WSJ: Trump’s Commerce Secretary Pick Leads Firm That Reportedly Struck $600M Tether Deal

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As a seasoned analyst with over two decades of experience in the financial industry, I find myself intrigued by the recent developments involving Howard Lutnick and the crypto giant Tether, as well as the potential appointment of Scott Bessent as the next U.S. Treasury Secretary.

Based on an investigation by the Wall Street Journal, it’s been found that Howard Lutnick, a potential appointee for Commerce Secretary under President Trump and current advisor during the transition period, has substantial business ties with Tether, a major player in the cryptocurrency world, through his company Cantor Fitzgerald.

On Saturday, it was revealed by The Journal that Tether’s significant $134 billion in assets are predominantly held by Cantor Fitzgerald, with Lutnick serving as chairman. It seems this setup results in Cantor earning tens of millions of dollars annually in fees, primarily from U.S. Treasury bills.

According to a recent investigation by the Wall Street Journal, there are new details emerging about the connection between the two companies that were not previously known. The report suggests that within the last year, Cantor may have acquired around 5% ownership in Tether, with an estimated worth of up to $600 million, as per sources privy to the situation.

The timing is crucial because the Journal points out that Tether is currently facing investigations by both the Treasury and Justice Departments for possible breaches of anti-money laundering and sanctions regulations. However, Tether has vigorously contested these accusations, with a company representative dismissing claims of assisting criminal activities or circumventing sanctions as “unfounded.

According to reports by The Journal, it’s been mentioned privately by Tether’s owner, Giancarlo Devasini, earlier this year that Lutnick would use his political connections to aid in addressing issues for Tether. Business associates of both men have confirmed this information. Notably, the Wall Street Journal highlights that due to apprehensions about potential arrest, Devasini, an Italian citizen, has refrained from visiting the United States.

After the announcement of his nomination, Lutnick declared he would step down from Cantor once it was confirmed by the Senate and sell off any business assets to adhere to ethics guidelines set by the government. A representative from Tether dismissed claims of regulatory interference, characterizing their connection with Cantor as strictly professional, focusing on managing reserves.

Last Friday, it was reported by The Wall Street Journal that Trump announced Scott Bessent as his pick for the position of Treasury Secretary. As a skilled financier and the founder of Key Square Capital Management, Bessent is poised to play a significant part in formulating the administration’s economic strategies.

Previously serving as the Chief Investment Officer at George Soros’s investment fund, Bessent has been an outspoken proponent of Donald Trump’s economic strategy, backing initiatives like deregulation and tariffs. He put forth a daring “3-3-3” plan for economic transformation: aiming to decrease the budget deficit to 3% of GDP by 2028, promoting 3% yearly economic growth, and boosting U.S. energy production by 3 million barrels per day. Trump has commended Bessent as a brilliant strategist and crucial partner in executing his “America First” policy.

There’s a buzz in the cryptocurrency world, as people are hopeful that Bessent might become the upcoming U.S. Treasury Secretary.

Blockchain Association CEO Kristin Smith made the following statement:

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2024-11-24 11:51