According to the Financial Association News on November 15 (Editor: Xiaoxiang), the elected president of the USA, Trump, currently has an ally in the U.S. Senate who is proposing a bold plan. This plan can fill the bitcoin strategic reserve that Trump proposed to establish without increasing the federal government deficit, and the method is very straightforward: to sell part of the Federal Reserve's gold reserves...

Republican Senator Cynthia Lummis from Wyoming plans to promote a bitcoin bill (BITCOIN Act) when the new Congress takes office next year to achieve this goal. The bill requires the USA to purchase 1 million bitcoins, which accounts for nearly 5% of this largest circulating token.

Based on current market prices, the purchase of 1 million bitcoins will cost about 90 billion dollars—of course, if the bill is passed, and investors buy ahead of the government, the spending amount is likely to increase.

In a media interview, Lummis stated, "We (on the Federal Reserve's balance sheet) already have financial assets in the form of gold certificates, which can be converted into bitcoin. This move will have a very neutral impact on the balance sheet of the USA."

It is worth mentioning that the aforementioned bill proposed by Lummis will greatly expand the scope of the bitcoin strategic reserve plan that Trump has revealed so far, namely, the over 0.21 million bitcoins currently held by the U.S. government, which were confiscated during the crackdown on illegal activities or asset seizures.

According to Lummis's bill, the holding period for cryptos should be at least 20 years, and the assumed appreciation will help reduce the issuance of national debt.

At least theoretically, the gold owned by the Federal Reserve is indeed sufficient to purchase 1 million bitcoins, and there would still be plenty left.

The Federal Reserve's balance sheet lists the gold certificates held by the Treasury, nominally valued at approximately 11 billion USD. However, this value is calculated based on the so-called statutory price, which has remained at 42.2222 USD per ounce since 1973. In contrast, based on the current actual spot price, the real value of this gold is as high as 675 billion USD.

Of course, if the usa authorities really conduct a large-scale gold sale, it would certainly bring the risk of pushing down gold prices.

Will the bill be approved.

So, how much hope is there that the bill currently planned by Lummis will be approved by Congress.

Some market observers noted that despite the hope for numerous bitcoin advocates following the change of the White House, the crypto community also hopes that this will be the most crypto-friendly Congress in history, but without a common sponsor for the above bill, it may be destined to face a tough battle.

The pricing on the crypto prediction platform Polymarket currently indicates that the likelihood of Trump really establishing a bitcoin reserve after taking office is only 31%.

Jennifer J. Schulp, Director of Financial Regulatory Research at the Cato Institute's Center for Monetary and Financial Alternatives, pointed out, "This (establishing a bitcoin reserve) essentially puts government funds at risk, and bitcoin has not shown itself to be a particularly stable asset. The bill attempts to instill greater confidence in its long-term feasibility among senators and representatives, even though these lawmakers may not be very familiar with cryptos."

Michael Novogratz, the billionaire head of the crypto investment company Galaxy Digital, also expressed in an interview that he believes the possibility of the usa establishing a bitcoin strategic reserve is very low. If the usa indeed establishes such a reserve, Novogratz expects that this will push the bitcoin price up to 0.5 million USD, as other countries will also be forced to establish similar reserves.

However, Lummis remains optimistic that her bitcoin bill will gain support in the next Congress. She stated that Trump has acknowledged the idea of establishing a bitcoin reserve, and some of his closest advisors include those who understand bitcoin and its role in our future world.

Editor / jayden