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The change in attitude of United States federal agencies is becoming increasingly evident. As Donald Trump’s inauguration as president of the North American country approaches, nods to cryptocurrencies are frequent. Thus, in a recent report cited by Forbes, the Treasury Department compares Bitcoin to “digital gold.”
It should not be lost sight of that under Janet Yellen, this department was deeply hostile or at least indifferent to cryptocurrencies. He was even recently accused of political persecution against Facebook’s Libra digital currency project (Meta).
In any case, now the treasury compares the largest of the cryptocurrencies with gold. The department’s analysts see similarities in their use cases in the decentralized finance ecosystem with that of the gold metal. They also highlight that this rapid growth occurs on small bases, which can be risky.
“Digital assets are experiencing rapid growth, albeit from a small base,” the report reads. They highlight that the market capitalization of the crypto sector is extremely small compared to traditional finance and real-world assets. In that sense, they emphasize that the main reason for current interest in crypto adoption is speculation. However, Bitcoin’s role in the financial market is changing, says the Treasury Department report.
Treasury Department will radically change its position on Bitcoin
Although the current Treasury administration shows certain changes in its position towards the crypto world, suspicion is still evident. However, the negative attitude should change in the coming months, especially after January 20, 2025. After the inauguration of Donald Trump as president, policies towards cryptocurrencies should be friendly at all levels of the State.
To this we must add that the role of the Treasury in this new stage will be significant. Thus, if the Bitcoin Act proposed by Senator Cynthia Lummis is approved, both the Treasury and the Federal Reserve must proceed with the purchase of at least one million bitcoins in the next 5 years. These funds would become part of the strategic reserves of the United States.
In this way, the qualities of the largest Cryptocurrency given to it by its supporters should be taken as true by the Treasury. So far, it’s unclear whether Yellen’s Treasury administration or the Powell-led Fed will be happy with that initiative. Despite this, if it becomes a federal law, they will be obliged to comply.
It is likely that neither of these two entities wants to enter into conflict with the White House over this purchase. In any case, there is no open confrontation position so far, which suggests that the Treasury will adapt. As already mentioned, this department did not maintain a hostile stance at the SEC level, but rather one of disguised hostility towards cryptocurrencies.
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