Back in May, when it was still unclear what Trump's crypto position would be, we were the first to make a modest proposal: to win not only the crypto vote, but also to ensure that after a catastrophic 4 years for the US crypto industry under the suffocating Gary Gensler/Liz Warren anti-crypto regime, Trump should announce a strategic bitcoin/ethereum reserve and allocate a certain sizable number to it (we proposed 2mm BTC/10mm ETH).
Trump should announce if elected he will buy 2 milllion BTC and 10 million ETH as part of a strategic US crypto reserve
— zerohedge (@zerohedge) May 26, 2024
Two months later, during the Bitcoin 2024 Conference in Nashville, many expected Trump to announce just that, but while getting tantalizingly close during his lengthy pro-crypto speech, the past and future president refused to make an explicit commitment, even though some viewed this as merely a delay until pro-crypto president moved back to the White House.
So fast forward to today when in what is a preview of things to come at the Federal level, Fox Business reported that Trump’s imminent return to the White House has prompted Pennsylvania lawmakers to introduce legislation that would enable the state’s treasury to hold the world’s largest digital asset on its balance sheet as part of a broader movement to recognize bitcoin as a store of value.
The new bill, called the Pennsylvania Bitcoin Strategic Reserve Act, introduced in the Pennsylvania House of Representatives on Thursday, is the first of its kind and would allow the state’s treasury to allocate up to 10% of its roughly $7 billion state funds into bitcoin as a way to help combat inflation and diversify its investments beyond traditional assets like bonds and cash reserves.
"The Pennsylvania Bitcoin Strategic Reserve Act is a visionary step toward securing our state’s financial future," Republican Pennsylvania state Rep. Mike Cabell, the bill’s sponsor, told FOX Business. "By integrating Bitcoin into our reserves, we’re not only protecting Pennsylvania from inflation’s relentless impact but also positioning our state as a leader in financial resilience and innovation."
The legislation comes as pro-crypto senators say they're hoping to push through a bitcoin reserve bill on the national level during the first 100 days of Trump's presidency.
The strategic reserve act is the second piece of crypto-related legislation to go in front of the state legislature this year. Last month, the state’s House passed a bill to protect residents’ rights to self-custody digital assets and ensure their ability to use bitcoin as a payment method. FOX Business reported on the Bitcoin Rights bill that's slated to move on to the Republican-led Senate in the coming weeks and, if passed, onto Gov. Josh Shapiro’s desk for signing.
The advocacy group that helped Pennsylvania lawmakers craft the Bitcoin Rights bill, Satoshi Action Fund, is also behind the new strategic reserve bill according to Fox Business. The group’s main goal is to help to mainstream bitcoin at the state level, and it has so far succeeded in helping write and pass bitcoin-related legislation in twenty-one states. Its founder, Dennis Porter, is hoping the strong bipartisan support garnered on the October rights bill will be a bellwether for how the strategic reserve bill will be received.
"The Bitcoin Rights bill sailed through the Democrat-led House with a majority of 176 votes to 26," Porter said. "With public support and interest in Bitcoin at an all-time high, we expect both bills to be passed and hopefully signed into law next year."
Porter says the strategic reserve act is expected to serve as a model for other states looking to integrate digital assets into their investment portfolios and says that SAF is currently in talks with 10 other states to implement similar legislation.
If the bill is passed into law, Pennsylvania would become the first state to hold bitcoin directly on its balance sheet, marking the first step in what could become a shift towards digital assets playing a bigger role in the economic strategy of state governments.
"This legislation sends a clear message: Pennsylvania is ready to embrace bold, modern solutions to safeguard economic prosperity for generations to come," Cabell said.
Optimism that Trump will fulfill his promises to make the U.S. the "crypto capital of the planet" and bitcoin a "permanent national asset" has made its price surge 20% in the week since his victory, reaching an all-time high of more than $93,000 per token and a market cap of over $1.8 trillion. This makes bitcoin the world’s seventh-largest asset behind gold and five U.S. tech giants, including Nvidia, Apple, Microsoft, Amazon and Google.
The surge in bitcoin ahead of what appears an increasingly likely announcement by the US that it will formally buy crypto for the US Treasury has prompted speculation that other nations are doing the same in hopes of acquiring the scarce asset before Uncle Sam swoops in and buys it up.
