Bitcoin News Today: U.S. Bitcoin Reserve Aims to Hedge $38 Trillion Debt, Inflation

The U.S. House of Representatives has taken a historic step toward integrating cryptocurrency into the federal financial system, with Rep. Warren Davidson (R-Ohio) introducing the Bitcoin for America Act of 2025. The legislation, endorsed by the Bitcoin Policy Institute (BPI), would allow Americans to pay federal taxes in Bitcoin without triggering capital gains liability—a first for the U.S. government—and channel the proceeds into a Strategic Bitcoin Reserve. The bill aims to modernize the nation's financial infrastructure while positioning the U.S. as a global leader in digital asset innovation.

Under the proposed law, taxpayers could transfer Bitcoin directly to the Treasury or approved financial agents to settle tax liabilities. The value of the Bitcoin would be determined at the time of transfer, with no capital gains recognized, similar to foreign currency transactions as reported by Bitcoin Magazine. The Strategic Bitcoin Reserve, established via an executive order earlier this year, would hold the incoming Bitcoin for at least 20 years, with limited dispositions allowed only after that period according to Cryptoslate. Proponents argue this creates a long-term, appreciating asset to counteract inflationary pressures on the U.S. dollar.

Davidson, a vocal advocate for Bitcoin, emphasized the act's potential to strengthen the nation's financial foundation. "By allowing taxpayers to pay federal taxes in Bitcoin and having the proceeds placed into the Strategic Bitcoin Reserve, the nation will benefit by having a tangible asset that appreciates in value over time," he stated. The legislation also includes robust custody measures, such as cold storage and multi-signature wallets, to secure the reserve as detailed in Bitcoin Magazine.

The Bitcoin Policy Institute, a nonpartisan think tank, has developed a proprietary model projecting the economic benefits of the act. If 1% of federal tax payments were made in Bitcoin over the next two decades, the reserve could accumulate up to 4.3 million coins, with an estimated terminal value of $13.8 trillion at a $3.25 million price per Bitcoin according to Cryptoslate. This, BPI argues, would provide a hedge against the U.S.'s $38 trillion debt and reduce reliance on traditional debt financing.

Critics, however, highlight risks tied to Bitcoin's volatility. While the act assumes stable adoption and price trends, market fluctuations could complicate revenue forecasting and introduce uncertainty into federal budgeting according to Cryptoslate. Additionally, the Treasury would need to overhaul its systems to handle timestamped price settlements, refund protocols, and sanctions screening for incoming transactions as reported by Cryptoslate.

The bill aligns with broader global trends, as nations like China and Russia are reportedly accumulating Bitcoin to diversify reserves according to Bitcoin Magazine. By enabling voluntary participation, the U.S. aims to democratize its Bitcoin accumulation strategy, with BPI's Conner Brown noting it creates "a truly democratic, market-driven model."

As of November 20, 2025, Bitcoin traded at $90,480, up from a six-month low of $82,000 earlier in the week. The Strategic Bitcoin Reserve, currently holding 326,000 BTC from seized assets, is projected to grow significantly.