Hedge Fund Elliott: The White House is inflating the cryptocurrency bubble, which could cause serious damage

Hedge fund Elliott warned that the Trump administration's support for cryptocurrencies has fueled speculative frenzy, which could cause "serious damage" when prices plummet.

A letter to investors shows that the company, with assets of $70 billion, targeted the U.S. government's significant enthusiasm for assets that have soared in price but have "no substantive content," as well as politicians who support cryptocurrencies.

Elliott wrote that the fund had "never seen such a market"... The AI boom and high stock valuations are signs of investors "acting like a bunch of sports gamblers." Cryptocurrencies are the "starting point" of the entire market speculation frenzy, not only because its scale has expanded, but also because it is "close to the White House." The “inevitable collapse” of cryptocurrency bubble “could cause serious damage in ways we cannot predict.” It’s worth mentioning that Elliott founder Paul Singer is a long-term donor to Republicans and donated $56 million to conservative candidates in 2024 election cycle.