Sen. Cynthia Lummis of Wyoming is set to propose legislation that could establish Bitcoin as a mainstream financial asset in the United States.

At the upcoming Bitcoin 2024 conference in Nashville, Tennessee, Lummis plans to introduce a bill requiring the Federal Reserve to hold Bitcoin as a strategic reserve asset. This move would represent a significant shift in U.S. monetary policy, placing Bitcoin alongside traditional reserves like gold and foreign currencies.

While the bill’s specifics are not yet public, sources indicate it aims to include Bitcoin in the Fed’s reserves to enhance the stability of the U.S. dollar. Lummis has garnered support from Senate Banking Committee colleagues and is seeking endorsement from former President Donald Trump.

If the United States adopts Bitcoin as a strategic reserve asset, it could become the largest nation-state holder of Bitcoin. This move would align with sentiments that all remaining Bitcoin should be mined domestically. Essentially, a Bitcoin strategic reserve would involve the U.S. Treasury holding significant amounts of Bitcoin, similar to its holdings of gold or foreign currencies.

Such a reserve would affirm Bitcoin’s legitimacy and its potential future use cases, positioning the U.S. advantageously against global competitors. It would also accelerate the acceptance of Bitcoin as a form of digital gold and a long-term savings instrument.

The proposal arrives in a politically charged environment. Vice President Kamala Harris, the presumptive Democratic nominee, is being advised to adopt a more favorable stance on crypto. Given that the U.S. already holds a substantial amount of Bitcoin, the legislation could trigger a global race among nations to accumulate more of the asset.

The move would position the U.S. favorably against global competitors and accelerate the acceptance of Bitcoin as a digital gold and long-term savings instrument.

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