Larry Summers: ‘Trump's hoarding of Bitcoin assets is a “crazy idea”’

Former U.S. Treasury Secretary Larry Summers has said that President-elect Donald Trump’s plans for a bitcoin reserve are crazy’.

‘The idea of a U.S. bitcoin reserve is crazy,’ Summers said in an interview with Bloomberg TV on Friday (local time). ‘There is absolutely no reason to do this other than to satisfy special interest campaign donors,’ he said.

During his presidential campaign, Trump said that he would like to see bitcoin stockpiled by the government as a strategic asset like gold. U.S. Senator Cynthia Loomis has introduced the Bitcoin Strategic Asset Act, which would require the U.S. to buy 200,000 bitcoins a year for the next five years.

‘It’s fair to say that cryptocurrencies have been over-regulated by over-zealous regulators,’ Summers said, but he stressed that there’s a big difference in what’s needed between the government maintaining a national oil reserve and establishing a gold stockpile at Fort Knox, a US Army base.

Meanwhile, he highlighted that while Tesla CEO Elon Musk has pledged to reduce government spending by $2 trillion as part of his mission to make government more efficient, including reducing the civil service workforce, the total US federal government payroll is nowhere near $2 trillion.

Summers said it would be really tough to change politically because a lot of the US government’s budget is tied up in national defence and support for the elderly.