As speculation swirls over the future of cryptocurrency under a potential second Trump presidency, Senator Cynthia Lummis has expressed confidence that a major legislative initiative—the creation of a U.S. Bitcoin reserve—could be fast-tracked within the first 100 days of Donald Trump’s inauguration.
The bill, known as the Bitcoin Act of 2024, aims to establish a strategic Bitcoin reserve, positioning the U.S. as a global leader in cryptocurrency adoption. In a recent statement, Lummis, a long-time advocate for crypto policy reform, emphasized the bipartisan potential of the proposal: “I believe we can get this done with bipartisan support in the first 100 days if we have the support of the people. It is a game changer for the solvency of our nation. Let’s put America on sound financial footing and pass the Bitcoin Act!”
The push for a Bitcoin reserve is supported by David Bailey, CEO of BTC Inc., who has been advising Trump on crypto policy. Bailey stressed that the reserve should be prioritized, describing it as “the #1 most urgent and transformational policy” on the President’s agenda. Bailey also floated the idea of integrating Bitcoin into government programs, including the possibility of using cryptocurrency to pay Social Security benefits.
The Bitcoin Reserve Proposal: What We Know So Far
The Bitcoin Act of 2024 would involve creating a network of decentralized vaults across the U.S. to securely store Bitcoin. Under the plan, the U.S. Treasury Department would acquire 200,000 BTC annually for five years, building a total reserve of one million BTC over time. The proposal also suggests the reserves would be stored for a minimum of 20 years, ensuring long-term security.
To fund the purchase of Bitcoin, the bill proposes utilizing other government assets, such as gold certificates, with a plan for revaluing these assets to cover the cost of acquisition. In addition, a system to verify the reserves would be put in place to ensure transparency and accountability.
Lummis’s plan has garnered significant attention from the crypto community, with analysts at CoinShares noting that such a reserve would likely generate substantial institutional and governmental interest in Bitcoin, potentially driving the cryptocurrency’s value to new heights. Pomp Investments’ founder, Anthony Pompliano, has predicted that the move could trigger a “fear of missing out” (FOMO) in the market, further accelerating Bitcoin’s adoption.
Economic Impact and Market Dynamics
Supporters of the proposal argue that the U.S. commitment to Bitcoin could make the cryptocurrency more attractive to investors, boosting its market value and accelerating its institutional adoption. Some analysts, however, suggest that the recent surge in Bitcoin’s price is primarily driven by the cyclical dynamics of Bitcoin’s halving events, which historically create a shortage of coins on the market, leading to price increases. Jesse Myers, co-founder of Onramp Bitcoin, cautioned that while the U.S. election may have acted as a catalyst, the broader market dynamics of the Bitcoin halving are more likely responsible for the recent price hikes.
Over the past week, Bitcoin’s price has surged by nearly 24%, reaching an all-time high of $93,000. Meanwhile, the total capitalization of the cryptocurrency market has grown by 25%, surpassing $3 trillion. The crypto market’s fear and greed index has also spiked, reflecting investor optimism.
Will the Bitcoin Reserve Happen?
While the proposal remains in its early stages, the prospect of a Bitcoin reserve is gaining momentum. If passed, the bill could signal a major shift in U.S. economic policy, elevating Bitcoin from a speculative asset to a cornerstone of the nation’s financial system. As Lummis and other supporters rally behind the bill, the crypto community is closely watching to see whether the U.S. will take a bold step towards integrating Bitcoin into its financial infrastructure.
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