Pro-Trump Engineer Infuriated by Crypto Reserve Plan Early Crack

The Trump Technology Alliance shows the first signs of actual pain. And that’s because of the code.

President Donald Trump relied on crypto executives and investors for most of his 2024 campaign fund. He was elected by cutting regulations and promised to reward them spectacularly by transforming the United States into a “planetary code capital.” Bitcoin A superpower in the world. ”

The president made a quick start and signed an executive order calling for the establishment of a working group on Ross Ulbricht, creator of the digital assets and the Silk Road. The SEC also dropped a long-standing investigation Coinbase.

These moves were praised by the most vocal engineers who supported Trump’s candidacy, but over the weekend the president took their views too far. In a post on Truth Social on Sunday, Trump announced the creation of a strategic cryptocurrency reserve for the US, including not only Bitcoin, but also several other digital currencies, including Ether, XRP, Solana’s Soltoken and Cardano’s ADA.

For the most part, all Trump’s crypto advocates wanted a strategic Bitcoin reserve. For such a move, you will need to use cash to buy Bitcoin. This is widely seen as a wise way for crypto enthusiasts to deploy capital in decentralized currencies, an alternative to hard money. As Coinbase CEO Brian Armstrong wrote in X, Bitcoin offers a “clear story as a successor to Gold.”

By going far beyond Bitcoin, critics have the potential to use US taxpayer money to strengthen the net worth of the few investors who own the coin with unproven value. That’s even more problematic for those seeking to pay trillions of dollars of government spending to support Elon Musk’s cost-cutting mission in so-called government efficiency.

“Tax is theft,” Joe Lonsdale, founder of venture company 8VC, and Joe Lonsdale, a vocal Trump supporter, wrote in an X post.

Venture capitalist David Sacks, who was considered by Trump as “White House AI and Crypto Czar,” has given Lonsdale’s comment, suggesting it’s too early to jump to conclusions. Bag and Lonsdale are part of the same conservative circle in the tech world, with Musk and Peter Tiel at the center.

“No one ever announced a tax or spending program,” Sacks wrote in response to a post by Lonsdale. “Maybe you should wait to find what’s actually being proposed.”

The White House did not respond to requests for comment.

However, Lonsdale was not alone.

Longtime tech investor and early crypto evangelical Naval Ravikant wrote after he announced that “US taxpayers should not withdraw the liquidity of cryptocurrencies, where only names are distributed.” And Vinny Lingham, blockchain startup Civic and creator of the massive crypto influencer, wrote, “Please call me old fashioned, but I don’t think the government should pump taxpayer money while running a 2TRN deficit.”

Crypto’s leading Trump supporters and celebrities joined the chorus on Monday. Billionaire Bitcoin investor Tyler Winklevos, who wrote that Trump should vote just before the November election, opposed the president’s crypto reserve plan.

“I have nothing for XRP, SOL or ADA, but I don’t think it’s suitable for strategic reserves,” Winklevoss wrote. “Today, only one digital asset in the world is encountering bars, and that digital asset is Bitcoin.”

David Marcus, former head of Facebook’s failed Crypto project, suggested that most of his peers in the Crypto community have the same view.

“Unmistakable, if not all, industry leaders agree on this,” Marcus wrote.

Marcus, now CEO of payment infrastructure startup Lightspark, declared in July that he “beyond Rubicon” and shifted his support for Trump and was away from Democrats.

Anthony Pompliano, the loud pro-trump voice of Crypto Investing, committed over 1,500 words to the topic in his newsletter on Monday. He says Trump is willing to propose agenda that would buy risky tokens on behalf of the US as the wrong people have reached him.

“We have a joint look at the US president by crypto projects, lobbyists and special interest groups,” Pompliano wrote. “They told the president that crypto-related sanctuaries should hold tokens “made in America.” This pitch was the perfect trap for a president who ran on America’s first agenda. ”

Part of the online outrage has been directed specifically at Sacks, who promoted and supported various cryptocurrencies as a VC before joining the Trump administration, and whose company Craft Ventures promoted and supported Bitise, an investor at Crypto Index Fund Manager.

Sacks wrote in X’s post that he will sell all the cryptography, including Bitcoin, Ether, Sol, and “providing updates at the end of the ethical process” before taking on his new role.

Until late Monday afternoon, crypto prices were a dramatic reversal from weekend rally following Trump’s announcement. Bitcoin fell by about 9%, while ether slipped by 15%. XRP and Sol have dropped more.

The slides appeared to be linked to President Trump’s confirmation of future tariffs. This defeated the dangerous assets across the board, knocking the Nasdaq down almost 3% at the end of the transaction.

Crypto has had some voices that were unwilling to publicly condemn Trump’s backup plans.

Michael Saylor, Chairman strategyeffectively appeared as a Bitcoin proxy for around $43 billion, told CNBC on Monday that Trump’s decision to include additional cryptocurrencies.

“There’s no way to interpret this, but this is bullish for Bitcoin and bullish throughout the US crypto industry,” Saylor said. “I think the best thing for this country is to advance our enlightened and progressive policies on digital assets.”

Jonathan Jachym, head of global policy and government relations at Kraken, told CNBC that the crypto exchange is “encouraged to see the announcement,” indicating the president is “trustworthy to his commitment.”

Even among skeptics, it appears that Trump has lost wider support for his agenda due to this one announcement. Supporters like Lonsdale quickly posted on other issues, celebrating the actions that Secretary of Defense Pete Hegses and Trump took to put pressure on Mexican drug cartels.

But just six weeks after Trump’s second administration, the response shows how quickly the anger can be activated when the proposal touches the nerves of a key group of supporters. The debate adds interest to Trump’s first White House Script Summit on Friday as investors are eagerly waiting for more details.

As Sacks wrote in his first post on March 2nd about the announcement of the Strategic Reserve, “comes more to the summit.”

Watch: The US needs a “enlightened, progressive” crypto policy