Lummis Revives Bitcoin Act, Seeks to Legislate National Strategic Reserve

Wyoming Senator Cynthia Lummis, a vocal advocate for cryptocurrency, reintroduced the "Bitcoin Act" on Tuesday, legislation aimed at establishing a national strategic Bitcoin reserve for the United States.

Lummis's bill, a revival of legislation first introduced last year, proposes a five-year plan for the government to purchase 1 million Bitcoin. These Bitcoins would then be transferred to a "decentralized network" of secure storage facilities.

Unlike President Trump's executive order, which primarily focuses on building a reserve from bitcoin seized through federal law enforcement, Lummis's bill proposes a distinct funding mechanism. The legislation outlines the use of funds derived from "diversifying existing funds" within the Federal Reserve system. Specifically, the bill proposes setting aside the first $6 billion in remittances from reserve banks each year between 2025 and 2029 to finance the bitcoin acquisitions. It also suggests leveraging the Fed’s gold certificates as a potential funding source.

Senator Lummis framed Bitcoin as a strategic national asset in her statement accompanying the bill's reintroduction. “Bitcoin is not simply a technological opportunity, but a national imperative for America’s continued financial leadership in the 21st century,” she said. "By transforming the president’s visionary executive action into enduring law, we can ensure that our nation will harness the full potential of digital innovation to address our national debt while maintaining our competitive edge in the global economy.”

The Bitcoin Act enjoys bipartisan support, co-sponsored by Republican Senators Jim Justice (W.Va.), Tommy Tuberville (Ala.), Roger Marshall (Kan.), Marsha Blackburn (Tenn.), and Bernie Moreno (Ohio). This bipartisan backing may increase the bill's chances of gaining traction in Congress. The reintroduction also coincides with reports of growing support within the House of Representatives, with at least seven additional representatives reportedly endorsing Lummis's plan.

While both Lummis's bill and Trump's executive order aim to establish a Bitcoin reserve, they differ in key aspects. Trump's order primarily envisions a reserve built from forfeited digital assets, while Lummis’s legislation proposes active acquisition through market purchases funded by the Federal Reserve.

David Sacks, President Trump’s advisor on artificial intelligence and crypto, has emphasized that Trump’s plan would be "budget-neutral," relying on seized assets and not costing taxpayers directly. However, Trump’s executive order also directs the Treasury and Commerce departments to explore "budget-neutral strategies for acquiring additional bitcoin," suggesting potential overlap with Lummis’s approach or an openness to market purchases.

Reactions to the renewed push for a Bitcoin strategic reserve have been largely positive within the cryptocurrency industry. Many proponents view it as a validation of Bitcoin's importance and a sign of growing mainstream acceptance. However, some analysts have cautioned against the government holding non-Bitcoin digital assets as part of a broader "digital asset stockpile," arguing that Bitcoin possesses unique properties that make it the most suitable cryptocurrency for a national reserve. The Trump administration's apparent distinction between a Bitcoin reserve and a separate digital asset stockpile may be an attempt to address these concerns.

Senator Lummis and her co-sponsors are expected to actively promote the Bitcoin Act in the coming weeks, aiming to build further support in Congress and educate policymakers and the public about the potential benefits of a national strategic bitcoin reserve.