The election is over, and Trump will now be president again. He achieved something that had not been done since Grover Cleveland in the 19th century: successfully re-elected after losing after his first term. People all over this space are celebrating this as some kind of victory for Bitcoin, but nothing could be further from the truth.
Ross will likely be released, but Trump is too busy backing away from such a frivolous case to fulfill his campaign promises, so he’ll likely do just that. It’s very easy, and it’s something he can brag about and take credit for, so it will happen.
This is where anything of substance will end. The strategic reserve does not occur without congressional approval, and even confiscated assets are required by law to be disposed of on the open market. Trump cannot by any reading of his power, that I know of, unilaterally push the federal government to start accumulating bitcoin. Even if by some miracle Congress moves to pass such legislation, what good is Bitcoin? The government accumulating Bitcoin will not make it more scalable, will not make it more private, or protect it from government overreach and interference. It will not even help us pay off our debts, and the higher prices needed to achieve such an outcome are frankly illusory.
Instead the most likely outcome is more of the same. More attacks on Bitcoin privacy. Further bypass regulation in the form of KYC and AML. Miners are likely to come under scrutiny as Bitcoin continues to rise on the global political scene. The question of their responsibility and involvement in confirming sanctioned or unsolicited transactions has already been floating around in Washington, D.C. for a few years now, and the tone of these questions is likely to become more serious.
Trading platforms and other on/off methods will likely be pressured to engage in more invasive surveillance of their users in an effort to eliminate terrorism, criminal use, child trafficking, etc. All traditional figures will be eliminated in the digital world, and the regulatory noose will be tightened. To be sure, Trump may push for self-custody as a right, but does this in itself provide any serious degree of freedom without privacy? Without resisting censorship?
Trump even spoke in Nashville about regulations, expansion, and approval of stablecoins. “People who see Bitcoin as a threat to the dollar, it’s the exact opposite.” He wants to spread dollar-backed stablecoins around the world, taking advantage of the new way for us to export inflation without the need for diplomacy. People in other countries can just use them, and they don’t need their government to choose to deal in dollars, or hold dollar reserves. Simply download an app and start using it. The approach he wants to take towards Bitcoin and cryptocurrencies will breathe new life into the dollar, pushing Bitcoin down a path of stagnation and capture.
People are cheering this as a victory for Bitcoin, but the reality is that we are entering into a challenge. It is still an open question whether we can manage it successfully and come out the other side without having to make serious and perhaps fatal compromises.
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