Sen. Cynthia Lummis’ Bitcoin Bill

Senator Cynthia Lummis from Wyoming has introduced a new draft bill. This bill, known as the “Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act of 2024,” or the “BITCOIN Act of 2024,” could change how the United States handles Bitcoin. The bill would let U.S. states hold Bitcoin in their reserves if they choose to participate.

Details of the BITCOIN Act of 2024

The BITCOIN Act of 2024 aims to allow the United States and individual states to hold Bitcoin as part of their reserves. Bitcoin, as a decentralized and scarce digital asset, offers unique properties that complement existing national reserves like gold and petroleum. This bill could strengthen the position of the U.S. dollar in the global financial system.

Bitcoin Purchase Program

One of the key parts of the bill is the Bitcoin Purchase Program. This program will buy up to 200,000 Bitcoins each year for five years, adding up to a total of 1 million Bitcoins. The U.S. Treasury Department will be responsible for managing this program. They will publish quarterly reports on their website so the public can see how the program is going. States can also participate in storing Bitcoin holdings as part of the reserve if they follow certain security protocols.

Support and Background of Sen. Cynthia Lummis

Sen. Cynthia Lummis has been a strong supporter of Bitcoin for years. On July 27, she announced her plan to introduce this bill. Although she does not expect the bill to become law this year, it could be considered after the elections in November.

Importance of Bitcoin in U.S. Reserves

Lummis believes that establishing a strategic Bitcoin reserve will bolster the U.S. dollar with a digital hard asset, securing the nation’s standing as a global financial leader for years to come. The United States already holds reserves in assets like gold and petroleum, so adding Bitcoin could further strengthen the national reserves.

Adjustments to Gold Certificates

The draft bill also includes changes related to gold certificates. Within six months of the bill’s enactment, Federal Reserve Banks must tender all outstanding gold certificates to the Secretary of the Treasury. Then, within 90 days of receiving the last certificate, the Secretary will issue new gold certificates that reflect the fair market value of the gold held against them. This ensures that the value of gold in the reserves is accurately represented.

Crypto Industry and the 2024 Elections

Cryptocurrency is becoming a significant topic in the lead-up to the 2024 elections. GOP presidential candidate Donald Trump has promised to end what he calls an “unlawful and un-American crackdown” on the U.S. crypto industry. Meanwhile, Vice President Kamala Harris’s campaign team has started asking questions about the cryptocurrency industry. This shows that both parties are paying attention to the growing importance of crypto.

How States Can Participate

States can choose to participate in the Bitcoin reserve program voluntarily. To do so, they must adhere to specific requirements, including stringent security protocols to protect the Bitcoin holdings. This gives states the flexibility to decide whether they want to include Bitcoin in their reserves, based on their own financial strategies and needs.

Impact on the Global Financial System

Including Bitcoin in the U.S. national reserves could have a significant impact on the global financial system. Bitcoin’s unique properties as a decentralized and scarce digital asset could provide additional stability and strength to the U.S. dollar. This move could position the United States as a leader in the adoption of digital assets, influencing other countries to consider similar strategies.

Sen. Cynthia Lummis’ BITCOIN Act of 2024 represents a bold step towards integrating Bitcoin into the U.S. financial system. By allowing states to hold Bitcoin in their reserves and establishing a national Bitcoin reserve, the bill aims to strengthen the U.S. dollar and secure America’s position as a global financial leader. With the growing importance of cryptocurrency in the political landscape, this bill could pave the way for significant changes in how digital assets are viewed and used in national financial strategies.

Overall, the BITCOIN Act of 2024 highlights the potential benefits of Bitcoin as a strategic reserve asset and sets the stage for further discussions and developments in the integration of digital assets into national reserves. As the political and financial landscapes continue to evolve, the role of Bitcoin and other cryptocurrencies in national and global economies will likely become even more prominent.

