Donald Trump returned to power in 2024 with the support of the crypto community. However, not everyone is positive about his initiatives.
The Beginning of Trump's Journey
In July 2024 at the Bitcoin 2024 conference in Nashville, Trump announced plans to create a U.S. bitcoin reserve, promising to fire SEC Chairman Gary Gensler and ban the sale of bitcoins owned by the government. Gensler has already left, and the new SEC leadership is ceasing prosecution of crypto companies.
The Essence of the Bitcoin Reserve
The initiative is to create a federal reserve comprising 1 million bitcoins, about 5% of total cryptocurrency issuance. Proposed by Senator Cynthia Lummis, it's planned to be realized through the BITCOIN Act of 2024. The main goal is to address the U.S. national debt with long-term BTC investments.
Criticism and Problems of the Project
The project faced criticism for asset choice uncertainty and political motivation, as the inclusion of altcoins raised questions about the reserve's stability. Economist Peter Schiff accuses Trump of market manipulation to benefit insiders.
While creating a bitcoin reserve appears promising, the initiative carries risks of BTC volatility and potential cyber threats. Thoroughly evaluating all possible outcomes is crucial.
