Democratic presidential candidate Robert F. Kennedy Jr. raised eyebrows recently after vowing to progressively back the US dollar with Bitcoin if he wins the presidency. During a July 19 Heal-the-Divide PAC event, Kennedy promoted the idea of backing the US dollar with “hard currency,” including commodities like gold, silver, platinum, and Bitcoin.
Kennedy articulated this strategic move as a way to bolster the American economy and restore strength to the dollar while curbing inflation. By incorporating a small proportion of Bitcoin to back up issued T-bills (i.e., government debt obligations), this is hoped to instigate a new era of American financial stability, peace, and prosperity.
Optimistic projections aside, skepticism isn’t far to seek. Critics argue that this move, despite its groundbreaking impact, might be overly ambitious. Leaning on Bitcoin’s inherent volatility, they articulate why such a proposal could pose more harm than good.
Even more shocking to the cryptocurrency community was Kennedy’s dramatic u-turn regarding his personal exposure to Bitcoin. Despite initial claims of zero exposure, investment disclosures found that he owned up to $250,000 worth of Bitcoin. This raises unsettled questions about the transparency of his campaign and the validity of his financial declarations.
Further, Kennedy intends to exempt Bitcoin-to-dollar conversions from capital gains taxes. This approach could indeed fuel investment and entice businesses to thrive more within US borders rather than looking to more crypto-friendly jurisdictions such as Singapore or Switzerland. This presents as an elegant strategy to foster a more inclusive economic environment.
On the flip side, such a tax exemption could be perceived as a means to favor the rich who have the capacity to invest large sums into Bitcoin. Critics argue that this could widen the economic divide, hence marginalizing lower-income earners who are typically less involved in cryptocurrency markets.
As the presidential race heats up, other candidates are also making crypto-based promises to woo voters. For instance, Republican presidential candidate and Florida Governor Ron DeSantis pledged to ban central bank digital currencies (CBDCs) if he wins the presidency.
While these promises make for an exciting presidential race for crypto enthusiasts, they ultimately point to the ferocious struggle of traditional economics to integrate with the new era of digital finance. However, promises alone won’t suffice; it’s the execution that will ultimately define the future of America’s financial landscape.
Source: Cointelegraph
