Peddle To The Meddle 

               A Bitcoin view of the first month of Trump as President #47 and the ongoing money wars

March 10, 2025
 

Once again, Donald Trump is the talk of the town. Love him or hate him, he is a master at stirring up public discourse. Every minute since the inauguration on January 20, 2025 has generated news-worthy sound bites that are relevant to people from every walk of life – ranging from cultural, technological, regulatory to geopolitics. 

The surprising part of the new administration is the speed of execution to begin tackling their campaign promises. Naturally, during the first days in a presidential change-over, the President will work to impress their voters on “fulfilling campaign promises”. However, I have the impression Trump and his team are working differently this time. Appearing more experienced, with a team that is on-board with his agenda and are appearing better equipped to execute than his last presidential term.

Without knowing the US political system better, and due to his age (78), I presume this is the last chance Trump has to be president. Judging by the news that Elon and the DOGE team are sleeping at work and comments by VP Vance to “Expect This Breakneck Pace for the Next Four Years”, the Trump administration will use the next 4 years to achieve everything they believe will Make America Great Again. This timestamp of MAGA across Washington DC, and the world, will likely have ramifications for years (or decades) to come.

So what does this have to do with Bitcoin? Well, Bitcoin was a major election promise and now is a priority to fulfill on for the new administration. I am curious to explore what is happening in the United States of America and how this may shape the future of Bitcoin & Digital Assets. 

It is a surreal time to be a part of this moment in history. My aim is to provide some historical context of the past few years of the digital asset markets and why this administration is interesting for the future of Bitcoin.

A mentor once told me: don’t ignore the government’s influence on business. What they do matters. A perfect demonstration of how true this rings is experiencing the flip-flop treatment of the Bitcoin industry between different political administrations.

Under Biden, Bitcoin was progressively being shut-out from the American economy. Attacks were levied from all angles against digital asset firms. SEC lawsuits, Wells notices, de-banking, app store bans, prison sentences and suspicious deaths were all used against the builders focused on advancing open, private and innovative financial markets through decentralized ledger technologies (DLT).

The net effect of these attacks was capital and human movement. Companies moved out, incorporated elsewhere. Money flowed to where taxes were minimized. People settled where they were welcomed instead of persecuted to grow start-ups. High quality jobs, revenue and economic benefits then began accruing outside North America. 

The result? Well, it appears to have reinforced Bitcoin and distributed networks but disadvantageous for local economies. Brain drain, less entrepreneurs, revenue, taxes and local spending and losing start-up culture all contribute to slow economic growth on all time frames. Countries that willingly turn away the best and brightest, specifically those that are motivated to take risks and build the future are bound to economically flatline or recede.

Fortunately for Bitcoin, it still survived (and thrived) during this time. The Lightning Network continued to grow, hash rate increased (overall computer power directed to mining) and an accelerated stream of people continued to use the network.

There was also a big boost to Bitcoin’s price. One long-standing narrative finally came to fruition: institutional adoption. ETFs have been a long fought for financial tool in the Bitcoin space, dating back to efforts for SEC approval by the Winklevoss brothers in 2013. Personally, after hearing the rumors and many false starts of the “ETF approvals” since I entered the Bitcoin space, my mindset was always “I’ll believe it when I see it”.

Canada became the first country to approve Bitcoin ETFs and have been available to invest in since 2021. A big milestone with local and international fanfare from Bitcoin fanatics. Then, an unlikely ally – Larry Fink via Blackrock – helped get Bitcoin ETFs approved in the US in early 2024. The US products have become the most successful ETF launch of all time. This tool now gives the world’s largest, most advanced capital markets access to Bitcoin. While it’s only a simple tool for financial exposure, this is a bright orange flag of signal that Bitcoin is now eating its way into tradfi.

