Elon Musk's Interview With Donald Trump: What Will Happen to Bitcoin?
Donald Trump announced a major interview with Elon Musk on August 12. The cryptocurrency community is speculating about its potential impact on the price dynamics of the market.
Why did Trump need an interview with Musk?
US presidential candidate Donald Trump announced a major interview with billionaire Elon Musk scheduled for August 12. The announcement, which was made on the Truth Social platform, came as a pleasant surprise to the entire crypto community, as Trump and Musk are both open supporters of cryptocurrencies.
Trump and Kamala Harris' election race in the crypto perspective
The announcement came at a time when Kamala Harris announced Minnesota Governor Tim Walz as her VP candidate. This sparked outrage among the cryptocurrency community, as Waltz is considered an opponent of cryptocurrencies. Trump's announcement, though it did not directly hint at a possible cryptocurrency discussion with Musk, sparked excitement among industry participants.
The timing of the message has become a strategic move in his campaign, as Trump is actively vying for votes among the crypto community. Cryptocurrency prediction marketplace Polymarket has revealed that users still rate Trump's victory in the upcoming election highly. The odds on Trump winning are 52%, while Harris is trailing with 47% odds.
Why Trump and Musk are aligned, since they were rivals
Donald Trump and Elon Musk are both vocal figures in the media arena. Interestingly, their relationship didn't set in right away. Musk has been a longtime Democrat and back in 2022, he called Trump too old to be President of the United States. In response, Trump also spoke unflatteringly of the Tesla and SpaceX founder. Musk actively supported Trump's political opponents, but his position soon changed. After a failed assassination attempt on Trump last month, Musk said he now supports the Republican candidate.
The upcoming interview could be beneficial for Trump and his campaign, as Elon Musk has a huge audience and platform. Trump can once again seize the opportunity to communicate his stance, especially on cryptocurrencies, to a wider audience. Notably, this is not the first big conversation between the two figures. In March, Trump met with Musk and other donors. At the time, crypto industry participants speculated that Musk had become an advisor to Trump on cryptocurrency, but the billionaire later denied those claims, as well as claims that he was a contributor to Trump's campaign.
Musk, Trump, and Bitcoin: why do the interview matter?
At the moment, it is unknown exactly what the politician and the billionaire will discuss during the interview. Trump promised to share the details soon. In the meantime, the crypto community is actively speculating on what important issues in the field of cryptocurrencies they will raise, since it is a related topic of interest.
Previously, Trump has spoken negatively about the nature of cryptocurrencies, and Bitcoin in particular, calling it "made out of thin air." His stance was ingrained in the minds of crypto industry participants. However, his opinion began to slowly change with the launches of his own NFTs and cryptocurrency investments. Later, when Trump entered the election race, he openly announced his change of stance. And now with his speeches and promises, he is trying to prove his soft stance on cryptos.
He has recognized the benefits of Bitcoin, and at the recent Bitcoin 2024 conference, he promised to create a Bitcoin reserve to combat economic instability. Promised to fire current SEC Chairman Gary Gensler after expressing dissatisfaction with his policies on cryptocurrencies.
Meanwhile, Musk has also become a prominent figure in the crypto space. The billionaire expressed his support for Bitcoin, leading Tesla to purchase $1.5 billion worth of Bitcoin in early 2021. That news then drove Bitcoin to a then-record high of $44,220. Tesla briefly accepted Bitcoin as a means of payment in 2021, further cementing Musk's position in favor of the major cryptocurrency. And his support for the Dogecoin memecoin on X has repeatedly led to the coin's rise. He has also spoken out about the environmental concerns of mining, as well as the fraud issues that exist in the industry.
Bitcoin and crypto: what exactly Trump and Musk can discuss
With all of this in mind, Trump and Musk are likely to touch on the topic of cryptocurrencies in their interview. Both Trump and Musk could discuss how they envision the regulatory framework for cryptocurrencies evolving in the U.S., as the country is facing serious economic problems that could be partially solved by cryptocurrencies.
Market participants are expecting more detailed answers on supporting regulation to spur innovation and investor protection, or on SEC actions and potential reforms to make the country a more attractive center for cryptocurrency businesses.
Given that Trump is a businessman and Musk is in the business of technological innovation, market participants expect they may discuss the economic implications of widespread adoption of cryptocurrencies. For example, using cryptocurrencies to hedge against inflation and economic instability. Or talk about the development of blockchain technology in general. The interview may also include a focus on how to improve public understanding and confidence in cryptocurrencies.
Trump and Musk interview: how did Bitcoin and other cryptos react?
Amid the announcement of the interview, Bitcoin reacted with a 5% increase in the last 24 hours. The asset is trading around the $57,500 mark at the time of writing.
Political-themed memecoins have also reacted with gains. The announcement sparked a brief rally in Trump-themed tokens, with STRUMP up 16%, TREMP up 4% and MAGA up 6%.
The cryptocurrency market's reaction to Trump and Musk's interview will largely depend on the content of their conversation. Ahead of and during the interview, increased volatility in the market is expected.
