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- The potential US Treasury Secretary under Donald Trump, Scott Bessent, has claimed there is ‘no reason’ for a USD central backed digital currency.
- Bessent argued the US economy was strong and diverse enough to not require a CBDC.
- Speaking at a Senate Finance Committee meeting, Bessent turned his attention to tax cuts – largely focussing on the proposed 2017 Tax Cuts and Jobs Act.
The Trump era is just days away, and the crypto community awaits eagerly to see how the regulatory landscape will shift under his leadership.
With promises of a Bitcoin (and possibly more) Strategic Reserve for the US, among other nations, the discussion over a central bank digital currency (CBDC) has once again reared its head.
In Europe, the Union’s central bank has long researched the potential of a digitised Euro.
However, if Trump’s Treasury Secretary pick Scott Bessent has his way, a USD CBDC is unlikely to happen in the next term.
During a Senate Finance Committee nomination hearing, the potential Treasury Secretary claimed the United States has no need for an official virtual US Dollar.
I see no reason for the U.S. to have a central bank digital currency…in my mind, a [CBDC] is for countries who have no other investment alternative. If you hold US Dollars, you could hold very secure US assets.
Scott Bessent
The rationale somewhat ignores the benefits of a CBDC, such as significantly improving cross-border transaction speeds and fees, as well as helping prevent money laundering.
Despite this, Bessent is still known as a pro-crypto candidate, having previously stated he was “excited” to see how the blockchain industry flourished under Trump.
‘The rich get richer’: Bessent’s Primary Focus is Installing the 2017 Tax Cuts and Jobs Act
Bessent’s discussion on crypto throughout the committee hearing was very brief.
Instead, he spent much of the time emphasising the importance of tax breaks for millionaires. Of particular focus was the 2017 Tax Cuts and Jobs Act.
According to the Tax Policy Center, the top 0.1% of US earners would see up to US $250k in tax cuts (AU $402k), while middle and lower-class incomes would yield significantly less in tax relief.
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The top quintile of earners would experience the largest percentage of tax breaks (compared to current rates), or a 2/3rds share of the total tax change.
This argument was not particularly well-received by the Democrats, who accused Bessent of spending “his life helping the rich get richer”.
A NY Times article revealed the proposed tax cuts would cost the US Government multiple trillions over a decade.
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