WEBVTT - How Trump pushed bitcoin to record highs

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<v Speaker 1>From Swartz Media. I'm Daniel James. This is seven am.

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<v Speaker 1>Crypto is skyrocketing ever since Donald Trump won the US selection.

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<v Speaker 1>Trump is set to lead the most pro crypto administration ever,

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<v Speaker 1>promising a crypto advisory cancel and appointing a prominent pro

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<v Speaker 1>crypto hedge fund manager as his pick for Treasury Secretary.

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<v Speaker 1>His campaign received considerable donations from the crypto industry, and

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<v Speaker 1>there's hopes among the industry he'll come good on his

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<v Speaker 1>promise to create a national bigcoin stockpile. Today, managing editor

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<v Speaker 1>of the Saturday Paper, Emily Barrett on why Trump backs

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<v Speaker 1>crypto and what it means for the global economy. It's Wednesday,

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<v Speaker 1>November twenty seven. Emily. It seems like crypto is some

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<v Speaker 1>think will either know a lot or nothing about. But

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<v Speaker 1>what we do know is that it's going to gain

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<v Speaker 1>busters since Trump was elected. So can you explain why

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<v Speaker 1>that is?

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<v Speaker 2>Yeah, So the reason is that Trump has clearly declared

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<v Speaker 2>himself the crypto president.

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<v Speaker 1>This afternoon, I'm laying out my plan to ensure that

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<v Speaker 1>the United States will be the crypto capital of the

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<v Speaker 1>planet and the bitcoin superpower of the world.

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<v Speaker 2>And we're getting there. So Trump, you know, he used

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<v Speaker 2>to be not such a fan of crypto. You know,

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<v Speaker 2>he's own record in the past saying that he thought

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<v Speaker 2>it was too volatile. But I think that we got

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<v Speaker 2>to the point really where Trump began to have a

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<v Speaker 2>few crypto sponsors in his ears.

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<v Speaker 1>So nearly half of all the corporate money being.

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<v Speaker 2>Pumped into this year's election is coming from a crypto industry.

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<v Speaker 2>According to a new the industry raising more cash for

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<v Speaker 2>twenty twenty four campaigns than any other single issue group.

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<v Speaker 2>The crypto industry was pouring like one hundreds of millions

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<v Speaker 2>of dollars into the presidential race. It was supporting lots

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<v Speaker 2>of packs, and essentially, you know, Trump was kind of

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<v Speaker 2>chasing votes. He had been told by several influential people

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<v Speaker 2>in the crypto industry that you know, there were sort

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<v Speaker 2>of upwards of twenty million votes to be had, and

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<v Speaker 2>particularly among a demographic that he's very sympathetic towards a

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<v Speaker 2>sort of a young male contingent who were very strong

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<v Speaker 2>boosters of cryptocurrencies. And so he's had something of a

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<v Speaker 2>kind of come to crypto moment over the past few years.

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<v Speaker 1>So it's had a long and checked sort of background

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<v Speaker 1>as a market, but how did the fascination with crypto

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<v Speaker 1>come about. What's the appeal from a financial perspective.

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<v Speaker 2>So, certainly the main thing that we know about crypto

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<v Speaker 2>is that you can make a lot of money very fast.

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<v Speaker 2>You can also lose a lot of money very fast.

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<v Speaker 2>You know, cryptos sort of starting in two thousand and eight,

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<v Speaker 2>for a long time it was just trading around ten US.

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<v Speaker 2>Since this is bitcoin, which was the sort of largest cryptocurrency.

