Donald Trump is scheduled to speak at the Bitcoin 2024 conference in Nashville, Tennessee this weekend. Meanwhile, pro-crypto Republican Senator Cynthia Lummis also appears ready to announce a new bill at the session that would treat Bitcoin as a strategic reserve asset.
Citing three cryptocurrency executives familiar with the bill, Fox Business reported that Cynthia Lummis is preparing to announce the legislation at the annual Bitcoin conference, which would require the Federal Reserve to hold some Bitcoin as a strategic reserve asset. But the timing of the announcement is still subject to change. Staff close to Cynthia Lummis revealed that she hopes to announce her legislation before Trump speaks; and for Trump to publicly support the bill and the ideas behind it at the event.
News of the bill has yet to be made public, but Cynthia Lummis gave some hints on her X account this week, writing:
"Big things are going to happen this week. Stay tuned!"
₿ig things are in store this week. Stay tuned!
— Senator Cynthia Lummis (@SenLummis) July 22, 2024
While the specifics of the legislation are unclear, according to a person who has seen an early draft, the purpose of the bill is to direct the Federal Reserve to purchase Bitcoin and hold it as a reserve asset, just like a country’s central bank. There is gold as well as foreign currencies to help manage the U.S. monetary system and keep the value of the dollar stable.
Sam Lyman, director of public policy at Bitcoin mining company Riot Platforms, said:
“Classifying the world’s largest cryptocurrency as a strategic reserve asset would be the first shot in the ‘Bitcoin space race. By accumulating Bitcoin, other countries will have strong incentives to do the same.”
Still, the move is likely to be controversial. Some worry that adding cryptocurrencies could undermine the value of gold, a mainstay of the U.S. economy. Cryptocurrency skeptics also worry that Bitcoin's volatile tendencies could make it difficult for the Federal Reserve to effectively use Bitcoin to hedge against economic headwinds.
Cynthia Lummis is a Bitcoin investor herself. She is known as the “Crypto Queen” of the Senate and is a proponent of using Bitcoin to enhance the country’s financial standing.
In 2022, she floated the idea of using Bitcoin to decentralize the Federal Reserve's $40 billion worth of foreign exchange, emphasizing that the asset's decentralized nature would make it more "ubiquitous" over time. In an interview earlier this month, she floated the idea of including Bitcoin in reserves, saying it would help support the dollar's strength. It’s unclear how Trump would view the concept of Bitcoin as a potential reserve asset or whether he would support it.
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