If bitcoin and crypto weren’t already gaining mainstream attraction with the increased coverage on popular financial news media following the price swings, the President and Treasury Secretary have also acknowledged their existence and provided some free publicity as well as their own commentary on the subject matter. It began with Donald Trump tweeting about bitcoin and crypto assets followed by a press conference by Steven Mnuchin regarding their anxiety surrounding them. It was all largely been sparked by Facebook announcing its plans on entering the space with a new type of stablecoin that would essentially be a digital reserve currency, Libra. Interestingly, the price action for bitcoin in the wake of Trump’s tweets as well as following Mnuchin’s press conference showing it staged small rallies in the hours afterward displaying its anti-fragile and apolitical nature. Libra likely is not going to be decentralized like bitcoin, which has raised concerns on Capitol Hill since Section 8 of the Unites States Constitution permits them to coin money and to regulate its value and Section 10 denies states the right to coin or print their own money. Posing the question whether the dollar will be the money of the state, Libra the money of the corporations, and bitcoin as the money of the people?

Donald J. Trump took to Twitter on July 11th tweeting out a thread stating, “I am not a fan of Bitcoin and other Cryptocurrencies, which are not money, and whose value is highly volatile and based on thin air. Unregulated Crypto Assets can facilitate unlawful behavior, including drug trade and other illegal activity…” continuing on to say, “…Similarly, Facebook Libra’s “virtual currency” will have little standing or dependability. If Facebook and other companies want to become a bank, they must seek a new Banking Charter and become subject to all Banking Regulations, just like other Banks, both National…” and concluding, “…and International. We have only one real currency in the USA, and it is stronger than ever, both dependable and reliable. It is by far the most dominant currency anywhere in the World, and it will always stay that way. It is called the United States Dollar!”

It’s not surprising that the leader of the Free World finds these new financial instruments as competition to the existing power structures at be which have fruitlessly been running their own monetary experiments. Not to mention, the President has arguably been more vocal of and involved with the Federal Reserve system than any other his predecessors. Its sole purpose was meant to be an independent central bank with their policy decisions not requiring his approval. Crypto assets like bitcoin in contrast to the Unites States Dollar are trustless, stateless, and borderless pieces of distributed software that have monetary policies written in their hard code. Bitcoin, the King of Crypto, notably will have its block reward halving next year cutting the inflation rate below the Federal Reserve’s target rate of 2%. The significance of this is because its a deflationary asset with hard cap of only 21 million bitcoins, but there is an unlimited supply of fiat money that can be printed. Naturally, this makes bitcoin scarce and hence more valuable should there be enough live demand to meet its price. Causing many people to debate over the question, which one’s value is actually based upon thin air?

On Monday the 15th, days after Trump’s tweets, Treasury Secretary Steven Mnuchin in a press conference began with covering Facebook’s proposed new stablecoin “cryptocurrency” and its potential nation security issues as well as worries regarding its use with money launderers and terrorist financiers. Mentioning that he’s not comfortable with them moving forward with launch of their new product. His comments were not limited to Libra as he said, “Cryptocurrencies such as bitcoin have been exploited to support billions of dollars of illicit activity…” The Treasury Secretary said that the worries are shared by him and the president citing “…legitimate concerns that we have been working on for a long time.” Mnuchin explained it has been made clear with bitcoin users as well as Facebook that they need to implement the same Anti-Money-Laundering (AML) and Know-Your-Customer (KYC) safeguards to be compliant with other financial institutions. As ominous as these statements might sound, it is actually a positive move for the industry that has already been moving for some time to meet these regulatory standards in efforts of bringing more legitimacy and “good actors” into the space.

The next morning House GOP Minority Leader, Kevin McCarthy, told CNBC that, “I like bitcoin,” as well as its decentralization and the secure nature of its blockchain technology. The powerful part of bitcoin is its distributed ledger technology, or blockchain, providing transparency through its pseudonymous nature. If widespread adoption were to happen, it would provide a ledger that broadcasts public and private transactions to the entire network in real-time. The same cannot be said for the United States Dollar that does not have a real-time payments system from our Federal Reserve yet. Bitcoin could be implemented show donations, payments, and governmental decision-making as well as verification on politicians’ claims. In other words, it would also expose corruption and ineptness providing accountability which is not exactly appealing to governments, politicians or their private interests.

In some ways, this was a major achievement for bitcoin highlighting its credibility for being politically neutral as an electronic payment system. The Libra hearings on Capitol Hill allowed lawmakers from the United States Senate and House of Representatives to listen to Facebook’s testimony regarding their new project and understand how it is radically different than bitcoin, ether, and other “true” crypto assets. They heard from David Marcus, former PayPal president and now Calibra chief, as well as expert panelists on payment systems and crypto assets. The refreshing part of the hearing was the knowledge and understanding the lawmakers had and sought clarity on around bitcoin and crypto. It was especially endearing that they saw decentralization as a positive and viewed centralized tech giants like Facebook with the scrutiny it deserves, not to mention, given its history with data privacy as well as the Cambridge Analytica scandal.

It was very beneficial during the hearing that lawmakers had a general understanding that Libra was going to be vastly different from bitcoin and other existing crypto assets. Some of best moments during the hearing came from the lawmakers statements and questions towards Mr. Marcus and Calibra, Facebook’s wallet provider for Libra. During the testimony on the 17th, Rep. Patrick McHenry expressed to his fellow lawmakers that efforts to stop Bitcoin was futile describing it as an “unstoppable force.” He gained a lot of attention for saying, “We should not attempt to deter this innovation; governments cannot stop this innovation, and those that have tried have already failed.” Signaling, legislation or not, that the Bitcoin network will prevail. Afterwards, interviews with various experts and ranking members of the Financial Services Committee discussing the various topics showed the importance of the United States occupying a place of preeminence over the adoption and regulation of this industry.

Clarity on the regulatory front will help bring institutional money on the sidelines that has been desperately waiting for permission to deploy it in bitcoin and crypto. Bitcoin still is trading in a range continuing to support the trends for a bull market this year and may be setting up another big move upwards. Given the macro events of falling interest rates, riskiest credit market in history, reserve currency devaluations, and widespread expectations of more “easy money,” Bitcoin will see continued momentum for being a deflationary asset with catalysts over the next year that will push demand further. While the short-term outlook has clouded somewhat with possible investor shakeouts, the long-term prospects still appear strong. One thing is certain, there needs to be a way to discern whether or not which crypto assets are investment-grade or junk. For that, there’s the systemic bliss crypto index and its ratings system [patent pending]!