As part of his campaign promises, President Donald Trump vowed to introduce a Bitcoin Reserve underlining how the president-elect aims to embrace cryptocurrency. Last year, in a keynote address at a Bitcoin conference held in Nashville, Tennessee, Trump disclosed that if elected he would create a US strategic Bitcoin reserve.
The move according to Trump is an attempt to make the United States the center hub of crypto. Meanwhile, Trump’s sudden embracement of digital assets came to many as a surprise considering how he once opposed the industry.
Despite labeling crypto as a scam in the past, the support of the president-elect has propelled BTC and other cryptocurrencies by extension to new heights. With the growing confidence of Donald Trump in Bitcoin, there are high hopes that his administration will introduce regulations that will protect investors and the market at large.
However, there are speculations that the move to establish the strategic reserve will materialize in the new administration. Currently, there are doubts about whether the president-elect would implement the national hoarding of BTC.
Possible Composition of the US Bitcoin Reserve
So far, the project remains a mere idea as there is yet to be a clear Bitcoin reserve proposal. There are growing pointers that Trump could introduce the reserve through executive orders. With this system, the president could order the United States Treasury’s Exchange Stabilization Fund to purchase BTC.
The Exchange Stabilization Fund is a strategic set up by the US government to buy or sell foreign fiats and it holds up to $39 billion as of 2023. Conversely, the president-elect could also establish the reserve through an act of parliament.
Providing clues to what the reserve would look like, Trump during a speech promised to create a crypto presidential advisory council. He also added that his administration would maintain a stockpile of BTC and other cryptocurrencies seized from criminals.
Currently, the United States Department of Justice is in control of confiscated digital assets. By that, it remains uncertain how Trump intends to divert the cryptocurrencies from the DOJ.
Away from Trump’s proposal, the idea of a Bitcoin reserve first gained traction in July 2024, before Trump’s election. Then, Senator Cynthia Lummis introduced a bill with the pursuit of establishing a Bitcoin reserve.
According to her proposal, the United States Treasury will establish an initiative to accumulate 200,000 Bitcoin yearly until the reserve holds 1 million BTC. Furthermore, the bill suggested that the Treasury will ensure that the BTC pile will remain intact for at least 20 years.
Accordingly, the scheme will be funded by profits from the Federal Reserve’s bank deposits and gold reserves. The lawmaker argued that the initiative will help reduce national debt by 50% within 20 years and protect the US economy and dollar against inflation.
She explained that BTC could help the US achieve the aforementioned goals without raising taxes.
Will it Materialize?
Trump is already preparing for his much-anticipated pro-BTC administration and he has appointed two key figures to his proposed Presidential Council of Adviser for Digital Assets. According to recent revelations, David Sacks will head the Crypto Council with Bo Hines serving as the executive director.
The appointment will serve as a bedrock for the administration’s focus on cryptocurrencies and most especially the fulfillment of the Bitcoin reserve. Additionally, this crucial move is a strong indicator that the president-elect will keep his campaign promises, giving crypto enthusiasts and investors hope.
Aside from the appointment, the rationale behind the proposed hoard will as well fuel its actualization. Trump’s motive for establishing the Bitcoin reserve is to ensure that the United States of America remains a crucial player in the digital assets sectors.
The president-elect once explained that if the US fails to embrace Bitcoin, China may do so, giving the Asian country a crucial edge. Also, he urged investors to hold on to their BTC as his administration will ensure that the government will support the virtual assets market.
Likewise, Trump is confident that the stockpile will protect US investors and support the digital assets industry to grow. Considering these factors, the proposed BTC reserve looks like it is just a matter of time before it becomes a reality, nevertheless, it remains a speculation.
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