Bloomberg is back to doing what it does best: pushing fear, uncertainty, and doubt (FUD). This time, the target is Tether, the crypto industry’s biggest stablecoin issuer, and the ammunition is Donald Trump’s presidency.
Bloomberg’s latest editorial predicts what’ll happen when Trump’s crypto-friendly policies collide with Tether’s controversial practices. But let’s just call this what it is — an attack on crypto, laced with political undertones. It’s not the first one this month either.
Tether acts as a digital dollar, providing traders a safe haven from unstable local currencies and other volatile cryptos. It’s supposed to be simple: for every Tether token issued, there’s an actual dollar in reserve. But Bloomberg doesn’t buy it.
According to the editorial, Tether operates more like a dodgy offshore bank than a transparent financial institution. Its reserves reportedly include Bitcoin, risky loans, and investments nobody can seem to fully identify.
Add shady associations to the formula. Over the years, Tether’s name has popped up in investigations involving everyone from North Korean hackers to Irish gangsters and Hamas operatives. Bloomberg points to these links in accusing Tether of enabling billions of dollars to move in and out of the criminal underworld.
Trump makes Tether even bigger
Admittedly, Trump’s administration is already too cozy with Tether. His pick for commerce secretary, Howard Lutnick, has direct ties to the stablecoin issuer via his company Cantor Fitzgerald, which owns a 5% stake in Tether, earning millions in custody fees and pushing for plans to lend billions against Bitcoin.
For Bloomberg, this is the beginning of the end. It argues that the deeper Tether integrates with Wall Street, the higher the chances of a catastrophic fallout. Trading volume exploded after Trump’s election, with Tether moving $4.6 trillion in November alone.
What’s worse, the news outlet argues that Tether’s continued growth could turn a crypto crash into a full-blown financial crisis. Imagine if Tether’s reserves—already packed with risky assets—collapse. Bloomberg warns this could drag down firms like Cantor and infect traditional financial markets.
But wait, it gets juicier. Bloomberg accuses Tether of being a tool for crime. Federal prosecutors have had their eyes on the company for years, and the Treasury Department has floated the idea of sanctions to remove it from American markets altogether.
Tether, for its part, denies any wrongdoing and insists its reserves are fully backed. Still, with Trump back in the Oval, Bloomberg argues that Tether could flourish in a way that makes these alleged risks impossible to ignore.
Bloomberg slams Trump’s Bitcoin reserve plan
Bloomberg isn’t just targeting Tether, as aforementioned. They’ve got a bone to pick with Trump’s rumored Bitcoin reserve plan too.
The idea, backed by Trump and first created by crypto-friendly Senator Cynthia Lummis, involves the U.S. government holding onto 200,000 confiscated Bitcoins—worth $20 billion—and buying another million over five years.
Supporters compare it to the country’s strategic petroleum reserve, which stockpiles oil for emergencies. However, Bloomberg published an editorial earlier this month calling it “the biggest crypto scam yet.” It argues that Bitcoin has no industrial use, no intrinsic value, and no connection to the real economy.
In the news outlet’s eyes, it’s nothing more than a speculative asset, with its value entirely dependent on market hype.
According to Bloomberg, a government Bitcoin reserve would enrich early holders, inflate the price, and leave taxpayers holding the bag. Funding the purchases would mean either borrowing more money—adding to the national debt—or printing more money, fueling inflation.
And if Bitcoin’s price tanks, the reserve could end up worthless, leaving the government with a pile of useless digital tokens. Bloomberg also warns that a Bitcoin reserve could push banks deeper into crypto. Imagine banks lending dollars against Bitcoin collateral, only to panic when prices drop.
The media giant says this could lead to another financial crisis, complete with bailouts and taxpayer-funded rescues. And the irony is not lost on Bloomberg either. Bitcoin was supposed to be about freedom from governments and banks.
Yet here we are, with centralized financial institutions lobbying for subsidies and government backing. Bloomberg calls it the ultimate betrayal of Bitcoin’s original vision. And it’s not wrong.
Bloomberg’s bias and political games
Here’s the thing, though: Bloomberg’s motivation might have more to do with bitter politics than the Satoshi gospel. The company, owned by billionaire Michael Bloomberg, has a history of taking potshots at both.
You see, Michael is a Democrat and a longtime Trump critic who hates crypto. He even ran for president in 2020 on a platform that included a heavy campaign against crypto.
So, it’s no surprise that Bloomberg’s editorial board is now going after Trump’s crypto policies with a vengeance. But while Bloomberg’s warnings might scare some, they don’t tell the whole story. Tether and Bitcoin have survived worse.
The crypto industry thrives on uncertainty, and every time someone declares its demise, it comes back stronger. As for Trump, he’s not likely to back down. We doubt the self-proclaimed “crypto president” ever even thinks about Michael Bloomberg.
