Trump Bets Big on Crypto in Midterm Election Gamble

The US is on the cusp of a midterm election that could greatly impact President Trump's leverage in the next two years. With sluggish material production and setbacks in the conflict with Iran, the President needs immediate economic achievements to win re-election.

Trump has opted to focus on the crypto sector, which he views as a way to create a controllable economic high before the elections. The US dollar's purchasing power has been declining, and Trump sees this as an opportunity to bolster economic data and boost his chances of winning.

The Treasury Department has initiated a de facto mini-QE and repurchase agreements to suppress long-term bond yields, but this comes with costs that will harm the economy in the long run. Trump's bet on crypto is seen as a way to create a short-lived economic boom before the elections, after which he can discard it.

Crypto has become a four-track phenomenon: cryptocurrencies, prediction markets, stablecoins, and Perps. Each of these tracks has different potential uses and benefits, but they all share a common thread - they are being promoted by Trump and his allies as a way to create economic growth before the elections.