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Donald Trump’s CBDC, AI Warnings Include Their Power to Shift War Tides

Last Updated February 5, 2024 10:24 AM
Teuta Franjkovic
Last Updated February 5, 2024 10:24 AM

Key Takeaways

  • Donald Trump has expressed concerns about artificial intelligence, particularly the risks associated with deepfakes.
  • Despite personal investments in crypto, Trump remains cautious, labeling CBDCs as ‘very dangerous’.
  • Trump’s potential return to presidency might, ironically, lead to more favorable conditions for digital asset firms.

Recently, former president and Republican front-runner Donald Trump voiced his concerns  about artificial intelligence (AI), branding it as “dangerous and scary.”

He spotlighted the formidable capabilities of deepfakes, which can range from fabricating false product endorsements to potentially altering the course of warfare.

Trump Labels AI “Dangerous and Scary”, Cites Deepfake Risks

In a recent interview  on Fox Business, reflecting on a personal encounter, Trump recounted:

“I saw somebody ripping me off the other day where they had me making a speech about their product. I said I’ll never endorse that product. You can’t even tell the difference. It looks like I’m actually endorsing it,” he said. “You can get that into wars and other things.”

He warned  of the broader implications, suggesting that such manipulation could extend into areas as grave as warfare.

Trump emphasized  the urgent need for action against the potential threats posed by artificial intelligence (AI), labeling it as possibly the most perilous of all due to the lack of concrete solutions.

In the same interview, he reiterated  his criticisms of Central Bank Digital Currencies (CBDCs), deeming them extremely hazardous. Furthermore, Trump disclosed his decision not to reappoint Jay Powell  as the chair of the Federal Reserve, criticizing Powell’s approach as politically motivated and suggesting that his interest rate policies might be aimed at influencing electoral outcomes.

Pledges to Block ‘Digital Dollar’ Despite Personal Crypto Holdings

Despite possessing an estimated $3 million in cryptocurrency, as reported by Forbes, and promoting a line of NFT trading cards, Trump described  a potential “digital dollar” as “very dangerous.”

He cautioned that such a currency could lead to scenarios where funds vanish from people’s bank accounts. This statement aligns with remarks Trump made last month in New Hampshire, where he emphatically stated his opposition to CBDCs, labeling them a “dangerous threat to freedom” and vowing to obstruct the Federal Reserve’s efforts to introduce a formal digital currency.

Friend or Foe? Trump’s Presidency Casts Doubt on Future of Crypto Regulations

While the Republican party has been introducing crypto-friendly regulations, Trump, if returned to office, is expected to appoint regulators who may favor digital asset firms more than the current Biden administration, known for its general skepticism towards the crypto sector.

The Federal Reserve has yet to take a clear position on digital currency , though it is actively considering the prospects amidst the burgeoning private crypto market. The central bank’s deliberations are partly driven by concerns that private digital currencies could evolve into a decentralized financial system, operating beyond the regulatory reach of the federal government.

CBDCs as ‘Government Tyranny’

In his address in New Hampshire, Donald Trump starkly criticized the prospect of a CBDC, framing it as a mechanism for “government tyranny” and a threat to personal financial autonomy.

This comes as the Biden Administration, through a 2022 executive order, set in motion a process for government agencies to formulate policy guidelines  and a potential regulatory structure for digital assets.

Federal Reserve Chair Jerome Powell, in his congressional testimony last year, indicated that the journey towards establishing a CBDC is a prolonged one, with no definitive stance yet on its viability. Powell highlighted the extensive evaluation underway to gauge public interest in such a system, a project that would necessitate approval from both Congress and the executive branch.

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