(Alternet)

Trump’s crypto-ligarchy will blow up in his face — and possibly take the financial system with it | Opinion

Robert Reich.

As of Friday, the Trumps’ cryptocurrency meme coins — the $TRUMP and $MELANIA cryptocurrency coins — had a combined market value of about $6 billion.

Days before taking the oath of office, Trump announced on his social media platform the creation of the $TRUMP coin, featuring Trump’s image from the July assassination attempt, and said: “Join the Trump Community. This is History in the Making!”

The $MELANIA coin soon followed.

Despite no details about the coin’s value, use, or risks, Trump supporters. gamblers, and those wishing to suck up to Trump bought it — sending the coin’s price into the stratosphere. On paper, the Trump family is now several billion dollars richer (edit: while the median wage in the US hasn't increased one cent...)

Trump once denounced crypto, but as the crypto industry poured tens of millions of dollars into 2024 campaigns, he changed his mind. Not only did he see the political power of the crypto industry; he saw an opportunity to make a pile of money.

He then promised to make the United States the “crypto capital of the planet.”

In September, the Trump family started World Liberty Financial, which they marketed as a platform to facilitate borrowing and lending in digital currencies. (Trump receives a cut of the sales of WLFI, the cryptocurrency associated with the platform.)

Now that he’s taken office, Trump plans to make billions off his presidency by implementing policies that favor crypto.

The truth about crypto
Cryptocurrencies serve no useful purpose other than the purchase of other crypto assets, money laundering, extortion and scams. As economist Paul Krugman has said, their market value rests on nothing but “technobabble and libertarian derp.”

They also use huge amounts of energy.

And if they infiltrate Wall Street, they could destabilize the entire financial system.

The crypto industry has a dubious reputation. Sam Bankman-Fried, founder of FTX, one of the world’s biggest crypto exchanges, was last year sentenced to 25 years in prison for fraud. Changpeng Zhao, founder of a rival exchange, has spent four months locked up for money-laundering.

But the richest people in America with huge power — the oligarchy, including Trump — support cryptocurrencies. Not only can they make a fortune, but crypto advances their longterm aim of shifting financial controls out of a democratically elected system of government and into their own hands.

Now that he’s president, Trump is actively promoting crypto — reversing Biden’s attempts to prevent the crypto industry from infiltrating Wall Street.

Biden’s tight rules made it prohibitively expensive for banks to hold digital assets on behalf of clients, and stopped them from developing their own crypto products, such as stablecoins (tokens pegged to the dollar or other assets).

The Federal Deposit Insurance Corporation (FDIC), a watchdog, stopped dozens of such projects on the basis that it did not know how digital assets ought to be treated in regulatory filings.

With Trump, though, banks and the crypto industry are now pushing in the same direction, and face little resistance. New and enormously profitable forms of risk-taking are emerging — for a small group of people able to take such risks and able (like the Trump family) to profit of their own crypto products.

Trump is putting crypto-friendly people into place at key federal agencies, boosting its prospects. In December, he picked Washington lawyer Paul Atkins, a known crypto booster, to chair the Securities and Exchange Commission, America’s main financial regulator.

Last week, the Securities and Exchange Commission altered its guidance so that financial institutions no longer have to account, on their own balance-sheets, for crypto assets held on behalf of customers. The S,E.C. rolled back accounting guidance that had deterred banks from getting involved with crypto.

Trump has tapped the venture investor and digital currency enthusiast David Sacks to oversee administration policies on crypto (and artificial intelligence).

Then, this past Thursday, Trump issued an executive order committing the Trump administration to “protecting and promoting” the crypto industry:

“The digital asset industry plays a crucial role in innovation and economic development in the United States, as well as our nation’s international leadership. It is therefore the policy of my administration to support the responsible growth and use of digital assets.”

The order gives his administration authority to establish a national cryptocurrency stockpile — a stash of digital coins that the crypto industry has spent months lobbying the new administration for because it further legitimizes crypto and adds to the demand for it.

Trump’s order also prohibits the creation of a “central bank digital currency,” overseen by the government. And the order promises “fair and open access to banking services” for crypto (responding to complaints from crypto companies that banks have denied them accounts).

In effect, Trump is writing the rules for a business venture from which he and his family are personally profiting. It could earn them hundreds of billions of dollars.

cont.

See how the economically  illiterate mainstream Left (tricked into supporting obsolete Adam Smith-based neoclassical economics) are freaked out by Musk (though Musk is also economically illiterate):

(The Independent)

'Utterly terrifying’ poll reveals Elon Musk effect pushing far-right AfD closer to power in Germany

A new poll has fuelled growing fears that the far-right Alternative for Germany (AfD) party could be on the cusp of winning power.

The findings show billionaire X social media platform owner Elon Musk has helped catapult AfD into second place with their leader Alice Weidel the favourite to become the country’s new chancellor.

The survey results have been described as “utterly terrifying” by Labour MP Blair McDougall who sits on the Commons foreign affairs select committee, who has branded Musk “the most irresponsible man on Earth.”

