Starting in 2024, digital assets such as BTC will gradually enter the mainstream and become an important topic for institutional investment and cultural discussions. Moreover, with the listing and issuance of Bitcoin spot ETFs in the U.S. securities market, the size of institutional and corporate positions has also increased rapidly, and BTC's role as "digital gold" has been further strengthened.

Supporters generally believe that BTC can become a powerful inflation hedging tool, with hedging capabilities comparable to gold. At the same time, as time goes by, BTC will appreciate significantly and more financial institutions will accept it as a store of value.

In the 2024 US election, Republican presidential candidate Trump publicly expressed his support for the encryption industry and proposed the idea of ​​"establishing a BTC reserve" , in one fell swoop, pushed BTC to a high point of public opinion, and also ignited the encryption market’s expectations for the future.

Now that the U.S. presidential election has come to an end, Trump’s charismatic plan to “build a BTC reserve” can “turn the ideal into reality” "?"

Reviewing the idea

U.S. Republican Senator Cynthia Lummis of Wyoming is actively promoting the development of digital assets , representatives of crypto activists who criticized the U.S. Securities and Exchange Commission’s harsh enforcement tactics against the crypto industry. In July 2024, Cynthia Lummis also proposed a bill related to BTC assets. The core contents of the bill proposal include:

Proposed to establish a system governed by the U.S. Department of the Treasury A managed decentralized network of BTC storage facilities (commonly referred to as BTC vault).

It is proposed that the United States acquire up to 200,000 BTC each year in the next five years. This move will increase the size of the United States’ BTC reserves to 100 Ten thousand BTC, which accounts for approximately 5% of the total supply of BTC.

It is proposed that the United States should hold the above-mentioned BTC for at least 20 years, and these BTC can only be used exclusively to repay US debt. Within 2 years after the implementation of the bill, the proportion of the above-mentioned BTC sold by the United States cannot exceed10%.

Proposed to re-evaluate the gold certificate (Gold Certificate) and adjust the value of the gold certificate held by the U.S. Federal Reserve System to the actual market value, to actually increase the value of assets and provide financial support for the acquisition of BTC.

Looking back, the BTC bill proposed by Cynthia Lummis seems to be in the same vein as the "establishing BTC reserve" plan advocated by Trump. . After Trump won the popular vote in the presidential election, Cynthia Lummis also publicly expressed her excitement on social platforms.

Status Progress

On October 25, 2024, Pennsylvania, USA voted in favor of 176 , the "Bitcoin Bill of Rights" (Pennsylvania House Bill 2481) was passed with 26 votes against, creating a new milestone in digital asset regulation.

The core provisions of the "Bitcoin Bill of Rights" include: individuals and companies have the right to keep digital assets by themselves, operate blockchain nodes, and operate under unrestricted municipal regulations. Trade without interference.

The bill was sponsored by U.S. Republican Representative Mike Cabell and received bipartisan support, reflecting the growing recognition of the transformative potential of blockchain technology across parties. However, according to media platform Forbes, all 26 votes against the “Bitcoin Bill of Rights” came from Democratic representatives. However, well-known members of the Democratic Party supported the passage of the “Bitcoin Bill of Rights” and emphasized its potential to stimulate economic growth and improve the Contribute to financial inclusion.

Following the passage of the "Bitcoin Bill of Rights", U.S. Republican Representative Mike Cabell teamed up with another Republican Representative Aaron Kaufer to file another proposal on November 14, 2024 Pennsylvania House Bill 2664), a core proposal of the bill is to allow the Pennsylvania Secretary of the Treasury to allocate 10% of the general fund, emergency fund, and state investment fund to the purchase of BTC and trading products on digital asset exchanges, echoing the BTC reserve plan initiated by Trump.

According to reports from the media platform Decrypt, if the above-mentioned bill is passed, the scale of BTC acquisitions in Pennsylvania alone may be as high as $970 million.

△ Source: Trump Digital Trading Card #10004

Possible future

In addition to the plan to establish a BTC reserve initiated during the election phase, after winning the presidential election, the Trump team Disclosed support related to the crypto industry also includes:

An official position dedicated to digital assets will be established in the White House. A report published by Bloomberg stated that Trump would appoint a “crypto-asset czar.” At present, it is not clear what kind of budget and team this position will be allocated, and what kind of supervisory power it will have. However, as an internal position in the United States, it is speculated that the primary function of this position will be more focused on affairs rather than directly participating in the formulation of the position. Officials are more likely to become liaisons with federal regulators and outsiders.

Trump supporters entrepreneurs Elon Musk and Vivek Ramaswamy will serve under Trump The president will co-lead the proposed "Department of Efficiency" (DOGE, which has the same name as the digital asset backed by Elon Musk, but it is not a formal federal department) to provide advice and guidance from the outside and promote large-scale structures. Reform and create unprecedented entrepreneurial methods.

