Will the US push for a Bitcoin stockpiling strategy trigger a global 'FOMO'?According to a report by cryptocurrency asset management company CoinShares on the 10th (local time), the U.S. government is considering including Bitcoin as a strategic reserve asset. CoinShares analyzed that this measure could have a greater impact in the long term than the approval of a Bitcoin exchange-traded fund (ETF). US Bitcoin Reserve Plan… Two Approaches: ‘Bitcoin Act’ and Executive Order Currently, there are two approaches being discussed in the United States regarding the strategic reserve asset of Bitcoin. The first is the 'Bitcoin Act' proposed by Senator Cynthia Lummis. This bill contains the content that the US government purchases 200,000 BTC per year for 5 years, totaling 1 million BTC, and holds it as a national strategic reserve asset. The Bitcoin in question cannot be sold for the next 20 years, and can only be used for the purpose of repaying national debt. CoinShares predicted that if this bill is passed, it will bring about significant changes to the global financial order. However, it analyzed that there is a political hurdle to passing it through Congress, and it is unlikely that President Trump will make it a top priority. The second scenario is a Bitcoin hoarding via an executive order. According to a recently leaked draft, the Trump administration is considering a plan to have the Treasury seize all of the government’s current Bitcoin holdings and use the Exchange Stabilization Fund (ESF) to purchase an additional $2.1 billion worth of Bitcoin. An executive order would likely be more expedited in reality, as it does not require congressional approval. However, it is less secure than passing a bill, as it can easily be overturned if the next administration changes its policy. Bitcoin Reserve Asset, Growing Interest from Governments Around the World If the United States adopts Bitcoin as a strategic reserve asset, the impact on the global financial market is expected to be significant. CoinShares predicted that the U.S. move would “be a catalyst for governments around the world to compete to stockpile Bitcoin.” Several countries are already moving to include Bitcoin in their national financial strategies. European Union (EU): European Parliament member Sarah Knafo has spoken out against a digital euro and said the EU should include Bitcoin as a strategic reserve asset. El Salvador: Became the first country in the world to adopt Bitcoin as legal tender in 2021 and continues to purchase BTC through its national treasury. Brazil: Representative Eros Biondini has introduced a bill that would place 5% of the country’s foreign exchange reserves in Bitcoin. Russia: Considering National Bitcoin Reserve to Counter Sanctions Poland: Presidential candidate Sławomir Mentzen has pledged to make Poland a cryptocurrency hub and make Bitcoin the national reserve asset. Argentina: President Javier Milei has criticized the central banking system and has highlighted Bitcoin as a way to return monetary sovereignty to individuals. Canada: Conservative Leader Pierre Poilievre argues that Bitcoin could serve as an inflation hedge and alternative to fiat currencies. Bitcoin Strengthens Its Position in the Global Financial System CoinShares estimates that if major governments were to replace 5% of their strategic gold reserves with Bitcoin, around $110 billion worth of Bitcoin (around 5.5% of the total BTC supply) would be purchased, which would likely further strengthen Bitcoin’s position in the global financial system. Adopting Bitcoin as a national strategic asset may seem somewhat unusual given its competition with fiat currencies. However, the report analyzed that “the dollar is gradually losing its status as the global reserve currency, and Bitcoin could be adopted at the national level as a store of value, like gold.” In fact, according to IMF data, the dollar’s share of global foreign exchange reserves has decreased from 71% in 2000 to 59% in 2022. CoinShares predicted that if the U.S. government were to adopt Bitcoin as an official strategic reserve asset, Bitcoin's credibility would increase dramatically and have a powerful impact across the global economy. see more
