resolution would weaken the SEC's ability to establish necessary lines of defense and emphasized the importance of protecting consumers and investors. However, later, because he was worried about losing to Trump in terms of popularity, he also began to recruit cryptocurrency-related experts as campaign team consultants.
Let Bitcoin elect a new president! What impact will the 2024 US election have on the currency community? What are the attitudes of the two major candidates?
Cryptocurrency community’s support for Trump
As the 2024 U.S. presidential election approaches, Trump is gaining support from a growing number of cryptocurrency billionaires and social media KOLs. Prominent crypto figures such as the Winklevoss brothers have publicly announced their support for Trump. The Winklevoss brothers even said on X that they would donate $1 million in Bitcoin to Trump’s campaign, citing the Biden administration’s “war” on cryptocurrencies. Although it was subsequently determined that the donation "exceeded the limit of individual political contributions allowed by federal law," the excess was refunded.
In addition, social media KOLs such as Wendy O also expressed support for Trump. She highlighted regulatory uncertainty and noted that this election is critical to the future of the industry. Trump has deftly integrated cryptocurrencies into his campaign and is reportedly in talks with organizers of Bitcoin 2024, the largest Bitcoin event of the year scheduled for July 25-27 in Held in Nashville, Tennessee.
As early as earlier this month, Trump also met with major U.S. Bitcoin miners and advocated mining all remaining Bitcoins domestically. Additionally, at a recent rally, he promised to end Biden’s “war” on cryptocurrencies and ensure that the future of Bitcoin and cryptocurrencies is shaped in the United States.
JP Morgan reacts to Bitcoin OG
While Trump’s supporters believe his election will usher in a bull run in the cryptocurrency market, analysts at JPMorgan are skeptical. They warned that the key policy goals of Trump's campaign could lead to higher inflation. These policies include:
Extend the 2017 tax cuts: Trump aims to extend the tax cuts enacted in 2017 and set to expire at the end of 2025.
Tough restrictions on immigration: The campaign's plans include deporting foreign-born illegal immigrants, which could put upward pressure on wages as the labor market tightens.
Imposing tariffs on imported products: Extensive tariffs on products imported into the United States could cause domestic prices to rise, adding to inflationary pressures.
Analysts noted that these policies could have a significant impact on inflation expectations and the issuance of U.S. Treasury bonds.
Bitcoin OG, on the other hand, expressed anger at Trump’s stance on cryptocurrencies. They believe that Bitcoin should not become a tool for political manipulation. These OGs worry that Bitcoin’s overexposure in the political arena could harm its long-term development and place in the global financial system.
A left-leaning voter and Bitcoin supporter said he was disappointed with Trump's supporters, believing it would label Bitcoin a "right-wing currency" and further deepen political polarization. He emphasized that Bitcoin should be a tool that transcends politics and ideology and should not be hijacked by any political party or individual.
Source: ReadWrite Bitcoin OG is worried that Trump will over-manipulate Bitcoin and damage its long-term development and status in the global financial system.
The future of the cryptocurrency market
All in all, while Trump’s supporters believe that his election will usher in a bull run in the cryptocurrency market, the market is mixed. JPMorgan warned that Trump’s policies could stoke inflationary risks, while Bitcoin OG worried that Bitcoin could become a political tool. The future cryptocurrency market needs to find a balance between regulation and innovation to achieve sustainable development.
Regardless of who is elected in 2024, establishing clear and fair regulatory policies will be critical to the growth of the cryptocurrency market. A lack of regulatory clarity has been a major stumbling block for investors, limiting innovation. As the election approaches, the outlook for the cryptocurrency market remains unclear, but this also leaves endless possibilities for future development.
