- Donald Trump has not always been a fan of cryptocurrencies, but he has recently voiced strong support for the industry.
- Political spending by the industry has made cryptocurrency an election issue for both parties, sources told BI.
- Bernstein said Bitcoin is becoming a “Trump trade” due to the former president’s pro-cryptocurrency stance.
At a campaign fundraiser in June, former President Donald Trump presented himself as a persona that would have been unthinkable only a short time earlier.
“He said he’d be the crypto president,” Trevor Traina, a tech executive who attended the fundraiser that month, told Reuters.
This is not a title the Republican candidate would have been eager to acquire during his first term.
In a series of tweets in 2019, then-President Trump made it clear he had no interest in cryptocurrencies.
“I am not a fan of Bitcoin or any other cryptocurrency. They are not money and their value is highly unstable and unfounded.”
I am not a fan of Bitcoin or other cryptocurrencies. They are not money and their value is highly unstable and unfounded. Unregulated crypto assets could facilitate illegal activities, including drug trafficking and other illegal activities.
— Donald J. Trump (@realDonaldTrump) July 12, 2019
Trump has stuck to this view at least into 2021, telling Fox Business that Bitcoin “seems like a scam.” In making these points, he repeatedly asserted that the industry needs strict regulation.
But with the 2024 election looming, Trump has almost completely reversed his stance.
Earlier this year, he told CNBC that he was no longer convinced about abandoning cryptocurrencies, but in May he declared that the U.S. should be the global industry leader in the field.
“Meanwhile, the worst president in the history of our country, villainous Joe Biden, wants America to die a slow and painful death,” he said in a post on Truth Social.
The comparison with his Democratic rival may be symbolic of one of the reasons why cryptocurrency has become such a hot issue in the election, attracting increased attention from both parties.
“By any standards, this is going to be a very tough election,” Alan Konevsky, chief legal officer at tZERO, told Business Insider. “There’s going to be a fierce competition for campaign funds, and that shows that crypto and the crypto lobby are a significant force in that regard.”
The numbers back this up: The crypto sector is becoming a political fundraising juggernaut that can’t be ignored, according to a May report from Public Citizen: Throughout the 2024 election cycle, crypto-backed super PACs have raised more than $102 million, the third-highest total among all super PACs.
Trump has pledged to help crypto miners in the U.S. and ease regulations, which could allow him to raise new funds from the industry. For example, one crypto industry executive told CNBC that the industry has pledged to donate $100 million to Trump’s campaign.
“As an industry, we are committed to raising over $100 million and rallying over 5 million voters to help re-elect President Trump,” said David Bailey, CEO of BTC.
Meanwhile, cryptocurrency’s rise in the election campaign is also due to how important the topic has become to Americans, which Konevsky said may have been underestimated.
For example, roughly half of young voters surveyed by Grayscale said they consider a candidate’s stance on cryptocurrency before voting.
The increasingly bipartisan nature of cryptocurrencies is also influencing President Biden’s policies: He has also welcomed crypto donations, and his administration has adjusted its regulatory approach to the industry.
Growing political support for cryptocurrencies means it may not matter who wins in the long run, said billionaire crypto bull Michael Novogratz, as industry-friendly initiatives such as the Financial Innovation and Technology Act also move forward in Congress.
But in the short term, the market seems more confident that President Trump will help the industry.
Bernstein stressed in late June that Trump’s promises of increased regulation would help drive Bitcoin prices higher throughout the fourth quarter if the Republicans were to win the November election.
“A shift in electoral sentiment toward the Republican Party could see cryptocurrencies ultimately become a major ‘Trump trade,’ and hopes of a favorable regulatory regime could change the ‘use case’ narrative for blockchains like ETH,” the analysts wrote.
Konevsky noted that it will also be important to watch how regulators and court appointees change with a new administration. Aside from the question of who will lead a market watchdog like the Securities and Exchange Commission, the crypto litigation has put judges at the forefront as decision-makers on market-related issues.
