Quote from: Orluemma on June 16, 2025, 05:54:40 PM

Quote from: fillippone on December 09, 2024, 10:49:56 PM

[edited out]

Lately, there's been growing buzz around the idea of a Bitcoin Strategic Reserve (BSR) a concept where the U.S. government would hold Bitcoin in the same way it holds gold or oil. The idea isn’t as far-fetched as it may sound. In fact, some argue it's already influencing Bitcoin's price momentum past the $100,000 barrier.

But before we get carried away, it’s worth taking a closer look at what this proposal actually means, and more importantly, what we’re not talking about enough.

What is a Strategic Reserve?
A strategic reserve is basically a safety stockpile — a stash of critical resources that a government or large institution keeps aside to prepare for economic shocks, supply disruptions, or emergencies. These are usually items essential to national security or economic stability, like oil, natural gas, gold, or even grain.

In the U.S., two of the most famous examples are:
The Strategic Petroleum Reserve (SPR): where over 390 million barrels of oil are stored along the Gulf Coast.

The Gold Reserve: with over 8,000 metric tons of gold held mostly in Fort Knox, worth about $700 billion.
These assets serve as national insurance policies — not things to be spent casually, but to be tapped in times of crisis.

The Bitcoin Proposal: The B.I.T.C.O.I.N. Act
In July, U.S. Senator Cynthia Lummis proposed that the country create a Bitcoin Strategic Reserve. She introduced the B.I.T.C.O.I.N. Act — short for Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide. The core idea? Treat Bitcoin as a strategic long-term reserve asset, just like gold.

The plan includes:
Funding the reserve using gold certificates that the Fed already holds (marked to today’s gold prices).
Avoiding taxpayer money by using those gold profits to buy Bitcoin.

Acquiring 1 million BTC over time, beginning with 200,000 BTC a year for four years.
Having the Department of Justice contribute 208,000 BTC seized from the Silk Road case.

Holding the Bitcoin for at least 20 years.
While the idea sounds innovative, there are several key concerns that aren’t getting enough attention:

1. Bitcoin Is Volatile
Gold is relatively stable. Oil prices can fluctuate, but they’re still tied to supply and demand. Bitcoin? It can lose half its value in a few months. If the U.S. government locks up a huge amount of BTC, a massive drop could make the reserve look reckless — even if the long-term thesis is solid.

2. Where Will They Store It?
1 million BTC is a huge target for hackers. The proposal doesn't explain how the government plans to securely store and manage such an enormous amount of digital assets. Cold storage? Multisig wallets? External custodians? That’s a serious gap.

3. Why 20 Years?
The proposal says the BTC should be held for 20 years but why that number? Is it linked to economic forecasts, inflation cycles, or simply a guess? The logic needs to be explained if it’s going to be credible.

4. What Happens If Bitcoin Becomes “Too Valuable”?
If Bitcoin hits $1 million, this reserve could easily be worth more than the gold reserve. What would that mean for monetary policy? Could Bitcoin undermine the dollar, or would it back it up? There’s no roadmap here.

5. The Silk Road Coins Could Be Controversial
Those 208,000 BTC from the Silk Road case were seized in a criminal investigation. Using them in a strategic reserve could invite legal challenges or ethical debates. The idea isn’t bad but it needs careful framing.

6. Public Opinion Isn’t Addressed
Let’s be honest not everyone in Congress (or the general public) loves Bitcoin. Some see it as a Ponzi scheme or tool for crime. Others worship it as financial freedom. The proposal doesn’t address how it plans to win over skeptics, which is crucial for something this bold.

7. Global Reactions Could Be Intense
If the U.S. creates a Bitcoin reserve, what will China or the EU do? Will it spark a global Bitcoin arms race? What about countries that have banned crypto altogether? We haven’t thought enough about the geopolitical impact.

A Great Start But Needs More Work

The idea of a Bitcoin Strategic Reserve isn’t crazy. In fact, it makes sense for a world that’s moving digital and where traditional financial systems feel shaky. But just like any major policy shift, it needs to be deeply thought through.

Right now, the excitement is drowning out the caution. Before we celebrate, we need to talk about custody, risk, duration, international fallout, legal concerns, and the tech side of this plan. Because once the U.S. goes down this path, there may be no turning back.

You think that there is some value to quote all of OP? And, then what good does it do for actual forum members to be considering communicating with a bot rather than the ideas of a real person?