The Secretary of the Treasury under Trump will liquidate Bitcoin ETFs

There is a rumor that the candidate chosen by Donald Trump to serve as Secretary of the Treasury in his administration, Scott Bessent, intends to dispose of Bitcoin ETFs to avoid potential conflicts of interest with his new role.

Scott Bessent: the Treasury Secretary chosen by Trump will sell ETFs on Bitcoin

Scott Bessent is a billionaire hedge fund manager, and in his portfolio, there are many assets, including ETFs on Bitcoin.

He was a partner at Soros Fund Management, where he became the head of the London office, and he is the founder of Key Square Group.

Key Square Group was created in 2015 together with Michael Germino. It is an investment company that uses geopolitics and economics to make macro investments. 

The company has an AUM exceeding 5 billion dollars and has recorded significant gains from 2021 to 2023. 

Note that Bessent was also a professor of economic history at Yale, from 2006 to 2011. 

At the end of November 2024, Donald Trump announced his intention to nominate him as the next Secretary of the Treasury of the United States in his new administration that will take office on January 20.

Bessent and Bitcoin

Scott Bessent also happens to be an enthusiast of the crypto markets. 

It should therefore not be surprising at all that in his portfolio he also has ETFs on Bitcoin.

A few months ago, during an interview, he openly stated that he is excited about Trump’s crypto adoption.

According to Bessent, cryptocurrencies are directly related to freedom, and they are here to stay.

Furthermore, he believes that Bitcoin is one of the most exciting things, and that cryptocurrencies are important for attracting young people to the financial markets. 

His support is therefore almost total, even though in the role of Secretary of the Treasury he will also have to deal with the numerous scams that have plagued the crypto markets for years now. 

The important thing, however, is that he mentioned Bitcoin as a separate thing, compared to the rest of the cryptocurrencies, and in fact, his portfolio includes ETFs on BTC. 

The liquidation of Bitcoin ETFs in the Trump administration

The rumor about the liquidation of its Bitcoin ETFs was published by the New York Times.

The key point is the possible conflict of interest of the new Secretary of the Treasury regarding the assets that he has in his portfolio. 

Therefore, according to the NYT, he plans to liquidate several assets at risk of conflict of interest, including his shares in BTC ETFs. 

In total, Bessent holds investments worth over 700 million dollars, of which only a small part (between 250,000$ and 500,000$) in ETFs on Bitcoin. 

The figures that it will therefore liquidate are too small to have even a minimal impact on the markets, and given the motivation, they should not even impact the sentiment. 

The impact on the price of Bitcoin

This news therefore should not have any significant impact on the price of BTC. 

A different discussion, however, concerns the policies of Trump and Bessent, particularly regarding the dollar. 

The same Bessent has indeed stated that the new Trump administration will probably seek to keep the US dollar strong. 

It should be remembered that in the medium/long term, the trend of Bitcoin’s price tends to be inversely correlated to the dollar, and in particular to the Dollar Index. 

However, in these days the Dollar Index is at its highest in recent years, and there are several analysts who believe that in the short term it may end up weakening a bit. 

Furthermore, there are also analysts who argue that Trump might actually find a weak dollar more convenient at this stage, in order to counterbalance the problems that will be caused to exports by the increase in tariffs. It should not be forgotten that if the USA increases tariffs on imported products, it is very likely that the exporting countries affected by these tariffs will do the same.

However, there is the possibility that the dollar may weaken only during the first phase of the Trump administration, and that instead it may later initiate a new phase in which the dollar could strengthen.