As the Biden and Kamala administration slowly phases out for Trump in January 2025, many crypto enthusiasts are anxious to see Trump deliver on many of his promises during his election campaign. One of the most infamous ones many crypto users seem to be excited about is the firing of the SEC boss, but that aside, one more promise has gotten the internet fired up. 

Polymarket data has shown that many netizens are especially bullish on Donald Trump’s creation of a strategic Bitcoin reserve. Currently, the odds of Trump setting up a federal Bitcoin reserve within the first 100 days in office have risen from 22% on November 10 to 38% on the prediction betting site.

While the exact reasons for this change in market sentiment are not known, many have attributed this dramatic rise to the recent introduction of the Pennsylvania Bitcoin Strategic Reserve Act just last week. 

The Satoshi Action Fund advocacy group is also reported to be behind this new act and the Bitcoin Rights Bill introduced last month. According to Fox Business, the advocacy group has now also shared that it is speaking with ten other states in an ongoing process to pass similar legislation.

If both bills set up by the advocacy group are passed into law, they would have massive implications for Bitcoin markets. Pennsylvania’s Strategic Reserve bill aims to allow the state to set aside up to 10% of specific government funds for Bitcoin, including the General Fund, Rainy Fund, and the State Investment Fund.

Analysis from the 2023 Treasury Annual Investment Report shows that these funds combined hold approximately $51 billion in assets. This means that a 10% allocation from them would amount to an estimated $5.1 billion in Bitcoin investment. 

The "Boost Innovation Technology Competitiveness Through Optimized Investment Nationwide" (BITCOIN) Act, introduced by Senator Cynthia Lummis earlier in the year, is also considered a major factor in the significant rise in confidence.

That act proposed that the U.S. create a Strategic Bitcoin Reserve built by the government by buying new Bitcoin and keeping all Bitcoin seized by the U.S. authorities instead of selling them off as many other governments do. 

The US government has at least 69,370 bitcoins to date. The BITCOIN Act also requires that the government purchase at least 200,000 BTC annually for five years, rounding up to 1,000,000 BTC after five years. 

Calculated at current prices, this would mean that the U.S. government would be holding approximately $6.4 billion that could otherwise be in the market and an additional $18.2 million bid every 12 months for a complete five years. It sounds impressive but it also means that the government could end up starving the market of Bitcoin!

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