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In late July, former U.S. President Donald Trump made headlines in the crypto community with a bold statement: “Never sell your bitcoin.” Addressing a crypto convention in Nashville, Tennessee, Trump outlined his campaign promise to create a national bitcoin stockpile. Read on for the details and implications of this proposal.
Trump’s Proposal: A Strategic National Bitcoin Stockpile
Trump’s Bitcoin Stockpile Plan Stirs Debate
The Policy
The Presidential candidate’s speech was a last olive branch in his efforts to reach out to voters with an interest in cryptocurrencies ahead of the November election, offering numerous campaign promises such as plans for a State bitcoin reserve.
“If elected, it will be the policy of my administration to keep 100% of all the bitcoin the U.S. government currently holds or acquires into the future,” Trump said, adding the funds would serve as the “core of the strategic national bitcoin stockpile.”
Other Advocates
Trump isn’t the only one involved in this proposal. Senator Cynthia Lummis has introduced legislation to purchase one million bitcoins (approximately 5% of the total supply). Robert F. Kennedy Jr., an independent candidate, has also suggested a government stockpile of four million bitcoins.
A strategic reserve would be appropriate for the enormous amount of bitcoin held by the U.S. government. However, it remains unclear whether it’s feasible and whether it might even benefit the entire crypto market.
The U.S. Government’s Crypto Holdings
The U.S. government currently holds 203,239 Bitcoin tokens worth around $11.1 billion. Most of this stash comes from criminal seizures, including those related to the Silk Road online marketplace.
Market Impact
Although a government bitcoin stockpile could potentially boost bitcoin’s price, it also raises questions. Fewer tokens available for trading might impact investors, and the idea of holding a significant portion of the total supply has sparked debate.
“It would have a positive impact on price. It would have to because we’ve never had such a limited supply commodity, albeit digital, assume a new state of a reserve asset,” said Mark Connors, head of global macro at Onramp Bitcoin. “RFK talked about having 19% of bitcoin, the same amount of the gold supply – I can’t imagine a single bitcoiner would be happy about that,” Connors added.
Global Context
China, the second-largest government holder of Bitcoin, possesses 190,000 coins. The broader crypto market awaits further developments. Many governments still wonder if they should ban digital currency or benefit from the technology of the future. It will further take time for the cryptocurrency adoption at a global stage.
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