By Kevin T. Dugan, Vicky Ge Huang and Caitlin Ostroff | Photographs by Roger Kisby for WSJ

LAS VEGAS -- The cryptocurrency world was once the province of libertarians who kept their distance from the government. These days, it is in the midst of an all-out MAGA takeover.

Take the scene at the industry's flagship event in Las Vegas last week. Star speakers at the Bitcoin Conference included a parade of Trump officials and Washington allies. Crypto boosters including billionaire bitcoin evangelist Michael Saylor got a private audience with Vice President JD Vance to push their favored policies.

A retail store hawked Trump hats, bobbleheads, martini glasses and sequined shirts. Two Tesla Cybertrucks were wrapped in orange, bitcoin's unofficial color. A felon pardoned by Trump was feted at a "welcome back" party that cost $300 per person.

"The Bitcoin Conference right now is basically a right wing rally," said Richard Scotford, a 53-year-old bitcoin owner who lives in Costa Rica. He said being enamored with powerful people is "against the ethos of bitcoin."

The industry, a realm of outsiders who have long clamored for legitimacy, has never had a friendlier U.S. regime in power. President Trump raised millions from crypto executives and is delivering a lot of what the industry craved, dropping Biden-era lawsuits against crypto companies and backing legislation to bring digital tokens into the financial mainstream.

Despite the winning streak, Trump's fervent embrace is causing discomfort to some factions of the crypto world, including a wing that has argued since bitcoin's early days that cozying up to any government is a bad idea.

Even some of the president's supporters say they have cringed at the Trump family's push into every corner of the business, from bitcoin buying to mining to memecoins. Such moves might raise crypto's profile, but they also create substantial conflicts of interest and could jeopardize the industry's push for widespread acceptance, the critics say.

Some early bitcoin stalwarts are wary of the government entering the market. Patrick Murck, who spent years trying to establish the industry's legitimacy as co-founder of the Bitcoin Foundation, warned that Trump's plan to create a national strategic reserve for bitcoin could be counterproductive.

"It's supposed to be an apolitical, value-neutral network," he said. "If people believe that the U.S. government has a very large stake in its success, I don't know how people will feel about that in other parts of the world."

Crypto's comeback wasn't a given. Things looked promising a few years ago when entrepreneur Sam Bankman-Fried, schlubby attire notwithstanding, turned the exchange FTX into a phenomenon worthy of naming rights for a Miami arena and a Super Bowl ad starring Larry David. That gave way to the scandalous FTX collapse in 2022, criminal prosecutions -- Bankman-Fried was sentenced to 25 years in prison on fraud charges -- and ramped-up regulatory scrutiny.

The mood is decidedly different now. Bitcoin is trading near record highs. The industry is optimistic that with Trump's backing, legislation to create a regulatory framework for stablecoins -- tokens that are pegged to real currencies such as the dollar -- will accelerate the mainstreaming of crypto.

Big banks including JPMorgan Chase, Bank of America and Citigroup are exploring whether to issue their own joint stablecoin, The Wall Street Journal reported. New Labor Department guidance could make it easier to bring cryptocurrency into 401(k) plans.

Time with the veep

As the conference showed, crypto's elite executives are hardly outsiders -- they are the ultimate Washington insiders. In a ballroom on the third floor of the Venetian Hotel, past 20 security guards and three dividers, bitcoin enthusiasts pitched Vance in an intimate, hourlong private meeting.

Saylor, the executive chairman of Strategy, a software company that has made stocking up on bitcoin the centerpiece of its business, advocated for tax leniency for bitcoin miners, who perform the complex computational feats needed to unlock units of the currency, according to people familiar with their exchange.

Saylor argued that miners should only pay taxes on sales of tokens. He likened the status quo to if a movie studio had to pay taxes on a script based on the prediction that it would be a blockbuster.

The event was organized by Gemini, a crypto exchange controlled by the Winklevoss twins, of Facebook-founding lore. Namecards seen by a Journal reporter bore the logo for MAGA Inc., a pro-Trump super PAC. Donald Trump Jr. and White House crypto adviser David Sacks were among other people at the event. Sam Kazemian, the founder of stablecoin company Frax, pitched the ability for taxpayers to use dollar-pegged tokens to pay taxes.

Vance didn't indicate what he might do, but spoke about the need to make the industry more legitimate, said three people who were there.

'No conflict of interest'

Last year, Trump used the Bitcoin Conference to declare himself a major industry ally. By this year's event, he and his family were part of the industry.

Trump Media & Technology Group, the president's social-media company, announced plans to raise $2.5 billion to buy bitcoin, mimicking the playbook of Strategy's Saylor. That would give the Trumps control over one of the largest private bitcoin stashes.

"It is the hottest asset on Earth, hands down, not even close right now, " said Eric Trump, one of the president's sons. "There is no conflict of interest. I have nothing to do with Washington, D.C."

"The very same people that were coming after the crypto community were coming after us viciously, for no reason whatsoever," the younger Trump said, "and it brought an industry and our family, quite frankly, together."

Backers of a national bitcoin reserve say it would lend the prestige of the U.S. government to the currency. "It's a good thing, because the more people know about bitcoin, obviously, the higher the value is going to be," T.J. Slingby, who works for a crypto advocacy group in California, said of the administration's support of bitcoin.

A Trump family-controlled venture, World Liberty Financial, has also launched a stablecoin that would be affected directly by legislation that is advancing in Congress.

Tina Mataia, a former telecom worker from New Zealand, has been into bitcoin for five years and came to the conference for the first time, drawn by Trump's political message of antiwokeness. She is troubled by Trump's own foray into crypto coins. The top holders of Trump's memecoin recently were invited to dinner with the president, drawing criticism from Democrats and government watchdog groups.

"I'd not buy it, even though I respect the man," Mataia said.

'We do live in the real world'

Bitcoin was championed in its early days by libertarian idealists who dreamed of a currency that was totally private and secure, outside the reach of governments and financial institutions.

Earlier conferences were concerned with the finer details of money and personal liberty, and were attended by more paranoid types, said bitcoin developer Tadge Dryja. "We were like, 'Well, are they gonna bomb this place and kill us all because they want to destroy bitcoin?'" he said.

Eventually, a more pragmatic approach took hold, one that sees joining with governments and financial institutions as the way to make bitcoin valuable in daily life -- as a store of value, or a way to buy things.

"As much as the early adherents to bitcoin were libertarians that imagined it could exist in its own world, we do live in the real world," said Dan Morehead, the CEO of Pantera Capital, a cryptocurrency-focused investment firm. "And the real world has regulators and the government will be involved."

A free man

The MAGA impact on crypto land was on display with the celebration of Ross Ulbricht, the founder of Silk Road, a market for illicit drugs that used bitcoin as payment for transactions.

In January, Trump granted Ulbricht a full pardon of his conviction on drug trafficking charges, saying his life sentence was too harsh. During Ulbricht's 2015 trial, prosecutors said Ulbricht had ordered the assassinations of six people, which he denied. There was no evidence anyone was killed.

"He said he would free me, and he did. Period. He's a man of integrity," Ulbricht said in his conference remarks. The conference also held an auction for clothes Ulbricht wore while incarcerated, as well as his prison ID and paintings he made while in custody.

One painting sold for more than a bitcoin, or about $105,000.

Write to Kevin T. Dugan at kevin.dugan@wsj.com, Vicky Ge Huang at vicky.huang@wsj.com and Caitlin Ostroff at caitlin.ostroff@wsj.com

(END) Dow Jones Newswires

June 02, 2025 14:53 ET (18:53 GMT)

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