Another major catalyst for Bitcoin has been “Nation-State” adoption. This idea was percolated by El Salvador purchasing Bitcoin in 2021 and recognizing it as legal tender. The basic concept is that countries, just like individuals, can start using bitcoin as a monetary instrument to manage their national finances. Small countries like Bhutan have been generating revenue by mining bitcoin and holding it as a savings tool. During the Russia-Ukraine war, the Ukrainian Government solicited donations and bought bitcoin in an effort to secure financial resources to finance what has become a prolonged, costly war. An idea held by many bitcoiners was starting to take shape. A monetary revolution: Global game theory of adopting Bitcoin. 

Fast forward to July 2024, the biggest Bitcoin conference in the world is in Nashville. The headline speaker is Donald Trump. Amid much speculation and a 3 hour delayed start time Trump announces a “Strategic Bitcoin Reserve” of Bitcoin holdings for the United States Government (USG) if he’s elected president. This came with many other crypto related promises during his speech that he pitched as enabling America to be a world leader in Digital Assets. The crowd was elated. Trump won the election a few months later, greatly supported by the libertarian, Bitcoin and wider digital asset voter base. Many of which are single-issue voters, focused on electing a president to support this cause.

In what felt like the flick of a switch, we went from an administration actively suppressing an entire industry, to one throwing full weight in support of it. 

Starting on the first day of his presidency, Trump has moved swiftly to establish a litany of executive orders (EO), pardons and cabinet picks that are shaping up to be incredibly impactful for Bitcoin and Digital Assets. My hope is that the growth of Bitcoin and the related industry is going to become so significant, so quickly that future governments (both in the US and globally) can no longer ignore this technology and try to sweep it under the rug. Hopefully, the free money market revolution of Bitcoin can use this lightning bolt of positivity to get a jump start towards mass adoption aka hyperbitcoinization.

A History Lesson – How Did We Get Here?

Before I summarize the flurry of news and executive orders, let’s take a few steps back and get up to speed with some of the crucial major events in global markets and digital assets over the last 6+ years that created the macro conditions that propelled bitcoin to the importance of the United States’ top office.

  • Repo Markets began failing in 2019. Banks started getting bailed out in secret
  • The Federal Reserve stepped in to plug the gap. They denied it for a while, but eventually they did admit to the dirty word, QE – Quantitative Easing, or a market bailout
  • FTX rapidly ascends in 2019 and becomes a dominant crypto exchange player
  • A crisis appears (Covid) and perfectly coincides with under-acknowledged QE. The immediate response is to print money like crazy. Approximately 30% of all USD that has ever existed was created between 2020-2022
  • Stimulus money flows into markets everywhere – propelling asset prices up across the board and causing rampant inflation that continues to today
  • The real surprise, to me, is how long this inflation has taken to leak through every aspect of the economy
  • A rational actor would see this money supply growth and invest, raise prices accordingly. But without understanding monetary theory, many are subject to being “last person in the chain” aka being the furthest away from the “Cantillion Effect”. Main street simply has to raise their prices to remain profitable based on every other relationship around them raising prices to also stay economically feasible
  • Notice how the S&P, house prices, consumer goods prices increase roughly in line with the money supply increase? That’s your main source of inflation. A tidal wave of fresh money
  • During covid lockdowns, trading and investing becomes popular as everyone is at home with time to spare and free helicopter money. Platforms like FTX, Binance and Robinhood are perfectly positioned and surge in usage
  • During this “free” time, some take the opportunity to study markets and money. I believe this caused a big boost for Bitcoin understanding
  • “DeFi” summer brings growth in decentralized applications and exchanges (Dapps and Dex’s)
  • Bitcoin lending surges in popularity (Celcius, Blockfi, Genesis, Voyager Digital)
  • Oct 2020 – the first public company to announce a bold new idea: holding Bitcoin on their balance sheet is Square (now Block Inc.), Soon followed by Microstrategy then Tesla. These purchases and associate press help set off the 2021 bull-run
  • El Salvador announces “Bitcoin country” in 2021
  • Buys bitcoin for their own holdings
  • Makes bitcoin legal tender
  • Begins mining bitcoin using geothermal energy from volcanos
  • Attracts global talent and investment
  • Fed sets expectations: 
  • Expects a “soft landing” after covid
  • Somewhat misleads about future interest rate hikes, which (spoiler) leads to banking collapses later
  • Feb 2022 – Russia invades Ukraine. Sanctions placed against Russia and they are cut-off from SWIFT and “de-banked” globally. Russians at all levels of society lose access to assets, savings and need to immediately find alternative financial rails
  • I believe this might be looked at in the future as a significant milestone in the history of money
  • Cutting off a major country from their own financial assets stored in global banks, removing their access to global payment networks sets a unique precedent that nation-states cannot rely fully on the US for their financial sovereignty
  • BRIC quietly builds BRICS Pay to settle value outside the US controlled global financial system
  • Ongoing SEC attack on industry – Gary Gensler’s SEC issued 125 crypto related enforcement actions, 80% more than the previous head Jay Clayton [source]. Jay Claton began the trend by suing Ripple Labs at the end of 2020 over issuance of XRP
  • Stablecoins rise to prominence, reaching yearly settlement values rivaling Bitcoin and Visa 

