Bessent is known to be very supportive of crypto and bitcoin in particular.
As Treasury Secretary, Bessent would have a major influence on the development of the US cryptocurrency sector.
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Posted November 22, 2024 at 7:03 pm EST.
President-elect Donald Trump will nominate hedge fund manager Scott Bessent for the role of Treasury Secretary, according to sources who told Bloomberg and the Wall Street Journal the president-elect had asked Bessent to take on the role on Friday.
As Secretary, Bessent would be one of the most important voices after Trump himself on the United States economy, and would have the power to sanction foreign crypto projects, as well as play a role in pursuing or discouraging the creation of a central bank digital currency (CBDC). Cabinet nominees are almost always approved by the Senate. However, Trump posted on Truth Social earlier this month that he could use recess appointments to push through his nominees in a “timely manner” if the Senate delays the process.
Bessent is the founder of Key Square Group and previously led investments at Soros Fund Management. He is known to be very supportive of crypto and bitcoin in particular, having made several positive statements about cryptocurrency in recent months. “Crypto is about freedom,” he said in an interview on Fox.
Jockeying for Position
The race between Bessent, former Federal Reserve Governor Kevin Warsh, Apollo Global Management CEO Marc Rowan, Republican Tennessee Senator Bill Hagerty and, until this week, Cantor Fitzgerald CEO Howard Lutnick, has been contentious, with allies for each actively lobbying the president-elect. On Tuesday, Lutnick was nominated for the lesser role of Commerce Secretary after infighting between people close to Trump, including Department of Government Efficiency Secretary nominee Elon Musk and Department of Health and Human Services Secretary nominee Robert F. Kennedy Jr., frustrated Trump, according to reports.
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After Lutnick was tapped to serve as Commerce Secretary, the remaining four contenders to head the Treasury Department each visited Mar-A-Lago this week. Bessent visited Mar-a-Lago on Thursday, according to Fox Business. A source who speaks with Trump aides told Unchained that Rowan was out of the running after a meeting between Rowan and Trump on Wednesday went sour. Also on Wednesday, Trump reportedly floated the idea of Warsh temporarily serving as Treasury Secretary before becoming Fed Chair at the end of Jerome Powell’s term in 2026.
Deliberations over Trump’s Treasury choice were so tense largely because the Treasury Secretary will play a significant role in crafting tax legislation, and also because they will likely serve as a middleman between Trump and other foreign leaders during trade negotiations. The Tax Cuts and Jobs Act, broadly known for including tax cuts for wealthy individuals and corporations that Trump campaigned on, expires at the end of 2025.
A replacement bill would ultimately need to be passed by Congress, but would also incorporate input from the Treasury Secretary. Details on what will be included in a new tax bill are expected to be a political focal point next year, and crypto lobbyists are already meeting with members of Congress to ensure that the industry’s preferences, such as eliminating capital gains taxes on cryptocurrency investments, are prioritized.
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The crypto industry was also concerned that Trump’s Treasury Secretary nominee would have a strong understanding of blockchain technology and a desire to avoid targeting crypto builders so that he would not sanction international protocols. Under current Secretary Janet Yellen, the Treasury Department sanctioned cryptocurrency mixer Tornado Cash for allegedly laundering money for North Korean hackers Lazarus Group. The sanctions have been criticized by many in the industry for being unsuccessful in halting financial crime, as well as unfairly penalizing developers and consumers who use the mixer to protect their privacy.
