Bitcoin becoming a strategic reserve for multiple countries is a victory of civil rights over official power.

Politics is a game of catering to ideas.

In the political realm, ideas are called public opinion; in the crypto realm, they are called consensus.

Many things that people think are unbreakable are actually products of ideas.

If the majority of people's ideas change, these things can change in an instant.


No matter how dictatorial the tyrant, how powerful the state machinery, or how terrifying the butcher's knife and bombs, they will inevitably lose in the general consensus.

Becoming a national reserve is another powerful concept on the path of Bitcoin's development.


When a politician begins to promote this concept, it means that this idea has gained recognition from a considerable number of people, which will certainly prompt more politicians to align with this idea and will inevitably alert, evaluate, reflect, and follow up other countries.


The inclusion of Bitcoin in the strategic reserves of multiple countries is a victory of civil rights over official power.


1️⃣ (2024 Bitcoin Strategic Reserve Act)

The U.S. starts to believe in BTC, which is good news for the whole world, not bad news.

An America that does not believe in BTC will push forward its dollar hegemony, continuously exporting zero-cost printed dollars to the whole world in exchange for valuable resources and goods in others' hands.

This is indeed a kind of exploitation brought about by seigniorage.

Bitcoin's code is open source.

Anyone can download and review every line of code.

Satoshi Nakamoto could not possibly hide any backdoor.

Anyone can make any modifications to the code.

The difficult part is that after you modify the code, why should others use it?

If you cannot convince thousands of computer nodes scattered around the world to use your code, what you modified is meaningless.

This is called public consensus.

Even a powerful entity like the U.S. can hardly change the code rules to plunder other BTC holders.

Let's talk about the U.S. first. The U.S. is the leader after all. Trump mentioned 'Bitcoin Strategic Reserve' at the 2024 Bitcoin conference, planning to promote the appreciation of the dollar and repay national debt through the establishment of a Bitcoin strategic reserve.


Specifically, the (2024 Bitcoin Strategic Reserve Act) mainly includes the following contents:

1. Bill objectives: By incorporating Bitcoin into the U.S. national asset reserves, provide the U.S. with an effective tool to combat economic uncertainty and currency instability, thereby enhancing national financial resilience, maintaining a leading position in global financial innovation, and ensuring the U.S. is in a favorable position in future economic competition.


2. Bitcoin purchase plan: Acquire Bitcoin through diversified existing funding sources such as the Federal Reserve System and Treasury internal funds. Purchase no more than 200,000 Bitcoins annually for five years, totaling 1 million Bitcoins, which is planned to account for approximately 5% of the total global Bitcoin supply, comparable to the scale of U.S. gold reserves. The purchasing process will be transparent and strategic to minimize market disruption.


3. Establish a secure storage network: The U.S. Treasury will operate a decentralized Bitcoin storage network to ensure that the physical and network security of national Bitcoin assets meets the highest standards.


4. Holding period and usage rules: Bitcoins purchased by the government will be held for at least 20 years. During this period, except for repaying national debts, Bitcoin must not be sold, exchanged, or auctioned. After the initial holding period, a maximum of 10% of the reserves can be sold every two years.


On November 19, 2024, an article titled 'Will Bitcoin Become a U.S. Reserve Asset?' was published in the International section of the Economic Daily.


BTC has been around for nearly 16 years.

Starting from zero, in 16 years, how many people dared to believe, were willing to believe, and could persist in believing that one day it would have the chance to become a reserve asset of the world's top powers?


The Trump administration may initiate the establishment of a Bitcoin strategic reserve through an executive order, but substantial financial commitments typically require Congress to take action to allocate funds and establish a legal framework.


2️⃣ The trend of strategic reserves in multiple countries is rising. Will Bitcoin reshape the balance sheets of sovereign nations?

Gold has walked through thousands of years of history as a global strategic reserve asset, while 15-year-old Bitcoin is launching new challenges.


What is the concept of a strategic reserve asset of 1 million BTC? According to statistics from the World Gold Council, as of the third quarter of 2024, the Federal Reserve's gold reserves totaled 8,133.46 tons (approximately $530 billion), maintaining the world's largest, while the current market price for 1 million BTC is nearly $100 billion, almost equivalent to 19% of the U.S. gold reserves!


