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ATLANTA, GEORGIA - JUNE 27: Republican presidential candidate, former U.S. President Donald Trump ... [+] participates in the CNN Presidential Debate at the CNN Studios on June 27, 2024 in Atlanta, Georgia. Former President Trump and U.S. President Joe Biden are facing off in the first presidential debate of the 2024 campaign. (Photo by Justin Sullivan/Getty Images)
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Donald Trump assumes office with plans to make the United States the world's bitcoin mining capital. Many are celebrating the idea of bitcoin as a Strategic Reserve Asset. Supporters like Michael Saylor, Tether, and other large institutional players argue this is a landmark achievement, reinforcing bitcoin's status as a legitimate store of value. However, this growing institutionalization risks compromising bitcoin's original ethos as "freedom money," with its decentralization and censorship resistance eroding under the weight of regulatory and economic control.
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Donald Trump
Centralizing Bitcoin Mining
Trump's administration has made bitcoin mining a national priority, framing it as an opportunity to dominate the "block space". Rachel Silverstein, U.S. General Counsel for Bitfarms, commented on the day of the election that, "Sanctions in my mind are a way to avoid war," and continued to say leaving sanctions as a tool for states to use is important.
Bitcoin blocks have a finite capacity, limiting the number of transactions that can be included in each block. Fred Thiel, CEO of Marathon Digital, commented in an X post: "Block space ensures the ability to transact. Let's keep the US as the most dominant Bitcoin mining country in the world." This dominance could empower the U.S. to enforce transaction censorship via compliance with Office of Foreign Assets Control sanctions or other regulatory tools.
The precedent for such control already exists. In 2021, Marathon attempted to mine "OFAC-compliant" blocks, filtering transactions from sanctioned entities. More recently, mining pools like F2Pool have been flagged for possibly excluding sanctioned transactions. Trump's push for mining dominance presents a clear path to institutionalizing these practices, leveraging tools like the Bank Secrecy Act and FATF recommendations that promote widespread KYC and classify wallet software as Crypto Asset Service Providers.
