New BITCOIN Act Proposes 1 Million BTC Purchase Over 5 Years
The U.S. Congress is considering new legislation called the BITCOIN Act that would direct the Treasury Department to create a Strategic Bitcoin Reserve by purchasing up to 1 million Bitcoin over a five-year period. According to the proposal, the government would need to hold these Bitcoin reserves for a minimum of 20 years.
Investment firm VanEck has analyzed the potential impact of this strategic reserve on the national debt. Their research suggests that by 2049, the Bitcoin holdings could offset approximately $21 trillion of U.S. debt, representing 18% of the projected total national debt at that time.
VanEck's analysis is based on several key assumptions about future economic conditions. The firm projects that U.S. debt will grow at a compound rate of 5.0% annually, expanding from $36 trillion in 2025 to roughly $116 trillion by 2049. Additionally, they forecast Bitcoin's price will increase at a compound rate of 25% per year, rising from $100,000 to approximately $21 million per Bitcoin over the same period.
The proposed implementation timeline includes:
- Five-year acquisition period to accumulate 1 million Bitcoin
- Mandatory 20-year minimum holding period for the reserve
- Regular evaluation of the reserve's impact on national debt levels
While VanEck acknowledges these projections are optimistic, they suggest the Strategic Bitcoin Reserve could introduce a new approach to managing sovereign reserves and addressing national debt challenges. The analysis explores how different variables, including U.S. debt growth rates, Bitcoin acquisition prices, Bitcoin price growth rates, and the total quantity of Bitcoin acquired, could affect the program's potential outcomes.
The BITCOIN Act represents a significant shift in how the U.S. government might approach digital asset management and long-term debt reduction strategies. If enacted, this legislation would make the United States one of the first major nations to establish a formal Bitcoin reserve as part of its national financial strategy.
The discussion around a potential Strategic Bitcoin Reserve comes amid evolving political perspectives on cryptocurrency regulation. During a recent speech at the FII PRIORITY Summit in Miami Beach, President Donald Trump addressed the topic of cryptocurrency markets, stating his support for reducing regulatory restrictions on digital assets and positioning the United States as a leader in the cryptocurrency sector. Trump linked Bitcoin's recent price performance to supportive policy positions and outlined plans focusing on artificial intelligence development alongside cryptocurrency market growth. These statements reflect broader ongoing debates about the role of digital assets in U.S. financial policy and national economic strategy.
