Senator Says Bitcoin Reserve To Come From States First

Senator Cynthia Lummis, the legislator responsible for a bill advocating the establishment of a Bitcoin reserve in the US, indicated that advancements on the plan are expected to require more time than many crypto proponents desire.

While Lummis's Senate bill calls for the US to acquire 1 million Bitcoin, Donald Trump's initial plan called for the government to hold on to about 200,000 tokens that the US already has from asset seizures.

Earlier last week, Lummis led the banking GOP's subcommittee on Digital Assets hearing on bipartisan legislative frameworks for the industry.

After the subcommittee hearing, the Senator highlighted that "most digital assets are not legally securities under the Howey test. The United States is behind other countries in creating laws for digital assets. Stablecoins will bring our payment system into the 21st century."

On Friday, at a Conference in New York, Lummis said, "My bets are that you'll see a state have a Bitcoin strategic reserve before the federal government. States are incubators of innovation."

She added, "We're seeing the United Arab Emirates purchase Bitcoin. You're going to look at some of the sovereign wealth funds around the world who are not as tied up in a democratic republic like we are, be able to just make it so."

The Senator called Bitcoin digital gold and said she is spending dollars and saving Bitcoin.

At a trade show in Nashville in July, President Trump and Republican Senator from Wyoming, Lummis, initially proposed the notion of a national strategic Bitcoin reserve.

Despite early enthusiasm for state governments to keep digital assets this year, four states' crypto reserve laws have recently failed.

Legislators in Wyoming, South Dakota, North Dakota, and Montana have recently opposed the idea of cryptocurrency reserves at the state level, citing concerns about the potential hazards and volatility of digital assets.

According to Bitcoin Laws, 24 states have introduced bills regarding cryptocurrency reserves.

Lummis' home state's House of Representatives shot down a plan to legalize Bitcoin investments in early February. Just one lawmaker voted in favour of the measure.

A recent vote in the South Dakota House of Representatives defeated a reserve bill that would have allocated up to 10% of state assets to Bitcoin.

Instead, lawmakers decided to put the matter on hold.

The House of Representatives voted down Montana's bill last week by a margin of 41 to 59.

Despite worries about volatility in other jurisdictions, Ohio, which has introduced laws to create a cryptocurrency reserve in the House and a Bitcoin reserve in the Senate, is hopeful about the bills' benefits.

The Government Oversight Committee in Oklahoma approved establishing a strategic Bitcoin reserve on Tuesday.

Nevertheless, it remains to be determined whether there is a universal readiness to prioritize investing public money in cryptocurrency.

Lummis said, "What we don't have is enough knowledgeable members of the House and Senate to have the comfort level to do this yet."

Strategy chairman and a well-known Bitcoin maximalist, Michael Saylor, has even expressed support for the reserve's inclusion of assets like XRP and Cardano alongside Bitcoin.

While he has consistently argued that Bitcoin is the only true digital asset, he now acknowledges that a broader crypto reserve could be bullish not only for Bitcoin but for the entire US crypto industry.

"There are conservatives that view the right path forward as a Bitcoin only policy but the President has adopted a more liberal economic policy and that's his right," he said in a CNBC interview. "The best thing for the country is to move forward with an enlightened, progressive policy towards digital assets.

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