Pro-crypto Senator Cynthia Lummis recently introduced legislation aimed at establishing a strategic Bitcoin reserve for the United States. As of now, the U.S. government holds more than 183,000 Bitcoin (BTC), valued at approximately $12 billion, making it the largest geopolitical owner of the decentralized currency.
Government Crypto Holdings
According to Arkham Intelligence, the U.S. government also possesses 50,000 Ether (ETH), 121 million USDT (Tether), 40,000 Binance Coin (BNB), and over 10 million USD Coin (USDC). The latest transaction from government-controlled wallets occurred on July 29, involving nearly 28,000 BTC, though the identity controlling the receiving wallet remains unknown.
Bitcoin as a Strategic Reserve Asset
On July 27, during the final day of the Bitcoin 2024 conference in Nashville, Tennessee, Senator Cynthia Lummis announced legislation to designate Bitcoin as a strategic reserve asset for the United States. The Wyoming lawmaker's plan proposes purchasing 5% of Bitcoin’s total supply to hold as a Treasury asset. Lummis compared this proposal to the 21st-century "Louisiana Purchase," referring to the 1803 acquisition of the American Midwest from France for $15 million.
Former President Donald Trump also hinted at creating a Bitcoin strategic reserve. During his keynote address at the Bitcoin 2024 conference, the Republican presidential candidate promised not to sell any of the U.S. government's Bitcoin holdings. Trump emphasized his desire for the Bitcoin industry to flourish in the U.S. without being stifled by overregulation.
Similarly, independent presidential candidate Robert F. Kennedy Jr. pledged to sign an executive order transferring the U.S. government's extensive Bitcoin holdings to the Treasury and purchasing 500 BTC per day until the United States owns 4 million BTC.
Skepticism About a Strategic Reserve
Despite these high-profile endorsements, not everyone believes a strategic Bitcoin reserve is imminent. Ari Paul, chief information officer at BlockTower Capital, expressed skepticism, estimating the odds at 10:1 against Bitcoin becoming a strategic reserve asset by 2028. Paul argued that informal announcements by presidential candidates are insufficient to establish an official strategic reserve fund.
In conclusion, while the U.S. government's significant Bitcoin holdings and recent legislative proposals indicate growing interest in cryptocurrency as a strategic asset, there remains considerable debate and uncertainty about the feasibility and implementation of such a reserve.
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