Outside the Box
Opinion: Is Trump’s bitcoin embrace the biggest ‘pump-and-dump’ ever?
The U.S. government buying bitcoin at inflated prices would do nothing to pay off America’s debt

By Jeffrey Funk and Gary Smith
Published: Jan. 16, 2025 at 7:31 a.m. ET

There is an apocryphal story of an investor, “Sam,” who became enamored of a lightly traded stock. He called his stockbroker and bought 100 shares at $20, made several more purchases that pushed the price up to $30, and made even more purchases that pushed the price up to $50. Then he told his broker to sell all his shares for $50. The broker replied, “Who to?”

We were reminded of this cautionary tale by reports that U.S. President-elect Donald Trump plans to establish a federal stockpile of bitcoin that will be used to pay off the U.S. national debt. If the federal government spends trillions on bitcoin, it will surely drive bitcoin’s price up. Indeed, the cryptocurrency’s price has already soared in anticipation of these purchases.

{snip, due to paywall}