Senator Lummis Presents Official Strategic Bitcoin Reserve Bill

By Jody McDonald August 01, 2024 In Bitcoin, Law, Strategic Reserve

A futuristic vault with digital lock mechanism displaying bitcoin symbol — Source:AdobeStock

A bill introduced yesterday by Republican Senator Cynthia Lummis aims to establish a US government-owned strategic reserve of one million Bitcoin, around 5% of the total supply.
Lummis says establishing a strategic Bitcoin reserve will ensure the US dollar maintains its position as the global reserve currency and will strengthen the US economy.
Neither of the presidential nominees for the two major parties have endorsed the idea of a Bitcoin strategic reserve, but Trump has said he will make it a policy of his administration to never sell any of the US government’s Bitcoin holdings.

USA? How ‘bout USB, baby? United States of Bitcoin!

That’s where we could be headed if a bill introduced by pro-crypto senator Cynthia Lummis yesterday gets passed into law. The bill, referred to as the ‘Bitcoin Strategic Reserve Bill’, aims to create a huge federal government-owned strategic reserve of approximately one million Bitcoin, or 5% of the total supply.

The wait is over. This is our Louisiana Purchase moment.

Read the text for my BITCOIN Act below ⬇️⬇️https://t.co/mSYJVwn1wI
— Senator Cynthia Lummis (@SenLummis) July 31, 2024

The bill also includes a plan to establish a decentralised network of secure ‘vaults’ to store the Bitcoin, featuring stringent cybersecurity and physical security measures to prevent the Bitcoin from being stolen—basically a crypto Fort Knox.

Lummis: Bitcoin Bill Will Secure US Dollar As Global Reserve and Fight Inflation

The full name of Senator Lummis’s bill is the ‘Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act of 2024’—a mouthful that seems to have been chosen to allow for the acronym “BITCOIN Act of 2024.”

The bill sets out a “Bitcoin Purchase Program” which would see the federal government acquire not more than 200,000 Bitcoin per year over a period of five years, for a total reserve of one million Bitcoin. The bill also says the Bitcoin must be held for a minimum of 20 years, and no more than 10% of the total reserve could be sold in any two-year period after the expiration of the holding period.

In a statement released just before the bill was introduced, Senator Lummis—who is a Republican from Wyoming—said that the establishment of a Bitcoin reserve will secure the US dollar’s pre-eminent global position:

Establishing a strategic Bitcoin reserve would firmly secure the dollar’s position as the world’s reserve currency into the 21st century and ensure we remain the world leader in financial innovation.

Cynthia Lummis, US Senator from Wyoming

Lummis also suggested that a Bitcoin strategic reserve will combat inflation and strengthen the US economy into the future:

Families across Wyoming and the U.S. are struggling to keep up with soaring inflation rates and record-breaking costs while our national debt reaches unprecedented levels; now more than ever, we need to create a brighter future for generations of Americans by diversifying into Bitcoin and securing our economic future.

Cynthia Lummis, US Senator from Wyoming

What Are the Chances This Bill Becomes Law?

At the moment it seems unlikely that the US House and Senate would agree to spending US$65 billion over five years to establish a Bitcoin reserve (and that’s at today’s price, who knows what BTC might cost in 5 years).

That said, there has been some support for similar ideas from the likes of Donald Trump who declared last week at the Bitcoin 2024 Conference in Nashville that he wants to make the US the “crypto capital of the planet.” While Trump didn’t commit to establishing a Bitcoin reserve during his appearance in Nashville, he did say that if he’s elected president his administration’s policy would be that the government should never sell any of its Bitcoin holdings:

For too long our government has violated the cardinal rule that every bitcoiner knows by heart: Never sell your bitcoin…If I am elected, it will be the policy of my administration, United States of America, to keep 100% of all the bitcoin the U.S. government currently holds or acquires into the future.