Two U.S. Representatives propose the American Reserve Modernization Act to create a federal Bitcoin reserve, facing both support and criticism.
New Bill Introduced for Bitcoin Reserve
Representatives Nick Begich and Jared Golden have introduced the American Reserve Modernization Act (ARMA), a proposal aiming to create a legal framework for a federal Bitcoin reserve. This initiative fulfills a key promise from the Trump administration and is expected to manage Bitcoin alongside other cryptocurrencies for a minimum of 20 years.
The bill mandates the U.S. Treasury Department to assemble and maintain this reserve while consolidating billions of dollars in digital assets currently held by various federal agencies, typically obtained through penalties or forfeitures. To ensure accountability, the legislation also stipulates that a proof-of-reserve report be produced.
Challenges and Political Context
As the strategic Bitcoin reserve evolves from an executive order initially signed by Trump, it is facing several hurdles. Patrick Witt from the President’s Council of Advisors for Digital Assets mentioned ongoing efforts to clarify the initiative's legal aspects. Begich emphasizes that the reserve will provide a safety net for the U.S. dollar and adapt to changing perceptions of value.
“The balance sheet of America’s reserves is essential for our nation’s insurance policy,” Begich stated in a recent X post.
In addition to Begich, Golden, who serves as the primary Democratic co-sponsor, highlighted that the reserve would carry legal weight and not be subject to arbitrary decisions by future administrations. The bill has gained support from 17 initial co-sponsors, including notable figures like Rep. Mike Collins, who has invested in cryptocurrencies himself.
However, expectations regarding the reserve's size and scope have been moderated. Treasury Secretary Scott Bessent indicated that there will not be any immediate agency purchases of Bitcoin, despite earlier hopes that the administration would seek to build a substantial reserve.
Criticism and Future Outlook
The initiative has faced criticism from some lawmakers, including Rep. Maxine Waters, who argues that cryptocurrencies do not meet the criteria of critical resources typically associated with government reserves. Meanwhile, the government is yet to disclose any plans for distributing this strategic stockpile, although previous legislation such as the BITCOIN Act, proposed by Sen. Cynthia Lummis, aimed at acquiring a significant amount of Bitcoin without taxing citizens.
As the legislative process unfolds, Begich and Golden continue to advocate for the establishment of a formal Bitcoin reserve, which they believe will benefit the broader digital assets landscape.
