Lummis introduces legislation to establish 1 million Bitcoin strategic reserve for the US
Senator Cynthia Lummis introduced new legislation that aims to establish a Bitcoin strategic reserve for the US totaling at least 1 million BTC 5% of the total supply.
Lummis announced the new bill at the Bitcoin2024 conference on July 27 following former President Donald J. Trumps keynote, who also vowed to make the US a Bitcoin superpower and ensure the government never sells the 210,000 BTC it already holds.
The flagship crypto reacted positively to the announcement, reversing most of the days losses to trade at $68,750 as of press time, based on CryptoSlate data.
Bitcoin reserve bill
In her speech, Lummis detailed the plan to create a network of secure storage vaults and a purchase program aimed at transparent management of the federal governments Bitcoin holdings.
The initiative would begin by moving the 210,000 Bitcoin the US government currently holds into a Treasury-managed reserve. This reserve will accumulate 1 million BTC over five years, representing 5% of the global supply.
Under the bill, the Bitcoin reserve will be held for at least 20 years and used only to reduce the countrys national debt. Lummis suggested that this strategic move could significantly cut the national debt by 2045.
MicroStrategy executive chairman Michael Saylors presentation at the event on July 26 detailed how the US could eliminate its debt by adopting a Bitcoin maxi strategy. He projected that the US could accumulate $30 trillion in Bitcoin by 2045 after reducing its debt to zero by applying the most aggressive investment strategy.
Saylor believes the first country to begin accumulating Bitcoin by issuing fiat currency will win and have the highest chance of becoming the worlds next superpower.
Excess Fed reserves
Lummis said her bill would not require further funding by tax payers since the government already has the money needed to implement the proposed Bitcoin reserve. She proposed the conversion of excess reserves from the 12 Federal Reserve Banks into Bitcoin over the next five years.
Lummis argued that holding Bitcoin, an asset that has historically grown in value, could be a more effective financial strategy than holding assets designed to debase over time.
The proposed bill signifies a significant step toward integrating digital assets into national policy, potentially positioning the US as a leader in the global financial landscape.
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Text source: CryptoSlate
