Recently, Trump’s ally in the U.S. Senate, Cynthia Lummis, proposed a bold plan: to push for a bill when the new Congress takes office next year - to sell part of the Federal Reserve’s gold reserves to establish Trump’s proposed “strategic Bitcoin reserves” without increasing the government deficit.
According to Bloomberg, the bill requires the United States to purchase 1 million bitcoins, which will cost about $90 billion at current market prices. In theory, the Federal Reserve has enough gold to buy 1 million bitcoins and still have a lot left over. If the bill is passed, investors will buy before the government, and the government's acquisition costs may increase.
“The U.S. already has financial assets in the form of gold certificates that can be converted into Bitcoin, so the impact on the U.S. balance sheet is fairly neutral,” Lummis said.
Analysts believe that Lummis' bill will significantly expand the scope of the strategic Bitcoin reserve plan that Trump has indicated so far. Allowing the government to retain ownership of approximately 200,000 Bitcoins previously seized by the US government, these cryptocurrencies will be held for at least 20 years, and the growth in their value is expected to help reduce the national debt.
However, despite the market's expectation that Trump's entry into the White House will usher in the most cryptocurrency-friendly Congress in history, some market observers believe that Lummis' bill will face challenges. Michael Novogratz, the billionaire head of cryptocurrency investment company Galaxy Digital, believes that the possibility of the United States establishing a strategic reserve of Bitcoin is low:
“If the U.S. actually created such a reserve, the price of Bitcoin would likely surge to $500,000 as other countries would be forced to create similar reserves.”
