The US government could buy up to 1 million BTC over five years and commit to holding it for 20 years.
The United States could establish a strategic Bitcoin (BTC) reserve during Donald Trump’s second presidential administration, according to a report from Decrypt in November 8.
Republican Senator Cynthia Lummis told Decrypt:
… Low [Trump’s] leadership, we are better positioned than ever to build a brighter economic future by creating a strategic Bitcoin reserve.
He stated that Trump has shown that he can be “the most pro-Bitcoin and pro-crypto president” in US history. He added that a Bitcoin reserve would “boost the US dollar’s position as the global reserve currency” for years to come.
Previously, Lummis spearheaded a bill to establish a federal Bitcoin reserve. He announced his plans in a July 27 press release and introduced the bill in the U.S. Senate on July 31.
The bill is titled BITCOIN Law of 2024abbreviation of “Law to promote innovation, technology and competitiveness through the National Optimized Investment Law.”
It proposes that the US Secretary of the Treasury create, monitor and audit a decentralized network of secure storage facilities for government holdings of Bitcoin.
The Treasury Secretary would also create a Bitcoin Purchase Program that allows the purchase of up to 200,000 BTC per year for five years. That would allow the government to acquire up to 1 million BTC in total. The funds would be held for at least 20 years, at which time the strategy would be reconsidered.
Lummis told Decrypt that the government would allow Bitcoin by diversifying other funds at the Federal Reserve, not by creating additional debt.
He said the strategy would be comparable to the Treasury’s current responsibilities around gold reserves, which is independent of the Federal Reserve system. Lummis added that the Bitcoin reserve could serve as a “modern parallel to our gold reserve” and a hedge against economic uncertainty in the digital age.
Lummis’ BITCOIN Act has not progressed since its introduction in the Senate in July. She told Decrypt that she believes the upcoming Congress is an ideal time to advance the BITCOIN Act and other cryptocurrency laws.
However, other Decrypt sources describe skepticism among senators and representatives, meaning the bill’s success is far from certain.
Finally, Trump’s commitment to that plan is unclear. On July 27, before Lummis’ announcement, Trump told attendees at the Bitcoin 2024 conference in Nashville that the US government would “hold 100% of all bitcoins that the US government currently owns.” or acquire in the future” and would avoid selling them.
While Decrypt has called Trump’s statement a promise to build a “strategic Bitcoin reserve,” other reports from CNBC They suggest that Trump’s statement only applies to current holdings. And despite the proximity between Trump and Lummis’ statements, the exact relationship between each plan is unclear.
Disclaimer: The information contained herein is provided without regard to your personal circumstances, therefore it should not be construed as financial advice, investment recommendation or an offer or solicitation to trade in cryptocurrency.
