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## [TL；DR]: 
In July 2024, Senator Cynthia Lummis proposed the <a href="/price/bitcoin-btc" target="_blank" class="blog_inner_link">Bitcoin</a> Reserve Act (BITCOIN Act of 2024), which aims to establish a national reserve through the government’s purchase of Bitcoin and enhance U.S. financial security and leadership.

The proposal of the Bitcoin Reserve Act has attracted attention across the United States. Once passed, it will help increase the legitimacy and acceptance of Bitcoin, and may trigger a global crypto hoarding competition and push up the price of Bitcoin.

The establishment of Bitcoin reserves is not only a supplement to the existing financial system, but may also have a profound impact on the global economic pattern, marking an important step towards practical application of Bitcoin.

## Introduction
Since the approval of the listing of spot ETFs, Bitcoin’s rapid rise has triggered widespread global attention to digital assets. In particular, the Bitcoin Reserve Act endorsed by Trump has once again driven the popularity of Bitcoin around the world. This article will explain the origins and background of the Bitcoin Reserve Act, its progress, and its potential impact on the <a href="/price" target="_blank" class="blog_inner_link">crypto market</a>.
 
## BITCOIN Act of 2024: Another Macro Narrative After Bitcoin Spot ETFs
Since its inception in 2009, Bitcoin has experienced several dramatic price surges, attracting the attention of more and more investors and policymakers. Especially in the context of increasing global economic uncertainty, many countries have begun to explore how to use digital assets such as Bitcoin to enhance financial stability. As the world's largest economy, the policy trends of the United States have an important impact on the global market.

In July 2024, Senator Cynthia Lummis announced the Bitcoin Reserve Act (BITCOIN Act of 2024) at the Bitcoin Nashville Conference. At the heart of the act is a plan to purchase 200,000 Bitcoins per year over five years, for a total of 1 million Bitcoins, thereby enhancing the financial security and leadership of the United States by establishing a national Bitcoin reserve.
 ![](https://gimg2.gateimg.com/image/article/17351841511.jpeg)
Source: @SenLummis
 
The proposal quickly gained the attention of crypto-friendly individuals in the United States, and states are now actively exploring the possibility of establishing Bitcoin reserves. For example, Republican Representative Giovanni Capriglione of Texas has proposed legislation to establish a strategic reserve in Bitcoin, with plans to receive taxes, fees, and donations through Bitcoin to enhance the state’s fiscal stability. Florida and Pennsylvania are also working on similar acts and are expected to establish their Bitcoin reserves by 2025.

Even President-elect Trump has publicly expressed support for establishing a “national Bitcoin reserve” while preventing the government from selling existing Bitcoin reserves, further fueling discussion and attention on the proposal.
 ![](https://gimg2.gateimg.com/image/article/17351841812.jpeg)
Source: @Dennis_Porter_
 
These developments reflect not only the states’ emphasis on Bitcoin, but also the gradual acceptance of digital assets around the world. As more states join the ranks, a global race to hoard Bitcoin could develop.
 ![](https://gimg2.gateimg.com/image/article/17351841993.jpeg)
Source: coinhills.com
 
Of course, the act is still under review. Although it is relatively radical and bold, in the context of increasing global economic uncertainty and challenges to the hegemony of the US dollar, the US government and some politicians have begun to pay attention to the popularity of Bitcoin as a strategic reserve asset.
 
## What Does the Bitcoin Reserve Act Say?
The Bitcoin Reserve Act proposes to incorporate Bitcoin into the national asset reserve system through government means. This move may be achieved through various methods, and the specific operation method depends on the act's final content and implementation strategy.
 ![](https://gimg2.gateimg.com/image/article/17351842344.jpeg)
Source: lummis.senate.gov
 
Its core content mainly includes the following aspects:

-Bitcoin Purchase Plan: The act stipulates that the U.S. government will purchase no more than 200,000 bitcoins per year for five years, for a total of 1 million bitcoins. The plan is to ensure that the U.S. government can hold large amounts of Bitcoin over the next 20 years, providing the country with a long-term financial hedge.

