Trump Commerce Secretary Selects Howard Lutnick to Talk with Tether to Support Bitcoin Lending Program: WSJ

Howard Lutnick, chairman of Wall Street trading firm Cantor Fitzgerald, is in talks with Tether’s Giancarlo Devasini about Cantor’s multibillion-dollar program that would allow clients to borrow money using bitcoin as collateral, the Wall Street Journal reported Sunday.

First announced in July, the lending initiative will begin with $2 billion in funding that could eventually grow to tens of billions of dollars. The potential inclusion of Tether in the project signals a deepening relationship between the stablecoin issuer and the trading firm.

According to the same report, Cantor, which has been the custodian of US Treasury bonds Tether since 2021, also acquired a 5% stake in Tether, which issues the USDT stablecoin, worth about $600 million.

Tether operates the most widely used stablecoin in the world. In US dollar terms, its market capitalization is $132.76 billion, according to CoinMarketCap.

But the token has drawn scrutiny due to its use by illicit actors, including those involved in fraud, money laundering and sanctions evasion. Last month, the Wall Street Journal reported that Tether was under investigation in the US for possible violations of sanctions and anti-money laundering rules.

Tether called the report “irresponsible” and accused detractors of suppressing its history of cooperation with law enforcement and efforts to curb abuse.

Under the Biden administration, several cryptocurrency companies have faced regulatory crackdowns. The Trump administration has signaled it will change course, with the president-elect and his family launching several cryptocurrency projects, most recently World Liberty Financial.

There are several cryptocurrency supporters in Trump’s circle, including Lutnick himself, who has taken on a key role on Trump’s team. He is currently co-chairing the transition team, and last week Trump tapped him to lead the US Commerce Department, which would allow him to influence the US crypto landscape.

Lutnick said last week that if his position is confirmed, he will resign from Cantor, as well as his positions at BGC and Newmark.