 

 

 

 

Visa, Nic Carter [Source]

  • 2022 – Leverage un-winds
    • Terraluna’s algorithmic stablecoin UST de-pegs
    • Over-leverage hedge funds – trading crypto generated from many sources including retail client deposits from Blockfi and Celsius – go bust in epic fashion, causing a cascade of liquidations that reverberate across the crypto ecosystem
    • Three Arrows Capital (3ac) collapses
    • Much all the leverage and re-hypothecation in the market is gone
  • FTX hobbles through 2022 until it is “rug-pulled” by Binance and its own token (FTT) collapses. FTX declares bankruptcy November 2022
  • Early 2023 – crypto-friendly banks collapse or are shut down. Specifically, Silicon Valley Bank (SVB), Signature Bank and First Republic
    • Growth-oriented banks such as SVB positioned themselves with long-dated treasury bills backing their deposits that end up becoming massive unrealized losses on their balance sheets. See here
    • Notably, these banks were either crypto client depository institutions (SVB) and some facilitated 24/7 dollar movements for their institutional crypto clients using their own private, blockchain based settlement networks such as Signet (Signature Bank) and the Silvergate Exchange Network. See more here.
    • Many believe that Silverage and Signature were forcibly taken out of business for their support of crypto businesses
  • Details of state-supported de-banking crypto companies and banks come to light
  • Nov 2023 – Binance & CEO Changpeng Zhao (CZ) charged with US Bank Secrecy Act violations, Money Laundering and steps down as CEO. Receives 4 month prison sentence in early 2024. Now the last major non-US crypto business leader is shaken out
    • Notable, CZ was educated in Canada at McGill and is currently jokying for the position of the wealthiest Canadian. His wealth was accumulated in crypto or via his businesses which are registered internationally in crypto-friendly jurisdictions such as the UAE
    • Binance stops servicing Canadian customers in May 2023
  • Many firms like Binance have been operating, or solidifying their move away from the US due to fear of litigation, being banned from operating, etc.
  • The SEC approves the Bitcoin ETF on Jan 10, 2024. Perfectly timed now that the US crypto businesses were at their weakest point or taken out entirely. Tradfi can now benefit
  • Bitcoin halving occurs at block 840,000 on April 19, 2024 and reduces the block reward (bitcoin released every ten minutes) from 6.25 to 3.125
  • Meme coins explode in popularity, largely driven as a response to the SEC’s heavy handed “regulation by enforcement” stance as joke tokens such as Fartcoin and dogwifhat are difficult to define as a “security” offering under the Howey Test
  • July 2024 – Trump announces support for Bitcoin industry at Nashville conference, vocalizes idea of “Strategic Bitcoin Reserve” for the United States Government
  • Nation-state adoption, bitcoin treasury asset strategy grows among El Salvador, Bhutan, UAE and others we likely will hear about soon
  • Crypto holdings grow: 50m American’s own digital assets, 500m+ globally
  • Nov 2024 – Trump elected in landslide victory and prices rally accordingly
  • Trump begins enacting policy to support Bitcoin & Digital Assets broadly

