Trump's Crypto Heist: A Taxpayer-Funded Scam?
I've been working on a piece that is quite chilling. It's an analysis of an essay by a strategic thinker who supports the Network State idea and has stark observations about what's unfolding in Washington today.
By now, it's clear that I take the Network State seriously and oppose it. However, others take the Network State seriously and support it. These aren't just cranks on the Internet. These are people with money, education, and expertise. They argue that the nation-state model is obsolete and must be replaced with an agile and decentralized form of government suited to the challenges of the 21st century.
Perhaps. But we should probably ask the American people what they think before imposing a radical overhaul of government. Right?
Strategic Crypto Scam
I'm going to take more time with my analysis, but I wanted to say something about yesterday's announcement re the United States "Strategic Crypto Reserve," which would apparently flood taxpayer money into scammy and crime-ridden crypto schemes.
As I've said before, the next few years will be one big crypto scam. Trump's second term began with a major presidential ripoff – $Trump, which harvested billions from its victims, enriched the scammers (including the president), and set the stage for what's to come.
Trump's new crypto reserve scam pumped up slumping crypto prices, as intended. But it is such a blatant con than even some tech bros and Republicans had to protest. From the New York Times:
Critics of all political stripes decried the move. Some Republicans raised questions about spending taxpayer money on risky assets instead of paying down the national debt. Joe Lonsdale, a friend of Elon Musk’s, wrote on X: “It’s wrong to steal my money for grift on the left; it’s also wrong to tax me for crypto bro schemes.”
Some protested the seeming latest conflict of interest involving Trump and crypto, noting that Trump profited from promoting the so-called memecoin $Trump before his inauguration. (The S.E.C. last week said memecoins wouldn’t be subject to regulatory oversight.) “This is getting egregious,” the software developer Nikita Bier replied to Lonsdale’s post. “Every 2 weeks there is a kickback to the family. Completely delegitimizes all the work DOGE is doing.”
"[T]ax me for crypto bro schemes"! These are the words of a Palantir co-founder.
Obviously, Musk and Trump are making the heist too obvious. I tremble to think how far they might get if they took things a little more slowly and tried to manage public perception. It's March 2025 and we already have angry MAGA voters turning up at town halls to castigate their GOP representatives. If this nation had a functioning opposition party, the tide could begin to turn very quickly. But I digress...
Crypto scam is about power
It's tempting to see the crypto scam only as a theft of money. But remember: These guys already have tons of money. Now they want power, and they see weakening the dollar and pumping crypto as keys to world domination.
In fact, some of the most influential people in crypto are openly enthusiastic supporters of the Network State. Last October, I profiled one of them for the New Republic.
Brian Armstrong, CEO of Coinbase, openly supports the Network State and sees his company as an important tool for bringing it into existence. Excerpt:
While pitching crypto as a tool for economic opportunity to the rubes in Congress, he harbors radical ideas about crypto’s true purpose. He believes the United States is in “slow decline” and embraces the Network State, a cultish tech movement that ultimately seeks to end countries as we know them—to decentralize governance in the same way that crypto seeks to decentralize finance.
“I do think crypto has implications far beyond just payments and money,” Armstrong said during a podcast interview in August, when asked about crypto’s relationship to the Network State.
Coinbase is one of the top crypto exchanges in the world. Armstrong has a net worth of $9.6 billion, according to Forbes. His parting advice at last year's Network State conference, which he addressed via video?
“If you’re building network states, build them with Coinbase.”
Read the entire piece: "The Most Powerful Crypto Bro in Washington Has Very Weird Beliefs."
And remember: This isn't just about money. It's about power – and a scary vision of a post-democracy world ruled by crypto bros.