Federal Reserve Chairman Jerome Powell made headlines last week when he declared that the Federal Reserve has no intention of investing in Bitcoin. This statement sent shockwaves through the crypto market, causing a sudden drop in Bitcoin’s price and a 7.5% overall loss in the crypto market.
Despite Powell’s stance, a recent report on Wu Blockchain revealed that President Trump could bypass the Federal Reserve and establish a Bitcoin Strategic Reserve through an executive order. By utilizing the Exchange Stabilization Fund controlled by the Treasury Department, Trump could potentially allocate funds to purchase Bitcoin without requiring approval from Congress.
Alternatively, Republican Senator Cynthia Lummis has proposed the “U.S. Bitcoin Strategic Reserve Act” to establish a legal framework for a Bitcoin reserve through Congress. While this route offers stability and long-term security, the legislative process is complex and could take months or even years to pass.
Although the Federal Reserve has the authority to conduct open market operations and purchase assets like government bonds, Powell has firmly stated that the Fed has no interest in acquiring Bitcoin. This leaves the Treasury as the primary option for establishing a government-led Bitcoin reserve.
President Trump’s strained relationship with Powell and his interest in Bitcoin as a strategic asset further complicate the situation. Trump’s family crypto project, World Liberty, swiftly reacted to Powell’s remarks by investing in altcoins, indicating his commitment to exploring the crypto market.
In conclusion, the debate over a potential Bitcoin reserve highlights the complexities of government involvement in the crypto space. Whether through executive action or legislative measures, the future of a Bitcoin reserve in the United States remains uncertain. Visit our website to learn more about the latest developments in the crypto market and how they may impact your investment strategy.