Legalize Bitcoin

Digital Asset regulatory updates since Trump’s Inauguration

Trump Executive Order signed Jan 23, 2025: STRENGTHENING AMERICAN LEADERSHIP IN DIGITAL FINANCIAL TECHNOLOGY

Summary of Purpose and Policies outlined within;

To support the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy

  • Protecting and promoting the ability of individual citizens and private-sector entities to access and use for lawful purposes open public blockchain networks without persecution, including the ability to develop and deploy software, to participate in mining and validating, to transact with other persons without unlawful censorship, and to maintain self-custody of digital assets;

Protecting the US Dollar:

  • The executive seeks to uphold the sovereignty of the U.S. dollar by promoting the development and global adoption of “lawful” and “legitimate” dollar-backed stablecoins.

Ensuring Fair Access to Banking Services:

  • It calls for the protection and promotion of equitable access to banking services for all law-abiding individuals and private-sector entities.

Regulatory Clarity:

  • The order seeks to provide clear and technology-neutral regulatory frameworks that accommodate emerging technologies, ensuring transparent decision-making and well-defined jurisdictional boundaries to support the digital economy – specifically innovations in digital assets, permissionless blockchains, and distributed ledger technologies.

Prohibition of Central Bank Digital Currencies (CBDCs):

  • The executive order prohibits the establishment, issuance, circulation, or use of CBDCs within the United States, citing concerns over financial system stability, individual privacy, and national sovereignty.

Revocation of Previous Directives:

  • It revokes Executive Order 14067 of March 9, 2022, titled “Ensuring Responsible Development of Digital Assets,” and directs the Secretary of the Treasury to rescind the Department of the Treasury’s “Framework for International Engagement on Digital Assets” issued on July 7, 2022.

Establishment of the President’s Working Group on Digital Asset Markets:

  • The order establishes a working group within the National Economic Council, chaired by the Special Advisor for AI and Crypto, to develop a federal regulatory framework for digital assets, including stablecoins.
  • The group is tasked with evaluating the potential creation of a national digital asset stockpile, possibly derived from cryptocurrencies lawfully seized by the federal government. This is the “Strategic Reserve” the Bitcoin community has been promoting, which Donald Trump referenced during his speech in Nashville.

Observations:

  • Bitcoin is not named a single time. This is unfortunate as the support Trump received was largely spearheaded by the Bitcoin community
  • The Federal Reserve (Fed) is not mentioned
  • Execution of financial changes are appearing to lean towards happening through the Treasury, which is part of the executive branch of government, unlike the Fed which acts independently
  • Framing as “Assets”, never “money” or “currencies”
    • “Currency” and “Money” is only used in relation to Central Bank Digital Currencies
    • “Dollar” is only ever used when referencing “United States Dollar” and is not linked to asset, money or currency terminology
  • Distributed Ledger Technologies is mentioned, but Decentralized is also never referenced. Again, the framing here is actually quite important. Distributed and decentralized are two different things. Even though they sound the same they are used for different purposes and achieve different goals.
  • The underpinning monetary system is arguably stronger as a decentralized network, which is a key focus of Bitcoin. This is worthy of an entirely separate post. We already have a distributed monetary network based on a different base layer – central banks. A distributed system based on stablecoins is essentially re-building the existing system on updated technology rails. This looks a lot like a CBDC that was supposedly “banned”.
  • The words used are becoming dilutive and confusing – crypto, cryptocurrencies, digital assets, blockchain, distributed ledger technologies. I am involved in the industry and the vernacular is becoming tiresome. I would presume new entrants are likely to be dissuaded by the complication of the way this technology is being communicated. The financial system relies on complication to concentrate power. I worry the same thing is happening here.

