Elon Musk recently proposed slashing at least $2 trillion from the U.S. federal budget. The idea has reverberated far beyond the usual financial spheres, catching the attention of cryptocurrency advocates, including Caitlin Long, CEO of Custodia Bank. Long, known for her sharp insights into the intersection of finance and crypto, weighed in on Musk’s proposal and the potential creation of the Department of Government Efficiency (DOGE) on social media on October 28th, voicing both optimism and caution.
The Case For DOGE – Caitlin Long’s Perspective
Long expressed hope that the DOGE initiative could improve the regulatory landscape for businesses like Custodia Bank that operate within the crypto sector. “The regulatory abuse has been staggering,” she commented, noting how complex and restrictive regulations have stifled crypto and financial businesses. Long argued that these heavy-handed policies have created barriers that hinder innovation and growth, particularly in an industry that values agility and rapid evolution.
However, with the U.S. Senate elections approaching in 2026 and the potential for a Democratic majority, Long cautioned the DOGE team to act swiftly to implement meaningful reforms that would endure beyond the next administration. “Move fast,” she urged, emphasizing the importance of locking in changes that could resist reversal in the future.
The Risks of Aggressive Cuts – Economic Slowdown
Despite her enthusiasm, Long also warned about the potential risks of Musk’s proposed cuts. With U.S. government spending currently accounting for a significant share of GDP, a drastic reduction could lead to an economic slowdown or even a depression. Long criticized the nation’s reliance on GDP as a primary economic metric, calling it “the wrong measure.” Instead, she advocated for a shift towards measuring “gross output,” a more holistic metric that includes business-to-business (B2B) spending and supply chain activities. Gross output, she argued, provides a clearer picture of the nation’s economic health, especially as it considers the dynamism of private-sector investments and business activity.
“Cutting government spending will by definition cut GDP,” Long acknowledged, but stressed that as capital and jobs shift to the private sector, B2B activity would likely increase, leading to real growth. This perspective aligns with a growing sentiment within the crypto community, where decentralization and private-sector innovation are highly valued.
Dogecoin’s Market Reaction – Positive Price Movement
Interestingly, Musk’s involvement with DOGE has had an unexpected side effect on the cryptocurrency named after it—Dogecoin. Following the announcement, Dogecoin saw a surge in price, increasing by about 7% within a single day to reach $0.145 on October 28th. This upswing is part of a larger 14.65% rebound triggered by the formation of a “golden cross” on its daily chart.
In technical analysis, a golden cross is a bullish signal indicating a shift in momentum, typically from a downtrend to an uptrend. Dogecoin’s 50-day moving average crossed above its 200-day moving average on October 25th, creating this bullish pattern. As the price of Dogecoin hovers around $0.141, traders are watching closely. If it remains above this support level, which was a significant resistance point back in July, Dogecoin could continue its upward trajectory, possibly aiming for resistance levels at $0.156 and $0.171 in November. However, if the price dips below $0.141, it could descend toward a support level at approximately $0.122.
Also Read: Dogecoin Jumps 15% In 30 Days – Is Now The Perfect Time To Buy Before The Next Bull Run?
The proposal for the Department of Government Efficiency (DOGE) reflects Musk’s bold and often unconventional approach to problem-solving, pushing for streamlined government operations. While it remains to be seen how this plan will materialize, its potential impact on the cryptocurrency industry—and Dogecoin’s symbolic association with Musk’s influence—could signal a turning point for both the meme-based cryptocurrency and the industry at large.
As regulatory reform and fiscal policy discussions continue, the crypto sector will be keenly observing developments within DOGE, viewing it as both a potential ally in the battle against overregulation and a gauge of the government’s commitment to fostering innovation. If Musk’s plan proceeds and DOGE gains traction, the results could set the stage for a new era of economic and regulatory transformation, making both DOGE and Dogecoin players to watch closely.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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