US Treasury Secretary Reveals What Will Be The Foundation Of The Strategic Bitcoin Reserve
The United States (U.S.) Treasury Secretary Scott Bessent has backpedaled on his earlier comments and revealed plans for a Strategic Bitcoin Reserve. He stated the foundation for this initiative and how the U.S. government intends to expand the reserve over time.
Treasury Secretary Comments On Strategic Bitcoin Reserve
In an X post, Treasury Secretary Scott Bessent said that BTC that has been finally forfeited to the federal government will be the foundation of the Strategic Bitcoin Reserve, which Trump established in March through an Executive Order. He also revealed that they are committed to exploring budget-neutral pathways to acquire more Bitcoin to expand the reserve.
The Treasury Secretary noted that this is in line with Trump’s promise to make the U.S. the “Bitcoin superpower of the world.” Meanwhile, it is worth mentioning that Bessent’s statement came following an earlier Fox Business interview in which he said that they have no plans to buy BTC for the Strategic Bitcoin Reserve.
His comment during this interview sparked backlash from the crypto community, who felt betrayed about the Strategic BTC Reserve. This is based on the fact that the president’s Executive Order had mandated the Digital Asset Working Group to consider ways that the U.S. can buy more BTC.
As such, the backlash is likely what prompted Bessent’s X post. Following his statement, pro-Bitcoin Senator Cynthia Lummis remarked that the Treasury Secretary was right about them finding a budget-neutral path to building the Strategic Bitcoin Reserve. She added that they cannot save the country from the $37 trillion debt by buying more BTC.
Instead, the senator proposed that they can revalue gold reserves to today’s prices and transfer the increase in value to build the BTC reserve. Lummis then declared that the U.S. needs the BITCOIN Act. This is a bill that she introduced, mandating the U.S. to buy 1 million BTC over five years for the Strategic Bitcoin Reserve.
Budget-Neutral Way To Buy BTC
Satoshi Action Fund CEO Dennis Porter has proposed a budget-neutral way that the U.S. government can buy more BTC for the Strategic Bitcoin Reserve. In an X post, he stated that this method leverages yield-bearing instruments obtained through confiscation or other means. This will enable the government to generate revenue for BTC purchases without additional budgetary allocations.
Porter added that when the U.S. acquires yield-bearing assets through confiscation, it can retain these assets in their native form while it uses the revenue they generate to buy BTC. The government can stake altcoins they own and use the yields from this endeavor to purchase BTC. Arkham data shows that the government holds altcoins like ETH and BNB, which it can stake and earn yields on.
At the time of writing, the BTC price is trading at around $118,800, down over 3% in the last 24 hours, according to data from CoinMarketCap.
Featured image from Pixabay, chart from Tradingview.com
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