The bill, abbreviated as the “BITCOIN Act of 2024,” calls for the U.S. Treasury to purchase bitcoins over a 5-year period until a pool of 1,000,000 BTC is achieved. The plan to incorporate Bitcoin (BTC) into the U.S. national reserves is beginning to take shape. U.S. Senator Cynthia Lummis has advanced the first draft of a bill that would enable the creation of a new “Bitcoin Strategic Reserve” and would set a path for the United States to have funds in that cryptocurrency. This was reported Wednesday by CoinDesk and The Block, which have had access to the document.
Dubbed the “Boosting Innovation, Technology, and Competitiveness through Nationally Optimized Investment Act of 2024,” or the “BITCOIN Act of 2024” for short, the bill proposes that purchases of the cryptocurrency would be funded in part by the appreciation of gold certificates held by the Federal Reserve System.
Lummis, a Wyoming Republican known for her pro-Bitcoin stance, announced her intention to propose the reserve on Saturday during the “Bitcoin 2024” conference in Nashville. She took the stage minutes after former President Donald Trump, a Republican candidate in this year’s presidential race, delivered a speech in favor of the cryptocurrency industry. Trump further proposed the formation of a “strategic national Bitcoin reserve” and made other related promises should he win the White House in November.
Bitcoin National Reserve: The Draft
According to reports, the draft states that the U.S. Treasury Secretary would set up a “Bitcoin Purchase Program” of up to 200,000 BTC per year for a period of five years, up to a total stash of 1 million bitcoins, currently valued at more than USD $1 billion. The bitcoins would be held for at least 20 years and would only be available to pay down the federal debt. Thereafter, no more than 10% of the assets could be sold within any two-year period.
The bill requires the Treasury Department to make public quarterly reports on Bitcoin holdings and post them on its website, the reports said. It also states that U.S. states will be able to voluntarily participate in holding Bitcoin as part of the reserve, provided they meet certain requirements, including security protocols. “Establishing a strategic Bitcoin reserve to bolster the U.S. dollar with a hard digital asset will secure our nation’s position as a global financial leader for decades to come,” Lummis said in a statement.
Federal Reserve Gold Revaluation
The bill also includes a section on adjustments to gold certificates, calling on the Federal Reserve Banks to revalue gold certificates and capture their fair market price. Under the plan, within six months of the law’s enactment, Federal Reserve Banks will be required to surrender all of their gold certificates to the Secretary of the Treasury, CoinDesk has reported. “Within 90 days of the surrender of the last such certificate, the Secretary shall issue new gold certificates to the Federal Reserve Banks reflecting the fair market price of gold held by the Treasury against such certificates on the date specified by the Secretary in each certificate,” the draft reads, as quoted by The Block.
Thereafter, the Federal Reserve Banks would “remit the difference in cash value between the old and new certificates” to the Secretary of the Treasury. On July 24, the Federal Reserve Banks held gold reserves valued at $11 billion, according to the central bank’s balance sheet. Along with gold, the United States also holds oil reserves.
For After November
Lummis previously told The Block that the bill will not pass this year but could be considered after the November presidential election. Cryptocurrencies have become a central issue amid the presidential campaign in the U.S. Trump, who began accepting Bitcoin donations in May, has stated his intention to protect the industry and end the “crackdown” that has been pushed by Joe Biden’s administration against the digital asset sector.
Meanwhile, Vice President Kamala Harris’s presidential campaign team has reportedly begun reaching out to ask questions about the cryptocurrency industry. At the time of writing, BTC is trading around $66,100.
