Senator Cynthia Lummis has introduced the “BITCOIN Act of 2024,” aimed at establishing a federal Bitcoin reserve of 1 million BTC over five years.
- Senator Cynthia Lummis proposes the “BITCOIN Act of 2024”.
- The bill aims to create a federal Bitcoin reserve of 1 million BTC in five years.
- The Federal Reserve (FRS) will purchase up to 200,000 BTC annually.
- Bitcoin assets cannot be sold for 20 years, with few exceptions.
- Funding sources include the revaluation of “gold certificates”.
Introduction of the BITCOIN Act
Senator Cynthia Lummis has presented the “BITCOIN Act of 2024” to establish a federal Bitcoin reserve in the United States. According to The Block, the bill outlines the creation of a federal reserve of 1 million BTC within five years.
Key Provisions of the Bill
The full title of the bill is “Promoting Innovation, Technology, and Competitiveness through Nationwide Optimized Investments” (BITCOIN). The central initiative is the “Bitcoin Purchase Program,” which mandates the Federal Reserve to acquire up to 200,000 BTC annually over a five-year period. These assets can only be sold after 20 years, exclusively to offset national debt. Post this period, the Federal Reserve can liquidate up to 10% of the reserves every two years for various needs.
Implementation and Custody
The acquired Bitcoin will be stored in a decentralized network of vaults across the nation. Custodians will be chosen based on comprehensive risk assessments, prioritizing geographical diversity, security, and accessibility. The Treasury Department will be required to publish quarterly reports on the valuation changes of the Bitcoin portfolio.
Funding the Bitcoin Reserve
Funding for the Bitcoin purchases will come from multiple sources. As reported by CoinDesk, one significant source is the unrealized gains from revaluing “gold certificates,” issued between 1882 and 1934. These certificates will be transferred to the Treasury for revaluation at fair market value, with the resulting gains used to finance Bitcoin investments.
Broad Support and Potential Impact
Senator Lummis announced the bill at the Bitcoin 2024 conference in Nashville. The initiative has garnered support from notable figures, including presidential candidates Donald Trump and Robert Kennedy Jr. The bill highlights Bitcoin’s unique attributes as a decentralized and scarce digital asset, enhancing the U.S. dollar’s position in the global financial system.
Final Thoughts
The introduction of the “BITCOIN Act of 2024” marks a significant step towards integrating Bitcoin into national reserves. By creating a substantial federal Bitcoin reserve and leveraging innovative funding sources, the U.S. positions itself at the forefront of the cryptocurrency landscape. This move could have lasting effects on both the crypto market and the broader financial ecosystem.