US Government Moves $2 Billion in Silk Road Bitcoin

US Government Transfers Seized Bitcoin

The United States government recently moved over $2 billion worth of Bitcoin that was connected to the Silk Road dark web marketplace. According to on-chain data shared by Arkham Intelligence, this large transfer involved Bitcoin that the government had seized from criminals. The Silk Road was an online black market where people bought illegal drugs before it was shut down in 2014. The Bitcoin used on this site was confiscated by the authorities.

Trump’s Pledge on Seized Bitcoin

This move comes just days after former President Donald Trump made a significant promise about Bitcoin. At Bitcoin 2024 in Nashville, Trump, who is running for president again, said he would create a national “strategic Bitcoin stockpile” if elected. He also promised that the government would keep all the seized Bitcoin and not sell it. This announcement was meant to show his support for the cryptocurrency community.

Impact on Bitcoin Prices

The news of the government’s Bitcoin move caused some concern among investors. The price of Bitcoin, the biggest digital coin by market cap, dropped by more than 2% within an hour of the news. On Monday morning, Bitcoin’s price briefly touched $70,000 per coin but fell to $66,845 later. This price is below its all-time high of $69,044, which it reached in 2021.

Reactions from the Crypto Community

The crypto community on Twitter, also known as X, had strong reactions to the news. Mike Novogratz, a crypto entrepreneur and the head of Galaxy Digital, criticized the timing of the move. He tweeted, “Tone deaf anyone??? Moving Silk Road BTC two days after Trump’s pledge to not move them is just dumb!!!!” His tweet shows the frustration felt by many in the community.

Expert Opinions on the Move

Not everyone believes the move is cause for alarm. Adam Cochran, a venture capitalist, reminded people that the U.S. Marshals Service (USMS) recently awarded a contract to Coinbase Prime to manage and dispose of large-cap cryptocurrency assets. This means the transfer might not indicate an intent to sell the Bitcoin. He pointed out that people often panic when large amounts of Bitcoin move, even if there’s no reason to worry.

Historical Context of Seized Bitcoin

The U.S. government and other authorities around the world sometimes move seized Bitcoin between wallets or custodians. These moves do not always mean that the Bitcoin will be sold. However, when the government does sell seized Bitcoin, it can impact the market. For example, last month, the German government moved Bitcoin to crypto exchanges, causing a price drop before it eventually recovered.

The Significance of the Silk Road Bitcoin

The Bitcoin moved by the U.S. government this time was connected to the Silk Road, a notorious dark web marketplace. The Silk Road was a major online black market, mainly used for selling illegal drugs. Authorities shut it down in 2014, and the Bitcoin used on the site was seized. The government still holds Bitcoin from these seizures and sometimes moves it around for various reasons.

Future of Government-Held Bitcoin

It is still unclear whether the U.S. government plans to sell the recently transferred Bitcoin. We reached out to the U.S. Department of Justice for a comment but did not receive an immediate response. The authorities have a history of holding onto seized Bitcoin and moving it between wallets or custodians without selling it. This strategy helps manage the large amounts of cryptocurrency the government has taken from criminals.

Market Reactions to Large Bitcoin Moves

Big moves of Bitcoin by the government or other large holders often affect the market. When significant amounts of Bitcoin are transferred, investors can become nervous, leading to price drops. This reaction is common because people worry that the Bitcoin might be sold, flooding the market and reducing prices. However, experts like Adam Cochran advise against panicking every time there is a large transfer.

The Role of Coinbase Prime

The recent contract between the U.S. Marshals Service and Coinbase Prime is important to consider. Coinbase Prime is a major player in the cryptocurrency market, known for managing large amounts of digital assets. This contract means that Coinbase Prime will handle the government’s large-cap cryptocurrency assets, including Bitcoin. The transfer to Coinbase Prime’s management could be a routine move, not necessarily an indication of an impending sale.

The Future of Bitcoin Under Trump’s Plan

If Donald Trump is elected and follows through on his promise, the U.S. government would stop selling seized Bitcoin and instead create a strategic stockpile. This plan could have significant implications for the cryptocurrency market. By keeping all seized Bitcoin, the government could potentially influence Bitcoin’s price and market dynamics. Investors and the crypto community are closely watching these developments.

