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Donald Trump's new Department of Government Efficiency (DOGE), led by Tesla CEO, Elon Musk, and former Republican presidential candidate Vivek Ramaswamy, has taken the crypto industry by storm but not everyone is too optimistic.
The agency’s main goals involve streamlining government operations by removing redundant structures, cutting down on excessive spending, restructuring agencies, and eliminating areas of waste and fraud within the federal budget, which currently stands at $6.5 trillion.
Its ultimate goal is to offer more government transparency and support entrepreneurship.
“Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies,” Trump said in a statement.
Coinbase CEO Brian Armstrong and Gemini co-founder Cameron Winklevoss are two staunch fans of the initiative. Describing DOGE as a "once in a lifetime opportunity" to increase "economic freedom," Armstrong praised the initiative on X.
"The founding fathers were geniuses but (with humility) may have missed the adverse incentives which grow the size of democratic government over time (winning elections by promising more free stuff)," he added.
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Meanwhile, Cameron Winklevoss, whose brother, Tyler, was famously critical of the Fed's so-called Operation Choke Point 2.0, also expressed support of DOGE's potential to address inflation and inequality.
However, investment giant JP Morgan isn't as keen on the DOGE setup. "We think the Elon Musk-led department, which aims to cut wasteful government spending, will have a difficult time doing so," Alan Wynne, global investment strategist at JP Morgan said in the firm's market update titled 'Past, present, future: Here’s where we stand.'
Wynne's concern is that Congress controls government spending and that DOGE can only suggest changes.
"The bottom line is that Congress controls government spending and DOGE sits outside of Congress. The department can make all the suggestions they want, but ultimately, it’s the typical 60 vote majority in Congress that makes legislative change," he explained. "A key question for investors in 2025 is what parts of the Trump 2.0 agenda are emphasized and which ones fade."
Trump is nonetheless seemingly shaping his administration to be more crypto-friendly. His pick for Treasury secretary, Scott Bessent, is renowned in the crypto space for championing the industry.
A vocal fan of blockchain and digital assets, Bessent was described as the "most pro-innovation, pro-crypto Treasury Sec we've ever seen" by Ripple CEO Brad Garlinghouse on Friday.
I don't want to get too far ahead of myself but...
— Brad Garlinghouse (@bgarlinghouse) November 23, 2024
Scott Bessent is the perfect pick by @realdonaldtrump!
He will be the most pro-innovation, pro-crypto Treasury Sec we've ever seen
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