Bitcoin News: CoinShares Exec Unveils Major Hurdle For BTC Strategic Reserve
Highlights
- CoinShares' Steven McClurg has weighed in on the need for a BTC strategic reserve for the U.S.
- However, he also emphasized the need for a diversified approach rather than just relying on BTC.
- McClurg also shed light on the potential hurdles for the creation of a BTC reserve.
Bitcoin News: Steven McClurg, CoinShares’ Head of Digital Assets, recently advocated for the United States to create a strategic BTC reserve. This aligns with views of pro-crypto presidential candidates like Donald Trump and Robert F. Kennedy Jr. Moreover, during the Bitcoin Conference 2024, on Saturday, Senator Cynthia Lummis announced a bill for leveraging BTC as a strategic reserve.
CoinShares’ McClurg On Bitcoin Strategic Reserve
In a compelling interview with Bloomberg, McClurg argued that BTC, as a “global currency for the Internet,” should be part of America’s strategic assets. According to McClurg, the rationale for a Bitcoin reserve is rooted in the global trend of maintaining diverse currency reserves.
He stated, “Bitcoin has really emerged as a global currency for the Internet.” In addition, he emphasized its role as a “currency without borders.” Hence, McClurg believes that incorporating BTC into a reserve could address issues stemming from inflation and the current lack of a monetary standard in the U.S.
“The last five years, inflation has really crept up,” McClurg explained. He added, “One of the reasons why inflation is so high is because there’s not any kind of cap on the US dollar.” Furthermore, he pointed out that the U.S. broke away from the gold standard in the 1970s, leaving the dollar without a solid backing. This, according to McClurg, has led to unchecked inflation risks.
However, McClurg also acknowledged significant hurdles to this proposal. When asked about financing such a reserve amidst the current deficit concerns, he responded, “It really has to do more with inflation.” He argued that while Bitcoin should be part of a broader reserve strategy. Moreover, the steady should also include other assets like gold and foreign currencies.
Also Read: US Govt To Sell Entire Bitcoin Holdings, Peter Schiff Warns
Major Hurdles In The Process
“Not only taking the seized Bitcoin,” McClurg suggested, referring to the approximately 200,000 BTC (now 183,000 BTC) currently held by the U.S. government, “but also purchasing more.” However, he believes that it is crucial to first address the U.S. deficit and control spending. This might be a key hurdle in the development of a Bitcoin strategic reserve.
McClurg stated:
“But I think more importantly we do need to start paying down our deficit and controlling spending before we can get to a strategic Bitcoin reserve. We do really do have to address those two issues and those really should be addressed in this current presidential campaign.”
On the contrary, on Monday, July 29, the U.S. government moved a huge stash of 29,800 Bitcoin worth a staggering $2 billion just days after the strategic reserve news came in. This also can serve as a major obstacle in the creation of a Bitcoin reserve. In case the Biden administration sells the entire stash of around 183,000 BTC before a pro-crypto candidate can takeover then the U.S. may have to make an additional BTC purchase.
However, the deficit and rising debt of $35 trillion may deter such acquisitions as noted by McClurg and other industry experts. On the debt front, Senator Lummis confirmed that the BTC strategic reserve wouldn’t increase debt but would actually help in combating the issue.
Also Read: Senator Cynthia Lummis Proposes Bitcoin Solution As US Debt Hits $35 Tln
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