Bitcoin Could Explode On Bessent’s $250 Billion Deregulation Shock
US Treasury Secretary Scott Bessent indicated that an overhaul of banks' supplementary leverage ratio (SLR) is imminent, potentially impacting Bitcoin markets. The proposed changes aim to exempt US Treasuries from the SLR, allowing banks to increase government debt purchases. The SLR requires banks to hold capital against total assets, including Treasuries, which has been criticized as outdated. The adjustment could free up approximately $250 billion in tier-one capital, significantly influencing market liquidity without additional Fed intervention. Lower Treasury yields may drive investors towards riskier assets like Bitcoin. However, some critics question the effectiveness of the rule change, citing banks' reduced appetite for duration risk post-2023 regional bank failures. The SLR modification is viewed as a potential catalyst for Bitcoin, functioning similarly to quantitative easing amid current economic constraints. Bitcoin traded at $108,790 at press time.