So what exactly is a 'strategic reserve asset'?

In simple terms, a 'strategic reserve asset' is a key asset held by a national or regional government aimed at responding to economic fluctuations, financial crises, or geopolitical risks, maintaining national financial stability, economic security, and international competitiveness. They typically have the following characteristics:

High value and widespread acceptability.

Safety and stability.

Liquidity.

At the corporate level, 'strategic reserve assets' also help enterprises/institutions achieve financial stability, enhance risk resistance, and support their long-term growth strategies. Especially during economic fluctuations, strategic reserve assets often serve as the first line of defense against risks.

Traditional strategic reserve assets mainly include:

Gold: Widely regarded as a stable value storage tool due to its scarcity and anti-inflation properties.

Foreign exchange reserves: Reserve currencies dominated by the U.S. dollar, which are important means of supporting international trade and payments.

Special Drawing Rights (SDR): Allocated by the International Monetary Fund (IMF) to supplement official reserves of member countries.

This also means that assets that can become 'strategic reserves' must possess comprehensive advantages such as value stability, global recognition, and convenient circulation.


As an emerging digital asset, Bitcoin is gradually meeting these conditions and is beginning to be seen as a potential alternative to gold.


El Salvador: Daily investment of 1 BTC.


El Salvador is the first country in the world to establish Bitcoin as legal tender. As early as September 7, 2021, the country enacted relevant legislation. It then launched the electronic wallet Chivo and preloaded $30 worth of Bitcoin for each resident who downloaded the wallet. This move not only integrates Bitcoin into the national economic system but also demonstrates its firm 'Bitcoinization' path.


Moreover, whenever the crypto market experiences significant volatility, El Salvador's President Nayib Bukele often promptly announces Bitcoin purchases through social media, injecting confidence into the market.


Currently, El Salvador continues to buy 1 BTC daily. Backed by rounds of 'bottom-fishing', as of December 10, its BTC holdings have reached 5,959.77 coins, with a market value of approximately $577 million. Although this holding is not large on a global scale, for a small economy, this steadfast Bitcoin strategy is noteworthy and provides a unique experimental case for other countries.


Bhutan: BTC holdings account for over 25% of the country's GDP.

Bhutan has been actively mining Bitcoin since 2021, a strategy that allows it to continuously increase reserves even amidst Bitcoin price fluctuations.


Bhutan utilizes the hydropower resources of the Himalayas for Bitcoin mining, providing energy for its mining operations.


As of now, Bhutan has held 13,011 Bitcoins, becoming the fourth-largest government holder of Bitcoin in the world, with a total value of its crypto assets exceeding $1 billion, accounting for over 25% of the country's GDP.


The strategic value of Bitcoin is gradually being transmitted from the national level to enterprises and institutions. Although a country's reserve layout directly impacts the policy environment, enterprises are the main practitioners of adoption. Thus, Bitcoin is not only a hedging tool but is gradually becoming a strategic component of corporate balance sheets.


From an objective perspective, the inclusion of Bitcoin in the balance sheets of mainstream institutions and traditional enterprises can indeed bring multiple advantages to the enterprises:

Inflation resistance: The fixed scarcity of Bitcoin at 21 million coins endows it with strong anti-inflation properties. In an environment of global monetary easing and fiat currency depreciation, it can help businesses stabilize asset values.


Diversified investment portfolio: Bitcoin, as an emerging asset class, provides enterprises with rich opportunities for asset allocation. By incorporating it into their asset categories, enterprises can reduce reliance on a single asset class, thereby enhancing overall financial robustness.


Enhancing corporate brand and market image: The act of holding Bitcoin not only reflects the company's support for innovative technologies and future economic models but also enhances its competitiveness in the market and helps shape a more forward-looking brand image.


'The light boat has passed ten thousand mountains.' Regardless of whether Bitcoin can become a strategic reserve asset for the U.S. or other countries in the next four years, it has already won an important victory on the road to adoption.


The next four years may be a key time window for revealing this answer.


Let's encourage each other!

#BTC