As the cryptocurrency industry rides the highs of political acceptance and financial growth, former President Donald Trump’s deepening relationship with the blockchain world has raised both hopes and alarm. Critics say what began as a movement for financial empowerment and decentralization is now entangled in a web of crony capitalism.
“If you’d asked me five years ago which American party would champion crypto, I would have picked the Democrats. Economic inclusion, censorship resistance and sticking it to Jamie Dimon were the kinds of things they care about. Or used to,” writes Omid Malekan in The Spectator World.
To many, blockchain technology represents a radically transparent, decentralized alternative to the centralized power structures of banks, governments, and technology giants. Yet Malekan argues that the spirit of innovation has taken a darker turn as politics enters the fold.
“Crypto could – and should – be the great Democratic project. If you disagree, consider this: the too-big-to-fail banks are bigger than ever, but can’t manage to pay a decent rate of interest, operate on weekends, or not mistakenly give someone $81 trillion… Also, they keep firing clients they don’t like, possibly for political reasons,” he writes.
Despite early optimism, Malekan criticizes the Biden administration’s handling of crypto. “It misapplied dated regulations… floated constitutionally dubious restrictions and tried to prevent crypto companies from getting bank accounts.” The result, he claims, was a chilling effect on the industry, capital flight, and limited job opportunities for American blockchain professionals.
In contrast, Donald Trump’s pivot to crypto has been described as swift and decisive. He “promised to make crypto a priority, pass sensible legislation and fire antagonistic regulators,” even going so far as to speak at a major bitcoin conference. His newfound embrace of digital assets resonated with many in the community.
“At a recent White House crypto summit, an industry attendee reportedly observed how remarkable it was that ‘a year ago we didn’t know if we were going to jail, and now we are in the White House,’ to which Trump replied, ‘Me too.’”
However, the honeymoon phase didn’t last. Days before the election, the Trump family launched a crypto fundraising project, quickly followed by the release of a Trump-themed memecoin, $TRUMP. Malekan expresses deep concern over the implications.
“There are problems with the President of the United States issuing such a coin… What if the President bases policy decisions on whatever benefits his coin?”
He notes the coin skyrocketed from under $1 to over $70, making up a significant portion of Trump’s net worth. But enthusiasm waned when Melania Trump released her own token, $MELANIA, which quickly became “almost worthless.”
“The $TRUMP coin was the worst of all worlds: a highly touted coin that had no point, most of the supply of which was kept by Trump and his affiliates,” Malekan asserts.
Despite signing two executive orders with provisions that would otherwise be celebrated—“an embrace of the technology, sensible regulations and a coherent federal approach”—Malekan is wary of one key initiative: the creation of a Strategic Bitcoin Reserve.
“Bitcoin is fine on its own. Government ownership imports government influence and threatens its free-market ethos,” he argues, warning that crypto’s independence may be compromised by political interests.
In a final reflection on the state of the industry, Malekan laments, “Crony capitalism has arrived on the shores of crypto, and the experience is bittersweet… I’m also concerned by the motives of those who embrace it in Washington.”
With $TRUMP now trading near $12 and $MELANIA virtually worthless, the question remains: can crypto remain true to its decentralized ideals, or has it become another tool in the arsenal of political power?
Blockchain at a Crossroads
As Trump champions crypto in Washington, the technology’s original promise of decentralization now collides with the realities of political favoritism. For a movement built on transparency and trust, the road ahead is anything but clear.
