https://sputnikglobe.com/20250203/trumps-crypto-play-thinly-veiled-attempt-to-mimics-fdrs-gold-standard-strategy-1121533546.html
Trump’s Crypto Play ‘Thinly Veiled Attempt’ to Mimic’s FDR’s Gold Standard Strategy
Trump’s Crypto Play ‘Thinly Veiled Attempt’ to Mimic’s FDR’s Gold Standard Strategy
Sputnik International
President Trump’s announcement of new tariffs against Canada, Mexico and China has perturbed the crypto market, undermining the administration’s ambitious goals for the deregulated digital money. A leading economist explained to Sputnik what’s behind Trump’s fascination with crypto, and why it could trigger a major economic calamity.
2025-02-03T16:52+0000
2025-02-03T16:52+0000
2025-02-03T16:52+0000
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President Trump is “clearly fearful of the BRICS idea to create their own trade settlement currency” and the threat posed by China in particular to the dollar’s supremacy, veteran economist Marc Ostwald told Sputnik.Meanwhile, Trump’s attempts to strengthen the US dollar through cryptocurrencies, besides creating “a big risk of a crypto bubble,” also threatens to crash the economy, if it’s combined with new financial deregulation, Ostwald said.Prime example? The derivatives time bomb unleashed during the 2007 financial crisis.Trump hinted as much on the campaign trail, saying the US could use crypto could help pay off its gargantuan $35 trillion debt.Crypto Crash Isn’t Surprising, Could Get a Lot Worse If…Whether cryptocurrencies recover or not “depends to a large extent on how the trade wars develop,” Ostwald says, noting that if Trump follows up on the Canada, Mexico and China tariffs by picking a fight with the EU as well, risk sentiments “will last for a good deal longer.”For ordinary investors, the crypto selloff and last week’s trillion-dollar DeepSeek-related tech bloodbath highlight the fact that “a lot of portfolios are very badly imbalanced, heavily overweight [on] tech growth stocks, and underweight [on] many others,” Ostwald stressed.
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what do trump and fdr have in common, is crypto attempt to bail us out of debt, can us nullify debt with crypto
what do trump and fdr have in common, is crypto attempt to bail us out of debt, can us nullify debt with crypto
President Trump’s announcement of new tariffs against Canada, Mexico and China has perturbed the crypto market, undermining the administration’s ambitious plans for deregulated digital money. A leading economist explained to Sputnik what’s really behind Trump’s fascination with crypto, and why it could trigger a major economic crisis.
President Trump is “clearly fearful of the BRICS idea to create their own trade settlement currency” and the threat posed by China in particular to the dollar’s supremacy, veteran economist Marc Ostwald told Sputnik.
“The fact is that China now settles around 51% of its trade in CNY, and there is a lot more bilateral trade in Asia, the Middle East and Africa which is also moving away from the USD, thus threatening the USD’s reserve currency status in the long run,” Ostwald, chief economist at ADM Investor Services, explained.
Meanwhile, Trump’s attempts to strengthen the US dollar through cryptocurrencies, besides creating “a big risk of a crypto bubble,” also threatens to crash the economy, if it’s combined with new financial deregulation, Ostwald said.
That’s because “less stringent regulation gives greater scope for ‘bad actors’ and financial innovation to create illiquid instruments, which attract leveraged investments that see forced sellers in a major risk off event,” he said.
Ostwald sees Trump’s crypto push as “a rather confused and thinly veiled attempt to mimic what Franklin Roosevelt did in 1933, when in a bid to pull the country out of the Depression, he depreciated the US dollar in relation to gold, effectively annulling all debt contracts.”
Crypto Crash Isn’t Surprising, Could Get a Lot Worse If…
“Crypto is a risk asset, and the tariffs have sparked a sell-off in nearly all risk assets and currencies” as capital resettles in more traditional safe harbors, Ostwald said, commenting on the overnight slashing of $2+ billion in value off the crypto market.
Whether cryptocurrencies recover or not “depends to a large extent on how the trade wars develop,” Ostwald says, noting that if Trump follows up on the Canada, Mexico and China tariffs by picking a fight with the EU as well, risk sentiments “will last for a good deal longer.”
At the same time, Ostwald doesn’t expect crypto’s core supporters to rethink their positions, since their backing of the deregulated form of digital money is based less on finance and more on a desire “to see the whole fiat currency complex collapse.”
For ordinary investors, the crypto selloff and last week’s trillion-dollar DeepSeek-related tech bloodbath highlight the fact that “a lot of portfolios are very badly imbalanced, heavily overweight [on] tech growth stocks, and underweight [on] many others,” Ostwald stressed.
