Senator Cynthia Lummis Introduces Federal Bitcoin Reserve Bill
Date: 2024-08-01 Author: Henry Casey Categories: IN WORLD
Senator Cynthia Lummis has introduced a bill that could be a significant step in integrating cryptocurrency into the U.S. financial system. The bill, known as the “BITCOIN Act of 2024,” proposes creating a federal reserve of bitcoin worth 1 million BTC over five years. This project promises to be an important element of the national economic strategy.
Key Provisions of the Bill
According to information obtained from a draft of the bill, a federal program called the “Bitcoin Purchase Program” would involve the Federal Reserve purchasing up to 200,000 BTC annually. These crypto assets would be stored in a decentralized network of vaults across the country, with custodians selected based on a comprehensive risk assessment, including geographic diversity, security, and availability.
The bill also sets strict rules for managing the reserve. Bitcoin sales will only be allowed after 20 years and only for the purpose of paying off the national debt. After that, the Fed will be able to sell up to 10% of the reserve every two years to meet any needs.
One of the sources of funding for the creation of the bitcoin reserve will be the revaluation of “gold certificates”. These certificates, issued between 1882 and 1934, will be transferred to the Treasury Department to be revalued in accordance with the market value of gold. The difference between the old and new valuations will be sent to the Treasury and used to buy bitcoins.
Transparency and Reporting
The bill requires the Treasury to publish quarterly reports on the value of the bitcoin portfolio. This will ensure transparency and allow changes in the value of the reserves to be tracked.
Senator Lummis announced the bill at the Bitcoin 2024 conference in Nashville. The idea of creating a federal Bitcoin reserve has found support from high-profile political figures, including presidential candidates Donald Trump and Robert Kennedy Jr.
Senator Lummis emphasizes that Bitcoin has unique properties that can complement existing national reserves and strengthen the position of the US dollar in the global financial system.