Global Impact of Government Bitcoin Moves

The U.S. is not the only country that moves large amounts of Bitcoin. Governments around the world have seized Bitcoin from criminal activities and sometimes transfer it between wallets or sell it. These moves can impact the global cryptocurrency market. For instance, when the German government moved Bitcoin to exchanges, it caused a temporary price drop. Such events highlight the influence of government actions on the crypto market.

Understanding Bitcoin Seizures

Bitcoin seizures by governments usually occur when authorities shut down illegal activities involving the cryptocurrency. The Silk Road is one of the most well-known cases where a significant amount of Bitcoin was seized. The government has since held onto this Bitcoin and occasionally moves it for management purposes. These actions are closely monitored by the crypto community and can lead to market reactions.

The recent move of $2 billion in Silk Road Bitcoin by the U.S. government has sparked discussions and concerns in the crypto community. While some see it as a routine transfer, others worry about its potential impact on the market. With former President Donald Trump’s promise to create a strategic Bitcoin stockpile, the future of seized Bitcoin in the U.S. remains an important topic for investors and crypto enthusiasts. As governments continue to manage their seized cryptocurrency assets, the market will likely remain sensitive to these significant moves.

Michael Saylor’s Bold Bitcoin Proposal

Michael Saylor, the co-founder of MicroStrategy, believes the US government should own the majority of Bitcoin. MicroStrategy is already the largest corporate owner of Bitcoin, but Saylor thinks the US should be the biggest Bitcoin holder. At the Bitcoin 2024 commentary desk, Saylor said, “The U.S. government should own the majority of the Bitcoin in the world.”

A Big Prediction for Bitcoin’s Future

Saylor is very optimistic about Bitcoin. He said that by 2024, Bitcoin’s market cap will hit $280 trillion, which is more than 200 times its current value. He has also predicted that Bitcoin’s market cap could go over $100 trillion, meaning each Bitcoin could be worth $5 million.

The Numbers Behind the Proposal

For the US government to own the majority of all Bitcoin, it would need to hold over 10.5 million BTC. At current prices, this would be worth $711 billion. Right now, the US government owns about 208,898 BTC, worth $14 billion. These Bitcoins were seized from criminals.

Similar Ideas from Robert F. Kennedy Jr.

Saylor’s idea is similar to that of Robert F. Kennedy Jr., an independent US presidential candidate. Kennedy said he wants the US government to have as much Bitcoin as it does gold. The US government has the largest gold reserves in the world, with 8,134 metric tons worth $615 billion.

Using Bitcoin to Back the Dollar

Kennedy believes that Bitcoin could be part of a group of hard assets backing the US dollar. Saylor agrees. He said, “You back the dollar by doing something economically rational.” He gave an example of how building the port of New York City helped the US engage in international commerce. He believes that the future of the country is in cyberspace and called Bitcoin “cyber Manhattan.”

Trump and Other Candidates’ Views on Bitcoin

Donald Trump, a former president, has recently shown support for Bitcoin. He wants to protect Bitcoin miners in the United States. Both Trump and Kennedy spoke at the Bitcoin 2024 event in Nashville. The views of current Vice President Kamala Harris on cryptocurrency are not well known, but the Biden administration has been tough on crypto firms. However, Harris’s team is reportedly reaching out to prominent crypto advocates like Mark Cuban.

Establishing a Federal Bitcoin Reserve

For any candidate to back the dollar with Bitcoin, they would need to create a formal US Bitcoin reserve. This would show that digital assets are legitimate in the eyes of the state. It would also mean not selling any of the $14 billion worth of Bitcoin the government currently holds. Bryan Courchesne, founder of crypto wealth manager DAIM.io, said this step is possible but difficult.

Moving Bitcoin Holdings to the Treasury

Courchesne suggested that the Justice Department, which holds about 200,000 units of Bitcoin, could move these to the Department of Treasury. This would put $13 billion worth of Bitcoin on the Treasury’s balance sheet. He believes that if the government moves from being a seller to a long-term holder of Bitcoin, it could be very positive for the cryptocurrency space.

