Preface

The 2024 US presidential election has become a global focus, and the re-election of former President Donald Trump has particularly attracted high attention from the cryptocurrency market. Although Trump had a negative attitude towards cryptocurrencies during his first term as president, his recent acceptance of cryptocurrency donations and public support for the development of Bitcoin indicate a significant change in attitude. Trump is set to attend the 2024 Bitcoin conference, and the news that Kamala Harris will also speak at the conference has further raised market expectations for the event. This article will take this conference as a starting point to explore the "maze of the election."

2024 Bitcoin Conference - A Stage for Politicians to Raise Funds

From July 25th to 27th, the Bitcoin conference will be held in Nashville, Tennessee. Former President Trump's confirmation of attendance has increased market attention to the conference, indicating that the conference may have a related impact on the cryptocurrency market. His policy proposals and public support for the development of Bitcoin, reducing regulations, and promoting economic growth may bring more investment opportunities to the cryptocurrency market, further boosting market confidence and promoting the development of Bitcoin and the cryptocurrency industry. Additionally, the high-intensity topics surrounding Trump may lead to the emergence of new memes.

In addition to the highly anticipated Trump, the CEO of MicroStrategy and the founder of ARK Invest, "Wood Sister," will also attend the conference and deliver speeches. MicroStrategy is one of the world's largest corporate Bitcoin holders, with a holding of 226,331 BTC as of June 2024, valued at approximately $1.514 billion. As one of the issuers of Bitcoin spot ETF, ARK Invest needs to express a positive long-term outlook on Bitcoin to attract more traditional investors into the cryptocurrency market.

The technical presentations at the conference may attract more attention to the ecological construction of Bitcoin, showcasing and discussing many technological innovations, especially in the areas of the Lightning Network, smart contracts, and zero-knowledge proof technology. These technological advancements may have a positive impact on the cryptocurrency market, enhancing the practicality and security of Bitcoin and other cryptocurrencies, and promoting their application in more business and daily life scenarios. The participation of Casey, the creator of the Ordinals and Runes protocols, may spark new life into meme projects related to the Runes protocol.

However, a relatively clear situation was disrupted by news on the 24th:

On the 24th, The Kobeissi Letter's official X announced that Fox News reported that Harris would speak at the Bitcoin conference. This news has not had a significant impact on the overall price of BTC. However, it is worth noting that according to the latest polling data from Reuters, Harris is currently leading Trump by two percentage points in the presidential election (44% vs. 42%), based on a July survey of 1241 American adults, including 1018 registered voters, collected through online surveys, which is representative to a certain extent but also has limitations.

In comparison to the support rate data from RealClearPolling, Trump still leads Harris by approximately 1.6 percentage points. When comparing data from multiple sources, it is evident that the support rates of both sides are relatively evenly matched. Therefore, if Harris confirms her attendance at the Bitcoin conference, it is worth considering whether the relatively one-sided balance in the cryptocurrency market will tilt.

Economic Support Behind the Election

Whether it's Trump or Harris, those of us in the market don't really believe that these two sides truly endorse POW and have reached a consensus with the cryptocurrency market to build a "decentralized" world for everyone. Capitalist politicians talking about supporting "decentralization" sounds like a sarcastic comedy. But as long as the interests are aligned, everyone can cooperate and win together.

Therefore, in the case of Trump's re-election, it is evident that his political campaign funding has significant support from the cryptocurrency market, primarily represented by important figures from Silicon Valley such as Elon Musk, co-founder of PayPal Kenneth Howery, venture capitalists Marc Andreessen, and Ben Horowitz.

Reasons for Silicon Valley Capitalists Supporting Trump

1. Economic Interests

Trump's tax reduction policies and business-friendly stance allow Silicon Valley capitalists to enjoy more economic benefits. For example, the "Tax Cuts and Jobs Act" passed in 2017 significantly reduced the corporate tax rate, resulting in significant tax breaks for technology companies. According to the latest data, during Trump's tenure, the US corporate income tax decreased from 35% to 21%, directly increasing the profit margins of Silicon Valley technology companies.

2. Policy Orientation

Many entrepreneurs in Silicon Valley support a free market and an innovative environment, tending to reduce government intervention in the technology and innovation industry. Trump's policy proposals align closely with this orientation. For example, in 2020, he signed the "Artificial Intelligence Initiative" to promote the development of AI technology and reduce regulation of emerging technologies. In addition, Trump's lenient attitude towards the acquisition of large technology companies has provided more freedom for Silicon Valley's capital operations.

3. Financial Market Stability

The collapse of Silicon Valley Bank (SVB) in March 2023 had a significant impact on the technology companies and venture capital (VC) market. Trump's promised policies to reduce regulations and promote economic growth may help restore market confidence and stabilize the financial market. The SVB collapse event demonstrated the high dependence of technology companies on financial infrastructure, requiring policy support to ensure market stability and continuous development.

4. Support for Technological Development

During his campaign, Trump expressed support for the development of Bitcoin and other cryptocurrencies, which aligns with the interests of Silicon Valley capitalists. Many companies and investors in Silicon Valley believe that cryptocurrencies and blockchain technology represent the future of financial innovation and hope to promote the widespread adoption and application of these technologies through policy support. For example, a16z's investment in cryptocurrency and blockchain projects reached $2 billion in 2023, demonstrating a high level of attention to this field.

On the other hand, Harris's current substantial campaign funding comes from individual donations and transfers from other committees. She has performed well in multiple fundraising events, raising $1.25 million at an LGBTQ event in New York City, making it the highest fundraising amount in the history of the event. If Harris confirms her attendance at the Bitcoin conference, she may directly compete with Trump at the conference to solicit funds and election support. However, from the comments on the tweet announcing Harris's potential attendance at the Bitcoin conference, it is evident that most cryptocurrency market users are already disheartened by Harris and Biden's three-year history of persecution, bluntly pointing out that Harris's purpose for this trip is "vote grab."

