Analysts say this will transform the U.S. financial landscape as Donald Trump begins to assemble his crypto-positive cabinet.
That’s according to a Matrixport report, a leading digital asset platform that claims that the former president’s return to power could stir a ‘DeFi renaissance’ where blockchain technology is integrated with traditional finance to boost efficiency and innovation.
Cryptocurrency enthusiasts hope Trump’s prospective appointees for high-profile positions at Treasury, Commerce, and even the Securities and Exchange Commission (SEC) will favor clarity around identification, regulation, and enforcement.
Howard Lutnick, CEO of Cantor Fitzgerald and a possible Commerce Secretary nominee, has been a staunch advocate for the use of digital assets and stable coins for modern financial systems.
That’s just the position Scott Bessen, a likely pick for Trump’s Treasury Secretary, took only days ago when he proclaimed that “crypto is about freedom, and the crypto economy is here to stay.” Analysts suggest also applying measures to address the U.S. budget deficit, a move that Bessen says may help appeal of Bitcoin as a hedge against fiscal uncertainty.
Even more good news for the crypto community is a report that crypto lawyer Paul Atkins, a former SEC commissioner, is reportedly being considered for SEC Chair. Atkins has long called for balanced oversight of digital assets and is credited with influencing the regulatory regime around digital assets.
Trump’s Policies Could Propel Bitcoin Beyond ‘Digital Gold’ Into a ‘DeFi Renaissance’
According to Matrixport’s latest report, the narrative of Bitcoin as “digital gold” could start to be featured in other applications within decentralized finance (DeFi) as early as 2024. However, analysts believe traditional financial institutions could use networks based on blockchain systems to enhance transaction efficiency and shorten payment times, ultimately helping to legitimize the crypto sector even more.
“DeFi applications integration into traditional financial ecosystems could herald a new era of financial markets,” the report says. This crypto-savvy group of policymakers is helping to drive a ‘DeFi renaissance’ that supposedly will accelerate.
Matrixport’s analysis also simulates the impact of Bessen’s fiscal policies. In contrast to stimulus-heavy strategies in recent years that promoted inflation and economic uncertainty, he is focused on reducing the budget deficit. Bitcoin is also becoming more of a haven: decentralized investors don’t necessarily trust anything run by central authorities.
If confirmed, these nominations will position the U.S. to become a global leader in blockchain and decentralized finance. The analysts argue that the pro-crypto leadership will focus on gaining regulatory clarity to allow for innovation without requiring investor safeguards.
The report concludes that this was a significant moment for the U.S. crypto industry. It suggests that the country could become a hub for blockchain innovation, attracting talent and capital from around the world.
“A Strategic Bitcoin Reserve seems increasingly likely, though the U.S. may not actively purchase Bitcoin but instead retain the holdings it already possesses indefinitely.”
Matrixport
As Trump’s cabinet selections remain pending, the confidence about how his cabinet may affect the crypto sector has already started to be felt. The next several months will define whether or not the hypothesized “DeFi renaissance” comes to pass as the U.S. begins its new chapter of financial policy.
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