Will the US government start buying bitcoin en masse? If so, it will follow in El Salvador’s footsteps. And that would mean a global revolution. Literally!
Bitcoins in US government wallet
During the Bitcoin 2024 conference, Donald Trump announced that during his term as president (assuming he wins the election, of course) the US government will not sell the more than 200,000 BTC it owns (these are funds seized from criminals). In addition, Senator Cynthia Lummis told the audience that she will submit a bill to the Senate that will cause the US government to start buying BTC, which will be added to the Fed’s reserve. In total, over 20 years, the US would buy as much as 1 million BTC, or about 5% of the total supply.
It all sounds like an election promise. And nothing more. But that’s just an appearance. The idea has some basis.
The point is that the US is increasing its debt. The country’s national debt has already reached $35 trillion. And while the average American may shrug at this news, it will eventually lead to disaster. Why?
Over the next 10 years, the federal government will spend more on debt interest than on research, development, infrastructure, and education combined.
– analysts from the Peter G. Peterson Foundation now point out.
This problem will deepen. In addition, in the next few years, there is a growing threat that the world will no longer need the dollar in trade, for example as a result of the weakening of the US relative to the camp built around China.
Americans will need to somehow reduce their debt (otherwise the cost of servicing it will become a huge threat). And the rising valuation of bitcoin may help them do that.
Impact on Bitcoin Price
El Salvador is already buying Bitcoin. However, it is difficult to compare this small and insignificant country to the USA. If Americans entered the cryptocurrency market, there would be a real revolution. It is not just about another large entity buying Bitcoin. It is about the message addressed to millions of companies and investors around the world: one of the two largest powers in the world believes in the success of BTC and puts Satoshi’s digital currency on a par with gold. The latter would be adding Bitcoin to the Fed’s reserves.
Of course, such a decision by the authorities would be followed by a spike in the BTC price and a long-term upward trend (probably interrupted by corrections – after all, the biggest ones would be more willing to buy “cheap” bitcoins).
The idea of the US starting to buy BTC has a substantive basis. The problem is convincing the deep state, the entire system of officials or politicians who actually govern America, of this vision. Yes, despite a certain stereotype, the power of the president in a superpower is very limited. Lummis’ idea may therefore be met with mockery or even hostility. It is also unlikely to be implemented. At least now. In 10 years, however, we may live in a completely different reality, in which many countries “patch up” their weakening reserves with bitcoins.