Although the "Efficiency Department" does not involve reforming the encryption industry, after the news of the establishment of the "Efficiency Department" was announced on November 12, 2024, it will be closely related to the " The market value of DOGE, a digital asset with the same name as the "Ministry of Efficiency", suddenly started to rise. On November 23, 2024, the market value reached its highest value in recent times. Compared with the market value the day before the news was announced, the increase was approximately 56%.

In addition to activities, after winning the presidential election, Trump’s corporate groups are also making frequent moves in the encryption market:

According to the Financial TimesAccording to reports, Trump’s company Trump Media and Technology Group is considering acquiring Bakkt, a digital asset trading platform launched by Intercontinental Exchange, the parent company of the New York Stock Exchange.

Digital asset trading platform Bakkt is closely related to Trump’s political election experience. Bakkt’s first CEO was Kelly Loeffler, who was later appointed to the U.S. Senate and was the wife of Intercontinental Exchange CEO Jeffrey Sprecher, who co-chaired Trump’s inaugural committee.

On November 18, 2024, Trump Media and Technology Group submitted a trademark application for "TruthFi" to the U.S. Patent and Trademark Office. According to the content of the trademark application documents quoted in media reports, the scope of use of the trademark covers areas related to digital wallets and payment services. Many industry insiders speculate that this may be a signal that the Trump Business Group is preparing to officially enter the field of digital asset trading services.

Questions and Challenges

On November 28, 2024, the highest price of BTC market value on that day It once rose to $99,660, approaching the $100,000 mark, setting a recent record high. Since Trump’s popular vote victory in the presidential election on November 5, 2024, BTC’s market value has increased by more than 40%.

Despite the high market sentiment, most industry players are betting that Trump will be friendlier to the crypto industry than Biden and will not only implement more favorable policies Regulatory measures for the development of the encryption industry will further enhance the value status of digital assets. However, there are also cautious financial scholars and industry insiders who have criticized and questioned this. They generally believe that the concept of establishing a BTC reserve plan is groundbreaking, but at present it is unlikely to become a reality soon. These questioning views, which are also worth pondering, focus on the following aspects:

BTC's asset stability is limited, and so far it has not been able to demonstrate its ability to serve as a reserve asset. required stability. If you also participate in large-scale acquisitions of digital assets in your own name, it will indeed push up the market price of digital assets in a short period of time, but it can easily cause market distortion.

It is inconsistent with the cautious stance taken by the United States on the crypto industry so far. If BThe launch of the TC reserve plan means that there is a possibility that the United States will invest financial funds in acquiring BTC. However, such an operation is not in line with the current cautious stance of the United States on the encryption industry, and the planning of these funds is to transfer from relatively stable investments to the field of digital assets, which will increase unnecessary risks to the finances.

There will be huge changes at the regulatory level. If you want to support the longer-term operation of the BTC reserve plan, it not only means that there needs to be a huge change in the regulatory level, but also means that industry participants must also change their attitude towards holding decentralized assets - from radical to conservative, from The pursuit of high volatility turns into long-term stable holdings - and all of this is not an easy and simple thing that can be achieved in a short time.

When the fiscal deficit is high, the financial strategy of investing in unstable assets is generally not adopted. According to data released by the U.S. Department of the Treasury, in fiscal year 2024 (i.e., from October 1, 2023 to September 30, 2024), the United States will spend $6.75 trillion, receive only $4.92 trillion, and the fiscal deficit will reach $1.83 trillion. , the total debt reached US$36.035 trillion, both hitting record highs.

As for Trump’s remarks in an interview with the media during the presidential election, “Maybe crypto checks or BTC can be used to repay the United States. The idea of ​​​​"foreign debt" cannot easily be supported by all creditors, unless BTC The market value tends to be extremely stable or is exchanged for something of considerable value. Just imagine which type of creditor would be willing to accept an asset that is prone to large fluctuations in value in a short period of time and is obviously not very safe as debt. What about repayment? In addition, the basis for the issuance of sovereign debt is credit endorsement. Regarding the "decentralization" concept upheld by the encryption industry, if any creditor accepts the use of BTC to repay national debt, BTC will be given credit. At the same time, BTC itself is an asset with a limited amount. When more creditors accept BTC to repay national debts, the value centralization trend given to BTC will become more obvious - and the final result of all this is that centralization will be able to manipulate The actual value of BTC is different from the nature of a person who recognizes the use of BTC as a general equivalent.

Institutional-grade storage solutions may have major vulnerabilities, making it difficult to completely avoid the risk of cyber attacks. In addition, BTC Mining has a huge impact on energy consumptionEnvironmental concerns raised by BTC are already a contentious challenge, and a push for BTC reserves could further exacerbate these controversies.