Can Bitcoin Save the US Economy? Saylor Proposes $16T Debt Reduction Plan

• In a CNBC interview, Michael Saylor asserted that acquiring one million Bitcoins within the next five years could significantly decrease the U.S. national debt by $16 trillion.
• Senator Cynthia Lummis has also introduced a bill to increase the nation’s digital asset reserves, which could face challenges in Congress due to Bitcoin’s volatility.

In a time of increasing national debt and economic uncertainty, MicroStrategy Co-founder Michael Saylor is advocating for an initiative: the establishment of a strategic Bitcoin reserve for the United States. The plan suggests that Bitcoin could play a role in alleviating the country’s financial burdens, and hopes are high for significant legislative backing.

On Friday, the national debt reached $35.95 trillion, as reported by data from the US Treasury website. This figure highlights a swift rate of government spending that has raised concerns among economists for several years.

In the CNBC interview, the vigorous Bitcoin advocate posited that accumulating one million Bitcoins over the next five years could shave $16 trillion off the current national debt, effectively reducing it by 45%. This bold assertion underscores Saylor’s confidence in Bitcoin as a viable financial asset that could bolster the U.S. economy.

Building on this momentum, Saylor believes that a formal plan for the U.S. government to hold its own Bitcoin reserve could materialize soon. Earlier this year, during the Bitcoin 2024 conference in Nashville, Trump indicated he would support an initiative to have 200,000 Bitcoins in reserve. 

Michael Saylor also elaborated on what he calls the “Trump Max” scenario, in which the U.S. would acquire four million Bitcoins. This strategy, according to Saylor, could yield a $81 trillion return, portraying it as the most “rational approach” in light of the nation’s financial challenges.

He also revealed MicroStrategy’s plans to raise $42 billion to acquire more Bitcoins over the next four years. This move reinforces the company’s plan to dominate as a ‘Bitcoin Treasury Company.’ Notably, the company currently owns 252,220 BTC, valued at $6.851 billion, which it acquired at an average price of $39,266 per Bitcoin.

Senator Lummis also Calls for a Bitcoin Reserve

Senator Cynthia Lummis of Wyoming has also proposed a plan to create a U.S. Bitcoin reserve by selling part of the Federal Reserve’s gold, aiming to convert this into one million Bitcoins at a cost of $90 billion. While it aligns with former President Trump’s pro-crypto stance, the proposal is likely to face significant challenges in Congress due to concerns about Bitcoin’s volatility and the high level of trust required from lawmakers.

Lummis’ proposal isn’t the only effort aimed at creating a government-supported Bitcoin reserve. In Pennsylvania, Republican Representative Mike Cabell has just put forth a bill that would allow the state treasury to allocate up to 10% of its funds for investment in Bitcoin.

Meanwhile, BTC is currently trading at $88,296, after experiencing a 2.09% decrease in the past 24 hours, while it increased by 17.09% in the past week.