By George Giles
November 14, 2025
The President of the United States is big on crypto currency. It now represents the majority of his wealth. In one sense a crypto currency is just another tool for facilitating economic activity. Currency is not wealth, it is a just a tool that allows buyers and sellers of goods and services to easily transact their business without resorting to barter. Barter is inefficient for example how many pair of shoes must a cobbler make in order to buy the latest NVidia GPU? Not to mention manufacture them in the right color, size and quality etc. etc. You get the idea.
Security on the Internet is based upon public key cryptography also called asymmetric cryptography. I will spare the reader the gory mathematical details of cryptography and crypto currency as they can be found elsewhere easily. It allows two parties that do not know one another and may not trust one another exchange digital data privately and securely. One of the benchmarks of secure cryptography is that the algorithms and code it is based upon are public. It basically based upon the computational difficulty factoring a very large number. The https: part of a url means use asymmetric cryptography for the initial connection and then use symmetric for data exchange which is very secure.
Trump's first crypto offering were his 'meme coins' that he and his wife brought to market in January. Trump is correct in that a 'cryptocurrency' can act as currency if a buyer and seller are willing to treat it as such.
Crypto currency requires just four things:
- a blockchain for transaction logging
- a hash algorithm for said block chain
- a computer program to mine 'crypto' bits or a wallet for coins you already have
- an exchange where actual currencies like dollars can be exchanged for coins
Bitcoin is deflationary as there is an upper limit on the 'coins' and is deflationary based on the halving algorithm that reduces the number of coins yet to be mined. The difficulty in mining and the fact that the number of coins have an upper limit is why it becomes more valuable over time.
Trump unveiled his most recent crypto offering. It opened at less than a dollar and then lost half its value the first day. Trump crypto is NOT Bitcoin because there no mining, no proof of work nor is it deflationary via algorithmic halving. Trump crypto is like Trump comments thus unlimited, not infinite, but certainly can produce as many bits as his customers are willing to pay for.
Currency just facilitates trade and as Austrians we know it should be gold, but a gold currency favors the working man and the saver. It takes almost all the power away from Federal Government and their agents (banks) with their sycophants and insiders. So no currency in the world is specie based like the gold dollar used to be.
Trump sees crypto as a perfectly legal transaction between his computers and customers who want to send cash for his bits on his blockchain. One does not have to stretch one's imagination to see that it might be called influence peddling: Gulf Shieks, Greater Israel etc. etc. Trump says his latest offering has some kind of voting rights associated with it and his firm.
While there are a lot of dollars in circulation they are not infinite in number (as far as we know, absent an audit). Most currency is bits between computers anyway; actual cash is small.
When the Spanish got gold from the new world back to Spain one of the fundamental laws of economics kicked in: greater supply lower demand thus the price of gold went down.
Donald Trump has recognized that the Federal Reserve is just a paper 'meme' and anytime the powers that be need more currency they take it and then hand it out to their friends. Why shouldn't the Trump junta do the same?
If Donald Trump created a digital currency with algorithms are public and if it was proof of work based from the hash cash algorithm it could be as viable as Bitcoin is from a deflationary perspective. He provides none of this so he is just exchanging purchaser's cash for his bits. Needless to say as an aggressive business man he will create as many digital bits as the market will bear.
Currency's value is in the eye of the holder and those willing to exchange goods and services for said currency. The value is in the exchange. The dollar has been the world's reserve currency for the simple fact that dollars can always be exchanged for something of actual value unlike all the paper currencies of country's that default on their bonds and go belly up.
There are only two countries in the world that have never gone broke: USA and Great Britain. Spain leads the deadbeat pack as it were having gone broke six times and would have extended their lead with a seventh but other European countries, most notably Germany, bailed them out. The pound used to be sixteen ounces of fine silver and twenty dollars were once an ounce of gold. No more, pound and the dollar are just bits on government computers somewhere.
The now infamous Bitcoin paper was written by Satoshi Nakamoto. Every single person in the world with that name has been contacted to no avail. The first million bitcoins were reserved for Satoshi himself and they have never been traded, they remain safely tucked away in his 'wallet'. These 'coins' i.e. bits are worth tens of billions of dollars. It would take a lot of effort in order to trade them for other currencies and the market could not handle that quickly. This then begs the question as to who has no need for tens of billions of dollars? Ther answer is the world's largest consumer of computers and phd mathematicians is the National Security Agency. It would not be a great stretch of the imagination to realize that Nakamoto SAtoshi might actually be a meme there!
Bitcoin has profitably created billions and billions of dollars. Anyone that bought $100 in Bitcoin in 2010 and held it until it reached $100,000+ would be a billionaire; even if liquidating that many coins for cash would take a long time. Ethereum has been very profitable but not nearly as much. There are lots of other crypto offerings (see coinbase) but they are the equivalent of penny stocks on the pink sheets and the difference between daily high and is less than the exchange cost so they are zero arbitrage positions but hold them for fifteen years and see. Remember what Warren Buffet said on his favorite buy and hold strategy is to hold forever!
Trump's crypto offering is just another hustle and offering it for sale just before his inauguration was certainly in poor taste bordering on shameful, but why not pocket a few hundred million dollars just because you can? Shame has never bothered Donald Trump. Shame from infidelity, shame from paying for sex, shame of telling the whole world how you like to grab women by their genitalia, shame of stiffing legions of subcontractors or the shame of telling tens of thousands of documented bold faced lies. None of this bothers Donald Trump, he is shameless! Selling bits for money as President of the United States is just another of his 'very stable genius' ideas. Trump and his crypto, while certainly in poor taste, are perfectly legal. Still Trump crypto may very well prove another foundational principle of economics: Gresham's Law where bad money drives out good!