Cryptocurrency - A Gift for the Wealthy

by Lilly Gioia

It’s doubtful most people who voted for now PA Senator Dave McCormick, a wealthy Wall Street hedge fund manager, knew they were voting to elect a major cryptocurrency investor scheming to make even more money once he got access to inside information McCormick was endorsed by the CEO of a major crypto firm who said in the campaign, “If you live in Pennsylvania, you should vote for Dave McCormick. He is the better candidate on crypto.” A Senator buying Bitcoin ETFs could signal support for the leading cryptocurrency. The day McCormick joined the Senate Banking Subcommittee on Digital Assets on February 26th, he began serious investing in Bitcoin. First he sold $1 million of his Goldman Sachs stock and promptly invested $600,000 in cryptocurrency. McCormick tweeted: “2025 is the year for digital assets. Blockchain and digital assets offer Pennsylvania and America the chance to lead the next wave of innovation, enhancing our national security and our economy. Proud to be a member of the inaugural Senate Banking Subcommittee on Digital Assets.”

While McCormick was still buying crypto, in early March President Trump signed an executive order creating a national stockpile of Bitcoin and other digital currencies. In legal cases over time the US has seized an estimated $17 billion in Bitcoin which will be the basis of this new stockpile. David Sachs, the White House crypto and A.I. policy czar, said, “This executive order underscores President Trump’s commitment to making the U.S. the ‘crypto capital of the world.’” He likened this Bitcoin reserve to a “digital Fort Knox.”

The issue is that the crypto industry is a volatile sector that has battled federal regulators for years. Trump’s election stopped any battling. Since his inauguration, the Securities & Exchange Commission dropped two lawsuits against two of the biggest U.S. crypto companies and halted investigations into several others. Trump hosted crypto executives at the White House for a first-of-its-kind “crypto summit.” President Trump and his family have personal financial stakes in the success of the crypto industry. This creates major conflicts of interest that raise alarms with government ethics experts. Skeptics argue that it is dangerous to link the United States economic future to a highly volatile asset.

In January Business Week’s story “CRYPTO WON. NOW WHAT?” warned of concerns that the crypto industry has consistently ignored existing rules.

“The crypto industry is built on a foundation of regulatory noncompliance,” an American University law professor said. With Trump’s approval now, the firewall separating the volatile and fraud-prone crypto markets from traditional finance may not hold through a Trump presidency, or protect us from the next crypto market meltdown. What little previous S.E.C. crypto enforcement we’ve seen is likely to disappear when President Trump’s new S.E.C. chairman is confirmed since he is a known crypto cheerleader.

The new administration has telegraphed its intention to de-fang or dismantle the agencies and regulations that protect consumers and maintain faith in businesses and markets. As retirement account administrators, including those managing employer-sponsored 401(K) plans, offer crypto exposure, risks for widespread fraud in cryptocurrencies remain. This looming threat could impact retirement savings and pension funds, even the broader banking system. Are we risking another devastating government bailout?

President Trump is unconcerned. He just announced “the most EXCLUSIVE INVITATION in the World,” in a flashy online invitation. You have a chance to have an “intimate private dinner” with President Trump On May 22nd at his member-only Virginia golf club followed by a tour of the White House. Seats are reserved for the top 220 investors in his cryptocurrencies $TRUMP, launched on the eve of his inauguration. Let the President know how many $TRUMP coins YOU own.!”

The $TRUMP meme coins price surged more than 60 percent suggesting investors were rushing to accumulate enough coins to qualify for a dinner seat. This blatantly makes a pay-to-play deal by a president with board immunity from laws governing conflicts of interest.