Wyoming Senator Cynthia Lummis is urging the U.S. Treasury Department to convert a portion of its gold holdings into Bitcoin, proposing the creation of a strategic Bitcoin reserve to address inflation and the soaring national debt.
Lummis Pushes Bitcoin as Strategic Reserve Alternative
Senator Cynthia Lummis of Wyoming is pushing for the US Treasury to create a Bitcoin strategic reserve by exchanging some of its gold for Bitcoin.
In an interview with Bloomberg, Lummis stated that the US government's balance sheet would be "neutral" if the gold certificates held by the US Treasury were converted into Bitcoin instead of spending almost $90 billion to buy Bitcoin at its current market price.
Previous Proposals and the Push for Bitcoin
In a prior argument, the US senator suggested that the US Treasury sell some of its assets to buy Bitcoin for the strategic reserve. However, he never said which assets the Treasury should sell.
As the bill was being introduced to the Senate, Senator Lummis made the statement, "As families across Wyoming struggle to keep up with soaring inflation rates and our national debt reaches new and unprecedented heights," referring to the urgency of the need to establish the Strategic Bitcoin Reserve.
A Bold Vision: One Million Bitcoin Reserve
As part of his Bitcoin strategic reserve proposal, Senator Lummis has proposed purchasing one million Bitcoins, or five percent of the entire supply, and storing them for twenty years. This lofty objective, at the present market price, would cost around $90 billion, Cointelegraph shares
The multi-billion dollar price tag is insignificant, according to investor and asset manager Anthony Pompliano, who recently stated that sovereign governments around the world are racing to acquire Bitcoin:
"The national debt increased by $850 billion in the last 90 days. If we were to try to put that same $850 billion into Bitcoin, that is about half of the current market cap. So, we're talking about 50-100 billion dollars — small rounding errors when it comes to government spending. And I think that it is well worth the risk-reward."
Mixed Opinions on the Feasibility of a Bitcoin Reserve
Mike Novogratz, founder and CEO of Galaxy Digital, recently stated his belief that a Bitcoin strategic reserve will not be implemented by President-elect Trump.
Nevertheless, according to Novogratz, the price of Bitcoin might skyrocket to $500,000 per BTC if the strategic reserve is created by the next Trump administration.