Trump's Pro-Crypto Policies Spark Global Economic Instability Fears

François Villeroy de Galhau, the governor of the French Central Bank, has issued a stern warning about the potential economic instability that could arise from former U.S. President Donald Trump's pro-crypto policies. De Galhau expressed concern that the U.S. administration's support for digital assets and deregulation could lead to financial turmoil, with repercussions extending beyond American borders.

Trump's pro-crypto stance was a significant part of his re-election campaign, attracting digital asset advocates who were eager to replace the previous administration's anti-crypto policies. Since returning to office, his government has implemented plans that have sparked debate among financial experts. De Galhau recently highlighted that the U.S. push for crypto and non-bank financial services could result in major disruptions, noting that financial crises often originate in the U.S. and impact global markets. By further integrating crypto into the financial system, Trump may be setting the stage for future instability.

One of the key moves by Trump's administration was the creation of a Strategic Bitcoin Reserve, announced through an executive order. This initiative, along with a proposed executive order to reverse Operation Choke Point 2.0—a policy restricting crypto firms' access to banking services—signals a significant shift in U.S. financial policy. However, critics argue that such actions increase risks for both investors and traditional banks.

These policies have already had an impact on the market. Following Trump's executive order, Bitcoin’s price dropped below a certain threshold, leading to significant liquidations. This event underscored the high volatility of crypto markets and raised concerns about the potential risks of government-backed investments in digital assets.

Prominent critics, including economist Peter Schiff, have openly condemned Trump’s Strategic Bitcoin Reserve, labeling it as a potential market manipulation tool that could lead to financial losses for regular investors. Schiff's concerns reflect broader fears that such policies may benefit insiders while exposing taxpayers to unnecessary risks.

A recent survey indicated that most American voters oppose Trump’s push for a national Bitcoin reserve, fearing that taxpayer funds could be misused on a volatile asset. This public sentiment could create challenges for the administration as it continues to advance its crypto agenda.

In response to these developments, Europe is taking a more cautious approach, aiming to strengthen its financial stability. De Galhau has urged the European Union to reinforce the euro’s global role and establish a robust savings and investment framework. His message is clear—Europe must act decisively rather than passively accept the consequences of U.S. financial policies.

Beyond crypto, France is also closely monitoring Trump’s new trade tariffs, particularly the duty on European cars. The French government views this as part of Trump’s aggressive economic strategy, which sees global trade as a zero-sum game. De Galhau believes Europe must assert itself and negotiate from a position of strength rather than simply react to U.S. actions.

As Trump continues to advocate for a crypto-friendly financial system, the global debate over digital assets remains intense. Supporters see this as a step toward financial innovation, while critics warn of instability, market manipulation, and the risks of excessive government involvement in volatile assets. With market fluctuations intensifying and regulatory uncertainties growing, the future of cryptocurrency in national economies is far from settled.