The proposal is on the table. And as the idea of making Bitcoin (BTC) part of the strategic reserves of States gains traction, so do the detractors.
The plan has been presented in a bill from Republican Senator Cynthia Lummis and has been supported by former President and candidate Donald Trump, as one of the ways to solve the debt crisis affecting the United States.
The plan contemplates the inclusion of digital currency as part of the reserves, through the purchase of a million bitcoins (5% of the total circulation of the currency) in the next five years. «The appreciation capacity of BTC would be taken advantage of», explains Lummis in an interview, reiterating the potential of digital currency to appreciate as much or more than gold.
In fact, “we know that bitcoin grows faster than gold,” the senator noted, recalling that the historical trend of Cryptocurrency register a compound annual growth rate of more than 60% in the last decade. A situation that, according to Lummis, will continue in the coming years.
Based on this characteristic, the legislator considers that the implementation of this plan It would be very beneficial for the US economy.and even to any other country or jurisdiction.
He assures, in this sense, that the only country that has implemented it is El Salvador, and the profits obtained in three years They are already around 35%. It is also being considered by the state of Louisiana in the US, where Governor Jeff Landry signed theHouse Bill 488that guarantees the right to use bitcoin.
Senator Lummis defends the inclusion of bitcoin in reserves. Source: YouTube.
But it is precisely this lack of precedents that is one of the factors that calls into question the proposal, opening the field for a battle – for and against – that is already looming on the horizon. Proponents and detractors of bitcoin as a reserve are beginning to present their arguments.
There is fear of losing control over money
On the plus side, Lummis says the United States has the opportunity to remain a leader in the cryptocurrency industry, as it has the potential and the tools to do so. She questions the fact that President Joe Biden’s administration has put that leadership at risk with its anti-bitcoin measures.
He also points out the global impact that a decision of this magnitude would cause, taking into account the position that the United States occupies in the global economy. Hence, one of the main points of friction It has to do with the global position of the dollar.
Vitaliy Katsenelson, an investor and author of several books, expresses his opinion on the matter, considering that the inclusion of BTC in the reserves is “very bad” because it would undermine the status of the dollar at a time when “sentiment towards the currency is being tested.”
“If Trump wins, This government policy will change the history of bitcoin, legitimizing it and boosting its use as a reserve currency to the detriment of the dollar,” Katsenelson says in a opinion article.
Bitcoin is not controlled by anyone, not even the US government. We can’t print more of it to fund medical or student debt forgiveness, help with down payments for first-time buyers, or cut taxes when we have massive budget deficits. What if strangers fall for another story that isn’t green and doesn’t have pictures of US presidents on it?
Vitaliy Katsenelson.
Investor fears focus on the new role that the dollar would play in the economy if bitcoin enters the reserves, possibly being diminished. This, in the face of the boom in global adoption of cryptocurrency that would arise from a decision of this magnitude.
In this sense, there are those who consider that Bitcoin would rescue the dollar from the debaclein a scenario where there is a block of countries that promotes the process of de-dollarization and that central banks are already diversifying their reserves. This is what analysts point out in a report from the River exchange, reviewed by CriptoNoticias.
But “money is more than just green paper with the faces of dead presidents on it. There are many ways to define it. One way to look at it is as a claim on the productive power and assets of a country, reflecting the value of a nation’s economic output,” Katsenelson questions.
This is an approach that Lummis shares, but with a pro-bitcoin vision. and philosophy which defends financial sovereignty“Whoever controls the money, controls the people,” the senator emphasizes, indicating that the fear caused by thethe currency created by Satoshi Nakamoto Among the powerful it is “losing control over people.”
That is why The fight is expected to intensifyif BTC is to be included in the US reserves. Lummis plans to move forward with the bill, and says she has Trump’s backing if he becomes president. It remains to be seen how the congressional debates and bipartisan actions play out.
The debate is just beginning
For now, there are those who see the proposal as unrealistic and They find it difficult to make it a reality in the short term. As comment Ari Paul, CIO of BlockTower Capital, “would bet 10:1 against the US adding bitcoin as a strategic reserve in the next 4 years.”
The policies that govern the Federal Reserve would be one of the main obstacles by not considering digital currencies, so it is thought that before adding BTC to the reserves Many changes need to be made to current legislation.
“People don’t think the U.S. could implement a Bitcoin Strategic Reserve, but at this point it’s inevitable,” said Dennis Porter, CEO and co-founder of the Satoshi Act Fund. “Everyone should have a Bitcoin Strategic Reserve. You. Your family. Your business. Your city. Your state. Your country. Everyone.” added Michael Goldstein, president of the Satoshi Nakamoto Institute.
The debate thus grows, amidst certainty and skepticism. This, at the same time as Bitcoin gains more ground in the political arena of the United States and the world.
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