The Bitcoin Business Newsletter | Trump's Bitcoin-Only Law?

Key insight

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This week, we’re thrilled to feature an insightful piece by Felipe Muñoz from Norway. With bitcoin nearing the $100,000 milestone, we dive into the potential implications of a changing political landscape and what it could mean for businesses embracing the bitcoin standard.

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"Bitcoin, not crypto" likely to become law under Trump

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For years, the overarching cryptocurrency community has been riddled with how to comply with laws and regulations. With Trump as the president-elect, having expressed support for the industry at the Bitcoin2024 event in Nashville in late July, new legislation is being written and prepared to finally draw a clear line in the sand.

As bitcoin rallied more than 30% since election night, the industry has understandably regained attention from well-known investors who seem to only pay attention periodically, some of which are the hosts of the All-In podcast. In their latest episode (EP. 204), they discuss new crypto legislation proposed by Senate Republicans.

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FIT21 – Financial Innovation and Technology of the 21st Century Act

"I think the crypto industry basically wants a clear line for knowing when they are a commodity and they want this commodity to be governed like all other commodities by the CFTC. That's what this bill would do. Now with the Republicans winning the Senate, the prospects for that bill to get enacted are now greatly improved, especially because Sherrod Brown, who used to run the Banking Committee, just lost to Bernie Moreno, which was a seat in Ohio. Senator Elizabeth Warren will still object to this legislation but she's just going to have way less influence, since it seems like Gary Gensler isn't going to be sticking around very long at the SEC" says David Sachs, before he goes on.

"Look, the bottom line here is that, we are close to having clear rules of the road codified by Congress, which is what the crypto industry has been asking for, and the days of Gensler terrorizing crypto companies by issuing wells notices without clarifying what the rules are that he is prosecuting, those days are about to be over, so I think this is why the crypto markets are rallying".

Under this legislation, crypto assets would be classified as commodities regulated by the Commodity Futures Trading Commission (CFTC) if the blockchain they run on is "functional and decentralized", which is the key requirement. If their blockchain is functional but not decentralized, then they would be considered securities and fall under the purview of the Securities Exchange Commission (SEC).

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Sellers Remorse

In the same episode, Chamath Palihapitiya shares that he thinks more about the bitcoin he sold for $1.8M in 2014 to purchase land in Lake Tahoe, which would now be worth more than $100M, rather than thinking about the gains from the bitcoins he kept.

Additionally, he mentions how much more money he would have made for his fund investors during the time he was a private investment manager, labeling the reallocation of funds motivated by capitulation a "$3 to 4 billion dollar mistake, and growing". At the beginning of the year, Chamath predicted bitcoin would be the best performing risk asset of 2024.

There are additional interesting data points highlighted in this episode:

• Publically traded centralized exchanges and brokers like Affirm, PayPal, Robinhood, and Coinbase rally from a low 30% up to more than 80%
• Not only is the crypto market reacting optimistically to the beneficial nature of the expected deregulation proposed by Trump, but also the finance and fintech industry
• How the 10-Year Treasury being more than 4% indicates inflation might persist, leading investors to allocate more capital to risk assets, which bitcoin is benefiting from.

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Bitcoiners rejoice!

Under the proposed law, almost every blockchain would be considered centralized enough to be classified as a security. This means cryptocurrencies like Ethereum, Solana, Ripple, and others could be regulated like company stocks because they aren't "decentralized enough" according to the law's strict standards. Only bitcoin would likely qualify as truly decentralized and avoid being labeled as a security.

There are many advantages for an asset class to be categorized as a commodity rather than a security. For instance, with respect to business operations, entities dealing in commodities enjoy lighter regulation, fewer discloser requirements, lower legal costs for ongoing operations, and reduced need for specialized compliance staff, which translates into less liability risk.

Under lighter regulation, businesses retain more profits and can roll out new ideas faster, allowing them to quickly adapt to what the market needs. This freedom in decision-making creates a positive ripple effect—teams can experiment with new features more freely, easily connect with various financial services, and list their asset on more platforms. The end result? The asset becomes accessible to a much wider range of users.

This builds upon the notion that bitcoin is a strategic reserve asset worth holding over a longer time period, as the user base expands, regulation becomes favorable, and more and more entities see bitcoin as a true store of value.

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Top News Stories

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Exclusive: Trump to Meet Privately With Coinbase CEO Brian Armstrong

President-elect Donald Trump is meeting with the CEO of cryptocurrency exchange platform Coinbase Monday, according to people familiar with the matter. The duo is expected to discuss personnel appointments for his second administration.

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Bitcoin Hits $98,370 as ETH-to-BTC Ratio Falls to 3-Year Low – Bitbo

Bitcoin's price surges to $97,700, setting new all-time highs, as the ETH-to-BTC ratio drops to its lowest level since March 2021.

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MicroStrategy Joins Top 100 U.S. Public Companies, Upsizes Debt to $2.6B – Bitbo

MicroStrategy's market cap nears $100 billion as it joins the top 100 U.S. public companies and upsizes its convertible debt offering to $2.6 billion to purchase more Bitcoin.

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Hoth Therapeutics and Acurx Pharmaceuticals Allocate $1M to Bitcoin as Treasury Asset

Hoth Therapeutics and Acurx Pharmaceuticals will each allocate $1M to Bitcoin, citing its inflation resistance and growing corporate adoption.

