Topline
Presumptive 2024 Republican nominee Donald Trump on Wednesday said he wants all remaining bitcoin to be mined in the United States, weaponizing cryptocurrency as a fresh line of attack against President Joe Biden as the former president further embraces the digital sector after years of skepticism.
Trump has increasingly embraced cryptocurrency in the run up to the 2024 general election.
Key Facts
“We want all the remaining Bitcoin to be MADE IN THE USA!!!,” Trump said in a late night post to his social media platform Truth Social.
Trump warned bitcoin, which is obtained through a computational process known as mining, “may be our last line of defense against” a Central Bank Digital Currency (CBDC).
The ex-president has previously railed against the notion of a so-called “digital dollar” issued by the Federal Reserve — which the central bank has explored but not expressed a stance on either way — branding it a “dangerous threat to freedom” and vowing to block its creation if re-elected.
Mining remaining bitcoin in the U.S. will also help the country be “energy dominant,” Trump said in block capitals, though it is unclear what the former president meant by this given that bitcoin mining consumes, rather than produces, significant amounts of energy.
Trump also took aim at Biden, whose administration and Democrat supporters are largely viewed as skeptical or even hostile to the crypto industry.
He said Biden’s “hatred of Bitcoin” only serves to help U.S. enemies like China and Russia, as well as the “Radical Communist Left.”
What We Don’t Know
The reasoning behind several key assertions in Trump’s post — namely that bitcoin will defend against a central digital currency, that mining will help the U.S. become “energy dominant” and that embracing bitcoin will help the U.S. against its domestic and foreign enemies — is unclear. It is unclear how embracing cryptocurrency would deter the Fed from establishing a digital U.S. currency and it’s possible widespread uptake of cryptocurrencies in the U.S. could even encourage it to move quicker on the issue. By energy dominance, it’s possible Trump is not referring to the energy used up when mining cryptocurrency but the regulations in place governing where that energy comes from. Bitcoin mining is notoriously energy intensive and was estimated to account for as much as 2.3% of national electricity consumption in 2023. In recent years its hefty environmental footprint has come under heavy scrutiny. Biden’s proposed budget for 2025 has suggested ways to mitigate mining’s environmental impact, such as a 30% tax on miners’ total energy costs. This would be in line with his other criticism of Biden’s environmental policies. Trump’s national security angle is harder to parse, especially given bitcoin’s well-documented potential to aid illicit activity, terrorism and sanctions dodging. It is possible Trump is raising the speculative privacy concerns surrounding a central bank issuing its own assets in a sector renowned for its anonymity and privacy.
News Peg
Trump reportedly met with bitcoin miners at Mar-a-Lago on Tuesday. The meeting, which included leaders from bitcoin mining firm CleanSpark Inc. and Riot Platforms, is his latest overture to the crypto sector — and the tech sector as a whole — as he strives to establish cryptocurrency as a dividing line between him and his rival Biden as they vie for second terms in the White House. He reportedly told attendees he loves and understands cryptocurrencies, according to Bloomberg, citing CleanSpark chair Matthew Schultz. Schultz told Bloomberg Trump vowed to be an advocate for bitcoin miners in the White House at the meeting and said miners could help stabilize energy supply from the grid.
Key Background
Trump was notoriously skeptical of the crypto sector when president. In 2019, he said he was “not a fan” of cryptocurrencies. He said assets like bitcoin “are not money,” highly volatile and “based on thin air,” criticizing their potential for facilitating “unlawful behavior” like drug trafficking and even proposed regulations to require firms to collect information on the identity of crypto wallet holders. He has since reversed course, revealing millions in digital assets, accepting campaign donations in cryptocurrencies and flogging his own “digital trading cards.”
Tangent
Supply of bitcoin is limited by design to 21 million bitcoins, the majority of which (around 90%) have already been mined. The process for mining an individual bitcoin grows more energy intensive the closer we get to that upper limit, with the reward for successful mining operations halving at predetermined intervals. Assuming a consistent rate of halving once around every four years, as has happened in the past, bitcoin is expected to be minted until around 2140. Estimates indicate the U.S. is already leading when it comes to bitcoin mining, accounting for between 35-40% of overall production. Data indicates other leading mining countries include China, Kazakhstan, Russia, Canada and Germany, though the computational nature of bitcoin mining can make it hard to determine accurately where the currency is mined.
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