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Trump’s Bitcoin Strategy: Rhetoric or Policy Shift?

Is Donald Trump’s recent stance on cryptocurrency just political rhetoric, or does it hint at a potential policy direction? As Selena Zito noted in 2016, while the media tends to take Trump’s statements literally, his supporters focus more on his intent. Therefore, his proposal for a "strategic Bitcoin reserve" and using Bitcoin to pay off national debt should not be taken at face value. However, given his recent statements and the current political-economic landscape, the possibility of U.S. government intervention in Bitcoin cannot be completely ruled out.

In July, Trump declared at a Bitcoin conference that the U.S. government would not sell its Bitcoin holdings. Then, in September, he proposed creating a sovereign wealth fund to use Bitcoin for debt repayment. The U.S. government currently holds 210,000 BTC, worth $21 billion. To cover $36 trillion in national debt, Bitcoin would need to reach $17.3 million per coin, an unrealistic scenario. However, government-led Bitcoin accumulation remains a possibility.

Potential Avenues for U.S. Bitcoin Purchases

Trump could bypass congressional approval and acquire Bitcoin through the Exchange Stabilization Fund (ESF), a $41 billion emergency reserve historically used for financial interventions. If allocated to Bitcoin purchases, it could boost prices significantly.

Additionally, Senator Cynthia Lummis has proposed a bill that would revalue the Federal Reserve’s gold holdings from $42.22/oz (book value) to $2,000/oz (market value), allowing the U.S. Treasury to unlock $640 billion. This funding could also be used to acquire Bitcoin, further fueling speculation.

If these measures materialize, the U.S. government would emerge as a massive Bitcoin buyer, triggering an unprecedented bull run in crypto markets. However, such government-led accumulation would have profound financial and economic ripple effects. While Bitcoin lacks cash flow and intrinsic utility, its value—like other financial assets—is dictated by institutional trust and adoption. If the U.S. government openly supports Bitcoin, this would mark a transformational shift rather than a speculative trend.

Market participants now assign a 1-in-3 probability that Trump’s Bitcoin reserve plan could materialize by April 2025. While policy execution remains uncertain, dismissing this as mere campaign rhetoric is no longer viable.

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