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Trump claims to be the first crypto-president, after he ended regulatory crackdowns and promoted crypto from the Oval Office. He also signed pro crypto laws (GENIUS Act and CLARITY Act)
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The growth of Digital Asset Trusts
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There are concerns that the line between public policy and private profit has become blurred
Donald Trump’s embrace of cryptocurrency and that of his administration fundamentally changed the US financial landscape within a short period.
Trump has branded himself the first crypto-president by aggressively dismantling the regulatory crackdowns. He has promoted crypto from the Oval Office and signed pro crypto laws (GENIUS Act and CLARITY Act) and launched his memecoin ($TRUMP).
His backing led to a flood speculative trading, which helped move crypto from the fringes of finance to public markets, stock exchanges, and into the hands of ordinary investor.
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The rise of Digital Asset Trusts
Digital Asset Trusts (DATs) are growing at a rapid rate. These are companies listed on the stock exchange with the primary purpose of buying large amounts of cryptocurrency. Over 250 public companies have crypto on their balance sheet. Some DATs purchase Bitcoin, while others opt for riskier coins such as Dogecoin.
Asset tokenization is another area of development. This involves turning real assets like property or stocks into crypto tokens. Companies like Coinbase, Plume, Kraken and Coinbase are working to make it possible for traders to trade tokenized shares 24/7, anywhere in world. They also want to create crypto versions of commodities or farms.
Leverage makes the upside faster, and the downside more sharp.
Borrowing is also what really fueled the crypto boom. For example, public companies borrowed heavily in order to buy crypto. Traders placed more than 200 billion dollars in leveraged bets, and loans backed with crypto reached a record high of $74 Billion worldwide.
This created a fragile system, where small price drops would trigger massive liquidations. The losses were then much greater.
The darker side of Trump’s crypto turn
October Crash: During a sudden crypto-crash in October, the risks of these strategies became apparent. The crash began when Trump announced new China tariffs, which caused Bitcoin, Ether and many other coins all to crash simultaneously. At least $19 billion of leveraged positions were liquidated and 1.6 millions traders were wiped off in a single trading day.
Even large US platforms such as Coinbase experienced delays and freezes, preventing investors from selling.
The Ethical shadow: There’s also the fact that Trump-owned businesses are at the heart of this new crypto eco-system, which creates conflicts of interest.
World Liberty Financial, a Trump-linked company, created its own coin, WLFI, put Trump family members in the top positions, like Eric Trump, and receives a fee for every time WLFI tokens were traded.
Some publicly-traded crypto companies tied to Trump’s deals have seen criminal issues exposed, executives resign, or their stock values drop by around 80%.
The Blur between Policy and Profit:The people are concerned that the line between public policy and private profit has blurred. This could encourage risk-taking by insiders.
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