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<v Speaker 2>It went from sort of twenty five twenty seventeen, and

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<v Speaker 2>then it fell back to six thousand. You know, it's

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<v Speaker 2>had all these peaks and troughs over the years. We

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<v Speaker 2>had it getting to a peak of eighty eight thousand

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<v Speaker 2>in November of twenty one, and then it fell right

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<v Speaker 2>back to twenty five thousand, So you know, it's literally

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<v Speaker 2>halving its value in the course of these massive crashes

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<v Speaker 2>that we've seen. Now as I say, it's broken through

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<v Speaker 2>one hundred and fifty thousand, it's really understandable that this

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<v Speaker 2>financial instrument really came about and started to gain traction

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<v Speaker 2>at the time of the global financial crisis. So we

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<v Speaker 2>saw a lot of people who felt that they had

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<v Speaker 2>been shut out of the economy, they'd lost a lot

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<v Speaker 2>of money, they'd lost their houses. They were feeling as

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<v Speaker 2>if the financial markets were really for the elite, for

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<v Speaker 2>people who were wealthy investors. It also promised, you know,

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<v Speaker 2>these massive games. All of a sudden, it became almost

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<v Speaker 2>like a lottery. And because it was an unregulated market,

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<v Speaker 2>it's been able to sort of grow really exponentially in

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<v Speaker 2>the shadows. And so it can't be underestimated how big

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<v Speaker 2>this market has become. It's now worth three point four

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<v Speaker 2>trillion US dollars globally.

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<v Speaker 1>I mean, during his campaign, Trump signaled an enthusiasm for cryptocurrencies.

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<v Speaker 1>Can you tell me about what he said he would

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<v Speaker 1>do if he got in.

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<v Speaker 2>Yeah, So he was promising the opposite approach to what

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<v Speaker 2>Biden had done, which was really overseeing a great theme

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<v Speaker 2>of crackdowns on crypto. I pledged to the bitcoin community

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<v Speaker 2>that the day I take the oath.

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<v Speaker 1>Of office, Joe Biden, Kamala Harris's anti crypto crusade will

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<v Speaker 1>be over. It will end, It'll be done.

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<v Speaker 2>So what we heard about a lot from Trump during

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<v Speaker 2>the course of the election campaign was the need to

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<v Speaker 2>get rid of people who were sort of obstructing the

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<v Speaker 2>crypto market. And among those people was Gary Gensler, who's

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<v Speaker 2>the head of the SEC. That's the Security and Exchanges

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<v Speaker 2>Commission that is the largest regulator in the US with

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<v Speaker 2>overseeing the financial markets and instruments. Gary Gensler took a

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<v Speaker 2>very combative approach to the crypto industry, which really put

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<v Speaker 2>him offside with a lot of the executives and investors

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<v Speaker 2>in that market. Nobody really liked what he was doing.

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<v Speaker 2>The SEC managed to recoup something like eight billion dollars

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<v Speaker 2>in penalties of a misconduct, and so obviously this was

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<v Speaker 2>a person that has fallen well foul of the crypto fans.

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<v Speaker 2>He was going to be removed by Trump as soon

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<v Speaker 2>as he came to power on day one, I will

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<v Speaker 2>fire Gary Gensler and appoint a new SEC chair, And

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<v Speaker 2>he has now actually announced that he's stepping back and

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<v Speaker 2>will be gone in January of next year. Trump has

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<v Speaker 2>actually said things like he'll create a crypto Advisory Council

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<v Speaker 2>that will help to sort of tell him what to

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<v Speaker 2>do in terms of crypto policy. He's brought people like

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<v Speaker 2>Elon Musk and Vivek Ramswami into a cost cutting regime

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<v Speaker 2>for the government, and definitely they have his ear in

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<v Speaker 2>terms of where digital currencies might be able to help

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<v Speaker 2>in that effort. He's also mentioned that he would like

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<v Speaker 2>to see more bitcoin mining. That's also a little controversial

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<v Speaker 2>in the sense that bitcoin is not a particularly green pursuit.

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<v Speaker 2>Mining this is incredibly energy intensive. Even Elon Lusk himself

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<v Speaker 2>has acknowledged this. He used to accept bitcoin payments for Tesla.