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Softwar author Jason Lowery looks to White House role advising on Bitcoin national security

Softwar author argues Bitcoin's PoW mechanism can revolutionize national defense strategies by deterring cyber threats.

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MicroStrategy Announces $1.75 Billion Private Note Sale to Buy More Bitcoin

MicroStrategy announces a $1.75B zero-coupon convertible notes offering to fund Bitcoin purchases, bolstering its BTC-first strategy.

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MicroStrategy Acquires 51,780 Bitcoin, Bringing Total Holdings to 331,200 BTC – Bitbo

MicroStrategy acquired 51,780 Bitcoin, bringing its total holdings to 331,200 BTC, now valued at nearly $30 billion.

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Polish Presidential Candidate Mentzen Proposes Bitcoin Reserve – Bitbo

Polish presidential candidate Sławomir Mentzen pledges to create a Strategic Bitcoin Reserve and implement crypto-friendly policies if elected in 2025.

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Michael Saylor to Present Bitcoin Case to Microsoft Board – Bitbo

MicroStrategy Chairman Michael Saylor will pitch Microsoft's board on adopting Bitcoin as part of its investment strategy, citing increased stability and value for shareholders.

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BlackRock Bitcoin ETF Options See $1.9B on Day One – Bitbo

Options for BlackRock's iShares Bitcoin Trust ETF traded $1.9 billion in exposure on their first day, contributing to Bitcoin reaching a record high of over $94,000.

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Senator Lummis Proposes Selling Gold to Build Bitcoin Reserve – Bitbo

Senator Cynthia Lummis introduces the BITCOIN Act to sell federal gold and acquire one million Bitcoin, aiming to establish the U.S. as a leader in digital asset reserves.

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Pennsylvania House Introduces Legislation for a Bitcoin Reserve

Pennsylvania proposed a Bitcoin Reserve Act to invest up to 10% of state funds in Bitcoin, aiming to diversify assets and combat inflation.

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MicroStrategy Announces $1.75 Billion Convertible Note Offering

MicroStrategy is raising $1.75 billion through 0% convertible notes to expand its Bitcoin holdings.

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BlackRock's Spot Bitcoin ETF To Open For Options Trading: Here's Why It Could Be A Big Deal For Bitcoin - iShares Bitcoin Trust (NASDAQ:IBIT)

Options trading for spot Bitcoin (CRYPTO: BTC) exchange-traded funds are all set to launch on Wall Street on Tuesday, marking a new era of the leading cryptocurrency's integration into traditional finance.

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Other Noteworthy News

🏛️Bitcoin Conference Coming to Washington D.C. In 2025

🏥Trump Nominates Bitcoin Advocate RFK Jr. as Health Secretary

📜Trump nominates pro-Bitcoin Matt Gaetz as US attorney general

💼Pro-Bitcoin Howard Lutnick Named Commerce Secretary by Donald Trump

🔃Trump Administration to Shift Focus Away from Bitcoin Enforcement

📈What Does a 60/40 Portfolio Look Like if We Replace Bonds With Bitcoin? A Lot Better: Van Straten

🧾Marathon Digital upsizes debt offering to $1 billion for Bitcoin expansion

🧠Genius Group expands Bitcoin Treasury with new $4M purchase

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Recommended Articles

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Why and How Bitcoin Consumes Energy by Lyn Alden

Bitcoin’s energy consumption is complex and often misunderstood, so this rabbit hole provides some resources to help understand this topic.

This article is a "rabbit hole" guide about Bitcoin's energy consumption. It offers a detailed look at Bitcoin's proof-of-work, energy use, and impact on decentralization, with external resources and presentations for a comprehensive understanding of the topic.

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Annual inflation rate hit 2.6% in October, meeting expectations

The consumer price index was expected to increase 0.2% in October and show a 2.6% 12-month rate.

This article discusses October's inflation data, highlighting a 2.6% annual rise in the consumer price index, driven mainly by shelter costs, and its implications for Federal Reserve monetary policy and economic conditions.

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BitcoinTreasuries.com

Track Bitcoin Treasuries of companies, miners and countries at BitcoinTreasuries.com.

treasuries.bitbo.io/us-etfs/?utm_source=bitcoinminimalist.com&utm_medium=newsletter&utm_campaign=btc-nears-100k&_bhlid=3ad54c09e85d9d403ff67b12d05aaebdb7646ff4

Keep track of various bitcoin holdings on Bitbo.

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Recommended Podcasts

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Bitcoin Alpha E003: Digging Into Microstrategy's Bitcoin Treasury

TFTC: A Bitcoin Podcast · Centimillionaire bitcoin allocation, ATH & prominent bitcoin-friendly figures, Term sheet report & Bitcoin Treasury strategy

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Bitcoin, The Red Wave, and The Crypto Renaissance - Michael Saylor Speaks at Cantor Fitzgerald.

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Chart of the Week

Bitcoin: Reserve Risk chart

Reserve Risk is a Bitcoin chart that illustrates long-term holder confidence in relation to Bitcoin's current price.

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“Bitcoin is the hardest money ever invented: growth in its value cannot possibly increase its supply.”

– Saifedean Ammous, The Bitcoin Standard

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