Does Trump's Strategic Holding of Bitcoin pose a Risk to Liberty?
Embracing the role of Bitcoin as a strategic asset, the new U.S. administration under Donald Trump is fiercely advocating for the country to establish dominance in Bitcoин mining. With this vision, some are celebrating Bitcoin as a safeguard for national wealth, while others warn of potential threats to its original principles of decentralization and freedom.
The Push for National Bitcoin Dominance
Trump's administration is taking a hands-on approach to Bitcoin, looking at the currency as an opportunity to dominate the "block space." Rachel Silverstein, the U.S. General Counsel for Bitfarms, believes sanctions can prevent conflicts and highlights their importance in preserving international cooperation. Meanwhile, Fred Thiel, CEO of Marathon Digital, underscores that controlling Bitcoin mining could ensure the U.S. maintains the ability to transact and remain the global leader in digital currency.
This focus on Bitcoin mining dominance may result in stricter regulations and oversight, enabling the U.S. to enforce transaction censorship through compliance with Office of Foreign Assets Control (OFAC) sanctions and other regulatory tools. The lead has already been set. Marathon tried mining OFAC-compliant blocks in 2021, filtering transactions involving sanctioned entities, and now miner pools like F2Pool are facing allegations of excluding such transactions.
The Spread of U.S. Regulatory Frameworks
U.S. guidance often influences international financial regulations. Consider the Financial Action Task Force (FATF), whose global anti-money laundering standards mirror U.S. priorities. U.S. regulatory dominance over Bitcoin mining could help push a framework that aligns with U.S. geopolitical interests. This perspective can be seen in talks by former White House cybersecurity advisor Carol House, who suggests that network-level censorship could serve national interests, making Bitcoin a governable digital asset rather than an unstoppable force of decentralization.
Such enhanced control could be driven further by oppressive measures like widening the net of the Bank Secrecy Act and FATF's recommendations to expand widespread Know Your Customer (KYC) procedures and categorize wallet software as Crypto Asset Service Providers (CASPs).
Bitcoin as an International Strategy Reserve
Some supporters of this approach, including Michael Saylor and Senator Cynthia Lummis, argue that Bitcoin's role as a Strategic Reserve Asset could be a valuable solution for U.S. economic challenges. They claim it could help address significant debt, lower foreign exchange risks, and strengthen global positioning.

However, as institutions like tether rally behind this emerging trend, concerns about the centralization and censorship resistance of Bitcoin grow. Those against regulating Bitcoin warn that such moves could hand institutional players excessive power, leaving the door open to open-ended regulatory overreach, jeopardising the network's decentralization and censorship resistance.
Tether's Massive Profits from Global Instability
While Bitcoin's Strategic Reserve Asset debate catches the limelight, Tether gains immense profits from the world's chaos. Reflecting Q3 2024's extraordinary market performance, Tether reported a net income of $2.5 billion, outperforming market titan BlackRock's $1.63 billion net income for the same quarter. A large portion of Tether's earnings stemmed from investments in U.S. Treasury securities, effectively bolstering U.S. monetary policy and providing financial relief to regions struggling under inflation's burden. The result: Tether's global dominance at the cost of exacerbating financial inequalities.
The Impact of these Changes
The rise of government-backed Bitcoin Strategic Reserves raises thought-provoking questions. While proponents boast of advantages like economic stability, improved legitimacy, and reduced vulnerability to illicit activities, opponents caution about the dangers of centralized control, potentially undermining Bitcoin's core principles of freedom and decentralization.
As regulations evolve, Bitcoin mining may become an activity that prioritizes compliant transactions, driving up fees for non-compliant ones. The result: a system where financial sovereignty, once a beacon of hope, becomes inaccessible for those unwilling or unable to meet regulatory demands.
In this discipline of choice between embracing regulatory overreach and preserving Bitcoin's decentralized nature, the world stands at a historic crossroads. Will Bitcoin continue to foster human freedom and escape state control, or will it succumb to political pressure and dictate?
- With the 47th president of the United States strongly advocating for Bitcoin, the price of cryptocurrency like Bitcoin and altcoins has seen significant fluctuations in the market.
- The push for national Bitcoin dominance has led to discussions about the role of Decentralized Finance (Defi) in the broader financial landscape, as central bank digital currencies (CBDCs) also gain traction globally.
- The potential impact of institutional adoption of Bitcoin and other cryptocurrencies is an ongoing debate, with some fearing that increased regulation could lead to centralization, potentially eroding Bitcoin's original principles of freedom and censorship resistance.
- The inauguration ceremony at Capitol Rotunda in 2025 might serve as a turning point, marking the entry of Bitcoin into mainstream finance and ushering in a new era of digital currency usage.
- As the role of Bitcoin as a strategic asset continues to evolve, the discourse around cryptocurrency and decentralized finance has become an essential topic of conversation in political circles, with implications for international finance and monetary policy.