Senator Proposes Federal Reserve to Hold 1 Million Bitcoin
US Senator Cynthia Lummis of Wyoming has introduced a bill to put Bitcoin on the Federal Reserve’s balance sheet. Through her BITCOIN Act, Lummis wants the Federal Reserve to buy 1 million Bitcoin as part of a reserve to address the $36 trillion US national debt.
In a Yahoo Finance interview, Lummis said, “I want our government to have a Bitcoin reserve to back the US dollar.”
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Overcoming Legal and Logistical Hurdles
Federal Reserve Chair Jerome Powell said the Fed is not allowed to buy or hold Bitcoin under the Federal Reserve Act. To make this happen, Congress would have to change the law. Powell also said the Fed has no plans to do so.
Despite these obstacles, Lummis thinks Bitcoin’s long term appreciation makes it a good asset to address national debt. She noted the US government already has around 200,000 BTC from asset forfeitures. She suggests those could be the foundation of a bigger strategic reserve.
BITCOIN Act: A Bold Proposal
Lummis’ BITCOIN Act would buy 1 million Bitcoin, backed by gold certificates held by the Federal Reserve. Here are the key points:
- Long-Term Holding Period: Bitcoin acquired under the act would be held for a minimum of 20 years, allowing for significant value appreciation.
- Debt Liquidation: The strategic reserve would be used to reduce national debt, leveraging Bitcoin’s potential growth.
- Global Market Impact: Holding such a significant share of Bitcoin’s supply would position the U.S. as a dominant player in the cryptocurrency market.
Just like MicroStrategy’s Michael Saylor. Sell US gold reserves to buy at least 20% of Bitcoin.
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