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DONALD Trump can end the so-called crypto-winter by proving that digital currencies are not just assets terror groups use, a financial expert has said.
During his successful election campaign, Trump vowed to turn the US into the “crypto capital of the world” and enthusiasts have been welcomed by the administration’s stance
He made the claims just years after he described Bitcoin as a “scam.”
Trump has even launched his own meme coin – a digital asset that doesn’t have any real value.
Former President Joe Biden appeared indifferent toward cryptocurrency, and experts believe Trump’s enthusiasm for digital assets could mark the start of a new era.
Investors simply believe this federal government is more open to the idea of cryptocurrency than the last.
But, experts warn Trump still has work when it comes to changing the narrative surrounding digital currencies.
Crypto critics have revealed how extremist organisations and terror groups have turned to digital currencies as a fundraising tool.
And, a chainalysis report revealed extremist groups in Europe had seen a crypto fundraising surge, and crypto mining is used by anti-American regimes such as Iran.
Cryptocurrencies are also vulnerable because their value can fluctuate, forcing users into a conundrum of whether to hold onto their assets or sell.
And, when the market stagnates or declines, it’s known as a crypto winter.
Last week, Bitcoin and Ethereum experienced sharp declines.
The value of Ethereum has dipped by more than 17% over the past month.
And the valuation of Bitcoin has seen peaks and troughs.
Bitcoin surged to $100,000 on December 5th – its highest valuation ever at the time.
It marked a 45% rise in valuation since Election Day.
On January 30, one Bitcoin was worth more than $105,000; three days later, its valuation plunged to below $93,000.
The valuation of Ethereum also saw a sudden nosedive between February 1 and 3.
Expert Tips: Crypto Scam Red Flags
Scam expert Toby Braun, the managing partner for American Special Investigative Group and Heroya Cryptocurrency Investigations spoke exclusively to The U.S. Sun about the warning signs of crypto scams.
Beware of a “Crypto trading platform, service or fund offering unusually high returns,” he said as these “are more than likely a scam.”
Individuals who still go ahead with the investment should ensure that “professional due diligence” is carried out regarding the individual or platform.
His second tip is to “refrain from responding to personal solicitations involving cryptocurrency from an unknown source.”
This can be via any social media platform, emails, text messages, or WhatsApp.
The third red flag is being approached by people who seem to be overly friendly.
“Many scammers use deepfake technology to pretend to be someone on dating sites they are not,” Braun said.
“Once the scammers connect with their unbeknown victim who is often just looking for a real connection, they flatter them before sharing how much money they are making with crypto.
“The victim is then lured into making substantial investments, and deposit funds they’ll never see again.”
Similarly, the expert warned people away from engaging with strangers or people they have just met if they are asking for money or encouraging them to invest.
Lastly, “be aware of anything that simply sounds too good to be true. It generally never is,” he added.
But Bitcoin has seen a steady increase in its valuation since Trump’s election victory, after hovering around $60,000 in the weeks leading up to the vote.
Speaking to The U.S. Sun while Trump was President-elect, Daniel Strachman, who has over 20 years’ experience on Wall Street, believes Trump’s enthusiasm for digital currencies can spark a boost in the markets.
But, Strachman warned about crypto enthusiasts being too optimistic.
“This euphoria is a little aggressive. I don’t want to call it tulip mania but it’s feeling quite frothy,” he said.
“We’re still in the first five minutes of the soccer match—the first inning of the baseball game.
“Trump’s win was a crypto reset, because we’ve been in a situation for the last couple of years where three or four things happened.”
Strachman alluded to how the Biden administration was rather indifferent to or opposed the concept of cryptocurrency entirely.
“Number two: you had a crypto winter, and things haven’t been great economically with rising inflation and interest rates going up,” he added.
Trump’s meme coin
DONALD Trump debuted a meme coin before he was inaugurated for the second time as president.
Meme coins don’t have any economic values and are inspired by memes or internet trends.
Experts have warned meme coins are highly volatile assets.
Trump’s coin $TRUMP is marketed with a picture of the president holding up a fist with the word “fight” embedded.
Trump told his diehard supporters to “fight” as he returned to his feet after being grazed in his ear in what was an attempt on his life at a rally in Butler, Pennsylvania.
The website selling Trump’s token has warned it’s not an investment opportunity.
First Lady Melania also launched a meme coin.
But, Ivanka Trump slammed a meme coin that was created in her name.
“There were a lot of factors that caused digital assets to collapse.”
Hedge fund expert Strachman warned how enthusiasm alone doesn’t lead to mass adoption.
He stressed how the reputation linked to cryptocurrency needs to change first.
“There hasn’t been mass adoption yet,” he said.
“There’s still [the argument] that this is the tool of terrorists, drug dealers and money launders.
“There is that sort of cloud that still exists.
“You have tens of millions of people in the United States who aren’t on the train yet.”
But, destigmatizing the perception surrounding digital currencies doesn’t require a huge effort from the federal government, according to Strachman.
He doesn’t believe bureaucrats in Washington D.C., should dictate what currencies people invest in.
“They could potentially educate them on what cryptocurrencies are,” he said.
“That wouldn’t be a bad thing, but the Federal Government shouldn’t be telling people ‘Buy this, or buy that.’ We don’t do that in this country.”
CHANGING THE NARRATIVE
Trump, himself, could change the narrative surrounding digital currencies, according to Strachman.
“If he’s saying ‘Crypto is good. Crypto is real. Crypto is here,’ that’s going to push those people, those larger investors toward making that adoption more complete,” he explained.
Trump raised eyebrows when he launched his own meme coin.
Melania’s meme coin went live the day before she became First Lady for the second time.
Meme coins are often inspired by internet trends and are considered risky assets, per Coinbase.
Trump launched his coin years after appearing to be a staunch crypto-skeptic.
In an X post from 2019, Trump claimed bitcoin’s valuation was based on “thin air.”
“Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity,” he said.
“We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable.
“It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!”
In 2021, Trump described bitcoin as a “scam against the dollar.”
TRUMP’S U-TURN
El Salvador made history in 2021 by becoming the first country to adopt Bitcoin as its legal currency.
At the time, the country’s leaders said it would open financial services to those who don’t have bank accounts.
Government officials provided incentives such as discounts on gas that was paid in bitcoin in a bid to encourage the rollout, per The National Bureau of Economic Research.
Despite El Salvador setting a precedent, countries have not followed suit.
And, the risks linked with cryptocurrencies have not disappeared.
Ivanka Trump was forced to put out a statement after a meme coin had been created in her name.
She warned she had no involvement with the coin and claimed the promotion was “deceptive, exploitative and unacceptable.”
