Bitcoin as a solution to the US debt problem

Trump's Shocking Plan: Can Bitcoin Save the US from Debt Abyss? How the Ex-President Plans to Use Cryptocurrency to Solve the Massive National Debt

Former US President Donald Trump has made a dramatic about-face on cryptocurrencies in recent months, promoting them as a possible solution to the nation's debt problem. This has sparked widespread controversy and many questions about his true motives.

Trump's Pro-Cryptocurrency Moves Are Questioned

Trump is actively courting crypto voters ahead of the upcoming election, with high-profile campaigns including accepting crypto donations, proposing to create a Bitcoin strategic reserve for the United States, promoting Bitcoin-themed merchandise, and attending the 2024 Bitcoin Conference.

However, Trump’s recent interview with FOX Business showed that his knowledge of cryptocurrencies remains superficial. When asked about his vision for the evolving role of cryptocurrencies in America, he responded:

“You have to understand that cryptocurrency is a very interesting thing. Very high level in some ways, intellectually very high level. But if we don't do it, China will. China will do it anyway, China is already doing it. And if we don't do it, other countries will. So we may well be at the forefront.”

Trump did not specify what exactly China and other countries were doing, raising doubts about his competence.

$35 Trillion Bitcoin Checks

During the same interview, Trump floated the idea of ​​paying off the national debt with $35 trillion in Bitcoin checks. He said:“Who knows, maybe we'll pay out our $35 trillion, hand them a crypto check, give them some Bitcoin and wipe out our $35 trillion.”

Impact on the market and political climate

Despite doubts about Trump's knowledge of cryptocurrencies, Its impact on the market cannot be denied. A recent AMBCrypto survey found that 80% of investors believe Bitcoin could reach $80,000 if Trump wins the election. As of July 2024, 25% of crypto discussions on X (formerly Twitter) revolve around the US election, with 76.6% of investors expecting the Republican Party to support crypto-friendly policies.

This confirms that the political climate will play a decisive role in the future of Bitcoin and cryptocurrencies in general. Trump, despite his superficial preparation, can have a significant impact on the crypto market using his influence and campaign promises.

Author's opinion: populism (from Latin populus – people) is a policy that appeals to the broad masses and promises them a quick and easy solution to acute social problems. At the core of populism is the desire of one or another political force to win the trust and support of the masses and to please the people. This is exactly what Trump is saying now about paying off the national debt by buying bitcoin. There will be 21 million bitcoins produced by the year 2010 (there are only 19.8 million today). There simply won't be enough bitcoins to cover the national debt.

There is another option. Currently, the US Treasury has 207 thousand bitcoins on its balance sheet. That is, if the level of national debt does not continue to grow, Bitcoin price should rise to $170 million per piece. That is, the capitalization of bitcoin will be like 10 snp500. Well, either this is completely unrealistic, or the money will not be worth anything at all. There are examples. In Zimbabwe they no longer buy toilet paper (2022) – their currency is cheaper!

What's also very strange is that such statements didn't cause a boom and didn't send cryptocurrencies to the moon. Just like the markets didn't flinch at the assassination attempt on Trump. Strange? I think so! Remember the cartoon about Prostokvashino? Matroskin didn't have enough money (or rather, didn't have any) to buy a cow.

Golden words

To sell something you don't need, you first need to buy something you don't need. But we have no money!

P.S. Yesterday the market dropped significantly (some people were shouting that all markets had fallen, and some were wiped off the face of the earth). Today they have grown, and I wonder who is buying such “bad” assets. I have a suspicion that maybe these are the same 76% of “digitalists” who will bring Trump to the White House? And they certainly had the opportunity to raise money to continue the election campaign yesterday.

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