Bitcoin to the Rescue: Senator Proposes Crypto Debt Solution

U.S. Senator Cynthia Lummis has proposed an innovative solution to tackle the nation's debt: allocating 1 million bitcoins to a strategic reserve. This move, according to Lummis, could potentially cut the U.S. debt in half over the next 20 years.

Lummis, who is the chair of the Senate Banking Committee on Digital Assets, believes that by creating a reserve with 5% of the total Bitcoin supply, the U.S. could significantly reduce its debt burden. This proposal, known as the "Bitcoin Strategic Reserve Act," aims to harness the power of cryptocurrency to address the country's financial challenges.

The senator's proposal comes at a time when the U.S. is grappling with a substantial national debt. As of February 2025, the U.S. national debt stands at over $31 trillion, according to the U.S. Treasury Department. Lummis' plan suggests that allocating a portion of this cryptocurrency to a strategic reserve could help alleviate this burden.

However, it's essential to note that this proposal is still in its early stages and faces numerous challenges. The U.S. government would need to acquire 1 million bitcoins, which would require significant investment and could potentially drive up the price of Bitcoin. Additionally, the proposal would need to navigate the complex legal and regulatory landscape surrounding cryptocurrencies.

Moreover, the effectiveness of this strategy depends on various factors, including the future value of Bitcoin and the U.S. government's ability to manage the reserve effectively. While the proposal is ambitious and innovative, it remains to be seen whether it will gain traction and become a viable solution to the U.S. debt crisis.