Senator Cynthia Lummis (R-Wyo) has formally introduced the BITCOIN Act of 2024, aimed at establishing a national Bitcoin reserve to enhance the U.S. dollar's standing in the global financial system. Announced at the recent Bitcoin conference in Nashville, the bill reflects a growing political interest in cryptocurrency.
The proposed legislation seeks to acquire one million Bitcoin, valued at approximately $65 million, and aims to ensure transparency in its management by the U.S. Treasury Department. Lummis argues that, similar to gold reserves, Bitcoin could serve as a cornerstone for national financial security in the digital age.
However, the bill faces significant challenges in a deeply divided Congress, especially with the upcoming Presidential election. Experts, including Nikhil Bhatia from USC Marshall School of Business, suggest that the bill is unlikely to advance before the election, citing the potential for a presidential veto from a Democratic administration.
The political landscape surrounding Bitcoin remains contentious, with prominent Democrats, such as Senators Elizabeth Warren and Congressman Brad Sherman, criticizing the cryptocurrency as a tool for criminal activity and a threat to the U.S. dollar. Conversely, former President Trump has publicly endorsed Bitcoin, further polarizing the issue.
Bhatia notes that the politicization of Bitcoin is evolving, pointing out that while support appears predominantly from the right, progressive advocates also recognize its potential for financial empowerment, particularly in banking the unbanked. He emphasizes that the Bitcoin Act does not seek to make Bitcoin legal tender but rather to explore its strategic value as a national asset.
In conclusion, while the BITCOIN Act of 2024 presents an innovative approach to integrating Bitcoin into U.S. financial policy, its passage will likely hinge on the political dynamics following the upcoming election. The ongoing debate underscores the complexity of cryptocurrency's role in both economic and political spheres.
