Former Congressman for Texas’ 14th District in the U.S. House of Representatives and former presidential candidate, Ron Paul, came out in defense of Bitcoin on Michelle Makori’s show on Kitco News. Paul defended the right of individuals to choose the form of money they prefer.
According to the former congressman, one of the biggest fears of the federal government is that the dollar will lose its status in the face of new cryptocurrencies, especially Bitcoin. For Paul, the dollar will remain as a reserve currency but its value will fall sharply against the Bitcoin.
The man who was one of the most libertarian congressmen in U.S. history, also said that the government is likely to introduce new laws to retain the dollar’s status, while at the same time trying to limit the use of cryptocurrencies in regular transactions. As a lawmaker, Paul tried to abolish laws that impose taxes on currency exchanges and purchases of other assets such as gold, silver, platinum or palladium.
“They won’t even allow you to replace the Dollar with a cryptocurrency. There will be laws against that, but I wanted to legalize it.” Paul stated and also added, “II think our problem isn’t the technicalities of the gold standard or crypto. Our problems are the dependency on the government.”
In his defense of Bitcoin, Paul emphasized that it and other cryptocurrencies are becoming a response to the devaluation of the dollar that has had a drop in value against other international currencies due to the expansive monetary policy of the Federal Reserve (FED).
“My goal is to help legalize the competition. And I think the people will sort it out, freedom of choice will sort it out,” he said calling for allowing Bitcoin to compete against the dollar.
Ron Paul’s Bitcoin defense is not without its edges
The former congressman said investors should also be concerned not only about the possibility of tighter regulations around Bitcoin, but also gold, which has been gaining in value following the announcement of 4.2% cumulative inflation during April by the Bureau of Labor Statistics.
Ron Paul’s defense of Bitcoin comes after the cryptocurrency lost nearly half its value in a month following messages from China’s communist government for banning mining of the digital currency in the country. The drop was compounded after the announcement that Tesla would no longer accept Bitcoin because of its environmental impact, which sent lousy signals to the market about the stability of the cryptocurrency.
Some countries such as China and India have already threatened to restrict the use of Bitcoin, under the pretext that the cryptocurrency represents a threat to financial stability, however analysts estimate that China does not want to lose the currency’s monopoly in its economy.
Although acceptance of Bitcoin has grown among some traditional investors such as pension funds, banks and even the stock exchange itself, there are still many skeptics as to whether Bitcoin can truly fulfill its function as a store of value, as its high volatility still makes it a risky and purely speculative investment.
Since its sudden drop during the month of May, the Bitcoin has been hovering between $35,000 to $40,000.
Former Congressman Ron Paul will be one of the guests to discuss the future of cryptocurrencies at the “Bitcoin 2021” conference to be held in the city of Miami on June 4-5, which will also be attended by Miami Mayor Francis Suarez.