Trump's re-election is a hot topic, what is the future of cryptocurrency?

Former President Trump won the US presidential election on the 6th of this month, successfully reclaiming the White House and being elected the 47th President of the United States.

With Trump's re-election as US President, Bitcoin (BTC), which was considered a 'Trump-related stock', immediately hit a new high and is showing a 'breakneck' rise, breaking new highs every day.

With Trump's election victory confirmed, having made numerous pledges to support the cryptocurrency market, led by Bitcoin, since the beginning of his presidential campaign, the cryptocurrency community is currently immersed in a sweet dream that seems like it will never be broken.

What will happen to the Bitcoin and cryptocurrency markets after the new Trump administration takes office? Will the Bitcoin and cryptocurrency dreams that the cryptocurrency community has been dreaming of come true?

# 'Bitcoin hater' Trump turns his hand and becomes a 'Bitcoin lover'... Why on earth?

President-elect Trump was a prominent figure who harshly criticized Bitcoin during his term as the 45th President of the United States. He harshly criticized Bitcoin and the cryptocurrency market several times at official events.

In July 2019, during his presidency, President-elect Trump’s comments were strong: “Bitcoin, which has high volatility, is an asset floating in the air,” and “Unregulated cryptocurrencies are very dangerous because they can be used for drug trafficking and various illegal activities, facilitating crime.”

He, who had been a relentless critic of Bitcoin and cryptocurrencies, showed a completely different attitude from before when he ran for the 47th presidential election. He started to show a very radical change in attitude, from saying, "I will make the United States the capital of cryptocurrencies" to "I will purchase Bitcoin as an essential reserve asset for the U.S. government."

Of course, considering the difference in Bitcoin's status as an asset between 2019, when President-elect Trump was in office, and 2024, when he is running as a candidate, it is possible to speculate that President-elect Trump has radically changed his views on Bitcoin.

However, President-elect Trump is one of the world's richest people, known to everyone, and has the most knowledge and principles on the financial system and investment assets. It is difficult to guess President-elect Trump's actions with the simple logic of "I didn't know then, but I know now."

Given these facts, it is possible to speculate that President-elect Trump’s public comments on Bitcoin and cryptocurrencies are a thoroughly calculated political choice.

During the Biden administration, Bitcoin and the cryptocurrency market have had a tough time. During the Biden administration, the U.S. Securities and Exchange Commission (SEC) has been suppressing cryptocurrency companies in the United States under the stubborn principle of Chairman Gary Gensler that "most cryptocurrencies are securities." There has been an 'exodus' of cryptocurrency companies in the United States, and companies that have firmly established themselves in the United States, such as Ripple Labs and Coinbase, have engaged in 'deadly' lawsuits with the SEC.

As if he had read the minds of these American cryptocurrency investors, President-elect Trump made a fiery promise during his presidential campaign: “On day one of my presidency, I will fire Chairman Gensler.”

Given these facts, President-elect Trump’s pledge to support Bitcoin and cryptocurrencies could be interpreted as a political move aimed at the cryptocurrency community, which has a significant number of voters.

# So What's Next?

Considering the rapidly changing world history, President-elect Trump's actions and stance, and the changing dynamics surrounding Bitcoin, we can predict the changes that could be realized under the new Trump administration.

As mentioned earlier, the difference in Bitcoin's asset status between the time of President-elect Trump's presidency and now is very large.

Through the Russian-Ukrainian war, the world has experienced the practicality of Bitcoin as an asset. American financial companies are pouring out financial products based on Bitcoin, giving Bitcoin great significance as an asset. Bitcoin is finding its status as a true 'digital gold' as an asset. For this reason, many experts are currently predicting that Bitcoin will change the global trade settlement paradigm.

President-elect Trump is also fully aware of this, and it is highly likely that he will purchase Bitcoin as a national reserve asset, as he declared during his campaign. The US government’s purchase of Bitcoin as a reserve asset will in itself give Bitcoin indescribable value, and other governments can also purchase Bitcoin as a reserve asset.

As a performance to strengthen the initial support, President-elect Trump could pressure to fire Chairman Gensler as he has pledged. The removal of Chairman Gensler, who has arbitrarily classified altcoins as securities and caused altcoin prices to plummet over the past several years, could in itself create a short-term ‘pump’ in altcoins.

However, President-elect Trump, who accumulated wealth through traditional finance, may have a more conservative worldview toward cryptocurrency than expected. President-elect Trump, who has just launched his administration, may implement market regulations that are not much different from the existing ones under the pretext of a “sound financial order,” and this may lead to the unexpected demise of several altcoins.

The cryptocurrency market will undergo significant changes after the new Trump administration takes office. However, the changes may be a sweet but not so sweet dream.

Reporter Kwon Seung-won ksw@blockstreet.co.kr