The Financial Impact of a US Bitcoin Reserve

If the US followed Kennedy’s plan, it would need to buy $154 billion in Bitcoin every year for four years. This buying could have a big impact on Bitcoin’s price. According to the “Bitcoin multiplier” estimate, every $1 invested in Bitcoin increases its market cap by $3 to $4 during a bull market. This means that the yearly increase in Bitcoin’s market cap could be between $460 billion and $615 billion. This would result in a yearly Bitcoin price increase of $23,000 to $31,000, putting the price of Bitcoin between $90,000 and $98,000.

Why Bitcoin Could Be a Good Investment for the US

Saylor and others believe that owning Bitcoin could be a smart move for the US. Bitcoin is seen as a valuable digital asset, and owning a large amount could give the US a strong position in the global financial system. As Bitcoin becomes more valuable, it could also provide significant financial returns for the country.

Challenges and Considerations

However, there are challenges to this plan. Establishing a federal Bitcoin reserve would require changes in policy and new regulations. There would also be logistical challenges in buying and storing such a large amount of Bitcoin. Additionally, the volatility of Bitcoin’s price could be a concern for some policymakers.

The Future of Bitcoin in the US

The idea of the US government owning the majority of Bitcoin is ambitious. It reflects the growing interest and acceptance of Bitcoin as a major financial asset. As more influential figures like Michael Saylor and Robert F. Kennedy Jr. advocate for Bitcoin, it could lead to significant changes in how digital assets are viewed and used in the US.

The Role of Cryptocurrency Regulations

The Biden administration’s crackdown on crypto firms shows that there is still a lot of uncertainty around cryptocurrency regulations in the US. Future administrations will play a crucial role in shaping the landscape for digital assets. Whether the US will become a major Bitcoin holder depends on the decisions made by current and future leaders.

Conclusion: A New Era for Bitcoin?

Michael Saylor’s proposal for the US government to own the majority of Bitcoin is a bold vision for the future. It highlights the potential of Bitcoin to be a significant part of the global financial system. As discussions around Bitcoin and other digital assets continue, the US could be at the forefront of this new financial era. The decisions made today could shape the financial landscape for years to come.

BTC Outperforms Broader Crypto Market

Introduction

Bitcoin (BTC) outperformed the wider crypto market as measured by the CoinDesk 20 Index during the Friday Asia trading session. The performance of Ether (ETH) exchange-traded funds (ETFs) mirrors that of the Bitcoin ETFs after their launch in January.

Bitcoin’s Strong Performance

During the Asia trading day, Bitcoin added 4.4% to test $67,000, while the CoinDesk 20 Index (CD20) rose 3.3%. Solana’s SOL jumped over 5% to lead gains among major tokens, with Ether (ETH), BNB Chain’s BNB, and Cardano’s ADA adding 3%. Dogecoin (DOGE) rose 4%, and Solana-based memecoin popcat (POPCAT) jumped more than 8% to lead gains in that category.

Ether and Crypto Futures

For the third day, Ether products led liquidations across crypto futures, with over $70 million in longs liquidated compared with $55 million on BTC-tracked futures. Open interest, or the number of unsettled futures bets, dropped by $1 billion over the past 24 hours, indicating money leaving the market.

Bitcoin Outflows

Bitcoin exchange-traded funds (ETFs) added a net $31.16 million, bringing the cumulative net flow since their introduction in January to just under $17.5 billion. Total net assets of the ETFs amount to $59.14 billion, or about 4.6% of the entire market cap of the largest cryptocurrency.

Ether ETF Performance

Ether, the second-largest cryptocurrency, rose 2.8% to top $3,200. The Ether ETFs experienced a net daily outflow of $152 million. The current cumulative flow for the ETFs since they started trading this week is negative $178.68 million, mainly due to withdrawals from Grayscale Ethereum Trust (ETHE), which converted to an ETF.