                      News & Actions Continued

    The pace and number of digital asset related developments has been vast over the past month. This should give you a good idea of where things stand now, who is worth watching and may give us an idea of what to keep our eyes on going forward.

    • Trump speaks to WEF and confidently promotes his America First message
    • Trump publicly shines light on the de-banking issues at WEF, airing grievances to Bank of America CEO Brian Moynihan
      • De-banking is pointed out by Trump as a conservative issue, Melania was de-banked for example, but he misses the mark that this is more than a conservative targeted tool. Debanking is a sneaky use of power to push industry regulation onto private and public institutions to stifle law-abiding citizens and businesses from their ability to participate in economic activity
      • Marc Andressen blew the lid off this issue on his Joe Rogan appearance
    • Trump declares a “National Energy Emergency” – which will affect everything from global energy markets, to households, AI and bitcoin mining
    • Trump targets a corporate income tax reduction to 15% for companies that “build in America”
    • DOGE.gov Launches with a goal of saving $2T of government spending
    • Foreign investment campaigns for building in USA:
    • Jerome Powell – banks perfectly able to serve crypto customers
      • In a big moment for the Federal Reserve, Jerome Powell signals their willingness to allow banks they oversee to facilitate crypto customers and services. While how far this support extends, it’s an interesting change. Perhaps it’s a small saving-face position amid the hard push by the Republican party to allow Bitcoin (crypto) to flourish in the US. 
      • Highlights of Powell’s comments:
        • “Banks are perfectly able to serve crypto customers as long as they can understand and manage the risks”
        • “A number of banks we oversee handle crypto clients, If you want this activity conducted inside federal safety net with deposit insurance, you want to be pretty sure its safe and sound activity”
        • “We are not against innovation and we certainly don’t want to take actions that would cause banks to terminate customers who are perfectly legal, because of excess risk aversion related to regulation and supervision”
        • “You want people to be educated about the financial decisions they make, that’s what securities laws are for, to be able to look at a prospectus so households have a chance to understand the risk they are taking.”
        • “I do think it would be helpful if there were a greater regulatory apparatus around crypto and I think that’s something [us and] congress is working on…and would be a very constructive thing for congress to do”

                                       We told you so, a long time ago! (2017)

    A number of notable attendees attend the Whitehouse Crypto Summit on March 7. Circulated attendee list below: 

    •  Trump to sign Executive Order officially establishing Bitcoin reserve, consisting of 200,000 Bitcoin previously seized through criminal or civil forfeiture proceedures – David Sacks

          Sentiment, Take-Aways and Summary

    Good

    • The overton window has shifted massively in favour of open markets and Bitcoin and Digital Asset adoption. The question is no longer “if” bitcoin, it is “how much”.
      • Governments may take multiple years to implement a strategy and execute. The fast may move in 1-2 years, slow taking 5-10 years or longer. This market may look much different than the past – regular, sophisticated institutional buyers may have more money to put into the market over long periods of time.
      • Amid increased adoption of Bitcoin, the ongoing incentives are set up for all participants to act in benefit of the network to maintain their investments. 
    • If this administration executes and creates a market structure with all the major financial players involved, and the populace further accepts and benefits from digital assets, it may create an industry much less likely to be suppressed by future administrations.
    • The US leads the financial world. Stablecoins and USD dominance are a main priority moving forward. This growth will continue to spread blockchain network usage globally with the USG backing this growth.
    • A larger financial pool is being created, plus cities, states, nations and financial firms are also all racing to get ahead of these changes. Again, Bitcoin’s game theory is now playing out. In the words of Satoshi Nakamoto, “It might make sense just to get some in case it catches on. If enough people think the same way, that becomes a self-fulfilling prophecy.“
    • As mentioned above, Russia and BRICs now understand the value of Bitcoin and one of the use-cases of open-source monetary networks. 
      • Having your financial reserves stolen, your ability to send money cut-off at the whim of the Government is a painpoint felt by everyone – from protesters in Canada, to the Russian Government and Oligarchs/
      • Eventually – rightly or wrongly – financial technology can and will be levered against anyone not obeying the state
      • Global acceptance of decentralized and uncensorable networks are crucial to empower freedom at all levels of society
    • Bitcoin, stablecoins and the overall digital asset industry grew significantly in the face of relentless battle against powerful government and global interests. This has only further tested and hardened these networks and further reinforces the staying-power and interest in this technology.
    • As more people wake up to the manipulation of the money supply and re-frame their price judgments to Bitcoin, I hope that this can assist in the de-financialization of other parts of the economy that have been used as speculative savings vehicles. These actions generally come at the cost of normal society functioning. The stock market, housing, cars, watches, art and any other asset imaginable has been used to store wealth outside dollars. With bitcoin as a savings tool, it reduces the incentive for speculation in other non-financial assets and can potentially bring these back to their production or utility price rather than speculative mark up.
    • I hope to see a return to building actual businesses focused on bitcoin adoption and away from meme-coins as response to legal actions from SEC enforcements.