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<v Speaker 2>He halted them for a while there because he said

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<v Speaker 2>that actually that was having more of an impact in

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<v Speaker 2>terms of emissions and fossil fuels reliance than he was

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<v Speaker 2>achieving with his cars. And Donald Trump promised to create

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<v Speaker 2>a sort of a national stockpile of crypto, and so

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<v Speaker 2>there would be a federal bitcoin reserve or a federal

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<v Speaker 2>cryptocurrency reserve.

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<v Speaker 1>Coming up after the break. What happens when crypto goes mainstream? Emily,

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<v Speaker 1>A Trump administration could see cryptocurrency become more mainstream. So

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<v Speaker 1>what does that look like in the real world?

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<v Speaker 2>So if that means better regulated assets, then that would

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<v Speaker 2>be a good thing, right, But that's not actually what

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<v Speaker 2>Trump appears to be proposing. What we're likely to see

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<v Speaker 2>is a lot of the long held sort of aspirations

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<v Speaker 2>of an aggressively experimental market coming to fruition, a lot

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<v Speaker 2>of them being met, more people getting invested, making it

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<v Speaker 2>bigger and more pervasive and more part of the financial system. Right,

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<v Speaker 2>regulators were already really struggling to keep up with crypto scams,

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<v Speaker 2>and that may just get worse in a freer market.

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<v Speaker 2>The broader the reach of crypto, the more damaging it

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<v Speaker 2>can be if the laws and let alone the watchdogs

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<v Speaker 2>can't keep it in check. If we see the boom

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<v Speaker 2>and bust that we've seen so far in crypto, that

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<v Speaker 2>can be a lot more widespread and had a lot

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<v Speaker 2>bigger effect than it was to date.

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<v Speaker 1>So a bigger market and one way the Securities in

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<v Speaker 1>Exchange Commission stops going after the new crypto ventures, that

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<v Speaker 1>could increase the risk of investing in crypto and had

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<v Speaker 1>a whole bunch of knock on effects globally.

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<v Speaker 2>Yeah. Yeah, that's the worst case scenario, I mean, and

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<v Speaker 2>it's possible to look, you can try and be optimistic

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<v Speaker 2>about it and say, Trump's presumably speaking to a lot

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<v Speaker 2>of vario established institutional investors, none of whom really want

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<v Speaker 2>to see a crisis. They may not be the best

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<v Speaker 2>stewards of the economy, but they certainly you know, don't

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<v Speaker 2>want to see their own assets destroyed. You know, you

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<v Speaker 2>could hope that maybe there'd be some checks and balances,

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<v Speaker 2>but we can't actually necessarily rely on that being the case,

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<v Speaker 2>certainly not when there are so many boosters of crypto

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<v Speaker 2>involved in the highest levels of government.

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<v Speaker 1>And how do you think they continue. Growth of crypto

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<v Speaker 1>with the United States will affect us here.

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<v Speaker 2>Crypto is pretty pervasive in Australia. It's been hard times

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<v Speaker 2>to the market over the last couple of years, so

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<v Speaker 2>these numbers may have changed a bit, but definitely one

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<v Speaker 2>in four at one point was what we were talking about.

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<v Speaker 2>One in four Australians invested in crypto, so it's a

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<v Speaker 2>big potential market. It's got a lot of room for

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<v Speaker 2>growth as well. Our trends interest generally in Australia has

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<v Speaker 2>been toward more regulation because we had a lot of

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<v Speaker 2>people thirty thousand people and upwards here were actually embroiled

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<v Speaker 2>in the FTX collapse that happened. Under stand bankman freed.

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<v Speaker 2>You know, that's reached the eyes and ears of politicians

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<v Speaker 2>here who are concerned about the risks that crypto poses.

