At the end of July, US Senator Cynthia Lummis announced "a historic proposal to supercharge the U.S. dollar and pay down the national debt by establishing a strategic Bitcoin reserve" and quickly followed with the introduction of the Boosting Innovation, Technology and Competitiveness through Optimized Investment Nationwide (BITCOIN) Act(direct link to the full bill in PDF format)in the Senate.

The aforementioned bill focuses on the following key elements:

• Establishing a decentralized network of secure Bitcoin vaults operated by the United States Department of Treasury.
• Acquiring one million bitcoins, which accounts for about 5% of the total supply and should mirror the gold reserves currently held by the country.
• Diversifying existing funds currently administered by the Treasury Department and Federal Reserve System to finance the initiative.
• Emphasizing that the strategic reserve shall not infringe upon individual financial freedoms.

While a quite good plan in theory, at least at first sight, the BITCOIN Act was pounded into dust by Nobel laureate Paul Krugman, who labeled it as"a government bailout of a scandal-ridden, value and environment-destroying industry." On the other hand, Donald Trump has a completely different position. At the Bitcoin 2024 conference, where Lummis advocated for the policy described in the BITCOIN Act, Donald Trump did the same. Even more, he vowed to turn the US into "the crypto capital of the planet."

In the aforementioned bill, the period mentioned for this plan is five years for acquisition and two decades for holding. If the bill passes, this means that the US will own about 5% of the total Bitcoin supply by 2030 and will hold onto it by 2050.

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Disclaimer: The information reported here should not be used as a basis for any personal investment decision. Notebookcheck does not offer cryptocurrency, NFT, or other trading, investment, or financial advice.