Comparison with Bitcoin ETFs

CoinShares analysts noted that this situation is very similar to the Bitcoin ETF product launches at the beginning of the year. Outflows from the Grayscale Bitcoin Trust (GBTC), the world’s largest Bitcoin fund at the time, which converted from a closed-end structure into an ETF, weighed on Bitcoin’s price over the first weeks. Later, inflows to rival funds overcame the negative trend, propelling BTC to an all-time high in March.

Grayscale Ethereum Trust

The Grayscale Ethereum Trust is following the same path but faster, making the decline a “prime buying opportunity,” according to Mads Eberhardt, a crypto analyst at Steno Research. If this trend continues, the outflow from the Grayscale Ethereum ETF could end much quicker than it did for Bitcoin in January, perhaps as early as mid-next week. After this, strong net inflow is expected due to the inflow into other ETFs observed over the last few days.

Different Opinions on Ether’s Future

Rachel Lin, CEO and co-founder of SynFutures, disagreed, saying she expects short-term pain for ETH traders. She noted that Grayscale’s ETH ETF fund is becoming a net seller on the market, with over $810 million in outflow since the ETF launch. Grayscale currently holds over $8 billion worth of Ether, and nearly 10% of it was sold in just the past two days. If the trend continues, Grayscale might reach the 50% mark far sooner than with Bitcoin. However, that would also mean more downside for Ethereum.

Solana and Other Major Tokens

While Bitcoin and Ether faced mixed performances, Solana’s SOL saw significant gains, jumping over 5%. This made SOL the leading gainer among major tokens. Other cryptocurrencies like BNB Chain’s BNB, Cardano’s ADA, and Dogecoin (DOGE) also saw positive movements, adding around 3% to their values. In the memecoin category, popcat (POPCAT) from the Solana network stood out with an 8% jump.

Market Reactions and Predictions

Analysts have varying opinions on the market’s direction. While some see the current situation as a buying opportunity, others predict more short-term pain. The market is reacting to the launch and performance of ETFs, with significant inflows and outflows affecting prices. The comparison between Bitcoin and Ether ETFs highlights how similar market events can lead to different outcomes based on the timing and speed of investor reactions.

Long-Term Outlook

The long-term outlook for both Bitcoin and Ether remains positive, according to some analysts. Despite the short-term volatility, the introduction of ETFs and the resulting market dynamics are seen as steps toward greater acceptance and integration of cryptocurrencies into mainstream financial systems. The cumulative net flows, despite some negative periods, suggest a growing interest and investment in these digital assets.

Conclusion

Bitcoin’s recent performance has shown its ability to outperform the broader crypto market, even amid significant market events like ETF launches. Ether, while facing challenges, mirrors Bitcoin’s previous ETF journey and may soon see a reversal in outflows. The crypto market remains dynamic, with various factors influencing the prices and performance of different tokens. As always, investors should stay informed and cautious, keeping an eye on both short-term trends and long-term potentials.

Bitcoin Investment Fund Opens Doors to EU Citizenship

A new investment fund is now offering Bitcoin holders a chance to become European Union (EU) citizens through Portugal’s golden visa program. This opportunity has been introduced by Alessandro Palombo, the co-founder and CEO of Unbound Fund.

Portuguese Citizenship Through Bitcoin Investment

In a recent post, Alessandro Palombo announced that their fund is the first to allow investors to gain Portuguese citizenship by investing in Bitcoin (BTC). According to Palombo, this unique opportunity is possible through Portugal’s Golden Residence Permit Program.

Investing in Bitcoin for EU Citizenship

To qualify for this program, investors need to indirectly hold Bitcoin worth 500,000 euros (about $542,000) through the Unbound Fund. This investment will make them eligible for the Portugal Golden Residence Permit Program. This program is a five-year residence-by-investment program designed for non-EU nationals.

How the Fund Works

Palombo explained that the fund invests in companies that have a 100% passive Bitcoin holding strategy. This means the fund is not trying to time the markets to sell BTC. Additionally, the fund will invest in BlackRock exchange-traded funds (ETFs) to ensure security and simplicity.

