Trump rejects the establishment of a strategic Bitcoin reserve

NASHVILLE – Former President Donald Trump delivered a keynote speech Saturday at the biggest Bitcoin conference of the yr.

Instead, the Republican presidential candidate simply promised to take care of the present level of Bitcoin holdings that the US has amassed by seizing assets from financial criminals.

“For too long, our government has violated the cardinal rule that every Bitcoiner knows by heart: Never sell your Bitcoin,” Trump said at this yr’s Bitcoin conference in Nashville.

“If elected, it will be the policy of my administration, United States of America, to retain 100% of all bitcoins that the U.S. government currently owns or acquires in the future,” he said.

Trump's strategy of holding his Bitcoin stake permanently, in each bull and bear markets, is strongly supported in crypto circles., However, this doesn’t correspond to the present approach of the US government.

Currently, the US Marshals Service repeatedly auctions Bitcoin in addition to other cryptocurrencies held within the state treasury, akin to ether And LitecoinThese sell-offs can sometimes result in declines in cryptocurrency prices, akin to earlier this month when Germany began liquidating tons of of tens of millions of dollars price of seized bitcoins.

During a closed roundtable discussion with various donors ahead of Trump's remarks on Saturday, the previous president didn’t discuss the mechanics of his plan but said he thought it could make sense for the federal government to own bitcoins.

The meeting was attended by investors Tyler and Cameron Winklevoss, musician Kid Rock, Republican Senators Cynthia Lummis, Bill Hagerty and Marsha Blackburn, and others, in line with two individuals who were within the room.

Trump's proposal was less revolutionary than some crypto enthusiasts expected, nor did it match the more far-reaching statement made by third-party presidential candidate Robert F. Kennedy Jr.

“For all I know, President Trump could announce tomorrow his plan to build a Bitcoin Fort Knox and authorize the U.S. government to purchase one million bitcoins as a strategic reserve,” Kennedy said during his own speech on the Bitcoin conference on Friday.

Kennedy went even further than Trump, promising to create a strategic reserve of 4 million bitcoins to complement the country's current gold supply, a part of which is stored near the Fort Knox military base. The independent presidential candidate said he would sign an executive order directing the U.S. Treasury to purchase 550 bitcoins a day, a move that might fundamentally change how the cryptocurrency is regulated and valued.

As Bitcoin becomes more of a central issue within the election campaign – largely attributable to the growing presence of the crypto lobby in Washington – Trump’s reluctance to emulate Kennedy’s “Bitcoin Fort Knox” promise is notable.

But Trump's reservations reflect the complications that include promising a strategic Bitcoin reserve on par with the gold standard.

The Trump team didn’t immediately reply to a request for comment.

In short: no.

An executive order wouldn’t be enough to create a U.S. Bitcoin reserve. The president would likely need recent laws and congressional approval to implement it. Some lawmakers have already began that process.

Shortly after Trump's keynote speech on the Bitcoin conference on Saturday, Senator Lummis of Wyoming announced her plan to introduce recent laws that might support a strategic Bitcoin reserve.

“Within five years, the United States will collect one million bitcoins, five percent of the world's supply,” Lummis said. “And they will be held for at least 20 years and can be used for a single purpose: to reduce our debt.”

Lummis added that creating such a reserve would help strengthen the dollar against rising inflation.

The US government has a hoard of Bitcoin assets that it has seized from financial criminals in spectacular undercover operations.

This existing Bitcoin supply could function the premise for the strategic Bitcoin reserve, which the U.S. government would increase by repeatedly purchasing a certain variety of Bitcoins.

These additional Bitcoin purchases would likely be funded not less than partly by U.S. taxpayers.

According to Senator Lummis' bill, which is predicted to be introduced in the following few days, a Bitcoin reserve could be funded by “existing Treasury resources,” which include tax revenues.

The ultimate goal could be to scale back the federal deficit, Lummis said on the Bitcoin conference, which could potentially offset the initial spending.

Passing laws to create a reserve just like the one proposed by Lummis would most definitely require a Republican victory within the White House, Senate and House of Representatives in November.

The likelihood of such a red wave looked as if it would increase throughout most of July as Democrats and independents turned away from President Joe Biden.

But with Vice President Kamala Harris leading the Democratic nomination, the 2024 election is a complete recent story.

A Bitcoin reserve would give the digital currency even greater legitimacy and construct on the momentum of the digital asset's increasing adoption on Wall Street.

In January, spot Bitcoin ETFs first launched on US markets with the blessing of the US Securities and Exchange Commission (SEC). Many viewed the listing as an event that cemented Bitcoin's status as a everlasting asset class.

Still, the introduction of a national reserve could be a shocking commercial for the young currency, which was launched in 2009 and has since been characterised by volatile performance with occasional unexpected gains for its investors. Trump himself was a Bitcoin critic as recently as 2021, when he called the currency a “fraud.”

In the short term, Bitcoin's recent status would drive up the worth of the cryptocurrency.

“If the U.S. government were to build a strategic reserve, other countries would probably do the same, and that would take a lot of Bitcoin out of the market,” said Marathon DigitalCEO Fred Thiel: “That drives up the overall price.”

Currently, the Bitcoin price is holding regular at around $68,000 as markets ignore Trump's guarantees on Bitcoin, which were far less aggressive than expected.