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<v Speaker 2>And what we saw actually after the US election is

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<v Speaker 2>some politicians sort of coming out and saying a lot

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<v Speaker 2>more about the action that needs to be taken to

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<v Speaker 2>protect potential investors. So Liberal Senator Andrew Bragg has been

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<v Speaker 2>very vocal about this. He chaired a Select committee on

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<v Speaker 2>crypto regulation in twenty twenty one and among the recommendations

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<v Speaker 2>arising for that were a market like licensing regime for

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<v Speaker 2>digital currency exchanges and including capital adequacy tests and auditing

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<v Speaker 2>and all of that would fall under the Treasury portfolio.

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<v Speaker 2>So he's actually been very critical of the Albanese government

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<v Speaker 2>for not legislating any rules for cryptocurrency exchanges, including the

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<v Speaker 2>consumer protections that would come from that. And you know,

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<v Speaker 2>we've got people like Stephen Johns whose name he and

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<v Speaker 2>he's the Assistant Treasurer and Minister for Financial Services in

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<v Speaker 2>the Labor government. He's working on steps towards regulating digital

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<v Speaker 2>and crypto assets and compiled some legislation to head off

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<v Speaker 2>scams and fraudulate behavior online. The steps are being taken

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<v Speaker 2>to try and limit that, but we know that it's

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<v Speaker 2>really hard to stay ahead of online scams. The risks

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<v Speaker 2>that we sort of looked to in Australia is you know,

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<v Speaker 2>we're struggling to implement gambling legislation. At this point, crypto

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<v Speaker 2>does kind of chirbo charge that market as well. And

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<v Speaker 2>you know, there's been the rise of crypto prediction markets

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<v Speaker 2>where people can literally sort of bet, you know, also

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<v Speaker 2>on political outcomes in elections. But there is a best

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<v Speaker 2>case scenario in which you know, crypto is actually brought

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<v Speaker 2>into the mainstream in the way that other financial assets

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<v Speaker 2>have been over decades, and that is there are steps

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<v Speaker 2>towards regulation that brings it better under the umbrella of

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<v Speaker 2>the watchdogs, that fraudulent behavior is detected and penalized so

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<v Speaker 2>that it can really make the market a safer place.

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<v Speaker 2>And that would be the scenario in which you head

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<v Speaker 2>off a crisis in which you end up with a

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<v Speaker 2>more benign usage of crypto in Australia.

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<v Speaker 1>Emily, it's all very fascinating and thank you for taking

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<v Speaker 1>your time to run us through it.

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<v Speaker 2>Thanks a lot, Daniel Grace talk.

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<v Speaker 1>Also in the news, more politicians are speaking out against

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<v Speaker 1>the proposed social media band for under sixteens, which Labor

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<v Speaker 1>is hoping will pass this week. Yesterday, National Senator Matt

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<v Speaker 1>Canavan told ABC radio that a band's clumsy hurdles could

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<v Speaker 1>make the situation worse and could have free speech applications.

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<v Speaker 1>Canavan joins the Greens and the Cross benches David Pocock

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<v Speaker 1>and Fatoma pain in voicing concerns about the speed at

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<v Speaker 1>which the bill was brought to the table and lack

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<v Speaker 1>of detail as to how the band will work. It

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<v Speaker 1>follows the government's review into the proposed band, which lasted

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<v Speaker 1>just one day despite receiving over fifteen thousand submissions. And meanwhile,

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<v Speaker 1>Donald Trump has already come out swinging on tariffs, promising

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<v Speaker 1>to impose twenty five percent terrorists on his closest neighbors,

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<v Speaker 1>Canada in Mexico from the first day of his presidency.

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<v Speaker 1>In a post on far right social media, Trump said

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<v Speaker 1>the tariff will remain in effect until quote drugs in

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<v Speaker 1>particular fensonal and illegal aliens stopped the invasion of our country.

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<v Speaker 1>Should he follow through with the tariffs, Trump will be

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<v Speaker 1>breaking the free trade agreement between the US, Mexico and

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<v Speaker 1>Canada that he signed into law in twenty twenty. That's

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<v Speaker 1>all for our We'll be back tomorrow.