INTERVIEW: Sen. Cynthia Lummis details why America needs a Strategic Bitcoin Reserve

THE LOWDOWN:

• President Donald Trump ordered the establishment of a Strategic Bitcoin Reserve last week.

• Sen. Cynthia Lummis (R., Wyo.) reintroduced her bill, the BITCOIN Act, to build upon President Trump’s order.

• Lummis said she believes the U.S. needs a strategic Bitcoin reserve because “the U.S. is $37 trillion in debt” and “the U.S. dollar is debased in value or drops in value every year” while “Bitcoin goes up year over year.”

• Additionally, Lummis praised President Trump for his leadership in establishing a Strategic Bitcoin Reserve, noting he “promised to lead the most pro-digital asset administration in American history, and he is fulfilling his promise to the American people.”

Cryptocurrency continues to shake up the global financial establishment through its utility and anonymity. These digital commodities have become so pervasive within American society that President Donald Trump recognized the strategic significance of stockpiling Bitcoin, the premiere cryptocurrency and widely-recognized “digital gold,” and ordered the U.S. to begin doing so last week.

But President Trump was not the only one pushing for this stockpile: Sen. Cynthia Lummis (R., Wyo.) has been a champion on the issue, backing her knowledge with legislative teeth in the upper chamber. Lummis spoke with the Washington Reporter this week to discuss her work pushing for a strategic Bitcoin reserve.

Lummis said she believes the U.S. needs a strategic Bitcoin reserve because “the U.S. is $37 trillion in debt” and “the U.S. dollar is debased in value or drops in value every year” while “Bitcoin goes up year over year.”

“And, since its inception, [Bitcoin’s value] has grown 55 to 60 percent per year,” Lummis said.

“So, we have an asset that has the characteristics of digital gold,” she continued. “Bitcoin is scarce; there will only be 21 million ever mined. There is no board of directors or founder — Bitcoin is completely trustless.”

“There’s nobody to turn to that you have to trust in order to make an investment in Bitcoin,” the Wyoming senator added. “And it’s infinitely divisible. It has a lot of the characteristics of gold, but in digital form.”

Lummis said her recently reintroduced BITCOIN Act will build on President Trump’s executive order establishing a Strategic Bitcoin Reserve, saying her bill is “consistent” with the president’s order.

“The very first 200,000 Bitcoin, which would form the initial corpus of a strategic Bitcoin reserve, would come from the asset forfeiture funds that are held by the U.S. Marshals Service, because we had Bitcoin forfeiture pursuant to asset forfeitures engaged in criminal activity,” Lummis said. “So we can start there.”

Lummis said she is “an advocate for using Bitcoin only within the strategic reserve because it specifically has the qualities of digital gold,” but that other cryptocurrencies like memecoins and stablecoins “can play a role more in the commercial economy in the identification and preservation of property rights.”

“And so things other than Bitcoin are best suited, I think, for the individual and commercial economy,” Lummis said, noting that stablecoins “are basically the on-ramp and off-ramp between fiat currency” — government-issued money not backed by a commodity like gold or silver, instead given value via a government’s guarantee of value — and digital assets.

Lummis also said that “we want our traditional banking industry to take advantage of the fact that transactions done in Bitcoin and other digital assets are faster and cheaper than existing means the banks engage with their customers directly.”

“So it provides an opportunity for banks to have another asset to offer to their consumers, whether it’s through an exchange-traded fund, through a mortgage product that’s backed by Bitcoin and allows the interest rate to be lower,” Lummis said. “There are all kinds of new financial products that have a relationship to Bitcoin that banks should be able to take advantage of.”

Lummis reintroduced the BITCOIN Act this Congress, with several of her colleagues joining her on the bill as original cosponsors who had not backed it before: Sens. Roger Marshall (R., Kansas), Bernie Moreno (R., Ohio), and Jim Justice (R., W.Va.).

The Wyoming Republican said keeping up the momentum is “going to be a constant effort because communicating the purpose of the reserve, why Bitcoin is the right strategic asset, and what use it can be put to help reduce the national debt is still a pretty new topic for the vast majority of members of Congress, both House and Senate.”

“So I’m delighted to have Congressman [Nick] Begich (R., Ak.) introducing a companion bill in the House that’s very similar to the Senate bill, so each of us can begin those one-on-one visits with our colleagues and try to win them over,” Lummis said.

“The good news is that President Trump’s executive order is a lot of wind beneath our wings over here on the legislative side of Washington, D.C.,” she continued. “And so we’re going to work with the White House and try and move this forward.”

Additionally, Lummis praised President Trump for his leadership in establishing a Strategic Bitcoin Reserve, noting he “promised to lead the most pro-digital asset administration in American history, and he is fulfilling his promise to the American people.”

“Last week’s executive order was just the start,” Lummis said. “It’s amazing to have a president invested in American innovation again.”