Bitcoin is increasingly gaining traction within the Republican Party. Key figures like former President Donald Trump are championing its adoption. At the forefront of this movement is U.S. Senator Cynthia Lummis, who proposes a groundbreaking initiative—the Bitcoin Act. This act aims to establish a strategic Bitcoin reserve for the United States.
Bitcoin: A Solution to the Fiscal Crisis
Senator Lummis recently discussed the Bitcoin Act in an interview with Bankless. She believes it is crucial to address the nation’s $35 trillion debt. According to Lummis, existing fiscal policies cannot solve this crisis, making a Bitcoin reserve the most logical approach.
The proposed plan involves the U.S. government revaluing its gold certificates. These certificates, currently pegged at 1917 rates, would be adjusted to their current market value of around $2,400. The difference would fund the purchase of Bitcoin over five years. The goal is to acquire over one million BTC, roughly 5% of the total supply. These Bitcoins would be stored securely for twenty years. Lummis asserts this strategy could halve the national debt by 2045.
Lummis argues that this plan allows the government to invest in Bitcoin without affecting the U.S. balance sheet or increasing debt. She sees Bitcoin as a long-sought solution, noting its reliability as a non-government-issued asset. In her view, it is a better backing for fiat currencies than traditional stocks or other fiat currencies.
A Global ‘Arms Race’ for Bitcoin?
Lummis also addressed concerns about the U.S. dollar’s devaluation. She pointed to the COVID-19 pandemic when massive amounts of U.S. dollars were printed. Lummis emphasized Bitcoin’s scarcity as a key advantage. She described it as a true diversifier, immune to the inflation that plagues fiat currencies.
Lummis further suggested a future global “arms race” for Bitcoin as a secure store of value. She noted that countries like the U.S., China, and Russia are competing to lead in the crypto space. After her remarks at the 2024 Bitcoin Conference, constituent support for the Bitcoin Act surged. The legislation has now moved to the Senate Committee on Banking, Housing, and Urban Affairs for further review.
Trump’s Vision: A Crypto-Centric Future
This push for a Bitcoin reserve aligns with former President Trump’s vision. He aims to position the United States as the “crypto capital of the planet.” Trump stresses the importance of maintaining significant Bitcoin reserves. He warns that neglecting this opportunity could let nations like China gain a financial edge.
Trump has consistently highlighted Bitcoin’s potential as a modern currency. He cites endorsements from key figures in his circle. Trump urges the government to recognize the benefits of Bitcoin.