Should We Really Trust Trump?

Although Trump's current inclinations and statements show a crypto-friendly stance, he carries a strong aura of a businessman, and all his actions and statements are driven by self-interest. Therefore, from a risk perspective, we need to be wary of the possibility of policy black swans and evaluate the reality of his commitment fulfillment.

1. Fulfillment Risks

As a reference, we can review the fulfillment situation during Trump's tenure. According to Politifact.com's statistics, among the 100 promises made by Trump during his 2016 campaign, 55% of the promises were never fulfilled, 22% were fulfilled after compromise, and only 23% were successfully fulfilled.

Trump-O-Meter (Source: PolitiFact)

Another reference is Trump's remarks this year. As of now (2024.7.22), he has made a total of 1029 remarks/comments (not all of which are promises), of which only 36 (3%) are true, 85 (8%) are mostly true, and the remaining 908 are half-true, mostly false, false, or "Pants on Fire" statements, accounting for 56%.

Donald Trump’s Election Comments 2024.7.22 (Source: PolitiFact)

For comparison, the current US President Biden, who has officially announced his withdrawal from the election, has only 22% of his remarks being false and misleading statements in this year's election:

Joe Biden’s Election Comments 2024.7.22 (Source: PolitiFact)

And Democratic candidate Harris has 19% false statements in this election:

Kamala Harris’s Election Comments 2024.7.22 (Source: PolitiFact)

Biden and Harris have significantly fewer remarks in this election compared to Trump, and their remarks are relatively more "accurate." Furthermore, Trump's remarks are numerous and extreme, with over half of his statements being "false" and "misleading":

• 670 false statements, Trump 392;
• 315 misleading statements, Trump 192.

Total Election Comments 2024.7.22 (Source: PolitiFact)

Considering Trump's track record of fulfilling promises during his previous term, even though his presidency would be a significant positive for the cryptocurrency market, promising a relaxed regulatory environment for cryptocurrencies, we still cannot be blindly optimistic and must pay attention to the potential fulfillment of his promises after winning the election. (The above data comparison aims to illustrate Trump's aggressive rhetoric strategy during the campaign and does not imply that the Democratic candidates are more trustworthy or superior.)

2. Attitude Risk

Trump publicly made remarks about BTC during his tenure in 2019: "I am not a fan of BTC and cryptocurrencies. These things are not money; their value is based on thin air."

Trump on Bitcoin & Cryptocurrencies 2019.7.12 (Source: X)

In 2021, he called BTC "a scam against the dollar" and "a threat to all mainstream currencies":

Donald Trump calls Bitcoin ‘a scam against the dollar’ (Source: BBC)

In March of this year, he publicly stated, "If re-elected as president, his government will not crack down on the use of Bitcoin or other cryptocurrencies through regulatory agencies."

Trump suggests he would not crack down on bitcoin, other cryptocurrencies as president (Source: CNBC)

In May, he said, "I will ensure that the history of cryptocurrencies and Bitcoin will be created in my country, not driven overseas."

Trump: I will ensure crypto history is made in US (Source: Baha Breaking News)

Trump's dramatic turnaround in attitude towards cryptocurrencies in this election, coupled with his actions for personal gain and the motivation to win votes from the cryptocurrency community, may not have a high probability, but if he reneges or changes his stance after taking office, it could be a heavy blow to the cryptocurrency market, and all promises may become unfulfilled.

3. Other Risks

Centralization Risk: The US holds the most BTC in the world, and combined with the possibility of Trump declaring BTC as a national strategic reserve asset, there is a risk of gradual "US-ification" of BTC or the cryptocurrency market in the future, given his consistently assertive style.

Risk of Losing the Election: Although Trump's current approval rating may be higher than that of the new Democratic Party's main candidate, Harris, there is still a risk of losing the election. Harris has not publicly stated her stance on cryptocurrencies, and it is known that neither she nor her husband, Douglas Emhoff, have been involved in the cryptocurrency field, and they are traditional financial investors. If Harris is elected, her attitude towards the cryptocurrency market will also be crucial.

Online Support Rate (Source: PolyMarket)

Market Volatility Risk: Given the recent frequent market fluctuations, even though the current bullish factors are significant, there is still a possibility of sudden negative news causing panic selling before and after the arrival of the bull market's main uptrend.

Conclusion

Trump's re-election campaign and his embrace of the cryptocurrency market have brought more possibilities and volatility to the market. His policy shifts and support may attract more investors to enter the market and drive market growth.

From expressing in early January 2024 that he would not allow the creation of a central bank digital currency (CBDC) in the US to participating in an NFT fundraising dinner on May 8 and announcing that supporters can use cryptocurrencies for donations, reiterating that he will be the "crypto president," all had a certain impact on the price of BTC in a short period of time. The high-profile attendance at the Bitcoin conference, which had been brewing for some time, combined with multiple factors in the market, will have its actual impact and performance revealed over time, and Harris's participation has also raised the overall attention of the conference. However, even if Trump or Harris, who currently appear to embrace Bitcoin, come into power, the concern remains whether there will be a repeated behavior of "fattening the sheep and then slaughtering" them.

Upcoming Report (Not Yet Complete): WolfDAO will continue to analyze in depth the impact of the US election on the cryptocurrency market, especially specific projects that can be involved in. Stay tuned for further detailed reports.

Contributors: Sylvia / Cage / Nora / Riffi / Mat / Darl

Editing and Proofreading: Punko

Special Thanks: Thanks to the above contributors for their outstanding contributions to this issue.

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