Sen. Cynthia Lummis of Wyoming is poised to announce legislation that could establish Bitcoin as a mainstream financial asset in the United States.
At the upcoming Bitcoin 2024 conference in Nashville, Tennessee, where former President Donald Trump is also set to speak, Lummis aims to announce a bill requiring the Federal Reserve to hold Bitcoin (BTC) as a strategic reserve asset.
If successful, this move would mark a significant shift in U.S. monetary policy, aligning Bitcoin with traditional reserves like gold and foreign currencies.
The bill’s details remain under wraps, but insiders revealed it directs the Fed to incorporate Bitcoin into its reserves to enhance the stability of the U.S. dollar. Lummis has support from Senate Banking Committee colleagues and hopes for Trump’s endorsement.
Fox Business was the first to report on the potential legislation.
What a U.S. Bitcoin reserve would look like
If the United States were to adopt Bitcoin as a strategic reserve asset, it could leverage its position as the largest nation-state holder of Bitcoin and echo Trump’s sentiment that all remaining Bitcoin should be mined in the United States.
Essentially, a Bitcoin strategic reserve asset would involve the U.S. Treasury holding significant amounts of Bitcoin as part of its reserve portfolio, similar to how they already do with gold or foreign currencies.
A reserve would be a formal nod by the U.S. government to Bitcoin’s legitimacy and future use cases. The move would position the U.S. favorably against global competitors and accelerate the acceptance of Bitcoin as a digital gold and long-term savings instrument.
Bitcoin in the middle of politics
The proposal arrives amid a politically charged climate. Vice President Kamala Harris, the presumptive Democratic nominee, is receiving advice to soften the administration’s stance on crypto.
As the U.S. already holds a substantial amount of Bitcoin, the potential legislation could spark a global race among nations to accumulate more of the asset.