The poll comes just days after the world commemorated the 80th anniversary of the liberation of the Auschwitz death camp, and marked Hitler’s genocide of 6 million Jews.

Last weekend Musk addressed an AfD rally in Halle, east Germany, telling party members that Germans should move beyond guilt – adding, in an apparent reference to the crimes of the Nazis: “Children should not be guilty of the sins of their parents, let alone their great-grandparents.”

Days earlier he faced global condemnation for an apparent far-right salute at one of Donald Trump’s inauguration celebrations, though he has denied accusations it was a Nazi gesture.

According to the findings from the Washington DC Democracy Institute, which conducts polls in the US and around the world, the centre-right Christian Democrats (CDU) are on 27 per cent, only two points ahead of AfD on 25 per cent.

Olaf Scholz’s Social Democrats (SPD) are a distant third on 15 per cent, with the Greens just behind on 13 per cent.

However, AfD’s far-right leader Weidel is the clear choice of Germans to be chancellor on 35 per cent, well ahead of the CDU’s Friedrich Merz on 26 per cent. Scholz lags behind on 15 per cent.

The findings are even more problematic given that this week Merz broke an 80-year convention of not working with the far right and siding with them in votes on migration.

he German elections were originally scheduled for 28 September but are now due to take place on 23 February after the collapse of the Scholz government.

The polling reveals that more Germans disapprove of Musk’s interventions than approve by 41 per cent to 36 per cent. However, it also shows he has had an impact, with 28 per cent saying they are “more likely” to vote AfD because of Musk compared to 23 per cent “less likely”.

He said: “Last week we commemorated the 80th anniversary of the ending of the Holocaust and this week we see this. It’s sickening and deeply worrying.

“Powered by the richest and most irresponsible man on Earth, Germany, of all places, is turning towards the far right. Leaders in all democracies need to wake up to the existential threat to our freedoms and way of life.”

Musk has also thrown his weight behind British far-right activist Tommy Robinson and had talks with Reform UK, as well as being pivotal in Trump winning the presidential election.

Democracy Institute director Patrick Basham said that a new phenomenon is emerging in Germany: “The shy Musk voter.” He likened it to Brexit in the UK and Trump in 2016 where voters did not want to admit publicly how they are voting.

He added: “What folks say in public isn't exactly what they think in private.”

While the Democracy Institute is based in America, it uses British Polling Council standards for its surveys and has previously been one of the first to pick up trends in changes of voting. In 2016 it correctly predicted Trump would win and in 2022 picked up Black and Latino voters switching from the Democrats to Republicans.

In Europe it was one of the few polling companies to predict the Brexit referendum result and also picked up on the rise of right-wing French leader Marine Le Pen.

........

Q: why did US workers abandon the Dems?

And why did German workers abandon the centre-Left  Scholz?

In a well functioning global economy, immigration should not be an issue, but the Left can't see the obsolesence of neoclassical economics which is partly responsible for the Right's rejection of immigration, resulting in policies  which are deemed "a threat to our democracy" by the mainstream losers at the Washington DC Democracy Institute.   

And Albo is lookng at minority government at best, even though Dutton will be worse for workers than Labor - workers who are also economically illiterate, since even Andrew Leigh , the most highly-trained  (Harvard)  economist in the ALP, is deluded by obsolete Smith-based neoclassical economics.

Right on cue, Dutton is on radio tonight, spouting the false mainstream "government debt causes inflation" narrative; when asked what government spending Dutton would cut, he replied "we will decide that in government"....

Astounding,  he can't/won't  tell the public BEFORE the election...

At least the BCA - unlike Dutton who thinks he can lie his way into the Lodge -  is prepared to expose  its survival of the fittest-based policies to the public:

(Daily Mail)

Business leaders reveal where Albo must cut spending to win election

(Story by Stephen Johnson, Economics Reporter For Daily Mail Australia):

Business experts have urged Prime Minister Anthony Albanese to slash government spending and prune the National Disability Insurance Scheme to keep a lid on inflation.

Under Labor, federal government spending as a proportion of the economy is at the highest level in almost four decades outside of a pandemic.

The Business Council of Australia has released a new report - The Big Five Questions - ahead of the next federal election calling for spending cuts.

It argues that existing spending on the NDIS, health and aged care was unsustainable.

'While this is not to suggest that we should not be taking government action to support our most vulnerable, we must have an overall whole-of-government aim to get spending under control,' the report states.

My comment: ah - so NOT 'survival of the fittest' after all, just  "a need to get spending under control"...let's read on:

'Spending associated with health and care services is on an unsustainable trajectory.'

The Business Council has called for the reinstatement of rules capping government spending at 23.9 per cent of gross domestic product, a policy introduced in 2014 under then Liberal prime minister Tony Abbott.

Treasury's Mid-Year Economic and Fiscal Outlook released in December showed government spending was set to make up 26.5 per cent of gross domestic product.

My comment: notice the BCA changed from "supporting the most vulerable" , to "reinstatement of rules capping government spending at 23.9 per cent of gross domestic product, a policy introduced in 2014 under then Liberal prime minister Tony Abbott."

