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Trump's Crypto Flip-Flop: From "Who's CZ?" to Pardon Power – What's the Real Game?
Okay, so Trump pardons Changpeng Zhao, the Binance dude who pleaded guilty to enabling money laundering. Then, a month later, claims he doesn't even know the guy? Give me a break. This is either dementia setting in real time or a level of calculated BS that's almost impressive. Almost.
The Pardon That Makes No Sense (Until It Does)
Let's be real: Trump doesn't do anything that doesn't benefit Trump. So, the question isn't if there's a connection between the pardon and his own pockets, but how blatant is it? His press secretary, Karoline Leavitt, calling Zhao's prosecution an "overly prosecuted case" and part of a "war on cryptocurrency" by the Biden administration? That's some serious spin. An "overly prosecuted case" usually doesn't involve pleading guilty and serving four months in the slammer.
Remember when the Trump administration halted that fraud case against Justin Sun after his investments in the Trump family's crypto firm? And now this stablecoin launched by World Liberty Financial is being used for a $2bn investment in Binance? Connect the dots, people. It ain't rocket science. So, is Trump playing 4D chess, or is he just really, really good at playing the grift? Or both?
DATs, Death Spirals, and Desperate Measures
While we're on the subject of crypto weirdness, let's talk about ETHZilla selling $40 million of its ETH to fund a buyback. Quynh Ho from GSR calls it "potentially rational if the stock trades at a deep discount to NAV." Michael Bucella from Neoclassic Capital warns it risks a "death spiral" for smaller tokens.
A "DAT death spiral," according to VCs, looks like prolonged sub-NAV trading leading to accelerated treasury selling, falling NAV, and mounting pressure on the shares. Shrinking treasury transparency and repeated ad-hoc buyback announcements are early warning signs. Sounds like a party!
Look, I'm no financial guru, but selling core assets to prop up the price of your stock sounds like rearranging deck chairs on the Titanic. It might work for Bitcoin or Ethereum, but for smaller tokens? That's just kicking the can down the road... or off a cliff.
And NEAR DAT announcing a fundraise to support the NEAR network by building/owning infrastructure? Why? Are they running out of cash? Is this a sign of confidence or desperation? I honestly can't tell anymore.
Crypto's Favorite President?
Trump has now pardoned the founder of Silk Road, founders of BitMEX, and CZ. He's basically the patron saint of crypto criminals. Maybe he's trying to corner the market on the "crypto bro" vote. Or maybe he just likes the smell of money, no matter how dirty it is.
Critics are saying the pardon of Zhao appeared motivated by Trump's personal financial interests. Offcourse, they are. According to the 'I don't know who he is', says Trump after pardoning crypto tycoon - BBC, Trump claimed ignorance of Zhao a month after the pardon.
Ray Hindi from L1D says concern should only arise if major DATs begin selling their holdings and if mNAVs for large DATs start trading at steep discounts (30%+) as it will attract sophisticated players that don’t care about crypto. Translation: the vultures are circling, waiting for the bloodbath.
Mathijs van Esch from Maven 11 points out that DATs have higher costs to just hold digital assets. If they don't utilize those assets efficiently, their asset basis will erode from asset management fees. Cosmo Jiang from Pantera Capital says DATs should ultimately be seen as actively managed funds. So, what are they actually doing with the money? Anyone know?
This Whole Thing Stinks to High Heaven
So, what's the real game here? Trump playing dumb while lining his pockets? Crypto companies desperately trying to avoid a death spiral? It's all so predictable, so cynical, so... Trumpian. And honestly, I'm tired of it. Aren't you?