Donald Trump: crypto president Bitcoin has conquered America

This might all seem alarmingly futuristic. And yet Bitcoin has much in common with the humble wampum, along with shells, beads, bones, feathers, and all the other various and sundry forms of primitive money. These primordial currencies represent mankind’s earliest attempts to display status, to avert evil, to avoid risk, and of course, the desire to gamble.

As it turns out, all money is fake money. As far back as 1670, real estate investor Nicholas Barbon wrote A Discourse of Trade. Money, he observed, “is an imaginary value made by a law, for the convenience of exchange”. Physical material does not matter — hence the wampum being magically transformed into money by the quixotic New World settlers, who had arrived with dreams of utopia, personal power, and riches.

Yet in America, fiction has never meant not real. Before the Revolution, the colonies of Massachusetts, Maryland, South Carolina, Connecticut, Rhode Island, Pennsylvania and New Jersey defied the mother country by printing their own paper money — guineas and shillings based on nothing but the paper on which they were printed. This created foreign exchange hell whenever a colonist might transport their pieces of coloured paper from one territory to the next, a problem solved in 1789, when Alexander Hamilton figured out how to turn a mountain of foreign debt into the United States dollar. Debt didn’t scare Hamilton, nor does it frighten Donald Trump, whose companies have declared bankruptcy six times, with losses reaching into the billions. Given the devastating losses incurred by his casinos in New Jersey, why should Trump have any qualms about the underlying value of anything, much less Bitcoin?

The myth of any currency requires a creation story, and such is the case for Bitcoin, whose origins are shrouded in mystery. The first Bitcoin appeared on 3 January 2009: a long series of numbers and letters shimmering on a computer screen, a triumph of the libertarian imagination, a story no one yet believed. It was supposedly created by a man named Satoshi Nakamoto, who most likely never existed. No matter. Early Bitcoin aficionados took to calling their currency “Satoshis”. (In June, Trump tried to pull a similar eponymous trick with TrumpCoin, with much less favourable results, as it is presently trading at a tad more than one-hundredth of an American penny.)

In the 15 years that followed Bitcoin’s founding, the idea of a purely speculative store of value caught on, perhaps because blockchain technology fit the cultural moment so well. Here was a digital quintessence of nothingness that perfectly aligned with longstanding academic deconstructions of truth into metatextual black holes — the dour philosophes never realising that post-modern cynicism could possess cash value. The crypto bro, suckled on the teats of such over-arching nihilism, saw opportunity.

The revolution has well and truly left the ivory tower. The SEC’s recent approval of options trading for Bitcoin exchange-traded funds supercharged BlackRock’s and Fidelity’s Exchange-traded funds (ETFs), each of which attracted more than $3 billion in their first month of existence. There are presently 11 Bitcoin ETFs, which witnessed daily inflows of $1 billion last week.

The crypto bro’s contempt for the United States dollar is in keeping with MAGA’s denigration of status quo politics and disregard for standard economic wisdom (hashtag tariff war). In this regard, Trump has once again aligned himself with Andrew Jackson, the richest president America had ever known and a famously ill-tempered son-of-a-bitch who despised lineage, pedigree, and protocol. Like Trump, Jackson detested anyone or anything with more power or culture than he, so naturally he despised the East Coast banking elite. The result was his infamous destruction of the Second Bank of the United States out of mere spite against its genteel, priggish, and rather literary banker-in-chief, Nicholas Biddle.

What happened next may serve as a warning for today’s crypto maniacs. Stripped of a national currency, Jacksonian America turned to “wildcat banking” — a term referring to frontier financiers, no longer constrained by regulations or any oversight whatsoever, who set up their own banks in the farthest reaches of the uncivilised West. The assumption was that if their corporate headquarters were 1,000 miles away from anywhere, few people would bother to show up, wait in line for the teller, and cash in their paper currency. In one case, the Jackson County Bank’s holdings consisted of nothing more than a half-full drawer of lead, 10 penny nails, and fragments of broken glass — which, by the way, is more than Bitcoin can boast.

The remainder of 19th-century American financial history would be plagued by boom, bust, panics, and bankruptcy. To the rescue came commodity markets, which back then looked rather different to the kind of markets that BlackRock, Fidelity, the Winklevoss twins and Donald Trump have been backing for crypto. What everyone appears to have forgotten is that American commodity markets were created to stabilise the price of volatile necessities — such as bread — and in their heyday governed the price of everything from apples and plywood to silk and cat pelts. The balancing of the “future” price of imaginary wheat with the day-to-day “spot” price of real wheat turned out to be an extremely efficient way to overcome the chaos of ages past, a problem that had bankrupted farmers in times of plenty and starved citizens in times of scarcity.

These days, no one seems to know the difference between Bitcoin and bread — certainly not the commodity markets. There is no “spot” price for “real” crypto as opposed to “future” crypto because there is no real crypto. Not that that bothers anyone. Every bet placed on Bitcoin requires that the exchanges themselves buy crypto in order to cover the bets, thus creating what is known among the denizens of Wall Street as a “gamma squeeze” — and to everyone else as a self-fulfilling prophecy. The more people bet that Bitcoin will rise, the more Bitcoin rises. It was George Soros, the whipping boy of MAGA (and himself an expert in the baroque workings of commodity markets), who came up with the term “reflexivity” to describe the mirroring relationship of perception and reality in financial markets. In sum: perception trumps reality, pun intended. No wonder Trump recently dubbed Scott Bessent as his new Treasury Secretary — a man who was for many years Chief Investment Officer for George Soros.

The self-declared “crypto president” hearkens a return to long-deflated images of political power — not only to Andrew Jackson and his “pet banks” but to the age of primitive money, of the charismatic tribal lord in his headdress of eagle tails, his many wives draped in beads. Indeed, women have spent a great deal of human history being traded, bought, and sold, for women were man’s first bet on futures and options — a view that eerily aligns with Trump’s atavistic chauvinism.

Crypto is the allegory, the metaphor, the symbol of the Trump presidency. Both Trump and Bitcoin display the triumph of image over substance, emotion over reason, charisma over competence. Perhaps a country founded on dreams deserves such totalising vacuousness. It works great, as long as you can keep manufacturing those clams — and convincing everyone else they have cash value. For Trump, the day of reckoning has never come, and likely never will.

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Frederick Kaufman is a contributing editor at Harper’s magazine and a professor of English and Journalism at the College of Staten Island. His next project is a book about the world’s first political reactionary.

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