|
Getting your Trinity Audio player ready...
|
Donald Trump wants to save ‘crypto’ from a Chinese takeover, while his selection of a ‘crypto-friendly’ running mate JD Vance has won him the deep-pocketed support of U.S. tech billionaires.
This week, Bloomberg published an interview with former (and likely future) U.S. President Trump in which he unveiled numerous policy plans should he win November’s election. In addition to cutting taxes, boosting spending, and leaving allies like Ukraine and Taiwan to their fates, Trump also weighed in on a few areas of interest to the ‘crypto’ community.
Trump being Trump, he chose to explain his ‘crypto’ conversion by referencing the earlier release of his three non-fungible token (NFT) collections while pimping the imminent release of a fourth set “because the people want me to do another one.” (The man is already flogging post-assassination attempt sneakers with his bloodied face on them, so color us not at all surprised.)
Trump claimed that nearly all the proceeds he derived from his previous sets were “paid in crypto, in this new currency. And it opened my eyes.” Trump concluded that this phenomenon was “not going away,” and so he chose to get behind it (or, at least, give the impression that he’s behind it until he no longer needs ‘crypto’ votes).
Trump equated the digital asset sector to “a baby. It’s an infant right now. But I don’t want to be responsible for allowing another country to take over this sphere. If I throw it aside, it’s going to be picked up in another country, most likely China—they’re pretty advanced in that sphere… what I want, again, is what is good for the country.”
As with his past comments on the importance of wanting “all the remaining [BTC] to be MADE IN THE USA!!!”, Trump often appears confused as to how blockchain technology works. The fact that some BTC block rewards go to U.S. miners doesn’t really benefit the country, particularly if the miners immediately sell their tokens to pay for their hefty electricity bills (and those bills are heavily subsidized by U.S. taxpayers).
Bending the knee
Trump told Bloomberg that he’d gotten to know some “top-flight” people in the digital asset space who’d convinced him that the U.S. digital asset sector has a “good foundation.” More importantly, he learned that supporting ‘crypto’ could prove a valuable wedge issue in the November elections.
While their partiality toward Trump was never much of a secret, the list of Silicon Valley bigwigs—many of them with ‘crypto’ ties—who went full-throated in their support of Trump following last week’s assassination attempt is significant. As are the checks they’re writing to ensure Trump returns to the Oval Office in January.
This top-dollar parade was led by DOGE fan Elon Musk, who publicly endorsed Trump following the assassination attempt. The Wall Street Journal later reported that Musk plans to give a new pro-Trump political action committee around $45 million per month until November, despite Musk’s claim in March that he was “not donating money to either candidate for US President.”
But with Trump telling Bloomberg that he’ll cut the corporate tax rate from its current 21% all the way down to 15%, Musk somehow found a way to forget his public shaming by Trump not so long ago. As the song says, money changes everything.
Between two bald ferns
Also dropping their fig leaves of political neutrality are Marc Andreessen and Ben Horowitz, co-founders of the Andreessen Horowitz (a16z) (NASDAQ: ZADIHX) venture capital group, which has been one of the foremost funders of ‘crypto’ projects of dubious utility. Following Trump’s terrible weekend, the pair reportedly told a16z staff that they would make “large donations” to Trump-supporting PACs.
They then recorded a podcast in which they interviewed each other (bold choice, guys). On that podcast, Horowitz claimed that the pair’s Trump support was due to their “literally” believing that “the future of our business, the future of technology, and the future of America is at stake.”
(We must have missed that Joint Chiefs of Staff meeting that warned of the growing threat to America by a possible slowdown in the production of function-free token projects so beloved by a16z. But apparently, what’s good for the Horoweessens is good for America, so carry on.)
Andreessen called Trump’s new ‘pro-crypto’ stance “a flat-out blanket endorsement of the entire space.” The pair went on to condemn President Joe Biden’s policies, including proposed new capital gains taxes that the pair claimed “would absolutely kill both startups and the venture capital industry that funds them.” So, no regulation, no taxes and no shame. Gotcha.
Don’t forget us!
The Coinbase (NASDAQ: COIN) exchange has been among the largest contributors to campaign super PACs in this election cycle. Coinbase has contributed tens of millions of dollars to the Fairshake PAC, which ranks second only to Trump’s Make America Great Again PAC in terms of dollars raised.
Coinbase has tried valiantly to paint Fairshake as representing the silent masses of ‘crypto’ voters allegedly outraged by the Biden administration’s enforcement of existing securities regulations. And yet, of the $161.6 million that Fairshake has raised, around $160.5 million has come via six- to eight-figure donations from ‘crypto entities‘. So, it’s not exactly the ‘grassroots’ revolution they’re portraying it as.
Fairshake and its related PACs have, to date, focused on the primary campaigns of both parties. Unlike Trump’s other supplicants, Coinbase appears more interested in promoting ‘pro-crypto’ candidates and opposing ‘anti-crypto’ candidates, regardless of their party affiliation.
Coinbase also sent its chief legal officer, Paul Grewal, to a ‘crypto roundtable’ organized by the Biden administration earlier this month. Grewal later claimed to have been “encouraged” by the “productive” get-together, which is a more measured stance towards Trump’s opponents than he traditionally demands from those looking to curry his favor.
But Coinbase might yet derive some benefit thanks to Trump’s primitive nationalism. His apparent belief that tokens are native to the country in which their issuer resides could benefit Circle, Coinbase’s partner on the USDC dollar-denominated stablecoin.