-Establishment of secure storage facilities: To ensure the secure storage of Bitcoin, the act requires the establishment of a decentralized network of Bitcoin secure storage facilities, managed by the U.S. Department of the Treasury and distributed across the country to enhance the security and resiliency of reserves.

-Funding sources: The act proposes to use existing Federal Reserve System and Treasury funds to purchase Bitcoin, including revaluing the Federal Reserve’s gold certificates to reflect the market value of gold and using the difference to purchase Bitcoin.

-Holding Length and Usage Rules: Under the act, Bitcoin purchased by the government will be held for at least 20 years. During this period, these Bitcoins may not be sold, exchanged, or auctioned except to be used to repay the national debt.

-Legal framework: The implementation of the act requires improving the relevant legal framework and clarifying the legal status, tax policy and regulatory measures of Bitcoin to ensure the legality and operability of the act.
 
## The future of the Bitcoin Reserve Act
There are currently many differences in market opinions on the market impact of the Bitcoin Reserve Act. Some experts believe that the act will increase the legality and acceptance of Bitcoin, triggering other countries to follow suit, forming a global Bitcoin hoarding competition, thereby pushing up the price of Bitcoin. For example, Iliya Kalchev, an analyst at crypto lender <a href="/price/nexo-nexo" target="_blank" class="blog_inner_link">Nexo</a>, believes that the act may be a milestone moment for Bitcoin, marking its recognition as a legitimate global financial instrument.

In addition, economist Alex Krüger also said that the election results made him believe that "Bitcoin is very likely to be in a super cycle" and that Bitcoin's unique situation can be compared with gold.
 ![](https://gimg2.gateimg.com/image/article/17351842935.jpeg)
Source: @Cointelegraph
 
However, some experts are cautious. Chris Brunsike, former head of blockchain product at ARK Invest, believes that the Bitcoin super cycle is just a myth, stressing that investors should treat the theory with caution.

But it is undeniable that if the Bitcoin Reserve Act is passed, it may trigger a global race to hoard the currency, with other countries following suit so as not to fall behind. Lawyer George S. Georgiades said enacting the Bitcoin Reserve Act “could mark a turning point in global Bitcoin adoption” and could trigger other countries and private institutions to follow suit, driving broader adoption and enhancing market liquidity. For example, just last Friday, the El Salvador Bitcoin Office announced on Twitter that it had transferred $1 million worth of BTC to El Salvador’s strategic Bitcoin reserve.
 ![](https://gimg2.gateimg.com/image/article/17351843136.jpeg)
Source: @bitcoinofficesv
 
To sum up, the establishment of Bitcoin reserves will provide a strong endorsement for the legitimacy and mainstream acceptance of Bitcoin. It will not only supplement the existing financial system, but may also profoundly impact the global economic pattern.

However, whether the Bitcoin Reserve Act can truly operate depends on practical considerations such as executive orders, congressional legislation, funding sources, and operational strategies. This process will face multiple tests, such as market volatility, technical risks, and regulatory challenges. However, no matter what, such measures will be an important step towards the practical application of Bitcoin, and we remain optimistic about this.



<div class="blog-details-info">
<div>Author:**Charle Y.**, Gate.io Researcher
<div>Translator:Joy Z.
<div class="info-tips">\*This article represents only the views of the researcher and does not constitute any investment suggestions. All investments carry inherent risks; prudent decision-making is essential.
<div>\*Gate.io reserves all rights to this article. Reposting of the article will be permitted provided Gate.io is referenced. In all cases, legal action will be taken due to copyright infringement.
</div>


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With the proposal of the Bitcoin Reserve Act, Bitcoin is gradually moving from virtuality to reality and becoming part of the national strategic reserve.

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Analyze the Bitcoin Reserve Act and Its Impact In One Article