Written by: Brayden Lindrea, CoinTelegraph
Compiled by: Deng Tong, Jinse Finance
Asset management firm VanEck stated that if the U.S. establishes a reserve of 1 million Bitcoins according to Senator Cynthia Lummis's proposed bill, the U.S. could reduce its national debt by 35% over the next 24 years.
VanEck estimates that by 2049, Bitcoin's compound annual growth rate (CAGR) will reach 25%, hitting $42.3 million, while the U.S. national debt's CAGR will hit 5%, growing from $37 trillion in early 2025 to $119.3 trillion.
Matthew Sigel, head of digital asset research at VanEck, and investment analyst Nathan Frankovitz stated in a report on December 20: "By 2049, this reserve could account for 35% of national debt, offsetting about $42 trillion in debt."
It is expected that U.S. national debt will increase alongside Bitcoin reserves from 2025 to 2049. Source: VanEck
"Optimistic" forecasts suggest that Bitcoin's 25% compound annual growth rate will start from a price point of $200,000 in 2025. Bitcoin's current trading price is $95,360, which needs to more than double to reach the starting point indicated by VanEck.
The price of Bitcoin rising to $42.3 million means it accounts for about 18% of global financial assets—far higher than its approximately 0.22% share in today's $90 trillion market.
Estimates of the U.S. national debt and Bitcoin reserve holdings, as well as the compound annual growth rate of Bitcoin value, are 25%. Source: VanEck
The new Trump administration proposed the idea of a Bitcoin reserve, which drove the price of Bitcoin above six figures, but Senator Lummis's bill has yet to be reviewed by the Senate or House.
Strike founder and CEO Jack Mallers claimed earlier this month that Trump might issue an executive order on his first day in office to designate Bitcoin as a reserve asset.
Under the Lummis bill, the U.S. could redeploy the 198,100 Bitcoins it holds due to asset seizures, while the remaining 801,900 Bitcoins could be financed through emergency support functions, selling part of its $455 billion gold reserves in exchange for Bitcoin, or both—none of which would require printing money or taxpayer funds, VanEck noted.
Sigel and Frankovitz noted that Bitcoin's adoption at the state, institutional, and enterprise levels in the U.S. will also boost the compound annual growth rate estimates for Bitcoin and Ethereum ETF issuers.
Sigel explained in a December 21 X post that member nation states of the BRICS alliance (Brazil, Russia, India, China, and South Africa) might also influence Bitcoin prices and lead to its increasing use as currency.
They pointed out: "For countries that wish to avoid a parabolic increase in dollar sanctions, Bitcoin is likely to be widely used as a settlement currency for global trade."
