After arresting real miners, Trump tries to woo bitcoin ones

For many Americans, Donald Trump’s recent decision post on social media about cryptocurrency would probably be inscrutable. Is he opposed to a “CBDC”? Does he think “bitcoin mining” will make us “energy dominant”? What exactly is this all about?

The short answer is that Trump feels that the North American community of cryptocurrency advocates is tilting toward his side, so, in keeping with his standard approach to politics (and business), he is dumping them. He is adopting niche crypto positions as a response to community enthusiasm, rather than as a driver of that enthusiasm. It’s similar to the way he tailors proposals for other communities where he thinks he’s gaining ground, like black voters and younger voters in general.

That’s the important point here, but let’s first offer a longer answer, explaining what Trump was saying and why.

The post in question linked to an essay in Bitcoin magazine written by a former Trump administration communications official. He suggested that Trump was “the best choice for bitcoin,” which Trump’s post amplified.

“VOTE FOR TRUMP! Bitcoin mining could be our last line of defense against a CBDC,” it said. “Biden’s hatred of Bitcoin only helps China, Russia and the Radical Communist Left. We want all remaining Bitcoins to be MADE IN THE USA!!! This will help us become ENERGY DOMINANT!!!”

A “CBDC” is a central bank digital currency, a government-issued cryptocurrency. The idea is anathema to many bitcoin advocates, given their embrace of cryptocurrency as a alternative for government-backed currencies. Trump, in an attempt to woo crypto enthusiasts, took up the cause – at least, as part of his speech.

“I will never allow the creation of a central bank digital currency,” Trump said (in one form or another) half a dozen times in speeches this year, including during remarks at the Libertarian Party’s anti-government convention. The complaint usually comes in a list of campaign promises that he reads from the teleprompter.

This wasn’t a problem when he was president. In fact, he criticized cryptocurrencies specifically in 2019, saying he was “not a fan” and that the coins could “facilitate illegal behavior.”

But now he wants “all remaining Bitcoins to be made in the US”, which is like declaring that you want all remaining animated films to be made in the US: if people elsewhere have computers, they will have a chance to mine bitcoin.

Bitcoin mining is not real mining, obviously. It is a term of art used to describe efforts to solve complicated mathematical equations, with users who solve the equations earning bitcoins as a reward. It is not about solving equations with pen and paper, but rather computational, so the effort to solve the equations requires an enormous amount of computational power – and, by extension, electricity. Apparently, this is why Trump says that focusing on bitcoin mining would make the United States “energy dominant,” although that’s a bit like saying that using a much larger percentage of the world’s gasoline would make us fossil fuel dominant.

Trump’s effort to appeal to the cryptocurrency community is not surprising given how young and male the community is. This broader constituency is one that Trump has been targeting for some time.

Vote taken by YouGov earlier this year reflected that young Americans and men were more likely to have heard a lot about cryptocurrency.

Men were also more likely to have invested in cryptocurrencies, although this constituency was slightly older.

But hearing about cryptocurrency and having confidence in it are two different things. About three-quarters of Americans, including young Americans, indicated that they thought at least half of cryptocurrency companies were blatant frauds.

At Axios, Trump’s promotion of cryptocurrency, including his introducing a line of NFTs in 2022, was framed as part of its effort to appeal to younger voters. But this takes us back to where we started: their proposals tend to follow supportive cues rather than push them forward. (NFTs, however, were clearly a pure money game.)

Gallup data shows that younger Americans, black and Hispanic Americans, have veered to the rightespecially since 2020. This is not strongly reflected in voter registration data analyzed by the Pew Research Center, but it’s something Trump and his allies have noticed. So his campaign is trying to capitalize on the perceived advantage.

The campaign and its allies also tend to present causality in reverse. After Trump was prosecuted following his indictment in Georgia, for example, his photo was hailed by conservative pundits as boosting new black support for his candidacy. There was no evidence of this. In June 2023, YouGov measured Trump’s support among black voters at 15 percent. The police photo was in August of that year. A recent YouGov poll had Trump at a statistically similar 12%.

Polls show that younger voters are more divided in the race between Trump and President Biden than reflected in 2020 exit polls. But this has been the case for some time; younger voters were among the first electoral districts sour Biden’s presidency. The trend began well before anyone on Trump’s team included his denunciation of central bank cryptocurrencies in his speech.

The question, of course, is what happens on election day. Polls also suggest that Biden a broader advantage among the most likely voters, including among younger Americans. The Harvard Youth Survey, released in April, showed this effect dramatically.

Trump’s social media post about bitcoin reflects an effort to appeal to cryptocurrency supporters, even if it conveys some unfamiliarity with the community. It seems safe to assume that the endorsement has less to do with a broad appeal to young voters than with an attempt to secure a favorable voting bloc, however modest. It is also about positioning Trump once again as the outsider, the guy willing to confront the establishment in all its manifestations.

He spent decades trying to close the deal on New York City real estate transactions. This bitcoin post can probably best be read as an effort to sweeten the deal for a client he hopes is about to put pen to paper.

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