Will the appointment of Scott Bessent, former CEO of Hedging Fund, as the US Treasury Secretary lead to stable cryptocurrency regulation?

The soon-to-be White House occupant, Donald Trump, will nominate Scott Bessent of the Key Square Group hedge fund to be the next US Treasury Secretary, and he has said that he will help usher in a new golden age for America, while also solidifying America's position as the world's leading economic power.

The CEO of the Hedging fund will lead the US Treasury

According to Bloomberg, 62-year-old Bessent stood out among many candidates. If approved by the US Senate, Bessent will become the first openly gay Secretary of the Treasury. Bessent has stated that he has always wanted to serve the country, but in the 1980s, his sexual orientation prevented him from entering the US Naval Academy and joining the State Department after graduating from Yale University.

Bessent spent part of his career managing funds for billionaire George Soros. He was part of the team led by Stan Druckenmiller that made a billion dollars shorting the pound in 1992 - a bet that forced the pound to exit the European Exchange Rate Mechanism and made Soros famous, earning him the title of 'the financial crocodile'. Under Bessent's leadership as Chief Investment Officer, the Soros family office made profits of around $10 billion with an annualized return of about 13%. In 2015, he founded Key Square, focusing on macro investing using geopolitical and economic trends.

According to a knowledgeable source, Bessent will return funds to its Hedging fund clients as soon as possible after December 1. Federal regulations require cabinet members to develop plans to eliminate potential conflicts of interest, and then implement these plans, usually within a short 90 days.

Bessent will lead the Financial Stability Committee for tax and stablecoin regulation

Bessent is expected to play a key role in pushing Congress to extend Trump's 2017 tax cut plan, many of which are set to expire by the end of 2025.

The Minister of Finance is also responsible for managing the Financial Stability Oversight Council, which is a group established after the financial crisis. Under the leadership of outgoing Treasury Secretary Janet Yellen, the FSOC has started to follow the issue of climate change, which has sparked criticism from Republicans who are cautious about requiring banks to incorporate climate into lending or capital decisions.

The Financial Stability Committee led by Yellen also recommended strengthening the regulation of stablecoins. The Federal Reserve likened stablecoins to bank deposits and money market funds, and they should be subject to more regulation. Trump's advocacy in the cryptocurrency field during the campaign may make the position of the new Treasury Secretary become the focus of attention.

The 'fiscal hawks' will face high federal budget deficits

Bessent, responsible for the national finances, also faces a high and constantly expanding debt burden. In the 2024 fiscal year, the federal budget deficit as a percentage of GDP climbed to 6.4%, setting a historic high during a period of economic expansion and full employment. The Federal Reserve's series of interest rate hikes in 2022 is a key driver of the soaring Interest costs.

Glen Capelo, who has worked in bond trading on Wall Street for more than 30 years (currently the Managing Director of Mischler Financial Group), referred to Bessent as a 'financial hawk'.

He will definitely have a positive impact on the economy and the market. He wants to control spending. Bessent hopes to align the finance minister with the market again, as he truly believes that Yellen has made some distortions in the issuance.

This article Hedging Fund CEO Scott Bessent serves as US Treasury Secretary, will stablecoin regulation be in place? Originally appeared on Chain News ABMedia.