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Donald Trump’s pledge to establish a strategic Bitcoin reserve has sent shockwaves throughout the cryptocurrency market, sparking both excitement and skepticism among traders and enthusiasts alike. While the President-elect’s vision may have sparked debate, it is crucial to examine whether such an initiative can indeed bypass the Federal Reserve.
It appears that Trump’s bold move might be more feasible than initially thought. A Bitcoin Strategic Reserve (BSR) would likely involve issuing an executive order upon taking office, directing the U.S. Treasury Department to utilize the Exchange Stabilization Fund (ESF) for direct BTC purchases.
In this scenario, the Treasury Department would act as a middleman between the government and the cryptocurrency market, allowing the administration to circumvent the Fed’s control over monetary policy. This approach might be seen as an effort to bypass Powell’s resistance to Bitcoin reserves.
It is important to note that the Federal Reserve has no plans to engage in any government initiative to accumulate Bitcoin. In a recent press conference, Jerome Powell emphasized that “We’re not allowed to own Bitcoin.” However, he also noted that the Federal Reserve Act specifies what it can and cannot own, implying that they are open to considering alternative options.
While the President-elect’s plan is still uncertain, one thing is clear: this bold move could revolutionize the cryptocurrency market. If successfully implemented, it would likely result in a significant shift in power dynamics within the financial sector.
Furthermore, this development could have far-reaching implications for traditional investors and institutions, who may be forced to reevaluate their stance on cryptocurrencies.
However, whether such an initiative can materialize remains unclear. As the situation unfolds, we will continue to monitor any updates and provide insights on the implications of this bold move.
Source: ambcrypto.com
