Not long ago, democratic hopeful Robert F. Kennedy Jr. proposed backing the U.S. dollar with bitcoin. He also promised to do away with capital gains taxes should he win the White House next year.
Kennedy Has Big Crypto Ideas
There are several analysts, however, that say his plans regarding USD and bitcoin are not possible. Not only that, but they also claim that his plans would do heavy damage to the U.S. economy and cause insurmountable problems.
At a recent event in July, Kennedy said tying USD to bitcoin and other “hard assets” would “rein in inflation and usher in a new era of American financial stability, peace, and prosperity.” He also said:
My plan would be to start very, very small. Perhaps one percent of issued T-bills would be backed by hard currency, by gold, silver, platinum, or bitcoin.
He also commented that getting rid of capital gains taxes would allow people to keep more of their money and open the door to additional forms of employment. He also mentioned that allowing bitcoin to be tax free would keep censorship out of play. He mentioned:
Non-taxable events are unreportable, and that means it will be more difficult for governments to weaponize currency against free speech, which as many of you know, is one of my principal objectives.
His comments are stirring quite a bit of controversy amongst figures like Jean-Paul lam, a crypto expert and associate professor at the University of Waterloo in Canada. In a statement, he described the proposals of Kennedy as a return to the gold standard America employed prior to the 1970s. He said:
Having bitcoin as a currency backer to any national currency would be a nearly impossible feat given all the issues associated with bitcoin, such as price volatility, security, and limited flexibility. However, the primary and possibly fatal drawback of having a gold-bitcoin standard is that it would severely restrict the ability of the Federal Reserve Bank to respond to economic downturns and provide necessary monetary stimulus during crises. For example, just envision how the Federal Reserve would have responded during the 2008-09 financial crisis or Covid under a gold standard (it would have been unable to prevent an economic catastrophe). The drawbacks of the gold standard far outweigh any benefits we might get from it. This matter has been thoroughly debated and settled. It is not worth further discussions.
Some Like the Ideas
Brian McGleenon of “The Crypto Mile,” by contrast, was intrigued by Kennedy’s proposals and said:
Kennedy has indicated his intent to support approximately one percent of issued U.S. Treasury bills with a hard currency like bitcoin. Such a move would pour a substantial allocation of capital into an asset class whose market capitalization stands only at $566 billion.