The US elections were one of the most defining events for the cryptocurrency space in 2024. Specifically, the re-election of Donald Trump revived Bitcoin and the entire cryptocurrency market after an uninspiring second and third quarter.
One of the promises made by President-elect Trump in the run-up to the polls was to create a strategic reserve of Bitcoin. Not surprisingly, most of the recent cryptocurrency conversations have revolved around the BTC reserve and its potential impact on the US economy and the cryptocurrency landscape.
Why should the United States create strategic reserves of Bitcoin?
CryptoQuant CEO and founder, Ki Young Joo, is the latest to address the issue of strategic Bitcoin reserves in the United States. In a post on the X platform, the cryptocurrency expert He said Using the world’s largest cryptocurrency to offset US debt is a possible approach.
CryptoQuant CEO stated:
Over the past 15 years, $790 billion in realized capital inflows have pushed Bitcoin’s market capitalization to $2 trillion. This year alone, inflows of $352 billion added $1 trillion to its market capitalization.
Young Joo then revealed that the US could reduce its domestic debt (70% of the total) by 36% if the government acquired 1 million Bitcoins by 2050 and designated the leading cryptocurrency as a strategic asset. “While the remaining 30% of debt held by foreign entities may resist this approach, the plan does not depend on all debt being settled using Bitcoin, which makes the strategy practical,” the CryptoQuant founder added.
A chart showing BTC's realized cap | Source: Ki_young_ju/X
Young Joo believes that using “pumpable assets” such as Bitcoin to offset dollar-denominated debt may face the challenge of creditor acceptance. However, the US creation of a strategic reserve of Bitcoin could serve as a “first symbolic step” towards bringing global and national legitimacy to the major cryptocurrency – as is the case with assets such as gold.
In the post on “However, if governments continue to accumulate Bitcoin until 2050 and its price continues to rise, I doubt they will actually get rid of it,” Yong Joo concluded.
BTC price at a glance
As of this writing, Bitcoin price is hovering around the $97,000 level, reflecting a 0.4% decline over the past 24 hours. According to data from CoinGecko, the major cryptocurrency has fallen by 3.6% in the past seven days.
The price of BTC on the daily timeframe | Source: BTCUSDT chart on TradingView
Featured image from iStock, chart from TradingView
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