USDC is currently the number-two stablecoin in terms of market cap, behind only Tether’s USDT. But since Tether is (a) based outside the U.S., (b) really popular in China, and (c) really popular with terrorists, expect Trump to figure out a way to punish the foreigner and promote the American (say, by prohibiting U.S. firms like Cantor Fitzgerald (NASDAQ: ZCFITX) from dealing with Tether). That is, assuming that the Americans (ahem) have proved their loyalty to Trump somehow.
With Tether already preparing to flee Europe rather than submit to the local banking requirements under the Markets in Crypto Assets (MiCA) regulations, getting forced off U.S. digital asset exchanges by an Oval Office executive order could prove ruinous. Particularly as Tether would be forced into an even tighter embrace with scammers in Southeast Asia.
Their play, our loss
“A contrary opinion” on Silicon Valley’s public fawning over all things Trump came from billionaire Mark Cuban, no stranger to tech/crypto. On Wednesday, Cuban tweeted that all this kowtowing wasn’t due to Trump being “a far stronger proponent of crypto,” nor the expectation that Trump will rein in the enforcement actions of the Securities and Exchange Commission (SEC). Instead, it’s a BTC’ play.’
Cuban noted the “global uncertainty” regarding Trump’s disdain for America’s historic role as global cop, as well as the negative impact on the U.S. dollar’s role as the world’s reserve currency from Trump’s plans to cut taxes and boost tariffs. Cuban said “you can’t align the stars any better for a BTC price acceleration.”
Cuban argued that global uncertainty could realize BTC maximalists’ fantasies of their token becoming the world’s new reserve currency. (Given BTC’s seven transactions-per-second throughput and high transaction fees, it will never be a ‘currency,’ but we digress.)
Cuban said this asset shift was already happening “in countries facing hyperinflation” like Argentina and Turkey, and the possibility of this happening in other nations “has a possibility somewhere above zero.”
Cuban basically implied that maxis’ support for Trump is based on realizing their fantasy of upending the planet’s fiscal hierarchy and becoming members of the vaunted 1%. Or, for the Andreessens and Horowitzes of the world, the 0.1%.
The fact that this new paradigm will condemn the other 99% of humanity to global serfdom as their life’s savings are made worthless is a feature, not a bug. It’s just nature winnowing out the weak who lacked the brains and the balls to go all-in on BTC back in 2011 with discretionary cash they didn’t have then and still don’t have now.
Cuban’s musings were followed almost immediately by a blog post from Ethereum co-founder Vitalik Buterin, who criticized those who “support ‘pro-crypto’ candidates just because they are ‘pro-crypto.'” Buterin added that these types of decisions lead you to betray “the values that brought you into the crypto space in the first place.” (You know, like the Ethereum developer who quit once he realized his primary role at Ethereum was “pumping Joe Lubin’s bags.”)
Nice republic you’ve got here… shame if something happened to it
Crypto bros rejoiced when Trump named Sen. J.D. Vance (R-OH) as his vice-presidential running mate, given Vance’s pro-crypto history, his listing of over $100,000 in BTC holdings on his financial disclosure forms, and Vance’s dislike of SEC chairman Gary Gensler’s desire to hold ‘crypto’ firms accountable.
Shortly after Vance’s VP gig was confirmed, Axios reported that several prominent tech figures—including Musk and venture capitalist David Sacks—had led “a secret lobbying campaign” to convince Trump that Vance should get the gig.
The article noted that Vance’s six-year history as a venture capitalist had left him with “relationships that’ll open new GOP fundraising frontiers with Silicon Valley and crypto entrepreneurs.” Vance’s VC tenure included stints at funds backed by Andreessen and Peter Thiel, the latter being one of the earliest supporters of Vance’s political ambitions (and Trump’s, for that matter).
Thiel, whose Mithril Capital firm hired Vance in 2017, later bankrolled Vance’s efforts to launch his own VC (Narya Capital). Thiel also brought Vance to Mar-a-Lago to meet Trump in February 2021 and plowed the then-unheard-of sum of $15 million into Vance’s 2022 Senate campaign.
Another big-dollar contributor to Vance’s 2022 campaign was Sacks, who, like Thiel and Musk, is part of the ‘PayPal Mafia’ and shares libertarian/authoritarian views. On July 16, Sacks tweeted a list of prominent VCs and ‘crypto’ supporters who have all gone public with their Trump support, stating, “Come on in, the water’s warm.” (Cuban responded by saying simply: “The Virtue of Selfishness.”)
Thiel, who in 2009 stated that “I no longer believe that freedom and democracy are compatible,” has been credited with converting Vance from one of Trump’s staunchest critics to one of his most rabid supporters. While Thiel famously declined to support Trump this time around, he appears very interested in ensuring that one of his own is a heartbeat away from the presidency.
The quid pro quo nature of American politics leaves no doubt that these tech bros expect a handsome payoff if Trump returns to the White House. Given that Trump is only a couple of years younger than Biden, not to mention Trump’s fondness for artery-clogging McDonalds meals, the tech titans may be banking that Vance could end up running America long before 2028 rolls around.
Will the last person to leave America please turn out the lights? Thanks.
Watch: Aaron Day and Kurt discuss CBDCs, Blockchain, and US Economy
New to blockchain? Check out CoinGeek’s Blockchain for Beginners section, the ultimate resource guide to learn more about blockchain technology.