    Uncertain

    • Is reducing debt, rebuilding the American economy short term negative for Bitcoin?
      • If the USD is better taken care of and more people have confidence in it, will this reduce demand for bitcoin?
    • Bitcoin becomes too closely tied to the legacy financial system
      • Same problems may arise
      • Over concentration on USG, USD$ printing and sentiment
      • Increased correlation to interest rates, money printing, hidden unknown re-hypothetication, wealth concentration via rent seeking behaviours
    • What more positive sentiment can come that will push bitcoin in the short-medium term? Until we see $100b – $1T volume inflows regularly, it may take a while for bitcoin to reach new highs in the near future
    • Institutions move slowly: it may take years (or decades) for governments to get set up to work with, hold, use bitcoin in a meaningful way.
    • Conflict of interests problems? Almost all Trump appointees, Trump and his family now have stakes in the crypto industry and will benefit from its growth. While I am a proponent and excited for positive support of the industry, I don’t want it to be in a crony-capitalist, corrupt market set up by those vying for wealth and power accumulation for themselves instead of the betterment of greater society.
    • Will higher stakes motivate more hostile attacks on Bitcoin in the future?
    • Are we turning this technology bi-partisan by pushing it aggressively with politicians instead of letting the free market play out?

                              What’s Missing

    What I would like to see or has not been included in current proposals to further enhance bitcoin adoption and attract related talent, businesses to the US

    • Reduction or elimination of capital gains tax on crypto holdings
    • Start-up capital gains, growth tax exceptions
    • No sustenance spending or small transaction tax or reporting
    • No capital gain, taxation between stablecoins (USD) and digital assets
    • Additional privacy protection rules for all services and exchanges
      • Zero-knowledge proofs, data ownership by individuals, automatic opt-out of data sharing, hidden wallet details in API calls, encrypted 2fa requirement for all financial platforms (also needed for cybersecurity), better laws for encryption protections at constitutional level
      • Could be added to GDRP and applied globally
    • Mining and energy incentives to build data centers
      • Benefits both bitcoin mining and AI data center developments
      • Likely more to come from David Sacks here

                           It Doesn’t Stop Here

    Thank you for reading to this point and hopefully this has helped inform you about some major happenings in Bitcoin and why it is so interesting to watch it intersect with politics. The separation of money and state was never going to be easy, and now we are watching this collision head-on. This article was difficult to write as every time I added a new section, more news kept occurring. This is almost guaranteed to continue, given Trump’s “policy by soundbite” style. So stay informed as the story will continue to unfold.

    Stay subscribed to Netcoins Blog and my social media feed if you are interested to learn more about Bitcoin, digital assets. In my next article, I will explore this same Bitcoin-political angle and how it is unfolding in Canada. Both locally in Vancouver up to the national stage when we – hopefully soon – get to vote for a change in leadership up north.

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