With the upcoming inauguration of Donald Trump as the 47th President of the United States, the idea of creating a strategic reserve of Bitcoins (BTC) in the coming months is very regularly mentioned. However, this measure is not welcomed by all players in the crypto ecosystem.
Before a strategic Bitcoin reserve emerges in the United States, the path seems strewn with pitfalls
Last July, Republican Senator Cynthia Lummis was working on a bill that would make headlines. This one concerned the holding of Bitcoins (BTC) by the United States Federal Reserve (Fed). In total, the senator would like the country to buy 1 million BTC over a period of 5 years.
Quickly, Donald Trump showed himself in favor of this measuresuggesting that in the event of an election and a majority in Congress, it could be adopted. Now elected and having this majority, a good part of the crypto community expects that congressmen will soon vote in favor of this legislative frameworkformalizing the creation of a strategic reserve of Bitcoins.
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However, some industry players do not share this opinion. For Nic Carter, partner at Castle Island Ventures, a venture capital firm specializing in blockchain and cryptocurrencies, “ he wouldn't be careful » to embark on such an approach.
“ A strategic reserve would shake confidence in global marketsunintentionally and implicitly indicating that the US dollar is in danger. We must not do anything that could call into question our solvency, » he continued.
Austin Campbell, CEO of cryptocurrency payments company WSPNPayment shares the same opinion. “ This would send a signal to the world that the United States do not intend to manage their budget well […] I think this is a very bad idea » he declared.
7/ One, the BSR cannot save the dollar. In fact, it would accelerate the demise of the dollar, as it would be a signal to the world that the US does not intend to manage its fiscal house well and will likely re-denominate in BTC at some point. I think this is a terrible idea.
— Austin Campbell (@CampbellJAustin) December 15, 2024
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Arthur Hayes is skeptical, advising policy makers to take time to think
In a similar vein, George Selgin, director of the Cato Institute, a libertarian think tank, considers Bitcoin as “ a useless reserve asset ». For him, the gold reserve that the United States already has would already serve the interests of the American dollar, and Bitcoin would not have “ no effect on its popularity around the world, nor would it strengthen its attractiveness ».
Recently, spot Bitcoin ETFs available in the United States have seen their capitalization surpass gold-backed ETFs. A shift which inevitably underlines the growing interest in BTCall the more so following Donald Trump's victory in the American presidential elections.
Compared to gold, Bitcoin still presents some disadvantages : great volatility, as well as a lack of confidence among the population in this cryptocurrency.
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However, these 2 points, over time, could be corrected. The adoption of clear regulations around cryptocurrencies could lead to its democratization and over time, being increasingly adopted, the volatility of Bitcoin could well approach that of gold.
Finally, Arthur Hayes, co-founder of BitMEX, known for delivering his analyzes and predictions around the crypto market, also expressed doubts about establishing a strategic Bitcoin reserve too quickly. “ Even if the creation of such a reserve allowed the United States to assert a certain financial supremacy, short-term thinking would hinder its success, » he explains.
At the time of writing, the price of Bitcoin is down 2.28% over the last 24 hours, trading at just over $102,000.
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Sources: Bloomberg, Cato Institute, Arthur Hayes Blog Post
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Surprised by the rise of crypto-assets at the end of the 2010s, I began to closely follow this sector which fascinates me to the greatest extent. When I'm not in football stadiums, rugby stadiums or handball halls, I work on writing relevant articles around cryptocurrencies and more broadly, Web3.
Zacharie Tazrout
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