"It's Disruptive Populism" - Steve Bannon Buys Into Bitcoin

Discussion in 'The World has gone to Hell' started by Tyler Durden, Jun 14, 2018.

  1. Tyler Durden

    Tyler Durden Guest

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    Ensconced in the "Breitbart Embassy," the nickname for his townhouse on Capitol Hill (even though he left the media company five months ago, and the White House staff five months before that), Steve Bannon has lately been using some of his free time to learn more about crypto and bitcoin, even investing in companies that are raising money via ICOs, a process that's recently attracted the attention of the SEC, according to the New York Times.

    The news comes as the price of bitcoin slumps to levels unseen since November. Bitcoin has now erased all of the gains from the late-stage pump that briefly brought its value to $20,000 a coin before the monthslong slide began.

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    Bannon's interest in crypto and blockchain wasn't widely known before the story. But apparently President Trump's former chief strategist has been involved in the space for a while, though he refuses to talk about specific projects - fearing that the controversy that accompanies his name could have a negative impact. But the Times confirmed that Bannon has had several meetings with hedge funds and so-called initial coin offerings via his investment business, Bannon & Company. Bannon also admitted that he owns a "good stake" in bitcoin, though it's unclear when, exactly, he bought in. Once, at a gathering of academics at Harvard (where Bannon got his MBA), Bannon said he raised the idea of creating a "deplorables coin" cryptocurrency named after the famous Hillary Clinton line "basket of deplorables." (He even once told a Swiss newspaper that crypto and blockchain would "empower" populist movements to resist the European establishment).

    While his work is in the "early stages", Bannon has said he's interested in helping people - and even countries - launch their own cryptocurrencies, projects that would likely be centered outside the US.


    "It’s disruptive populism," Mr. Bannon said in the interview, at his Capitol Hill townhouse in Washington. "It takes control back from central authorities. It’s revolutionary."

    As Bannon sees it, whoever controls the currency has the ultimate control in society - something that crypto could help change. Bitcoin and crypto have long been popular with the "alt-right" the NYT explains because it has remained a viable payments option as PayPal and Apple Pay have shuttered the accounts of right-wing groups.


    His vision for virtual currency has elements of his unorthodox ideology. He sounds like both an avowed libertarian who wants government out of his life and a progressive who wants Wall Street held to account when he insists that virtual currencies can help citizens take back power from the central banks that "debase your currency" and make citizens "slaves to debt."

    His focus on creating new digital tokens, which are usually offered through initial coin offerings, puts him squarely in the edgiest, most scam-filled slice of the cryptocurrency business.

    New companies have raised billions through these I.C.O.s, which allow them to bypass regulators and other middlemen and go straight to investors. That has also led to plenty of scams, and authorities throughout the world are starting to crack down.

    Mr. Bannon’s involvement in cryptocurrencies has raised eyebrows among people trying to move the business toward the mainstream. They fear he will further cement the technology’s reputation as a plaything of fringe elements.

    "It almost seems like a natural progression for a man who gained prominence by shoveling out unfounded conspiracies to now shilling complex technology and financial instruments to an unsophisticated investing public," said Colin Platt, a cryptocurrency researcher and adviser.

    One hedge fund manager who told the NYT about a meeting he had with Bannon said the former political operative appeared to have done his research.


    Timothy Lewis, a hedge fund manager who met with Mr. Bannon to talk about cryptocurrencies last month, said he was impressed with the degree to which Mr. Bannon had delved into the details of the technology and the challenges it faces.

    "I didn’t know what to expect going in, but he had clearly done his homework," said Mr. Lewis, who is a co-founder of the Ikigai hedge fund, which invests in cryptocurrency projects. He said they had talked about the laws governing new cryptocurrencies and a few initial coin offerings that had recently raised money from investors.

    Bannon found his way to the world of crypto through Brock Pierce, a former child actor who has acted as a pitchman for at least one ICO project. Pierce more recently has been criticized for wanted to create a crypto enclave in hurricane-ravaged Puerto Rico because of the island's low taxes. And while Pierce has been mocked by late-night comics like John Oliver, Bannon - who previously served on the board of one of Pierce's companies - insists that the ventures he has been involved in with Pierce have done well despite low expectations.


    "These guys are visionaries," he said.

    The question is: will he feel the same way if bitcoin returns to $3,000 a coin?

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