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Charles Hoskinson, one of the cryptocurrency industry’s best-known entrepreneurs, has warned that a new digital asset platform promoted by Donald Trump and his sons could be “scary” for the industry.
Hoskinson, the co-founder of the popular Ethereum blockchain, told the Financial Times he had concerns about a Trump-backed venture announced on Monday that President Trump, his sons Donald Trump Jr. and Eric Trump, and real estate developer Steve Witkoff are backing decentralized finance (DeFi) platform World Liberty Financial.
DeFi projects aim to provide financial services without intermediaries like banks or exchanges. World Liberty Financial promises to leave “slow and outdated big banks” behind, but details have yet to be released.
“Trump is trying to launch DeFi applications, and that’s scary for us as an industry because everything he does is hated by the left with a passion,” said Hoskinson, who is also the founder of the Cardano blockchain, an Ethereum rival. “He’s turning something that was bipartisan into something partisan.”
Democrats “will try to weaponize our institutions to slow down and damage Trump, so I wouldn’t be surprised to see the Department of Justice, the (tax) investigation and the Securities and Exchange Commission going after them,” he said. “That would have ripple effects throughout the industry and cause a lot of problems.”
Trump’s cautious comments come as he seeks to reach out to an industry he previously shunned, calling bitcoin a “scam.” In July, Trump promised to make the U.S. the “bitcoin superpower of the world,” fired the chairman of the Securities and Exchange Commission, and vowed to end President Joe Biden and Sen. Kamala Harris’ “anti-cryptocurrency crusade.”
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However, Hoskinson said he doesn’t believe either candidate in the US presidential election is capable of fostering a strong cryptocurrency industry in the country.
Trump has received endorsements from influential crypto investors such as venture capitalists Marc Andreessen and Ben Horowitz, as well as Gemini exchange co-founders Tyler and Cameron Winklevoss, while others, including billionaire entrepreneurs Mark Cuban and Reid Hoffman, have also backed Harris.
“You don’t see that level of quality and sophistication in the crypto community’s discussions with Trump and Kamala Harris,” Hoskinson said.
He said it may be difficult for him to deliver on his pro-crypto policy pledges if elected president in November.
Hoskinson said high staff turnover within the Trump administration will make it difficult to bring the right people into government to develop the industry.
“It appears Biden is continuing the disastrous policies he’s implementing against our industry,” Harris added.
Hoskinson said the US could capture “$5 trillion to $10 trillion worth of crypto” over the next decade if it passes legislation that brings transparency to the crypto market and “stops suing companies and shutting down bank accounts.”
He added that he has enjoyed productive dialogue with Republican Senators Tim Scott and Cynthia Lummis and Democratic Senators Ron Wyden, and that he has a very positive view of the legislative branch of U.S. policymaking.
Speaking in Singapore, Hoskinson said the country’s political neutrality gives it an advantage as a crypto hub over rival Hong Kong.
His Inside Outside blockchain infrastructure research and engineering company, also known as IOHK, was founded in Hong Kong and also has operations in Singapore.
“It hurts my heart because it would have been easier to live in Singapore. It makes me sad to see Hong Kong being absorbed into mainland China’s political system,” he said.
“Western countries are increasingly distrusting Hong Kong as a capitalist safe harbor, and more are shifting their business interests to Singapore.”
“Singapore has a unique opportunity to significantly simplify things and embrace decentralized identity,” Hoskinson added. “The government needs to decide whether attracting these kinds of companies is a financial priority. Dubai has made it a priority.”
Additional reporting by Alex Rodgers in Washington
