New Legislation Targets Seizure of $16B in Bitcoin and 1 Million BTC by U.S. Government

As of March 12, a new report from Nansen reveals that the U.S. government possesses 195,234 Bitcoin, amounting to over $16 billion.

In addition to Bitcoin, the government’s cryptocurrency portfolio includes Ethereum (ETH) valued at $4.6 million, stablecoins like USDC, as well as yield-bearing assets such as DAI and AUSDC_V2.

A recently introduced legislation by Rep. Nick Begich could significantly expand the government’s cryptocurrency holdings. The House Strategic Bitcoin Bill seeks to procure 1 million BTC, which would represent about 5% of Bitcoin’s total supply, over the next five years. If approved, the total expenditure at current market rates would be approximately $110 billion.

Market Implications

Should the bill be enacted, the U.S. government’s Bitcoin holdings would exceed the estimated 1.1 million BTC assigned to Bitcoin’s enigmatic creator, Satoshi Nakamoto. This would afford the government considerable power over market liquidity and price stability, possibly elevating Bitcoin’s value and altering overall market dynamics.

Nonetheless, such extensive ownership raises apprehensions regarding the centralization of an asset that is inherently designed to be decentralized. Large-scale government purchases could position the entity as a price influencer within the Bitcoin market, which some critics argue contradicts the fundamental principles of cryptocurrency.