Crypto capital of the world


Trump posted on his pseudo-twitter site: “I will make sure the U.S. is the Crypto Capital of the World.” He announced something he calls a US crypto strategic reserve. 

What, exactly, is a crypto reserve?

Look, I get it. Money is whatever people use as a medium of exchange and a store of value. And crypto is used as a medium of exchange, albeit mostly by wholesale drug dealers, money launderers and extortionists. But crypto as a store of value? Please. It would be more accurate to describe cryptocurrencies as a tool for pump-and-dump.

Gold is rare on the earth’s surface, so it might make sense to have a gold reserve. It certainly did when the dollar was on the gold standard. But the US dollar went off the gold standard in 1971, so one might wonder what the purpose of a gold reserve is anymore. And a crypto reserve is a reserve of what . . . electrons?

The disturbing possibility is that this is about destroying Treasuries as the reserve currency. From the discussion thread at the link:

“ . . . it would work by statutory revaluation of the gold reserves and using the resulting increased valuation to buy crypto. The specific provision would presumably be an obscure provision in one of the current omnibus-type bills. Unless I'm missing something, I don't see much difference between that and the platinum coin in spirit, but the magic invocation of gold could give it a respectability that the other wouldn't have. 

 

“If that's the play, it's kind of emblematic of this regime-- creating nothing from nothing, but with a big public show.”


A more benign but cynical take is that the goal is to boost the price of Bitcoin so Trump and his crypto pals can make a quick buck; the pump of yet another pump-and-dump scheme.

"The main argument for a Strategic Bitcoin Reserve seems to be that Bitcoin holders worry about an impending shortage of greater fools and need the US government to act as the greatest fool of last resort.”
~ David Frum

https://jabberwocking.com/dumbest-idea-ever/

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