US House Bill Orders Study on Strategic Bitcoin Reserve

A recent spending bill passed by the House of Representatives includes a directive for the Treasury Department to explore the feasibility of creating a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile.

The Financial Services and General Government Appropriations Bill (H.R. 5166) allocates significant funds to the Treasury Department, with specific language outlining requirements for digital asset considerations. Section 137 of the bill mandates that the Treasury Department deliver a report within 90 days of the bill's enactment. This report must detail the practicality of establishing both a Strategic Bitcoin Reserve and a broader U.S. Digital Asset Stockpile.

Key Areas of Focus for the Treasury Report:

• Balance Sheet Integration: How Bitcoin and other digital assets would be reflected on the federal government's balance sheet.
• Impact on Treasury Forfeiture Fund: The potential effects on the Treasury Forfeiture Fund.
• Custody and Security: Identification of all third-party contractors responsible for the custody and security of the digital assets.

No CBDC, but a Focus on Security

The bill explicitly prohibits the use of funds for developing a U.S. Central Bank Digital Currency (CBDC). Section 130 clearly states that Treasury funds cannot be used to advise, participate in the design or development of a CBDC, or to discontinue the circulation of paper currency.

Key Takeaways:

• The bill doesn't authorize immediate Bitcoin purchases but requires the Treasury to map out how a national Bitcoin reserve could be structured, custodied, and secured.
• The focus is on building a secure and modern framework for the government to potentially hold crypto assets.
• There is clear opposition to a U.S. CBDC within this legislation.

While the future of government-held digital assets remains uncertain, this bill represents a significant step towards exploring the possibilities and challenges of incorporating Bitcoin and other cryptocurrencies into the U.S. financial system.