Crypto trading has taken the back seat in the digital economy in 2022, with the market remaining under the bears' control for most of the year. Furthermore, traders have seen their faith rocked by the consecutive failures of centralized exchanges. These intermediary marketplaces have been the powerhouse of the industry since its humble beginnings. Now, they seem to crumble under mounting allegations of scams, lawsuits, and solvency concerns. Meanwhile, they make a convincing case for the imminent decentralization of crypto…
Pierre Poilievre – Canadian MP and front-runner for Conservative leadership – is showing support for Bitcoin. This is part of his campaign to combat growing inflation in Canada. On Monday, the politician visited a Shawarma shop in London, Ontario to purchase a meal using the cryptocurrency and promised to make Canada the “blockchain capital of the world.”
Addressing Inflation With Bitcoin
Inflation is a focal point of Poilievre’s campaign. He frequently notes the record CPI increases experienced by Canada in recent years, which are mirrored by the United States. The year-over-year price increase sits at 5.7% as of February.
As such, he has grown increasingly popular with the Bitcoin community for his speeches against irresponsible money printing leading to monetary debasement. Bitcoin’s supply has a limited supply of 21 million coins, leading many to view it as a powerful, deflationary counter.
Tahinis Restaurant owner Aly Hamam put that theory to the test. In conversation with Poilievre during pre-budget consultations last month, Hamam explained that his company bought Bitcoin in 2020 in anticipation of inflation from rampant money printing. Between then and interview, his investment had seen 66% ‘deflation’ – a tripling in price.
“Government is ruining the Canadian dollar, so Canadians should have the freedom to use other money, such as bitcoin,” said Poilievre, speaking at the restaurant today.
He blamed the $400 billion “printed out of thin air” for the fast-rising inflation in the country. Also, he named the phenomenon “Justinflation” after the nation’s Prime Minister Justin Trudeau. The PM previously admitted that he “doesn’t care about monetary policy.”
The Taxation Situation
At the restaurant, Poilievre demonstrated his Bitcoin purchase to an applauding crowd. However, this purchase was an exception. Last month, Haman stated that he cannot accept Bitcoin payments due to existing tax laws.
“It’s being treated as a taxable event if I sell it, or receive it, or use it to pay my vendors,” he said, while suggesting that capital gains laws be scrapped on trades that use Bitcoin.
Poilievre said today that he’d see Bitcoin taxed like gold and other commodities. This would further establish its position in the public conscience as “digital gold”. However, he also suggested that it compete with existing monies, which existing commodities tax laws would interfere with.
“Choice and competition can give Canadians better money and financial products,” he explained. “Not only that, but it can also let Canadians opt-out of inflation with the ability to opt-in to cryptocurrencies.”
Regardless, Poilievere showed interest in sorting out the existing “cobweb of contradictory rules” surrounding cryptocurrency with the provinces.
The Blockchain Capital
Though focused on Bitcoin, the politician’s support extends to crypto as a whole. He said he wants to give Canadians the freedom to use everything from tokens to smart contracts, to decentralized finance.
This afternoon, he tweeted a campaign donation link, alongside a promise to “take back control from bankers and politicians” and to “make Canada the blockchain capital of the world”.
Using crypto as a pitch in political campaigns is growing in popularity. Before Canada’s Federal election last year, People’s Party Leader Maxime Bernier voiced similar support for Bitcoin in response to Trudeau’s “Keynesian apparatchiks”. In the States, Eric Adams promised to make New York City “a center for BItcoins” before being elected as its Mayor.
Such developments mean Poilievre faces competition in making Canada the world’s blockchain hub, with cities like Miami and Lugano already working towards that goal. In terms of nations states, El Salvador has already made Bitcoin legal tender, with Malaysia and Tonga considering similar motions.