Why does spending have to be kept to that level?

Outside of the pandemic in 2020, this could comprise the biggest share of the economy since the 1986-87 financial year.

And Treasury is expecting that to climb to 27.2 per cent in 2025-26.

'One way to fight inflation is to limit money pushed into our economy,' the Business Council said.

The National Disability Insurance Scheme is set to cost $46.4billion in 2024-25, with the Parliamentary Budget Office estimating it would cost 1.7 per cent of GDP, rising to 2.2 per cent of GDP in 2034-35 as costs for every participant rose.

State governments are also to blame for higher spending, with Victoria's Suburban Rail Loop set to cost $216billion.

Federal and state government spending now makes up a record 28 per cent of GDP but productivity, or output for every worker, has been falling while underlying inflation is still above the Reserve Bank's 2 to 3 per cent target.

My comment: notice the "productivity" shibboleth rears its ugly head; in an economy - like Australia's -  changing from manufacturing to services, of course "ouput for every worker" will fall because workers are not now producing widgets (goods)  but services (including aid to the vulnerable)  which are more difficult to measure;  and wages of service workers need to be determined by government, not the market which determines the price of 'widgets' (goods). 

Despite the largesse, Australia's economic growth is also at the weakest level since the 1991 recession outside of the 2020 Covid lockdowns.

'With record public money in the economy and more regulation, we must address the root cause — an economy that has been running too hot relative to constrained supply, despite weak growth in demand,' the Business Council of Australia said.

My comment: mere market ideology; government must also determine outcomes in an economy, to "assist the most vulnerable". And why is "supply constrained"?

'Controlling government spending and greatly increasing productivity will make a big difference.'

Meanwhile, Treasurer Jim Chalmers has delivered two consecutive Budget surpluses, something no federal government had achieved since 2007 before the Global Financial Crisis.

'Savings and spending restraint have been hallmarks of our responsible economic management,' he said in December.

But a deficit of $26.9billion is forecast for 2024-25, growing to $46.9billion in 2025-26 as falling iron ore prices reduce commonwealth company tax revenue.

On industrial relations, the Business Council wants to reverse Labor laws giving casual employees the right to a permanent position, with holiday and sick pay if they had been in the role for 12 months.

It also wants to undo Labor laws banning employers from using labour hire staff who are paid less than staff on an enterprise agreement, arguing this would be about 'promoting choice and flexibility'.
(cont)

The  result of ignorance about money, in the post gold standard era of floating-exchange-rate  fiat currencies.

(Daily Mirror)

Bill Gates criticizes cryptocurrency: 'High IQs fooled themselves'

Gates' comments come as Bitcoin has hit record highs in recent weeks, and the cryptocurrency industry as a whole has hailed the arrival of Donald Trump in the White House as a positive moment. The President has said he will introduce policies supportive of digital currencies, and both him and his wife Melania launched their own meme coins last month.

Gates, who has a net worth of around $165 billion, has previously shared his skepticism around Bitcoin, and its volatility in particular. In 2022, he warned that it could be a risky investment for people without substantial financial resources.

In an interview with Bloomberg , he was asked his thoughts on the fact that Elon Musk 's Tesla had substantial Bitcoin holdings at the time. 'Elon has tons of money and he's very sophisticated so I don't worry that his Bitcoin will randomly go up or down,' Gates said. 'I do think that people get bought into these manias who maybe don't have as much money to spare. So I'm not bullish on Bitcoin. My general thought would be that if you have less money than Elon then you should probably watch out.'

In 2022, Musk was already the richest person in the world. Now, he has a net worth of over $433 billion and has been given a significant role in the Trump administration. Gates added that there are things that society invests in that produce output, but Bitcoin is not one of them.

'Bitcoin happens to use a lot of energy, it happens to promote anonymous transactions, they are not reversible transactions,' he said. He added that the Gates Foundation, a nonprofit founded in 2000, 'does a lot in terms of digital currency, but those are things where you can see who is making the transaction.'

Fellow billionaire Warren Buffett has also long been a critic of cryptocurrency, famously calling it 'rat poison,' a 'gambling token,' and predicting it will come to a 'bad ending.' But despite his disdain for digital assets, particularly Bitcoin, the billionaire is actually invested in a company tied to the cryptocurrency market - Nu Holdings.

....

Hmm...so nothing wrong with a bit of a 'flutter' if you are a billionaire, it seems....

Meanwhile most people in the world are living hand to mouth, and governments are "cash-strapped";  how will it end?

Grappler Deep State Feller wrote on Feb 5^th, 2025 at 11:07am:


Put bitcoin to good use?

How can money - any money (even "funny money" like bitcoin, or otherwise) - prevent further "unnecessary" conflict, when the conflict is political/ideological?

Eliminate the opposition?

That's what Bibi is already attempting to do, now with Trump's full-on (financial/military) assistance, eg "clearing out Gaza", and confiscation of the WB; the Saudis - and the entire Arab world, and much of the non-Arab world who also want a 2-state solution - aren't pleased.