Bitcoin hits record high as Trump vows to end crypto crackdown

Bitcoin hit a new record high late Monday, its value peaking at $89,623 as investors quickly moved to cash in on expectations that Donald Trump will end a White House crackdown that intensified last year on crypto. While the trading rally has now paused, analysts predict that bitcoin's value will only continue rising following Trump's win—perhaps even reaching $100,000 by the end of 2024, CNBC reported. Bitcoin wasn't the only winner emerging from the post-election crypto trading. Crypto exchanges like Coinbase also experienced surges in the market, and one of the biggest winners, CNBC reported, was dogecoin, a cryptocurrency linked to Elon Musk, who campaigned for Trump and may join his administration. Dogecoin's value is up 135 percent since Trump's win. On the campaign trail, Trump began wooing the cryptocurrency industry, seeking donations and votes by promising to make the US the "crypto capital of the planet," Fortune reported. He announced the launch of his own crypto platform, World Liberty Financial (WLFI), and vowed to "fire" Gary Gensler—the Securities and Commission Exchange (SEC) chair leading the US crypto crackdown—on "day one" in office, Al Jazeera reported. Whether Trump can actually fire Gensler is still up in the air, The Washington Post reported. It seems more likely that Trump may demote Gensler, The Post reported, since people familiar with the matter suggested that "fully outing" the current SEC chair "could trigger a novel and complicated legal battle over the president’s authorities." So far, Gensler has made no indications that he will step down once Trump takes office, although The Post noted that wouldn't be considered unusual. Sources told The Post that Trump is considering "a mix of current regulators, former federal officials, and financial industry executives," for leadership positions, "many of whom have publicly expressed pro-crypto views." Reportedly under consideration to replace Gensler are Daniel Gallagher, a former SEC official currently serving as chief legal officer for the financial technology firm Robinhood, and two Republican SEC commissioners, Hester Peirce and Mark Uyeda, The Post's sources said. Other names in the mix include a former SEC commissioner, Paul Atkins, and a former commissioner at the Commodity Futures Trading Commission, Chris Giancarlo. While Gensler has made it his mission to increase the detection of crypto crimes, bitcoin has notably emerged as a trustworthy digital asset in a sea of scammy tokens. In early January, the SEC approved spot-bitcoin exchange-traded funds (ETFs), which caused bitcoin to hit its previous record high of $69,000. That approval made it easier to fund bitcoin investment projects, but despite the seeming endorsement, Gensler warned at the time that the SEC still viewed bitcoin as a "volatile asset" linked to "illicit activity" like ransomware, money laundering, sanction evasion, and terrorist financing. Now, analysts are predicting that if Trump either clarifies laws or cuts back on regulatory scrutiny, bitcoin and other cryptocurrency trading could become more stable. His exact plans remain unclear, but at his boldest, he has suggested that bitcoin could be used to wipe out the US national debt, which crossed the $34 trillion mark early this year, Forbes reported. "We'll hand them a little bitcoin and wipe out our $35 trillion," Trump reportedly said on the campaign trail. Mauvis Ledford, CEO of a Singapore-based tech startup called Sogni AI, told Al Jazeera that Trump might launch initiatives promoting more widespread crypto adoption to spur economic growth, possibly with Musk serving as his adviser. If that happened and crypto adoption potentially expanded, Ledford forecasted, more companies might be willing to integrate crypto into more products. And that could potentially fuel innovations in blockchain technologies, possibly painting a future where everyone involved benefits from a more transparent regulatory framework that "could provide more stability and legitimacy to the crypto market," Ledford said. But we don't know yet how Trump's crypto plans will play out. "I don’t personally believe anything Trump says," Ledford noted, indicating that he remains "cautious" in predicting "how far Trump might go in his support for cryptocurrencies." As recently as August, when Trump seemed to be warming to the crypto industry, he told his followers on Truth Social, "You know they call me the crypto president. I don’t know if that’s true or not, but a lot of people are saying that."

Trump goes from “not a big fan” to “pro-crypto president”

In 2023, the SEC stepped up enforcement while one of the largest crypto exchanges, FTX, collapsed under massive fraud orchestrated by co-founder Sam Bankman-Fried. The commission recorded 46 enforcement actions, triggering losses of $281 million in monetary penalties resulting from crypto firms' settlements. According to Al Jazeera, Gensler said the SEC was "trying to enforce the laws at hand" amid "a field with a lot of fraudsters, a lot of grifters, a lot of scams." Trump has not always supported crypto, and he actually used to directly align with Gensler's views. In 2019, he praised the US dollar, posting on then-Twitter (now called X) that "we have only one real currency in the USA, and it is stronger than ever, both dependable and reliable." "I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air," Trump posted in 2019. "Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity." But apparently Trump's sons, Eric and Don Jr., got him interested in crypto over the past few months, Trump said during a Spaces discussion on X in September, seemingly coaxing him to start a new arm of the family empire. And now his youngest son, Barron, has been given the position of Chief DeFi Visionary for WLFI at the age of only 18, Forbes reported. Trump's sudden reversal—from calling crypto a "scam" to suddenly launching his own crypto platform—has raised ethical concerns, Forbes reported, especially as he prepares to go back to the White House. Crypto experts and political analysts are concerned about seeming conflicts of interest between how Trump governs crypto and his potentially large stake in the industry, should WLFI take off. Forbes suggested the big question is: "Can a sitting president regulate an industry in which he has a direct financial interest?" With WLFI, Trump appears to be targeting a niche group of crypto investors who might be motivated to cash in big on crypto if the regulatory environment didn't make investing appear so shady. WLFI is an unusual crypto platform in that its governance token can only be accessed by accredited investors. Unlike the ethos of bitcoin's founder, Satoshi Nakamoto—who wanted crypto to be an equalizer allowing anyone to mine their way to riches—only wealthy people will likely benefit from Trump's platform. WLFI investors must meet strict requirements of having either a net worth of over $1 million or an annual income of over $200,000 individually "for each of the last two years," Forbes reported. If Trump's bet on this investor group pays off, a potential fear might be that Trump's financial interest in crypto could deter him from passing stricter protections from fraudsters that the SEC has found run rampant in the crypto industry. Further, because of Trump's past involvement in "ventures that ultimately benefited him at the expense of others," such as casinos and Trump University, Forbes reported, some may doubt the legitimacy of his crypto venture. It likely doesn't help that in September, the WLFI account on X posted an alert that Trump family members' accounts had been hacked by a bad actor promoting a crypto scam using Trump's image. "Do NOT click on any links or purchase any tokens shared from their profiles," the WLFI account said. "We're actively working to fix this, but please stay vigilant and avoid scams!" Potentially raising another red flag, Trump also partnered with Chase Herro to launch WLFI, whom Bloomberg reported is "a self-described 'dirtbag of the Internet'" and Forbes noted is "known for selling dubious financial products." It's possible that Trump still has some learning to do as he dives headfirst into the crypto industry. In August, the left-leaning New Republic reported that Trump was "leaning into his grifty crypto guy image" by trading "scammy" non-fungible tokens (NFTs). In a video on Truth Social, Trump described the NFTs as digital trading cards featuring Trump "dancing" and "even holding some bitcoins." While some crypto coins exist for collectors, the trading card does not show Trump "holding" bitcoins but an illustration of Trump in an Iron Man-like suit with a shield emblazoned with the bitcoin logo.