orld’s largest fund manager BlackRock with over $10 trillion in assets under management has recently allegedly supported the formation of a US Strategic Bitcoin Reserve. Although the firm has not directly commented on the matter, it has acknowledged before the potential of the cryptocurrency to act as an inflation shield and an asset diversification instrument.
Legislative Progress
Republican Senator Cynthia Lummis from Wyoming has brought forward The Bitcoin Act for a digital currency reserve, which has been planned to be executed in the first 100 days of Trump administration. The bill has attracted a lot of traffic and has been ranked as the fourth most accessed US bill.
State-Level Movement
Governors are rushing to set up their personal Strategic Bitcoin Reserves before the White House does it for them. Speaking to Bitcoin Magazine, Dennis Porter, the CEO of Satoshi Act Fund, claims that this approach is consistent with the basic tenets of Bitcoin.
Concerns and Considerations
The major drawbacks that current critics see are associated with the high volatility of the bitcoin’s price and the enhanced vulnerabilities to cyber threats. Critics say that widespread use could put national reserves at the risk of market fluctuations and potential cyber attacks.
Bitcoin Reserve Policy Risks
Amid the increasing government and private sector interest in accumulating Bitcoin reserves, the controversy persists whether innovation in countries’ economic policies is beneficial and, if so, to what extent it may entail risks.
