A brand new Home invoice launched Friday would lock in President Trump’s unprecedented govt order establishing a Strategic Bitcoin Reserve, signaling the GOP’s deepening embrace of digital belongings as fiscal and geopolitical leverage instruments.
The invoice, H.R. 3798, sponsored by Rep. Tim Burchett (R-TN), goals to codify Government Order 14233, signed by Trump.
The order halted federal Bitcoin auctions and directed companies to consolidate BTC holdings below Treasury’s administration. If enacted, the laws would make sure the long-term existence of a U.S. Bitcoin reserve and a Digital Asset Stockpile for seized altcoins, shielding this system from future repeal.
“It’s time we handled Bitcoin just like the strategic asset it’s,” Burchett mentioned in a press release.
From forfeiture to fortress
Over the previous decade, the U.S. authorities has gathered 198,000 BTC, at present valued at over $21.32 billion, by forfeitures linked to prison enforcement actions. Previously, a lot of that Bitcoin was auctioned off, together with massive gross sales in 2014–2021 at fractions of at this time’s costs.
These early auctions forfeited over $21 billion in upside features. EO 14233 and now Burchett’s invoice purpose to cease the bleeding by treating the digital forex as a long-term strategic hedge fairly than liquidating it for short-term money.
“That is our digital Fort Knox,” Treasury Secretary Vivek Ramaswamy mentioned on the March rollout, promising “budget-neutral and innovation-positive” implementation.
Below the invoice, no taxpayer {dollars} can be spent to accumulate extra Bitcoin. As an alternative, BTC should come from future enforcement seizures, asset swaps, or market-neutral transfers. Altcoins acquired in related methods can be held in a separate “Digital Asset Stockpile,” which the Treasury may promote at its discretion.
The laws mandates inter-agency BTC transfers to Treasury custody and bars any gross sales with out presidential waiver, successfully nationalizing the U.S. authorities’s Bitcoin place until reversed by future laws.
A strategic hedge or digital gamble?
Supporters examine the reserve to a digital gold commonplace, a decentralized asset proof against inflation, geopolitical manipulation, or central financial institution defaults. The reserve’s proposed five-year goal is 1 million BTC, about 5% of the entire provide.
“That is our Louisiana Buy second,” mentioned Sen. Cynthia Lummis (R-WY), who plans to introduce a Senate companion invoice this week.
However critics argue that Bitcoin’s volatility and cybersecurity dangers make it a poor candidate for a nationwide strategic asset. Rep. Brad Sherman (D-CA), a vocal crypto skeptic, referred to as the invoice “crypto cosplay that dangers taxpayer {dollars} and world credibility” at an April Home Monetary Companies listening to.
The legislative push comes because the Federal Reserve continues exploring a CBDC, which Trump has vowed to dam. “Not on my watch,” the President mentioned on the Bitcoin 2024 convention final 12 months.
That convention additionally marked the primary public unveiling of the reserve idea, a marketing campaign promise that has since morphed into federal coverage, and now, presumably regulation. Presidential Government Orders will not be regulation until ratified by Congress.
With Bitcoin reaching an all-time excessive of $111,900 in Could and company treasuries growing BTC allocations, Burchett’s invoice faucets into rising perception in Bitcoin as a monetary backstop.
What Comes Subsequent
H.R. 3798 has been referred to the Home Monetary Companies Committee. Chair Patrick McHenry (R-NC) is anticipated to schedule a listening to this summer season, with Senate motion prone to comply with.
How Treasury will securely handle BTC custody, whether or not by chilly wallets, multisig preparations, or third-party custodians, stays an open query.
Additionally it is unclear how reserve holdings may have an effect on broader fiscal or financial coverage, together with debt ceiling negotiations or Federal Reserve collateral frameworks.
