Connect with us

Bitcoin reserve

Steve Hanke Is Wrong About the Strategic Bitcoin Reserve

Published

on


Steve Hanke is wrong about something Bitcoin related once again.

He’s recently taken aim at the idea of the U.S. creating a Strategic Bitcoin Reserve (SBR).

In the video embedded in the X post below, Hanke claimed that converting government savings into bitcoin would be a “drag on the economy” because those savings wouldn’t be invested in “real capital assets that produce things.”He even doubled down, saying bitcoin doesn’t build factories, create jobs, or drive innovation.

I couldn’t disagree more—and I think his argument completely misses the point.

Let’s get honest about what a SBR is supposed to do. It’s not about building factories or creating jobs directly. It’s about protecting a country’s economy, hedging against risk, and ensuring long-term economic stability.

Does Hanke think the U.S. should sell its gold and oil reserves or food and weapons stockpiles because they aren’t “driving innovation”? Of course not. Those reserves exist to provide security and stability, not to act like venture capital investments.

A SBR would work in the same way. It wouldn’t directly create jobs, but it would provide the U.S. with a hedge against inflation, dollar debasement, and geopolitical risks.

Let’s face it—the dollar isn’t as strong as it used to be, and holding bitcoin would give the U.S. a safety net as the world shifts toward decentralized money. It’s about preparing for the future, not clinging to outdated economic models.

Hanke also forgets how reserves can provide leverage. If bitcoin becomes the world’s most valuable asset and the U.S. has established a Strategic Bitcoin Reserve, it will be ahead of the game. That’s not just a hedge—it’s a massive geopolitical advantage. It would strengthen confidence in the U.S. financial system.

His take shows he doesn’t understand what reserves are for. They’re about risk management and long-term strategy, not short-term job creation. A Strategic Bitcoin Reserve isn’t a “drag on the economy.” It’s an innovative, forward-thinking move.

The idea of an SBR isn’t stupid. What’s stupid is dismissing it with outdated arguments.

This article is a Take. Opinions expressed are entirely the author’s and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.





Source link

Bitcoin

Solv Raises $10M for Bitcoin Reserve Offering to Drive Institutional BTC Finance Adoption

Published

on



Bitcoin (BTC) staking platform Solv has raised $10 million for its Bitcoin Reserve Offering (BRO) as it aims to build a $100 million BTC reserve.

BRO merges aspects of traditional convertible bonds with crypto-native features to drive institutional adoption of BTC finance, according to an emailed announcement shared with CoinDesk on Thursday.

Solv is attempting to offer an “on-chain MicroStrategy” model, referencing the Michael Saylor-founded software company that now owns nearly 500,000 BTC.

BRO may appeal to institutions who wish to invest in BTC as a store of value in a similar way to Strategy (as MicroStrategy is now called) but without physically purchasing and holding it themselves. Furthermore, they may be seeking a more active yield-generating form of BTC investment.

Solv will deploy the BTC raised to various yield-generating vehicles, such as liquid staking tokens, and invested across decentralized finance (DeFi), real-world assets (RWAs) and institutional finance products.

“What this means is that Solv’s protocol-owned Bitcoin Reserve will be active and productive, rather than having the BTC sitting idle,” Solv said in Thursday’s announcement.





Source link

Continue Reading

Bitcoin reserve

The United States Officially Establishes A Strategic Bitcoin Reserve 

Published

on


U.S. President Donald Trump has officially made the United States the largest nation-state holder of Bitcoin by signing an executive order this evening to create a Strategic Bitcoin Reserve. The reserve will hold an estimated 200,000 BTC, marking a significant shift in U.S. financial strategy and reinforcing Bitcoin’s role in the global economy.

David Sacks, President Trump’s Crypto Czar, provided further clarification on the newly established reserve, stating that the reserve will be funded by Bitcoin already owned by the federal government, specifically assets forfeited in criminal and civil asset forfeiture proceedings. “This means it will not cost taxpayers a dime,” he emphasized.

The executive order also mandates a comprehensive audit of the federal government’s Bitcoin holdings, as the exact quantity of BTC under U.S. control has never been fully accounted for. Sacks noted: “It is estimated that the U.S. government owns about 200,000 bitcoin; however, there has never been a complete audit. The E.O. directs a full accounting of the federal government’s digital asset holdings.”

A key provision of the executive order ensures that the government will not sell any Bitcoin deposited into the reserve. Instead, it will serve as a long-term store of value, with Sacks likening it to “a digital Fort Knox for the cryptocurrency often called ‘digital gold.’”

Highlighting past financial missteps, Sacks explained how premature sales of Bitcoin by the government have cost taxpayers over $17 billion in lost value. With the new reserve, the administration seeks to avoid such losses while strategically maximizing Bitcoin’s long-term value.

Additionally, the executive order grants the Secretaries of Treasury and Commerce the authority to develop budget-neutral strategies for acquiring more Bitcoin, provided that such acquisitions come at no incremental cost to American taxpayers.

The executive order also establishes a U.S. Digital Asset Stockpile, which will include non-Bitcoin digital assets seized in forfeiture proceedings. However, no additional assets will be acquired for this stockpile beyond those obtained through such means.

