Selling Gold for Bitcoin: US Senator’s Game-Changing Proposal
U.S. Senator Cynthia Lummis (R-WY) shared insights during a Thursday interview with CNBC as bitcoin reached a historic peak. She attributed BTC’s price movements to two primary factors: rising momentum for digital asset regulations and emerging discussions on a strategic bitcoin reserve.
Referencing her collaborative efforts with Senator Kirsten Gillibrand (D-NY) on crypto legislation expected to advance in early 2025, Lummis highlighted the increasing demand in Washington for clear crypto guidelines, stating:
There’s an appetite now to do a statutory framework for digital assets.
Another factor she identified was the market’s response to bold proposals like establishing a strategic bitcoin reserve. This concept suggests that the U.S. government could leverage bitcoin as a tool to fortify the dollar and address the national debt. President-elect Donald Trump has proposed creating a U.S. strategic bitcoin reserve, aiming to position the country as a leader in cryptocurrency innovation. This initiative aligns with Lummis’s Bitcoin Act, introduced in July, which recommends that the U.S. Treasury accumulate one million bitcoins over five years.
Lummis emphasized that the U.S. could establish the reserve without spending new funds by leveraging existing assets. Reserves at the 12 federal reserve banks, including gold certificates valued at 1970s levels, could be adjusted to current market value and converted into bitcoin, she suggested. Additionally, Lummis noted that the government already holds over 200,000 BTC through asset forfeiture, providing an initial source for the reserve without requiring new expenditures.
This would be an asset that could help shore up the U.S. dollar as the world reserve currency and serve as a reserve that could be used to reduce the national debt significantly.
Responding to concerns about conflict of interest, Lummis clarified that her bitcoin holdings are in a blind trust. “I had five bitcoin and put them along with other stocks I owned into a blind trust,” she revealed. A blind trust is a financial arrangement where a third party manages assets on behalf of the trust’s owner without the owner having any knowledge or control over the specific holdings or transactions. This setup is typically used to avoid potential conflicts of interest, particularly for public officials or individuals in positions of influence.
Emphasizing that bitcoin is a commodity, the senator concluded: “Bitcoin is legal tender in another country, and we need to recognize that as Americans bitcoin is a store of value and a means of exchange that has characteristics of a commodity so it’s very different from other assets.”
Source:news.bitcoin.com
