Donald Trump recently suggested that cryptocurrencies like Bitcoin could be utilized to address the United States’ $35 trillion national debt. At a campaign event, he remarked, “I think crypto has got a great future. Maybe we will pay off the $35 trillion with it.”
Of course, never a man to miss an opportunity we can see how this could be aligned with personal benefits as well as public one. To do that however deregulation of cryptocurrency markets would be essential for Donald Trump and Elon Musk to personally benefit from a Bitcoin-focused strategy for addressing the U.S. national debt. Here are the key reasons:
1. Facilitating Early Accumulation of Bitcoin
- Regulatory Barriers: Current U.S. regulations impose strict oversight on large-scale cryptocurrency acquisitions to prevent market manipulation and promote transparency. Deregulation could reduce scrutiny, allowing Trump and Musk to acquire significant Bitcoin holdings discreetly before government actions potentially drive up its value.
- Privacy and Reduced Reporting Requirements: Deregulation could loosen financial disclosure obligations, enabling private individuals or entities to accumulate large Bitcoin reserves without public attention.
2. Market Influence Without Legal Repercussions
- Pump-and-Dump Dynamics: Deregulation would minimize restrictions on public statements about Bitcoin’s value or government intentions regarding cryptocurrency. Both figures could strategically influence market sentiment without facing accusations of manipulation or insider trading.
- Government-Led Price Drivers: Actions such as the U.S. government announcing Bitcoin accumulation, mining initiatives, or strategic policies would naturally inflate Bitcoin’s price. Deregulation would allow private holders like Trump and Musk to benefit from these price movements without violating securities laws or ethical boundaries.
3. Minimizing Tax Liabilities
- Taxation of Gains: Current capital gains taxes on cryptocurrency profits could reduce the profitability of Bitcoin holdings. Deregulation could lead to more favorable tax treatment for crypto assets, such as deferred taxation or reduced rates.
- Cryptocurrency-Specific Tax Loopholes: A deregulated environment could introduce new financial mechanisms, such as crypto-friendly trusts or tax shelters, enabling Trump and Musk to maximize their returns while minimizing tax exposure.
4. Facilitating Institutional Support
- Access to Institutional Capital: Deregulation would encourage traditional financial institutions to increase their involvement in cryptocurrency, adding legitimacy and liquidity to the market. This broader adoption would amplify the value of existing holdings, benefiting early investors.
- Crypto Mining Dominance: With fewer environmental or compliance hurdles, large-scale mining operations could be established under favorable energy policies. These operations could directly benefit private investors if they hold stakes in mining ventures.
5. Strategic Timing of Government Actions
- Insider Advantage: Deregulation would create opportunities for individuals with knowledge of upcoming government policies to position themselves advantageously in the market. By acquiring Bitcoin before price-driving announcements or actions, they could capitalize on significant value appreciation.
Conclusion
Deregulation would be pivotal in reducing legal and financial barriers to large-scale Bitcoin ownership and enabling strategic market influence. By loosening oversight, Trump and Musk could privately accumulate Bitcoin, capitalize on price-driving government actions, minimize tax liabilities, and exploit institutional market growth. This deregulated framework would facilitate substantial personal financial gains while advancing national economic objectives.