Trump cites China competition in vowing to create bitcoin ‘stockpile’

By Stephanie Kelly

NASHVILLE, Tennessee (Reuters) – Republican presidential candidate Donald Trump said at a bitcoin conference on Saturday that the United States must dominate the industry or China will. Trump subpoenaed advocates of the cryptocurrency, which Beijing has restricted and once called a “fraud.”

Trump positioned himself as a pro-cryptocurrency candidate ahead of the November 5 presidential election, saying he would make the U.S. the world’s crypto leader and embrace friendlier regulations than presumptive Democratic nominee Vice President Kamala Harris, during a speech at the Bitcoin 2024 convention in Nashville.

While the Republican Party has promised lighter regulations for cryptocurrencies, Trump has criticized Democrats’ attempts to regulate the industry.

“If we don’t embrace crypto and bitcoin technology, China will adopt it, other countries will adopt it. They will dominate, and we cannot allow China to dominate. They are already making so much progress,” Trump said.

China has cracked down on cryptocurrencies and has tight controls on capital movements across its borders, but people there can still trade tokens like bitcoin on crypto exchanges, and Chinese investors can also open offshore bank accounts to buy crypto assets.

Trump said he would establish a presidential advisory council on cryptocurrency and create a national Bitcoin “stockpile” using cryptocurrencies already held by the U.S. government, largely seized through law enforcement actions.

“Never sell your bitcoin,” Trump said. “If elected, it will be the policy of my administration, the policy of the United States, to hold 100% of all bitcoin that the United States government now holds or acquires in the future,” he said.

Trump called cryptocurrencies a “fraud” in 2021, but added that he wants US firms to expand Bitcoin mining.

Although the price of Bitcoin initially fell following Trump’s speech, it later recovered and was last traded at $68,182, up 0.94%.

Trump also reiterated that he would commute the sentence of Ross Ulbricht, who was sentenced to life in prison for founding and operating the Silk Road website, which allowed users to secretly buy and sell drugs and other illegal goods.

Trump said Ulbricht’s time served was “enough,” and the crowd was heard applauding and chanting “Release Ross.”

Countries around the world, including the United States, have expressed concern that privately operated, highly volatile digital currencies could undermine governments’ control over financial and monetary systems, increase systemic risk, encourage financial crime and harm investors.

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Digital asset advocates say cryptocurrency users have become a growing political force this election season, but it’s unclear how many users will prioritize crypto over other issues at the ballot box.

Some crypto advocates support Trump, and any move by the US to create a national Bitcoin reserve would likely be seen by them as a major step towards legitimizing the cryptocurrency.

Jack Mallers, CEO of global Bitcoin app Strike, told Reuters that Trump’s proposal to create a strategic Bitcoin reserve was “an incredible vote of confidence.”

Meanwhile, cryptocurrency managers are disturbed by the sanctions decisions taken by the Securities and Exchange Commission during the term of US President Joe Biden.

The agency alleged that several cryptocurrency companies, including Coinbase and Binance, facilitated the trading of digital assets that were supposed to be registered as securities on their platforms, but the firms denied this claim.

A group of about 30 Democratic lawmakers and congressional candidates sent a letter to the Democratic National Committee and Harris on Saturday, urging them to take a “forward-looking” approach to digital assets.

“From an electoral perspective, crypto and blockchain technologies have a major impact in ensuring victory at every stage of the ballot box,” they wrote.

(Reporting by Stephanie Kelly, David Brunnstrom and Michael Martina; Editing by Marguerita Choy)