Sen. Cynthia Lummis (R-Wyo.) said in a Wednesday podcast that the U.S. acquiring more than 5% of Bitcoin’s supply as a strategic reserve could “erase” the country’s ballooning national debt.
Is Bitcoin The Key To Improving US Fiscal Health?
In a conversation with Bitcoin Magazine host Spencer Nichols, Lummis stated that acquiring just 5% of Bitcoin’s total supply— roughly 1 million $BTC—and holding it for 20 years could reduce the national debt, currently over $39 trillion, by one-third to one-half.
“And if we held even more than 5% of the world’s Bitcoin, it could actually erase our debt. So this is an important asset in a buy-and-hold strategy,” the cryptocurrency-friendly lawmaker added.
The BITCOIN Act
Lummis has long advocated for the passage of , a bill proposing the acquisition of 1 million $BTC over five years, leveraging budget-neutral strategies such as Federal Reserve remittances and gold certificate revaluations.
The Republican was not optimistic about the bill’s chances in the Senate, but expressed hope that the House version, introduced by Nick Begich (R-AK), would pass.
The U.S. government holds 328,352 $BTC, worth approximately $20.29 billion, according to on-chain analytics firm Arkham, with the majority seized from criminal and civil forfeiture proceedings.
While Bitcoin advocates argue that rotating capital from gold to Bitcoin could generate exponential long-term returns for $BTC, critics warn that selling over 8,000 tonnes of U.S. gold reserves and damage the credibility of U.S. reserves.
Critics have also highlighted Bitcoin’s volatility as a major concern, noting that it can drive prices higher during accumulation phases while increasing the risk of sharp reversals afterward.
After all, the cryptocurrency has collapsed nearly 52% from its record highs of $126,198.07 set in October last year.
‘Innovation Doesn’t Wait For Regulatory Clarity’
Lummis also weighed in on the importance of regulatory clarity for cryptocurrency, warning that without it, innovation could shift away from the U.S.
“I refuse to let that keep happening on my watch,” she added.
Price Action: At the time of writing, $BTC was exchanging hands at $60,726.20, down 2.92% in the last 24 hours, according to data from Benzinga Pro.
Photo: Memory Stockphoto / Shutterstock
