Two 50-page policy proposals detailing the plan. Details will be discussed with President-elect Donald J. Trump and his advisors. And we're talking to cabinet candidates about how to pay for it.
On the eve of Trump's inauguration, the crypto industry is pressing the incoming administration to implement an audacious plan unimaginable just a year ago: a government program to buy and hold billions of dollars in Bitcoin. are.
During his campaign last summer, Trump vowed to create a federal “Bitcoin stockpile” that would serve as a “permanent national asset that benefits all Americans.” Bitcoin enthusiasts hailed the idea as potentially transformative and argued it could help reduce national debt. There is still a possibility that Mr. Trump will abandon the plan, and the details are still being debated. But industry executives have spent weeks lobbying to finalize the proposal, raising hopes that Mr. Trump will act soon after taking office.
In recent days, cryptocurrency industry executives have challenged David Sachs, the venture capitalist whom Trump appointed to oversee cryptocurrencies and artificial intelligence, to discuss crypto policy, according to three people familiar with the matter. He provided input on possible executive orders targeting several areas. Bitcoin stockpiling is also part of those discussions, two of them said.
“This could be a Day 1 effort,” said Pete Rizzo, editor of industry news publication Bitcoin Magazine. “It's certainly an idea that has made great strides in a short period of time.”
By some estimates, the U.S. has $19 billion in Bitcoin seized from criminals over the years, and the government has recently moved to sell that Bitcoin. Some crypto industry executives are urging Trump to continue holding on to his Bitcoin, and an executive order would likely allow him to do so. Some are pushing more ambitious plans for the government to acquire tens of billions of dollars in new Bitcoin and build a “strategic reserve” similar to the federal government's gold or oil reserves. Spending that amount would likely require Congressional approval.
Proponents of the plan argue that profits from Bitcoin stockpiles will help chip away at the $36 trillion national debt, and that if the world economy is one day run on cryptocurrencies, the U.S. They claim that they can secure a competitive advantage.
But the most obvious beneficiaries will be those who already own Bitcoin, which soared to a record price of $100,000 last month. Prices are likely to rise further if there is any indication that the government is planning a takeover. In September, Trump launched his own cryptocurrency venture, World Liberty Financial.
Some crypto executives have privately said they are concerned that the plan could give the industry the impression of greed, and many financial experts believe that Bitcoin's price has declined for years. They point out the wild fluctuations and dismiss the plan as an act of self-interest.
“There's nothing strategic or sensible about this idea,” said Eswar Prasad, an economist at Cornell University. “While this is certainly a great deal for current Bitcoin holders, it would certainly be a bad deal for taxpayers as well.”
But the very fact that Bitcoin stockpiling is being considered shows how dramatically the political winds have shifted after years of regulatory crackdown on the crypto industry.
Brad Garlinghouse, CEO of cryptocurrency company Ripple, said in an interview that he recently had dinner with Trump at Mar-a-Lago and that Trump encouraged the president-elect and his advisers to establish a federal stockpile. He said he encouraged it. It includes Bitcoin and other cryptocurrencies including XRP, a coin closely related to Ripple's business.
“He's concerned about whether he's really going to be able to accomplish what he wants as crypto president,” Garlinghouse said.
Two 50-page proposals for new policies released by Bitcoin advocacy groups were circulated among industry executives and Trump allies. And in recent weeks, Wyoming Republican and cryptocurrency advocate Sen. Cynthia Lummis said she has discussed a plan to buy 1 million bitcoins over five years with Trump's transition team, including Cabinet nominees. This was revealed by two people familiar with the matter. .
Asked for comment for this article, Brian Hughes, a spokesman for Trump's transition team, said the president-elect “will deliver on his promise to encourage American leadership in cryptocurrencies and other emerging technologies.” Ta.
Bitcoin enthusiasts have speculated for years about the U.S. government's stockpile, a stockpile of digital gold in addition to the nation's physical gold holdings. Federal authorities have amassed about 200,000 bitcoins in criminal seizures, including billions of dollars worth of virtual currency from hackers who looted the online drug market Silk Road.
But the idea that the U.S. could hold on to its Bitcoin forever or acquire more of it on the open market came after Trump dismissed the cryptocurrency as a “scam” in 2021. It did not gain momentum until it adopted virtual currency in election campaigns.
In July, just before speaking at a popular Bitcoin conference in Nashville, Trump met privately with cryptocurrency executives and broached the idea of stockpiling Bitcoin, according to Anchorage Digital, who attended the rally. said Nathan McCauley, who runs the. , provides storage options for digital currencies. On stage at the conference, Senator Lummis announced the Bitcoin Act, a bill that would require the United States to purchase 1 million Bitcoins over five years.
In his speech, Trump stopped short of explicitly calling on the government to buy more Bitcoin. But he pledged to transform the country's existing holdings into the “core” of a “national Bitcoin stockpile” and praised the cryptocurrency as a “wonder of technology.” He appeared to double down on his promise in an interview on the New York Stock Exchange last month when asked if he would stockpile cryptocurrencies. “Yes, I think so,” he replied.
The most vocal advocate of this idea in the industry is David Bailey, CEO of Bitcoin Magazine, which hosted the Nashville conference. Bailey has claimed credit for helping shape Trump's views on Bitcoin, and said the two met before the meeting last year. Mr. Bailey recently acted as an intermediary for cryptocurrency executives seeking to contact people close to Mr. Trump, two executives familiar with the matter said. Mr. Bailey declined to comment.
Trump's remarks in Nashville instantly turned what sounded like an outlandish proposal into one of the industry's top policy goals. Michael Saylor, executive chairman of MicroStrategy, which holds more than $40 billion in Bitcoin, likened the creation of the Bitcoin Reserve to the Louisiana Purchase.
“Bitcoin is America’s manifest destiny,” Saylor, a friend of Trump’s son Eric, said at an industry conference in November.
Cryptocurrency companies have recently stepped up their advocacy efforts, eager to profit from Bitcoin stockpiling plans in any way they can.
Last month, Anchorage Digital released a white paper on how to set up Bitcoin reserves and contest contracts to protect government crypto holdings that could eventually come under Treasury oversight. are planning.
“There are new people within the Treasury that are likely to take on this responsibility, and they need to be trained,” McCauley said in an interview. “We’re pretty heavily involved.”
Lobbying has also intensified at the state level, with well-funded crypto industry associations often successfully shaping laws and regulations. Lawmakers in Texas, Ohio, Pennsylvania, New Hampshire, North Dakota, and Oklahoma have proposed bills that would create state-controlled cryptocurrency reserves. Some of the language in these proposals mirrors model legislation circulated by the pro-Bitcoin nonprofit Satoshi Action Fund.
Dennis Porter, the group's chief executive, said in an interview that he is working with state legislators across the country to promote Bitcoin stockpiling. Lawmakers in several other states are also drafting bills to establish their own reserve funds, he said.
“The draft is sitting in our inboxes,” Porter said.
Erin Griffith contributed reporting.
