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The growing endorsement of Bitcoin by US President Donald Trump has sparked significant backlash from economist Peter Schiff, who cautions that this action could undermine the dollar.
Schiff tweeted on X that converting dollars into Bitcoin “exerts additional pressure on the dollar” and deemed expenditures on the cryptocurrency “detrimental to our nation.”
Reports indicate that Trump perceives Bitcoin as a creator of jobs and a relief for the dollar, yet Schiff contends that the contrary might be true.
Trump And Bitcoin: Influence On Dollar Demand
Peter Schiff asserts that when individuals exchange US dollars for Bitcoin, they diminish the demand for the globe’s primary reserve currency.
Bitcoin’s value has surged over 30% this year, with some viewing it as a safeguard against inflation. Schiff argues that these dollar conversions erode the greenback’s position.
He cautioned that if this trend amplifies, the wider economy could be impacted.
Appeasing his donors and to promote his family enterprise, Trump asserted that Bitcoin “reduces pressure on the dollar and benefits the country.” However, selling dollars to purchase Bitcoin increases pressure on the dollar. Moreover, squandering resources on Bitcoin is perilous for our nation.
— Peter Schiff (@PeterSchiff) June 28, 2025
Government And State Reserves
As per reports, the federal authorities do not intend for direct dollar sales. Instead, they plan to utilize funds from criminal and civil forfeitures to establish a Strategic Bitcoin Reserve.
At least 10 states, including Texas and Florida, are adopting similar measures. They are allocating funds to acquire and retain cryptocurrency in their financial statements. This transition could lead governmental entities to be linked to a fluctuating asset.
Trump Media’s Crypto Approach
The private entity of US President Donald Trump, Trump Media, has garnered $2.3 billion via stock offerings and convertible notes to support a Bitcoin treasury.
In May, a White House gathering featured major holders of the “TRUMP” meme coin. Participants invested nearly $150 million for places at a dinner.
Critics argue that the family has already secured over $1 billion from its cryptocurrency undertakings. These figures illustrate how intensively the campaign is engaging with the crypto community.
Political And Financial Dangers
Peter Schiff proposes that Trump’s cryptocurrency initiative is more about enticing affluent donors than about monetary policy.
He characterized the fundraising events as “a tactic to draw crypto-based support.” Concurrently, the unpredictability of Bitcoin markets introduces tangible financial risks. A sudden decline in price could leave any reserve trapped in deficits rather than profits.
Recent Investment In DeFi
World Liberty Financial, another venture linked with the Trump family, obtained a $100 million investment from Aqua 1 as part of initiatives to grow in decentralized finance.
Trump Jr. has indicated that banking restrictions prompted the family to explore cryptocurrencies, but many perceive this move as an effort to secure new capital. This agreement underscores how the family is placing significant bets on emerging cryptocurrency sectors.
Featured image from MediaNama, chart from TradingView
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