KEY POINTS
- Trump may declare Bitcoin as a strategic reserve for the US at Bitcoin 2024: 10x Research
- Sen. Cynthia Lummis previously 'having Bitcoin in reserve' can boost the US dollar
- Michael Saylor has talked about $BTC being a treasury reserve asset in 2021
The cryptocurrency community on X (formerly Twitter) has been abuzz since the weekend after speculation emerged that Republican presidential nominee Donald Trump may declare Bitcoin as a U.S. reserve asset during his keynote address at Bitcoin 2024 later this week. If he does make the big declaration, how will it affect market prices, and for starters, is it even possible?
Bitcoin as a strategic reserve asset
Markus Thielen, the founder of crypto research firm 10x Research, wrote in a Saturday note that "there is speculation that Trump might announce Bitcoin as a strategic reserve for the U.S., which could further boost its value."
Trump will speak on July 27, the last day of the Bitcoin 2024 conference, as his campaign works to paint him as the crypto president.
Trump wouldn't be the first politician to put the word out
If Trump does make the announcement in Nashville, it wouldn't be the first time a politician suggested that the world's largest crypto by market value can be used as a reserve asset.
Earlier this month, Sen. Cynthia Lummis, R-Wyo., said in an interview that she is happy to support legislation that will block the issuance of a U.S. central bank digital currency (CBDC).
NEW‼️- Senator Cynthia Lummis:
— Swan (@Swan) July 12, 2024
“Having #Bitcoin in reserve can help the US dollar remain strong.” pic.twitter.com/EFZIxYTw1C
"We wanna make sure people can have individual wallets for their Bitcoin so they have that sovereignty over their own money. We know we want the U.S. dollar to remain strong, and actually having Bitcoin in reserve can help the U.S. dollar remain strong," she pointed out.
Not the first advocate either
Outside politics, a prominent name in the crypto space has already floated the idea of Bitcoin being used as a reserve. Back in 2021, MicroStrategy's executive chairman Michael Saylor said "the killer use case for Bitcoin is store of value and treasury reserve asset either for family, or corporation, or government, or an institution, or trust."
#Bitcoin is the ideal treasury reserve asset for a family, corporation, government, institution, or trust. pic.twitter.com/6bwSJGVi5E
— Michael Saylor⚡️ (@saylor) November 1, 2021
While Trump won't be the first to view $BTC as a strategic reserve asset, a major ticket candidate backing the idea would be big news for the burgeoning industry. But, the big question is, is it possible, and if it is, will it work out?
'Possible' but not without challenges
Bryan Courchesne, the founder and CEO of crypto asset management firm DAIM, explained that it is definitely "possible" to make Bitcoin a reserve currency for the country, but it will be "very difficult to get done."
Former President Donald Trump set to deliver the keynote address at next week's #Bitcoin conference, as the cryptocurrency rises on election optimism. @daim_io CEO Bryan Courchesne explains the implications of a potential second Trump term on the industry. pic.twitter.com/7p306AlK5G
— CNBC's Fast Money (@CNBCFastMoney) July 19, 2024
Courchesne noted that the U.S. Department of Justice (DOJ) holds some 200,000 Bitcoins, which can be "easily" transferred to the Treasury Department "and start right there have $13 billion worth of Bitcoin on the balance sheet."
Basically, the DOJ can be seen as a "random seller in the space," he said, but if the department shifts toward becoming "a long term hodler," it could be a catalyst for pushing $BTC prices up.
Since plunging below $55,000 some two weeks ago triggered by the German government's selloffs of its seized $BTC stash, Bitcoin has gradually recovered and is trading at around $67,300.
