While President Donald Trump continues to test the limits of executive authority by reshaping all manner Among the American government agencies, one of these battles seems to be on the verge of driving in the cryptocurrency industry: a brewing war against the federal reserve and its public mission to remain independent.
Since the early 1950s, the Fed has played the last word on key decisions related to the American banking system and American monetary policy. Now, the Trump administration and its republican allies in the congress seem determined to take up some of these decisions – first and foremost through many political initiatives related to the crypto.
As Decipher reported Last week, the White House soon plans to issue another executive decree focused on cryptocurrency which, among other things, will probably order the Fed to modify its policies on the redesign of the coveted master accounts of the so-called cryptographic banks-financial institutions that have banking licenses but also offer cryptocurrency care services to their customers.
Master accounts, which allow banks to access the Fed financial services, are crucial to serve large -scale customers. If cryptographic banks finally receive such approval, development would constitute a massive victory for the digital asset industry. Only the few precious banks focused on crypto -ocal that are registered as deposit institutions, such as Kraken Financial, a subdivision of the exchange of Kraken cryptocurrency and the Caitlin Long guard, would be immediately eligible to receive main accounts.
The main account approvals have, for decades, has been the last word of the Council of Seven Governors of seven members of the Fed. And although these governors are appointed by the president, their decisions have not been openly replaced by the executive power from a agreement granted them the independence of the development of policies in 1951, according to the Nourished.
Last month, Trump laid the foundations to start canceling this understanding by signing a executive decree declaring that he had the right to dictate the fed policies linked to the “supervision and regulation of financial institutions”. This category of policy would probably include the decision -making of the Fed linked to the Maître Accounts.
Trump’s order has warned that the Fed will continue to shape its own “monetary policy” on sensitive issues such as interest rates. But the efforts are preparing in Washington to even cancel the independence of the Fed monetary policy – and once again, these plans take place directly in the cryptography industry.
Last week, senator Cynthia Lummis (R-Wy) presented a bill, the Bitcoin ActThis would force the US government to buy around $ 80 billion in Bitcoin in order to strengthen a federal Strategic bitcoin reserve. This huge sum of crypto would be paid, mainly, by a program that would force the Fed to make its gold certificates from the Nixon era reissue at market prices.
Because Gold appreciated around 6,000% in the intermediate years, new gold certificates were theoretically worth hundreds of billions more than the old ones. The Fed would receive these new, more precious certificates, but it is then necessary to immediately pay more than $ 80 billion to the Treasury Secretary to finance Bitcoin purchases.
A source of Capitol Hill with a direct knowledge of the thought which has entered the act of Bitcoin said Decipher That no one has yet tried to draw on such a fundraising mechanism because, for decades, legislators and presidents hesitated to explicitly direct the Fed.
This position has now changed.
“Opinion (behind Bitcoin Act) complies with the president, that there is no independent agency,” said the source. “The federal reserve can be educated, in particular through legislation.”
The initiate of Capitol Hill has added that the Republicans have probably been embraced in recent years to adopt a stronger position to supervise the policies of ostensibly independent federal agencies due to the perceived politicization of these agencies, illustrated by the alleged political targeting which took place in the anti-Crypto “Operation Chokepoint 2.0. “”
Trump is in no way the first president to push against the independence of the Fed in the modern era. The presidents of the two parties put pressure on the Fed to adopt or cancel certain policies. In 1965, President Lyndon Johnson went to physical assault The president of the time, William McChesney Martin, on a disagreement on the increase in interest rates, according to a biographer.
But yet, since the 1950s, no president has succeeded or tried significantly, to bring back the main decision -making powers of the Fed governors – at least not explicitly. Should Trump and his Congress Allies continue to move forward on this objective-and should cryptographic policy become the point of this spear-how could the digital asset industry react?
A crypto lobbyist said Decipher That the Trump administration seems to use the policy linked to the crypto as a “test case” to recover control of independent agencies.
On the one hand, these efforts could unlock encrypted victories, cryptographic leaders would not have dared to dream a year ago.
On the other hand, the same movements could not only be found in controversial disputes, but also associate the cryptography industry – which has desperately tried to avoid political polarization– With a previous agenda that is increasingly testing the limits of the American Constitution.
“I cannot yet say if it’s a good one or a bad thing,” said the cryptographic lobbyist. “But we will take it. No?”
Edited by Guillermo Jimenez
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