When President-elect Donald Trump floated the idea of creating a US Bitcoin Strategic Reserve, it sparked excitement among crypto enthusiasts who believe such a move could position the US as a leader in the burgeoning global cryptocurrency environment.
Yet, skepticism persists within the crypto community regarding the practicality of this proposal. Ki Young Ju, the CEO of CryptoQuant, remains doubtful that the incoming administration will greenlight the establishment of a Bitcoin reserve.
Doubts Over a Bitcoin Reserve
Ki Young Ju argues that it’s unlikely Trump will adopt a crypto-centric strategy to safeguard the US dollar’s dominance, given that the greenback continues to be viewed as a reliable and safe investment.
Reflecting on history, Young Ju remarked that whenever the US felt its dominance was being challenged within the global economy, the result was a rise in gold prices, reviving discussions concerning the gold standard. In the late ’90s, financial commentator Peter Schiff was an advocate for gold, referring to it as the ultimate form of money – a position analogous to some views on Bitcoin today.
According to Young Ju, US policies are heavily influenced by the strength of its economy and the dollar’s leading role in international trade. He speculates that should US economic supremacy appear at risk, prices for gold, Bitcoin, or similar assets would likely climb.
The US Economy’s Unrivaled Strength
Young Ju is assured of sustained US economic supremacy, noting persistent investor faith in the American economy and its currency. "While I support the notion of a #Bitcoin Standard, I am skeptical whether the US, amid its economic growth against global stagnation, would adopt Bitcoin as a strategic asset," he stated.
He believes the Bitcoin reserve debate will only become serious if the US faces a "genuine threat" to its global economic position. For now, market confidence underscores the US’s continued dominance.
According to government data, the US handled 37.8% of the world’s Bitcoin transactions in 2022, highlighting its leadership in the crypto mining sector.
Potential Shifts in Crypto Strategy
Young Ju suggests there could be unforeseen shifts in Trump’s approach to Bitcoin, influenced by the broader political context. "If Trump can effectively demonstrate US economic resilience, bolster the dollar’s dominance, and elevate his approval ratings, it’s uncertain if he will remain as strongly pro-Bitcoin as he seemed during his campaign," he mused.
Should priorities shift, Young Ju believes Trump might distance himself from Bitcoin advocacy while avoiding alienating supporters. "At the BTC Conference, mentioning Bitcoin as a strategic asset – was it a sincere step toward considering a Bitcoin Standard, or simply a strategic move to gain support?" he questioned.
Ultimately, it remains unclear which aspects of Trump’s "campaign rhetoric on Bitcoin" will come to fruition.
