According to ChainCatcher, as reported by Jin Shi, the funding proposal for Bitcoin purchases previously put forward by U.S. Senator Cynthia Lummis partially relies on the large amount of gold heritage owned by the United States—these gold reserves were left over from the era when the dollar was pegged to precious metals, allowing dollar holders to exchange gold at a fixed price.
Although the dollar has not been convertible to gold since the early 1970s, the Treasury and the Federal Reserve still hold about 8,100 metric tons of gold. The government values this gold at $42 per ounce, far below the current market price of $2,650.
Cynthia Lummis hopes the Treasury can reassess this gold at current market prices and use the paper profits to fund Bitcoin purchases without raising taxes or issuing new national debt. However, critics point out that this operation is not a free lunch; it will require the Federal Reserve to cover the difference between the gold certificates held by the Treasury and the new valuation through a combination of printing money and asset sales.
Monetary economist George Selgin argues that this operation is akin to the government's 'backdoor loan' to avoid new debt, bypass regular appropriation procedures, and cover up the truth. The Lummis bill relies heavily on gilded magic. George Selgin said, 'What better way to win public support than to make people believe this plan won't cost a dime?'
