Trump says Bitcoin is a ‘scam’ – gold is waiting in the wings
In today’s Money Morning… Trump’s comments on bitcoin come as no surprise given de-dollarization efforts… many ways out of fiat, and all of them are compelling… it’s not a drawn scenario by the hair … and more …
Trump, the man who makes lightning rods look non-conductive, got a bit of a bang Bitcoin [BTC] recently.
Here is what he said:
‘I don’t like it because it’s another currency competing with the dollar… I want the dollar to be the currency of the world.‘
Trump’s comments on the cryptocurrency resulted in what I would call a “minor sell-off”, pushing the price of bitcoin down a hair’s breadth of support to US $ 33,000, which you can see below:
If Fear, Uncertainty and Doubt (FUD) persists, US $ 30,000 would be the next natural line to defend, and if that were crossed, the bottom could really fall.
Lower the price of bitcoin to US $ 24,000.
Is this the start of a new crypto winter? What about gold?
Let’s break it down.
Trump’s comments on bitcoin come as no surprise given de-dollarization efforts
Far from marking the dawn of a crypto winter, Trump’s statement is a buy signal if you can piece the puzzle together.
The headline could have read: “Former Ultra-Nationalist US President Trump Says Favorite Country’s Currency Best Thing Ever And All Other Currencies Are Garbage.”
Of course, Trump would say that. “America First” means “US Dollar First”.
And since bitcoin is a borderless currency, that means it could potentially shatter the nation state over a sufficiently long period of time.
It’s also important to know that the USD supports a lot of third world country economies, which is part of the reason why El Salvador just decided to make BTC legal tender.
Highlight a recent Reuters reports Russia runs out of US dollar reserves, Greg Canavan and Ryan Dinse from New money investor told the following to subscribers:
‘There is certainly some substance behind rational nation-states questioning the viability of their US dollar reserves, with this indebted country seemingly ready to print endless dollars …
‘[Blockchain inherently enhances] financial inclusion. The point is, the current financial system has excluded huge swathes of the world’s population. Especially in third world countries.
‘Blockchain infrastructure – the new rails of the financial world – is much more efficient at integrating these people into a financial system.‘
In turn, de-dollarization could speed up the shift to a much older form of money, gold.
It was a widely ignored S&P Global Intelligence article with huge implications:
‘The Indonesian government’s plan to launch a blockchain-based, precious metal-backed payment and savings platform outside the banking system is likely to promote financial inclusion in a country where around 51% of adults, or 95 millions of citizens are unbanked.‘
Tokenized gold and silver, blockchain bank backed by precious metals, call it what you want.
But the long-term arguments for exiting fiat are really starting to solidify.
Lots of ways to get out of Fiat, and all of them are compelling
Gold, bitcoin or DeFi cryptos that generate interest – all are compelling investments.
Or better yet, combine these three things.
You can buy bitcoin, exchange it for a DeFi coin that makes lending easy, all backed by gold or silver, and get a slice of the ‘exit fiat’ layer cake.
Whatever you do, standing still is not really an option anymore.
As much as I respect the ultra-bear “stay in cash” mentality, it just doesn’t seem right when central banks open the floodgates.
The reasoning is as follows:
- If a crash occurs, central banks know only one way to solve the problem, so …
- Modern monetary theory, helicopter money, QE will only speed up, which means
- Fiat will go even further to the sewer, in turn …
- Gold, bitcoin and DeFi are becoming even more attractive
- CBDCs are launched, while corporate digital currencies also contribute
- Governments around the world are then forced to choose sides in an environment where “techno-monetary competition” is the norm.
- Governments that harness innovation the fastest win the race to establish a system of trust, while governments that use clumsy tactics to force adoption are left behind.
This is not a far-fetched scenario.
Central banks are addicted to an ever-expanding playbook and wait for a “moment of clarity” where they somehow realize their sins against savers and those in cash is a mentality straight out of that of Samuel Beckett Waiting for Godot.
So if any of the items I just described apply to you, be sure to check out Greg Canavan and Ryan Dinse’s latest briefing on the future of money.
It’s a compelling watch, and there they share some tips and tricks for navigating the impending changes in the world of money.
For Morning money
Lachlann is also an editorial analyst at Exponential equity investor, a stock newsletter that searches for promising small-cap stocks. For more information on how to subscribe and see what Lachy is saying to subscribers right now, please click here.