By Robert Ross, Total Wealth Research, 2024-07-30
I love it when a plan comes together.
One of my big “calls” for this crypto bull market was by the end of it, governments and central banks would own Bitcoin (BTC) or other cryptocurrencies on their balance sheet.
This seems like a logical step. In the 2017-2018 bull run, we had a surge in individuals owning Bitcoin. And in the 2020-2021 bull run, we had major corporations like Tesla (TSLA), Square (SQ), and MicroStrategy (MSTR) owning cryptocurrency.
Now, we have the leader of the U.S. presidential race teasing that Bitcoin will be a “strategic reserve asset” for the U.S. government.
And that has major implications for the crypto market.
The Government Already “HODLs” Bitcoin
There's been a huge sea change in the relationship between the U.S. government and crypto in the last two weeks.
First, you have former President Trump calling himself the “crypto president” and headlining the upcoming Bitcoin conference in Nashville. Then he ordains JD Vance as his running mate – who has deep ties to the crypto industry and even owns more than $100,000 in Bitcoin.
Then you have the sitting vice president and now Trump challenger Kamala Harris reaching out to crypto evangelist Mark Cuban about how she can work with the industry.
This is a major narrative shift from several years ago when Trump called crypto a “scam against the U.S. dollar” and top Democrats like Elizabeth Warren saying the U.S. needs to “crack down on environmentally wasteful crypto mining practices.”
But while the narrative has changed, most people don't realize the U.S. Department of Justice already holds $13 billion in Bitcoin.
And if Bitcoin is to be treated as a strategic asset, the U.S. government's crypto holdings will swell dramatically.
Bitcoin as a Strategic Reserve Asset
The U.S. government holds around $242 billion in reserve assets.
This includes $165 billion in special drawing rights with the International Monetary Fund, $35 billion in securities, and $11 billion in gold. If Bitcoin were treated in the same category as these assets, it would have profound implications for the crypto market.
When a government starts to accumulate a particular asset as a reserve, it signals long-term confidence in that asset's value and stability. This could boost investor confidence and drive demand for Bitcoin, pushing its price higher.
Smaller nations such as El Salvador already hold Bitcoin. But the country has a GDP of just $32 billion (even less than the state of Vermont). Its entrance into the crypto market didn't make many waves.
But the U.S. – the world's largest economy – entering the Bitcoin market would be a completely different animal.
For one, such a move would pave the way for other countries to follow suit, creating a domino effect. If the U.S. treats Bitcoin as a strategic reserve – as former President Trump stated would be a priority for him if elected – it may encourage other nations to diversify their reserves with digital assets.
This global shift could further legitimize cryptocurrencies, leading to wider adoption and integration into the global financial system.
Just ask Wyoming Senator Cynthia Lummis. She announced a bill for the U.S. Treasury to buy 1 million Bitcoin (valued at $68 billion) to help reduce the U.S. national debt…
But before the U.S. government goes full bore into the crypto industry, you need to establish your own “strategic crypto reserve.”
Time to Buy
The U.S. government treating Bitcoin as a strategic reserve asset could be a game-changer for the cryptocurrency market. It would signal strong institutional support, drive global adoption, and lead to a more mature and regulated crypto ecosystem.
As a result, the prices for cryptocurrencies like Bitcoin could likely skyrocket… which means now is the time to invest.
I've been saying for nearly a year that this was a likely event for this bull market. And we've been getting into position in my Breakout Fortunes trading service by buying tiny cryptocurrency projects that give investors much more upside than crypto “blue chips” like Bitcoin and Ethereum.
But either way, Bitcoin is becoming a bipartisan issue… and it's a positive sign for this burgeoning asset class.
The post Big Promises Make for a Huge Crypto Sea Change appeared first on Total Wealth Research.
