Trump, on whom crypto voters bet heavily, could backstab the industry

Ben Schiller, CoinDesk

This year, the crypto industry finally got its own “friend”, and his name is Donald Trump. For years, the industry has been trying to find a political spokesperson, someone who can guide its liberation and bring its ideas to a wide audience. Now, that person is Trump.

He stood on the stage of the Nashville Bitcoin Conference and said how much he liked the people in the crypto industry. He announced the establishment of a strategic reserve of Bitcoin. He promised to release Ross Ulbricht. He distributed burgers at PubKey in New York. He even founded his own DeFi project, World Liberty Financial, and developed an internal management model (what better way to show his loyalty to crypto than this?)

Trump said what crypto wanted to hear and did what crypto wanted to do, and he attracted millions of dollars in donations. He is being cheered on by loudmouths and voiced by culture warriors in their hateful performances. He occupies the political space that the Biden administration and Harris campaign would have occupied if they hadn’t been so subservient to the Warren wing. He says everything that is right, because Trump always says what people want him to say. He fits perfectly with the goals of the crypto party, because his politics can adapt to any situation, and the crypto party is in desperate need of a friend.

I have to admit that all of this makes me personally uncomfortable, not because I have any affection for Harris, but because Trump has long been a friend of unreasonable people. He could easily take a completely opposite view on crypto if it worked for him, and he has done so. I am concerned about crypto’s embrace of Trump because I find it hard to believe that Trump is consistent with the principles that attracted me to crypto.

So what are three reasons we, as an industry, should be wary?

Trump may not deliver on his promises

Many White House officials during Trump's first presidency have spoken of his unprincipled nature. His former chief of staff, John Kelly, said he fits the definition of a fascist: someone willing to overturn constitutional norms to achieve his goals.

Here's what a former Trump White House official said this morning:

John Mitnick said: Trump is reckless, irritable, vindictive, narcissistic, and has no respect for the Constitution and the rule of law; Trump is not a conservative, he is more like a dictator and fascist driven by personal interests. He doesn't care about you and your family like he says, he only cares about himself.

Seriously, isn’t this something we should be worried about? Isn’t it odd to align the cause of crypto with an unreliable person? Isn’t it odd that crypto, which is supposed to abhor single points of failure, has joined a cult of personality?

Trump has to take the crypto issue personally to be a crypto politician. Harris and her team have engaged with crypto at times over the past few months, suggesting they might play by the rules on the issue. This summer, participants in Trump’s dance with crypto made it clear that they would not engage with Democrats. Why?

Because Trump has to be the guy: He won’t share this issue with Democrats. That’s what happened in Nashville. Elon Musk was expected to speak to Trump at the Bitcoin conference. But when Trump didn’t want to share the stage with him, he walked away, according to an insider and CoinDesk’s tracking of Musk’s plane. Trump needs to be the guy.

To be sure, the Democrats themselves have given up on crypto. It started with mining, and after the industry returned to the U.S., all the new plants went to red states. Democrats began to make bitcoin mining illegal as harmful to the environment, while Texas and other states are using it as part of their grid flexibility plans. Personally, I’m all for mining as part of the grid, and it would be foolish for the Democrats to outlaw it and lose the industry.

But the interesting question is how Trump would react if the Democrats really started to seriously support crypto.

Alienating Outsiders

In its quest for power and relevance, crypto has aligned itself with the Republican Party. It doesn’t usually say so publicly, but it has done so. The people running its campaigns are all Republicans. The down-ballot candidates it favors are mostly Republicans. When groups like Stand With Crypto implor people to vote, you know they’re not going to support a vote for Sen. Elizabeth Warren.

These campaign groups don’t always make their preferences clear. But their allies do, and the effect is often exclusionary. For example, here’s one-time Messari Ryan Selkis discussing his feelings about liberal white women today.

This is a free country, and Selkis can say whatever he wants. He may even think he’s brave for saying so. But, really, is this good for crypto? Is such language consistent with the goal of popularizing crypto? Wouldn’t liberal white women, and the other groups Ryan has been vilifying 24/7 for the past six months, be disgusted? Wouldn’t they think that crypto is made up of big bad guys like Selkis? If you want to build a broad crypto movement, you certainly don’t want to antagonize women.

Crypto will be associated with policies that have nothing to do with crypto

When I first heard the term “single-issue voter” in relation to crypto earlier this year, I immediately thought “BS.” How can you support a candidate or party on a single issue? That’s not how electoral politics works. When you support someone like Trump, you support a broad range of policies by default.

So when crypto offers Trump $10 million to reinterpret the “Howey Test,” it is also supporting (in no particular order, just to name a few Trump policies) a “peace deal” (aka capitulation) on Ukraine, mass deportations, opposition to abortion, and transgender rights. Is this what crypto wants, culturally and socially speaking?

Better safe than sorry. The Biden administration and SEC’s opposition to crypto over the past three years has been bad for the crypto industry, and the crypto industry must respond. But if this election is aligned with a man named Trump, it could bring about a whole new, different, and as yet unforeseeable set of bad things.