U.S Congress seeks to consolidate and modernize with the BITCOIN Act, Fed Chair Jerome Powell suggests otherwise!

Under Senate Committees Banking, Housing, and Urban Affairs, the Boosting Innovation, Technology, and Competitiveness through Investment Nationwide Act, or the BITCOIN Act was introduced at the senate floor on July 31, 2024. It was a bold proclamation to the entire crypto world, the United States Government was entering the fold, officially cementing the legitimacy of the cryptocurrency that had already on its own revolutionized the way currency existed for the first time in centuries, maybe even millenia. However those dreams have recently come to a grinding halt, as the Act has not seen any progress on the floor. Despite the next Presidents adamant position on the matter, President elect Donald Trump said on Dec 12 “We’re gonna do something great with crypto because we don’t want China, or anybody else … but others are embracing it, and we want to be ahead.”, the biggest blow thus far has come from the Federal Reserve itself, Fed Chair Jerome Powell said directly “We’re not allowed to own Bitcoin. The Federal Reserve Act says what we can own, and we’re not looking for a law change,". Since his comments, Bitcoin “fell 5.9% to $100,605, retreating from its record-breaking high of $108,000 achieved on Dec. 18. The global cryptocurrency market also dropped, with its market capitalization falling to $3.67 trillion — a 7.6% drop in the last 24 hours. Other major cryptocurrencies were also hit hard. Ethereum, XRP, and Solana recorded losses ranging from 4% to 11%, reflecting a broader market correction.” (Yahoo Finance)

The U.S currently owns an estimated 203,000 Bitcoin (Approx 21 Billion at current market value), largely made up of seized assets from criminals, 144,000 of these coins were astonishingly seized from Ross Ulbricbht and his illegal dark web empire “The Silk Road”.

In the proposed Bill can be summarized as follows, the full Bill is linked at the end of the article.

1. A Bitcoin Purchase Program. The U.S Government would start a 5 year initiative of purchasing an additional 200,000 coins a year totaling a million coins purchased by the end of the program. These newly purchased coins would have to be held for a minimum of 20 years to ensure long term financial responsibility.

2. It would emphasize transparency, with annual public reports on progress. Quarterly “Proof of Reserve” audits, with public cryptographic attestation of holdings. As well as independent third-party audits and oversight by the Comptroller General.

3. These coins already in possession as well as the additional million proposed to be purchased will all be held in the newly created SBR or Strategic Bitcoin Reserve. This reserve will be a decentralized network of secure Bitcoin storage facilities designed to safeguard and manage Bitcoin assets held by the Federal Government.

4. According to the Bill itself, it recognizes Bitcoin as a “digital-age” asset, and would help the U.S hedge against economic uncertainty. Additionally Bitcoins decentralized and finite nature compliments the U.S dollar and strengthens financial innovation.

5. The SBR would consolidate all Bitcoin held by federal agencies. It would also offer States the option to store their Bitcoin holdings in segregated accounts within the reserve.

If this is truly the direction the next administration intends to take, Bitcoin will have cemented itself as the dominant figure in the crypto world, and there is no telling how much the price may rise if and when the Bill is passed into law. Despite the recent comments by Chairmen Powell, it seems the crypto world is still steam-rolling ahead, and in my opinion Bitcoin will eventually get itself its own Reserve, in this ever increasing digital-age. I personally do not own nor have I ever purchased any Bitcoin, but I seriously regret not doing so, I have been exposed to this since my early teenage years. If you are willing to explore and have the financial capacity to do so, it seems Bitcoin will be an investment option and alternative for the foreseeable future.

Sources:

https://bitkan.com/learn/how-much-btc-does-the-us-government-hold-34558

https://www.congress.gov/118/bills/s4912/BILLS-118s4912is.pdf

https://finance.yahoo.com/news/fed-chair-jerome-powell-says-203140548.html