Exploring Possible Trump Crypto Policy Positions Further
The Daily Crypto Update for Institutional Investors
The Odds Of A Second Trump Presidency Stand At 63% On Crypto’s Largest Prediction Market, Polymarket - We Provide An Overview Of Trump’s Possible Digital Asset Policy Positions
BTC, AI & energy: In mid-June, when Trump met with BTC mining leaders, we described the candidate as recognizing the BTC, AI energy and nexus. Various attendees described Trump as understanding that BTC can be beneficial for public energy interests in the context of growing demand for AI. Following the event, Trump posted on Truth Social that he believes the remaining BTC should be mined in the US and that this ‘will help us be energy dominant!’ Trump’s meeting with miners comes on the back of growing awareness that these actors can play crucial roles in US energy policy. In Texas, for instance, miners have helped stabilize the energy grid during adverse events when electricity supply drops and supply decreases. This could help AI processing fasciitis stay on-line while mining powers down. Additionally, BTC could help subsidize the early development of energy infrastructure such as in Ethiopia; there, Chinese miners are using excess supply before distribution from the Grand Ethiopian Renaissance Dam, Africa’s largest dam, is built out.
The right to self-custody BTC: In a Fox News town hall event in February, on the topic of BTC, Trump signaled his openness to the asset, and noted ‘[y]ou probably have to do some regulation.’ Since, Trump has signaled opposition to the antagonistic approach to crypto taken by the current White House and SEC. Additionally, Trump has also shown support for the right to self-custody digital assets, following increasing anxiety in the crypto community that the incumbent administration ultimately aims to regulate self-hosted wallets. Speaking at the Libertarian National Convention in May, Trump said: ‘I will support the right to self-custody for the nation's 50 million crypto holders. I say this with your vote: I will keep Elizabeth Warren and her goons away from your Bitcoin, and I will never allow the creation of a central bank digital currency.’
‘Stablecoins backed by dollars provide demand for U.S. public debt and a way to keep up with China:’ The development of Trump’s relationship with the crypto community has coincided with new-found political support for stablecoins. On May 8, the same day Trump declared his support for crypto in Mar-a-Lago, Republican Congressman Andy Barr said he believes the US needs to promote USD-denominated stablecoins ‘in the global economy to protect and advance the dollar’s dominance and the dollar as the world reserve currency.’ Barr’s position has since received additional support from former Speaker of the House Paul Ryan. While Trump has not made any specific statements regarding stablecoins, he has frequently described a loss of dollar dominance as akin to ‘losing a revolutionary war.’ In May, Bloomberg reported Trump and his team are discussing penalties for countries moving away from the dollar. In this context, pro stablecoin policy could be conducive to Trump’s support for the US dollar.
BTC as a Federal Reserve asset: Numerous Republican politicians have proposed that the US federal reserve should hold BTC. For instance, former candidate Vivek Ramaswamy, who is now a favorite for a cabinet position or VP, proposed including BTC in a basket of commodities to back the US dollar. In 2022, Republican Senator Cynthia Lummis suggested the Federal Reserve diversifies the USD 40B in foreign currencies on its balance sheet by including BTC. While Trump has made no indication that he has considered similar policies, the former president’s inner circle is close with El Salvador’s Bukele administration, which has been an outlier in its adoption of BTC. El Salvador maintains a BTC treasury and has recognized the asset as legal tender, alongside the US dollar.
CRYPTO HEADLINES
Compute Labs, a startup building a Solana-based protocol for tokenizing GPUs, has closed a USD 3M pre-seed funding round. The raise, which valued the startup at USD 30M valuation, was twice oversubscribed and led by Protocol Labs. The firm's plan includes a seed round at a projected higher valuation and the upcoming pre-sale of its GPU-NFTs. - link - @TheBlock
Ethereum development firm Consensys acquired Wallet Guard to enhance its non-custodial wallet MetaMask's security. The integration aims to improve scam detection and protect users' digital assets. Wallet Guard's team will join Consensys, aiming to boost security for MetaMask's 30M monthly users. - link - @TheBlock
The Basel Committee approved a crypto disclosure framework for banks, effective 2026. This framework mandates banks to reveal both qualitative and quantitative crypto exposure details. It aims to standardize understanding and evaluate risks, with details forthcoming later this month. - link - @CoinDesk
Opentensor Foundation, the development firm behind AI-focused blockchain Bittensor identified the cause of an USD 8M exploit in the network’s wallets. The attack, which began on July 2, involved a compromised package that stole private keys when downloaded. The blockchain was halted, and Opentensor Foundation has since removed the malicious package and is reviewing the Bittensor code. - link - @Bittensor
South Korean regulators are enhancing surveillance of local crypto exchanges to enforce a new digital-asset law. Set to take effect on July 19, the law aims to protect investors by monitoring unusual trading activities. The Financial Supervisory Service has developed a system to detect suspicious trades and enforce compliance. - link - @Bloomberg
The Ethereum Foundation's email account was hacked on June 23 to promote a phishing scam. The account has been recovered, and no crypto was lost due to the attack. The scam involved a fake staking offer, misleading ~36k recipients. - link - @Cointelegraph
Crypto market maker DWF Labs launched a USD 20M fund to support Web3 startups in Chinese-speaking areas. Known as the Cloudbreak Fund, its purpose is to promote the expansion of Web3 efforts, with an emphasis on industries such as GameFi, SocialFi, and layer-1/layer-2 protocols. - link - @Cointelegraph
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CHART OF THE DAY
Since May 8, when Trump declared his support for crypto, Biden vowed to veto legislation repealing SAB 121, and Congressman Andy Barr endorsed stablecoins, ETH has outperformed on the back of the SEC's ETH ETF pivot.
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