No one ever accused Donald Trump of ideological consistency. And yet, even by the standards of a man who often seems capable of switching positions several times in the same speech, and sometimes in the same sentence, it is quite a turnaround. As president he condemned Bitcoin and other crypto currencies ‘a scam against the dollar’. And yet, during this campaign he has turned into an enthusiastic convert, promising to govern as a Bitcoin President if he retakes the White House in November. That raises an intriguing question. Could the Crypto Bros turn Trump into a small state libertarian?
Trump’s embrace of cryptocurrencies will shift him towards small-state liberalism
Speaking at a Bitcoin conference in Nashville over the weekend, Trump embraced the currency more enthusiastically than has done so in the past. He told the cheering enthusiasts for digital money that he would create a ‘strategic Bitcoin reserve’, sack the SEC chair who has been bothering everyone with regulations, and make America ‘the Bitcoin superpower of the world’. ‘My job will be to set you free’ he told a cheering audience. The message could not be clearer. The favourite for the presidency will be radically pro-crypto, and it was probably no surprise that the price of Bitcoin surged as he spoke, touching $70,000 per coin, very close to it’s all time high.
As so often with Trump, much of that has to do with money. He has been getting a lot of donations from the ‘Crypto Bros’, the small group of billionaires who promote digital currencies, such as Elon Musk, and Jesse Powell, the co-founder of the crypto exchange Kraken, who has said he donated $1 million mostly in another digital currency, Ether. With so much of his campaign financed by the crypto traders and entrepreneurs, Trump may simply be following the money, in a way that American political candidates have often done.
The interesting point, however, is surely this. The embrace of Bitcoin will shift Trump’s second term of office, if he wins one, in a very different direction from the first. Whatever its merits or otherwise as a store of value and a way of trading stuff, one point about crypto currencies is completely clear. They are fundamentally a libertarian project. The entire point of Bitcoin and its rivals is to reduce the power of the state, to restrict the influence of central banks, and to protect ordinary citizens from governments that tax and spend too much money and even worse financing their profligacy with printed money. Trump’s many critics paint him as a dictator in waiting, and a threat to freedom and democracy, and in fairness there is often an authoritarian streak to his speeches. And yet his embrace of cryptocurrencies will shift him towards small-state liberalism. It will probably not make him a full-blown classical liberal. But it will move him in that direction.