The past week has been quite eventful in the field of cryptocurrency, with the recent tweet by Donald Trump, the U.S president, on Bitcoin a cherry on top of the cake. The president of the free world lashed out at Bitcoin claiming he is “not a fan” of the digital asset and calling for regulation on the coin. However, his recent pick to the Federal Reserve Board of Governors’, Judy Shelton, is a well-known ‘gold bug’ and has been known to make bullish statements on cryptocurrencies. Does this make some wonder, is Trump secretly a crypto enthusiast?
The mainstream media have been looking deep into Judy’s life (as they always do), and were surprised to find out Trump’s economic advisor is an advocate to returning the dollar back to the gold standard. The president is well known for his pro-dollar statements and the latest stream of tweets on Bitcoin is a strong indication. He wrote,
“We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!”
Judy Shelton: A Gold Bug and a Crypto Bull!
The media have been focusing on the gold standard remarks made by Judy in the past ignoring the pro-crypto statements of the Fed nominee that prove she may well be bullish on the sector’s growth.
Judy spoke to CNBC last week saying that going back to the gold standard will push for the stability of gold’s price. However, according to modern economists, the idea is not viable as it impends the congressional duties of the Fed – to tackle unemployment and keep the inflation level stable. This was the main reason that saw Richard Nixon abolish the gold standard in 1971 through an executive order.
Dr. Judy Shelton speaks to CNBC: A Crypto bull or Gold bug? (Image: Twitter)
Furthermore, Shelton’s idea is not a popular one in the Fed’s building as shown by the Fed’s chair, Jerome Powell’s recent acts in Congress as he brushed off of the idea to oblivion.
Shelton, however, is not only interested in the dollar moving back to the gold standard but also is an advocate for virtual currencies – cryptocurrencies to be exact.
The CATO Institute journal on cryptocurrencies
The established economist published a paper – “The Case for a New International Monetary System” – in Cato Institute journal in the spring/ summer edition of 2018, speaking praises of cryptocurrencies and digital assets. The paper further focuses on the new monetary system based on the gold standard and benefits to the global economy.
Owing to Trump’s nationalist policies and key policies to maintain U.S sovereignty, Judy recommends that the government should look at the possibilities held in virtual currencies as they gain a footing in global trade and economies. She says,
“If the appeal of cryptocurrencies is their capacity to provide a common currency, and to maintain a uniform value for every issued unit, we need only consult historical experience to ascertain that these same qualities were achieved through the classical international gold standard without sacrificing the sovereignty of individual nations.”
She further looks at a modern approach of a monetary system which should include “issuance of virtual currencies in tandem with government-issued currencies”. Shelton further says for these modern monetary systems to work adoption of legal tender laws should be in place to permit healthy currency competition.
Senator Rand Paul is a big fan of Bitcoin (Image: Shutterstock)
Judy, however, is not the only Trump ally deep in the cryptocurrency fantasy as Senate confirmed Trump nominee Rep. Mick Mulvaney (R-SC) and U.S. Senator Rand Paul (R-KY) also dwelling deep in the industry. With such a close band of associates dealing with blockchain and cryptocurrencies, is Trump secretly in love with the industry?