Sacks concluded by praising the administration’s commitment to digital assets: “President Trump promised to create a Strategic Bitcoin Reserve and Digital Asset Stockpile. Those promises have been kept.” He credited key officials, including Treasury Secretary Scott Bessent, Commerce Secretary Howard Lutnick, and Executive Director Bo Hines, for their role in executing this initiative.

This landmark decision positions the United States at the forefront of the global Bitcoin economy. With this move, President Trump’s administration is signaling a bold embrace of Bitcoin as a core component of national financial strategy.



Source link

Continue Reading

Bitcoin reserve

Bitcoin Reserves And The Incentives Of Civil Asset Forfeiture

Published

on


Yesterday, President Trump announced the long awaited Strategic “Bitcoin” Reserve on Truth Social, and many in the space are pissed.

First, the Reserve appears to be far from Bitcoin only. “They’re doing DEI for Charles Hoskinson,” former CoinDesk Chief Insights Columnist David Z. Morris wrote on X – Hoskinson’s Cardano (ADA) was announced to be included in the Reserve. “Cut cancer research to buy Cardano,“ another user posted

Others take issue with possible investment interests surrounding the Trump administration: Trump’s announcement is “a new level of corruption,” wrote communications strategist Derek Martin, detailing David Sack’s investment in Bitwise. “You get exit liquidity and you get exit liquidity everybody gets exit liquidity” posted Bitcoin Policy Institute fellow Troy Cross alongside a picture of Oprah. (Sacks has since stated that he has sold all of his cryptocurrency holdings).

What all of these criticisms have in common is that they completely miss the point. Whether the Reserve is composed of additional coins, or may serve nefarious interests of the administration, is of little actual consequence for those holding Bitcoin.

What is very much of consequence, is the question of how said Reserve would be funded. On the one hand, many are speculating that the US may divert taxpayer funds to purchase cryptocurrency – a proposal that inevitably would have to go through Congress – which seems unlikely, as Trump is rumoured to make a new announcement on ‘investments’ today.

Another, much more likely approach, as already outlined in Trump’s Executive Order to “Strengthen American Leadership in Digital Financial Technology”, is that the Reserve would be “derived from cryptocurrencies lawfully seized by the Federal Government through its law enforcement efforts.”

That’s fine, you’ll say, because I’ve obtained all of my bitcoin legally and have never, nor will I ever, engage in criminal activity. And that’s precisely where you are wrong.

Bitcoin that is “lawfully seized by the Federal Government” does not just include bitcoin derived through criminal prosecutions. Bitcoin can additionally be lawfully seized through a process called Civil Asset Forfeiture: a funny little game that the Government plays in which it doesn’t have to accuse you of a crime, but can instead accuse the thing itself of a crime. 

As Cato Institute has outlined in a post calling for the reform of Civil Asset Forfeiture law, New York police routinely seize cars used in a DUI, and in Florida, police regularly seize cash excess of $100 suspected to be used to purchase illegal substances. In the most striking example, Cato highlights a case from Philadelphia, in which police tried to seize a grandmother’s house and car because, without her knowledge, her son sold less than $200 worth of marijuana from the house. In Philadelphia alone, civil asset forfeiture was so astonishingly abused, that the City seized over 1,000 homes, over 3,000 vehicles, and over $44 Million in cash over an 11-year period.

The problem with civil asset forfeiture is that it reverses the burden of proof. Instead of being guilty until proven innocent, it is up to the asset’s owner to prove that the property seized wasn’t used – or wasn’t intended to be used – in a crime. The cost of such litigation is what makes civil asset forfeiture close to impossible to fight.

While the Government could have – and has – applied civil asset forfeiture to cryptocurrencies, which usually stand out in court documents by their titles alone, such as United States v. Binance Account 188746, it never really had a strategic interest in applying it more broadly. The Bitcoin would be seized and forfeited to the Government, but the Government would have to end up selling it for dollars anyway.

If we take Trump’s Executive Order at face value, this may now change, giving the Government an incentive to apply civil asset forfeiture to bitcoin more broadly.

This is a problem, as we can likely trace a lot of bitcoin back to having touched a sanctions evasion, a darknet market, or other alleged illicit activity. The question then becomes: how many hops back do we go? How many UTXOs do we unravel to find it legitimate that bitcoin coming out of potentially illicit activity is seized on behalf of the Government to help build its Strategic Reserve?

The other problem is that, if the Government accuses the bitcoin you hold of having been involved in the facilitation of crime, you may have obtained said bitcoin fully legally, had nothing to do with the alleged criminal activity, and don’t even need to have been aware of it – the Government may still, fully legally, take your bitcoin away from you.

Taking Trump’s Executive Order at face, it seems that cheering on the Strategic Bitcoin Reserve may not be the smartest move until it is clarified that civil asset forfeiture will not be employed to further the Reserve. After all, it is a concept that should be reformed, and not encouraged. 

This is a guest post by L0la L33tz. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.



Source link

Continue Reading
Advertisement [ethereumads]

Trending

    wpChatIcon