With the dropping out of Bernie Sanders on April 8, Joe Biden is now the presumed Democratic Party nominee to take on President Donald Trump in the 2020 US presidential election, scheduled to take place in November. Scheduled may at first glance seem an odd addition to the sentence, but of course, thanks to a certain pandemic, it’s been an odd year. Many major global events originally scheduled for this year have already been cancelled or postponed, such as the Tokyo Olympics. So it would be rather presumptuous at this stage to take it for granted it will be taking place then.
Nevertheless, Biden vs Trump it almost certainly is, whenever it takes place. It’s fair to say common ground may be hard to come by when it comes round to the presidential debates. Although Biden isn’t as radical as Sanders with most of his policies, he did hold the vice-presidency during Obama’s two terms, a reign of which the legacy of, Trump has attempted to roll back in many ways with his own policies.
So on many wide-ranging issues, such as healthcare, education and the military, it’s inevitable that Biden and Trump are going to hold conflicting views. But what about crypto? What significance would a second term for Trump, or a Biden presidency, have for crypto? Can we gain any insights from anything either of them have said or done in recent years?
Trump: a Bitcoin hodler?
Trump isn’t a fan of Bitcoin or cryptocurrencies, and so pretty much as a guarantee won’t include Bitcoin in his portfolio of investments. How do we know that? Well, he gave his opinion on the subject in July 2019 when taking part in one of his favourite pastimes – tweeting.
It won’t come as a shock to hear that this tweet didn’t go down well in some quarters, as is the case with many of Trump’s tweets. One noticeable rebuke was from well-known crypto market commentator The Crypto Dog:
But was this now infamous tweet by Trump actually bad news for crypto and Bitcoin? Not necessarily. Because as noted by CoinDesk, it wasn’t the substance of what he said that was really of significance, it’s the fact he actually commented on the subject at all.
There’s no such thing as bad publicity
As the saying goes ‘there’s no such thing as bad publicity’. While it’s debatable to say the least if this is true across the board, it can certainly be applied in the case of Trump’s tweet. To gain mainstream adoption, it must first gain mainstream acknowledgement, and this tweet shows for one way or another it’s certainly done that.
As the CoinDesk article states:
Trump’s tweet, more than any other statement by a government official, will prove to be instrumental in driving buzz and bluster around this topic: Twitter itself.
Any ‘buzz’ or ‘noise’ will make people more curious and drive it closer to the mainstream. This ‘buzz’ from Trump’s tweet helped drive the price of Bitcoin up in the days after. Brian Armstrong, CEO of Coinbase, was bashful in the aftermath of the tweet, tweeting himself that it was an ’’achievement’’ for Bitcoin, was something he had “dreamt about”, and proclaimed:
If any further Trump comments will help or indeed impede attempts to get to ‘step 3’ remains to be seen, but given Trump’s predictable unpredictability in reacting to events and subjects impromptu, it certainly isn’t out of the question. Although this is the only time Trump has mentioned Bitcoin and crypto on the record, some of his actions have indirectly been of significance with regards to the topic.
In 2018, Trump signed an executive order banning “U.S. citizens, permanent residents and organizations from buying, holding, trading or spending petro, the cryptocurrency created by the Venezuelan government and purportedly backed by the nation’s vast oil reserves.” This formed part of the VERDAD act, which was passed by Senate in late 2019 to “advance a constitutional and democratic solution to Venezuela’s politic crisis.” Observers however have pointed out that the bill could have huge implications for crypto in the US, with potential bans on cryptocurrencies being as simple as “filling in the blanks”, and it “providing a road map for how to ban a particular cryptocurrency.”
Biden for Bitcoin?
Although there doesn’t seem to be any record of Biden saying anything on the topic in public, some of his comments and actions can give us some clues as to what a Biden presidency might mean for Bitcoin and crypto. Biden is known to be a big fan of technology and innovation, and interestingly, a political action committee that pressured him to run for president in 2016 accepted Bitcoin for donations. At the time, Joseph Schweitzer, the group’s director, said “this is in keeping with Vice President Biden’s strong support of technology and innovation throughout his career.”
An Trustnodes article entitled the ‘Joe Biden: The Bitcoin candidate?’, not only refers to the 2016 occurrence, but also analyses how Biden could take the initiative on the subject in the presidential race. Calling Trump’s Bitcoin tweet “the stupidest tweet ever sent out” and “out of touch with his own base which by and large strongly supports cryptos”, the article suggests that Biden has a opportunity to take an altogether different view, and live up to his reputation for pushing the technology and innovation cause by publicly embracing the positives of Bitcoin and crypto, as after all “innovation is what has made America great.”
It’s clear that it’s actually not clear at all as to what a Trump second term or Biden presidency would mean for Bitcoin or crypto, although a clearer picture can be formed by looking at a potential Biden presidency. There are tentative signs that Biden is supportive towards the subject, despite not speaking about it in public directly. Furthermore, one topic he has spoken about publicly, and where we could maybe gain clues about his views on crypto, is the internet. In 2011, he commented “no citizen of any country should be subject to a repressive global code” when using the internet, but also a “public-private collaboration” is important to keep the internet safe and “up and running”. This view could easily be translated into cryptocurrencies – that regulation is necessary, but so is the importance of not undue governmental interference.
With Trump on the other hand, we can decipher more clearly his views on the cryptocurrencies, but ironically the picture of what a second Trump may mean for the topic is probably more unclear compared to Biden. And that’s all because of his unpredictability. Although we have seen he holds negative views, we’ve also seen how that not necessarily is a bad thing, and any further utterances by Trump could well be better publicity than any money could buy. There are however warning signs. Who’s to say Trump won’t sign an executive order banning a cryptocurrency just as he did with the Venezuelan Petro? Additionally, a tweet following on from his one about Bitcoin would suggest he favors heavy governmental regulations on crypto.
Although here he refers to specifically Facebook’s Libra currency, it’s a fairly safe bet he’d hold the same viewpoint on other cryptocurrencies too. Of course the problem with Trump is his volatility. It’s hard to say how Trump will react to situations and what he’ll say on pretty much any topic from day to day. Especially with the current world situation, it’s quite conceivable that Trump won’t say anything or take any action on the subject for quite some time.
So with an unclear path ahead of us whoever wins the White House, we need to look to Congress for some clarity. There are currently around 20 bills on the table related to blockchain and crypto in Congress, and crypto regulation is certainly on the agenda. The Cryptocurrency Act 2020 was presented on March 9, with the aim of “to provide not only clarity but legitimacy to crypto assets in the United States”. Although this particular bill doesn’t seem to have much chance of passing, being called “dead on arrival”, it does shed some light onto what the governance of crypto in the US may eventually look like.
With ”regulatory concerns” being a stumbling block for more than half of financial advisors thinking of investing in crypto according to a study by Bitcoin Asset Management, the fact the bill even got to Congress is maybe some light at the end of the tunnel, a tunnel which at the moment due to the unclear direction a Trump second term or Biden presidency would take Bitcoin and crypto, is pretty murky.