Palombo’s Vision for Bitcoin and Freedom

Palombo believes that using Bitcoin as a tool for gaining freedom of movement is mutually beneficial for both the investors and Portugal. He has chosen to live in Portugal with his family and thinks the European citizen-by-investment program is the best for technical and strategic reasons.

Current Success and Future Plans

Palombo mentioned that the fund has already onboarded several customers and is in talks with complementary teams to expand their services.

Bitcoin Price Surge

On July 22, Bitcoin’s price reached its highest level in 40 days, peaking at $68,518 on some platforms. Analysts attribute this nearly 20% increase in 10 days to the end of the German government’s Bitcoin sell-off and growing confidence in the US Federal Reserve cutting interest rates in 2024.

The Portugal Golden Residence Permit Program

The Portugal Golden Residence Permit Program, often called the Portugal Golden Visa Program, is a five-year residence-by-investment program for non-EU nationals. This program allows investors to live, work, and study in Portugal and move freely within Europe’s Schengen Area.

Benefits of the Portuguese Golden Visa

• Visa-free travel: Allows visa-free travel in Europe’s Schengen Area.
• Work and Study: Gives the right to live, work, and study in Portugal.
• Citizenship Eligibility: Investors can apply for citizenship after five years as legal residents while keeping their other citizenships.
• Low Physical Presence Requirement: Only requires an average of seven days per year stay in Portugal over this period.
• High Quality of Life: Portugal offers excellent international and Portuguese schools and universities, local cuisine, a mild climate, rich culture, and high-level security.
• Healthcare: Provides access to international quality healthcare clinics and hospitals.

Requirements for the Portugal Golden Visa

Applicants can choose from several investment options in different categories:

Capital Transfer Options

1. Investment Fund or Venture Capital: Invest 500,000 euros in a fund dedicated to the capitalization of Portuguese companies with a five-year maturity and at least 60% of the investment portfolio in companies headquartered in Portugal.
2. Scientific Research: Invest 500,000 euros in public or private research activities within Portugal’s national scientific and technological system.
3. Low Population Density Area: Invest 400,000 euros in a low population density area.
4. Cultural Support: Invest 250,000 euros in artistic production or the recovery/maintenance of national cultural heritage.
5. Low Population Density Cultural Support: Invest 200,000 euros in cultural projects within a low population density area.

Business Investment Options

1. Job Creation: Create a minimum of ten new jobs or eight new jobs in a low population density area.
2. Commercial Company Incorporation: Invest 500,000 euros in setting up a commercial company in Portugal that creates at least five permanent jobs for three years or increases the share capital of an existing company, maintaining at least ten jobs for three years.

Low Population Density Area Definition

A low population density area in Portugal is defined as having less than 100 inhabitants per square kilometer or a GDP per capita below 75% of the national average.

Procedures and Time Frame for the Golden Visa

After receiving the residence permit, applicants must provide biometric data and updated original documents at each renewal. The initial permit is typically issued for one year but has been extended to two years due to the Covid-19 pandemic. Subsequent renewals are for two-year periods.

Application Process

The application process involves two trips to Portugal:

1. Initial Trip: To choose the qualifying investment, start the legal process, and open a bank account.
2. Second Trip: To provide biometric data and original documents.

The entire process to acquire a Portuguese residence permit through investment can take over 18 months.

Why Choose Portugal for Bitcoin Investment?

Portugal is an attractive destination for Bitcoin investment due to its favorable climate, rich culture, and strategic location in Europe. The country offers a high quality of life with excellent education and healthcare systems. The Golden Visa Program also provides a pathway to EU citizenship, making it a desirable option for investors looking to expand their opportunities in Europe.

Conclusion

The Unbound Fund, led by Alessandro Palombo, offers a groundbreaking opportunity for Bitcoin holders to gain EU citizenship through Portugal’s golden visa program. By investing in Bitcoin and meeting the program’s requirements, investors can enjoy the benefits of living, working, and traveling freely within the European Union. With the rising value of Bitcoin and the strategic advantages of the Portuguese Golden Visa Program, this initiative presents a unique and attractive investment avenue for non-EU nationals.