- Senator Cynthia Lummis unveils BTC as a strategic reserve.
- Bitcoin will boost USD and eliminate national debt.
Bitcoin and Crypto are taking center stage as the United States prepares for the upcoming presidential elections. In recent months, Donald Trump has become a pro-crypto presidential candidate, as previously reported by AMBCrypto.
The rise of political discourse around BTC and Crypto is shaping the future trajectory. During the Bitcoin conference, Senator Cynthia Lummis announced a bill proposing to make BTC a strategic reserve asset of the US.
Senator Cynthia announces the BTC strategic reserve bill.
During the Bitcoin 2024 conference US Senator Cynthia Lummis announced a proposal to strengthen the USD.
The senator proposed the creation of a strategic Bitcoin reserve to support the dollar against rising inflation and strengthen the US’s position in a changing financial system.
Through her proposal she noted that,
“Establishing a strategic Bitcoin reserve would firmly secure the dollar’s position as the world’s reserve currency in the 21st century and ensure that we remain the global leader in financial innovation,”
She argued that current economic conditions are difficult and inflation is rising. Therefore, with rising inflation, it is necessary to diversify into BTC and protect America’s economic future.
She added that the legislation will ask the US government to purchase 1 million Bitcoins over five years. Through her statement, she added that,
“Implement a Bitcoin purchasing program of 1 million units over time to acquire a total stake of approximately 5% of the total Bitcoin supply, reflecting the size and scope of the United States’ gold reserves.”
BTC holding company for US debt management
Source: Statista
US debt has skyrocketed to a record high of $35 trillion over the past decade. In her speech, Senator Cynthia argued that if the government invests $3.3 million in the BTC reserve, the government will eliminate debt.
According to the senator, the government can use BTC to eliminate debt as the value of BTC will increase over time. Therefore, BTC was created to anticipate the looming fiscal and monetary crisis in the United States and worldwide.
BTC wanted to address the ongoing devaluation of the fiat currency through government spending and borrowing that the US faces today.
Through BTC’s reserves, the government can therefore reduce borrowing, while individual holders avoid fiat devaluation.
What would the BTC reserve mean for the USD?
Source: Atlantic Council
For years, the USD has defied predictions of its collapse as it remains the most dominant currency. Nearly 60% of global foreign exchange reserves consist of dollars.
However, the share has gradually decreased in recent years. The decline is due to the evolution of the financial markets, especially due to the rise of cryptocurrencies and changing geopolitics.
With cryptocurrencies taking center stage in the digital financial revolution, having a BTC reserve will boost the dollar.
Although BTC prices experience volatility, their value increases annually, unlike the USD, which loses value due to devaluation.