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CNBC thinks Donald Trump will make Bitcoin a reserve currency

3M agoā€¢
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CNBC analysts are shaking things up with a wild idea. They say the U.S. government should hold Bitcoin as a reserve currency. The speculation is that under a Trump administration, this might actually happen.Ā 

The analysts believe a Trump-led White House could consider moving Bitcoin from the Justice Department to the Treasury. And that could stabilize Bitcoinā€™s price and increase its value as a reserve asset.Ā 

Trump has shown a lot of love for Bitcoin, so who knows? He just might.

We all know that Bitcoin is a big deal when it comes to protecting against inflation. Unlike fiat currencies, which can be printed like thereā€™s no tomorrow, Bitcoin has a fixed supply of 21 million pieces. This scarcity means Bitcoin canā€™t be devalued by just printing more.Ā 

But the US dollar, the inferior currency, often faces inflation, especially during big money-printing periods. Remember the COVID-19 pandemic when the U.S. pumped about $4 trillion into the economy?Ā 

That kind of move breaks the dollar, but Bitcoin stays rock solid. The crypto diva runs on a decentralized network. No single entity, like a central bank or government, controls it. This decentralization cuts the risk of mismanagement and corruption.Ā 

Now if America adopts Bitcoin as a reserve currency, itā€™d be decentralizing its monetary power, making its financial system way more stable and transparent.Ā 

It fits the principles of sound money, which isnā€™t easily manipulated by governments or banks and corporations. For everyday Americans, Bitcoin offers a shield for their savings against government mismanagement and inflation.

CNBC thinks Donald Trump will make Bitcoin a reserve currency
President Donald Trump and BlackRock CEO Laurence ā€œLarryā€ Fink at the White House. Credits: Getty Images

This is important for hourly workers and retirees on fixed incomes who suffer the most from rising prices. Younger Americans, facing the long-term effects of national debt, can find stability in Bitcoin as a store of value.Ā 

By holding Bitcoin, they can protect their future from an inflated dollarā€™s pitfalls. Letā€™s face it. With the way things are going, Bitcoin is a strategic economic opportunity for the U.S.Ā 

And itā€™d give it an edge in the economic war going on with China and other top economies with centralized financial models like. But adopting Bitcoin as a reserve currency isnā€™t a walk in the park.

CNBC thinks Donald Trump will make Bitcoin a reserve currency
Bitcoin. Credits: Cryptopolitan

First, liquidity is a big deal. The dollar is the most liquid currency globally, with about $7.2 trillion in reserves. Bitcoin needs a much larger market cap and liquidity to replace the dollar as a reserve currency.

Second, we need a supportive regulatory framework. Policymakers must avoid restrictive measures like capital controls, which could erode confidence in the U.S. financial system. Since Trump has said he hates CBDCs, we donā€™t have to worry about that destabilizing things.

3M agoā€¢
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