U.S. Vice President JD Vance discusses the proposed Bitcoin reserve
In a notable turn of events, the Trump team is set to participate in this year's Bitcoin conference, signaling a growing interest in the digital currency within political circles.
This interest is not limited to the Trump team alone. JD Vance, a prominent figure in the Republican party, sees Bitcoin as a strategically relevant asset for the USA government. Vance, who owns a significant amount of Bitcoin and still holds it, has emphasized the importance of competing with China in the context of a potential Bitcoin reserve.
The proposed Bitcoin reserve is being spearheaded by a group of Republican lawmakers, led by Senator Cynthia Lummis. Lummis has proposed a bill aiming to build a Bitcoin holding of 1 million coins in five years. Notably, Lummis announced that former President Donald Trump would support her bill. However, it's a significant hurdle to get enough politicians in Congress to vote for the "Bitcoin Act".
The implementing regulation for the establishment of the strategic Bitcoin reserve allows the government to buy more Bitcoin if it can be done in a budget-neutral manner. Bo Hines, the leading director of the "Presidential Council of Advisors for Digital Assets", has emphasized that the USA wants to have as many Bitcoins as possible.
One of the budget-neutral options being considered is re-evaluating gold certificates, which could free up over $800 billion for Bitcoin purchases. Another promising approach is the use of Bitcoin-backed Treasury bonds, also known as BitBonds. Sacks, the US AI and crypto czar, stated that the Department of Commerce and the Department of the Treasury already have the authority to purchase Bitcoin. He suggested that these departments could finance Bitcoin purchases without increasing debt by taking money from another program that isn't using it.
The idea of a Bitcoin reserve is not exclusive to the USA. Kyrgyzstan has already agreed to establish a Bitcoin reserve, inspired by the US, and Pakistan is now following suit. Even the Mayor of New York City, Eric Adams, has expressed support for his city issuing Bitbonds.
The potential for Bitcoin ownership in the USA is also seen as promising by JD Vance, who believes the number of American Bitcoin owners will double in the near future. David Sacks, in a similar vein, mentioned the possibility of convincing Secretary of Commerce Howard Lutnick or Secretary of the Treasury Scott Bessent to buy Bitcoin.
As the Bitcoin conference approaches, the spotlight is on the USA as it navigates the complex world of digital currency and seeks to establish a strategic Bitcoin reserve. The developments in this area are likely to be closely watched by both the Bitcoin community and the wider financial world.
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