Establishment of the strategic Bitcoin reserve and US digital asset stockpile | Hacker News Reader

Establishment of the strategic Bitcoin reserve and US digital asset stockpile

whitehouse.gov

28 pointspseudolus27 comments

Sounds like a wealth transfer to anyone holding Bitcoin.

And probably another constitutional crisis if he tries to spend federal money to buy Bitcoin without congressional approval, even if that's not in his order.

Perhaps he's trying to return to a combined crypto+gold standard?

The economic turmoil is making the people with the knowledge very rich, every day. This is the lesser spoken role of the volatility this gov is creating.

Kill confidence, buy 25% dips, hint at future announcements, sell at 35% gains. The inner circle with the timeline are just consolidating that wealth at the expense of a lot of the most vulnerable - the blind hopeless follower gambling beyond logic.

> at the expense of a lot of the most vulnerable - the blind hopeless follower gambling beyond logic.

The more concerning victims are the very many people whose retirements are heavily if not entirely invested in the stock market through 401ks, etc.

Can't wave that group away with moral hazard arguments and if the Republicans get their way across the board they'll be getting a double whammy in terms of their retirement investments being in tatters and Social Security being mostly destroyed as well.

This is the scam, the chaos is intentional

Given that this strategic reserve is to be built from all the various civil and criminal asset forfeitures, and not actually buying any crypto currency, how exactly is this considered a "wealth transfer"?

This is centralizing governance of forfeited assets from across the many agencies that are currently holding wallets with no direction, into a single place: the Treasury. This seems far favorable to letting various (430+) agencies manage these valuable assets on their own where they can easily be lost, stolen, etc.

Being a baggie for bitcoin begs the question that it’s necessarily going to increase over time. Given that Blackrock recently published a video reiterating the ground truth that there is no ultimate guarantee that the finite supply of bitcoin could not be increased, there are signs maybe this isn’t so bulletproof.

Blackrock are wrong.

No one will ever persuade me to or vast swathes of other bitcoin node runners, to run a version of bitcoin with a higher cap. It devalues our bitcoin. It devalues bitcoin full-stop.

Sure, a new fork can be, and in fact are, created with a higher cap, but why would people choose it over a harder system with a lower issuance?

Even if it somehow took hold, the old harder version of bitcoin would beat the newer softer version just like it's beating the soft fiat money we currently use.

I think the unspoken rationale is that governments can compel you to destroy a market. Look at when the US seized all of the gold in May of 1933. Blackrock operates in time scales where this sort of risk awareness is relevant.

Sure. But how does a government, or even governments, compel bitcoiners all around the world to stop running a version of bitcoin core on their nodes (likely running over TOR)?

Well considering the feds have charged and sentenced people for the activity of their exit nodes (CSAM), to which tor project has no response, I wouldn’t bother with Tor.

I’m sure the feds could force funding attached to crypto accounts to be verified by a trusted version of the bitcoin network or they are not legal to trade. They don’t have to physically stop the mining or validation, just the on/off ramps and banks who use it as collateral.

> Well considering the feds have charged and sentenced people for the activity of their exit nodes (CSAM), to which tor project has no response, I wouldn’t bother with Tor.

I'm certainly not a Tor expert, but I don't think bitcoin nodes running over Tor require an exit node. Even if they did they don't need to be located in the US.

> I’m sure the feds could force funding attached to crypto accounts to be verified by a trusted version of the bitcoin network or they are not legal to trade. They don’t have to physically stop the mining or validation, just the on/off ramps and banks who use it as collateral.

We could debate the details on a per-nation basis, but ultimately it's pointless. Even if it is possible for a nation to completely suppress bitcoin use within its borders, there will always be some country somewhere that embraces bitcoin and value looking to be stored will always migrate to the best store of value (bitcoin), just as air moves to the lowest-pressure volume, bitcoin miners move to areas with wasted, unwanted energy and electrons travel to less negatively-charged parts of a circuit.

It reduces sell pressure. I don't know how to estimate what that's worth.

> Sounds like a wealth transfer to anyone holding Bitcoin.

Don't forget XRP, solana and whatever else David Sachs is involved with.

> Perhaps he's trying to return to a combined crypto+gold standard?

I'm pretty sure Trump's too dumb to understand the arguments why such a system would be good, if anything it'd be all the crypto-bro billionaires who made their boy Vance VP. Or perhaps it's just all a pump and dump for them...

He seems to be emulating McKinley, down to using tarriffs to pressure Canada into being the 51st state, and the Gold Standard Act.

https://en.wikipedia.org/wiki/Gold_Standard_Act

> He seems to be

He is 79 years old, I do not thing that it is he who is emulating. Rather people who told him to do that.

Remember this is an executive order. The next president can sell them all to pay for a pet project.

Remember when trump used to criticise Obama because he used too many executive orders?

Not just trump but all republicans. They also used to criticize Obama for saying he’s willing to meet and talk to Putin.

“…the United States Government shall not acquire additional Stockpile Assets other than in connection with criminal or civil asset forfeiture proceedings or in satisfaction of any civil money penalty imposed by any agency without further executive or legislative action.”

That's interesting, it basically means that the coins that are seized are basically out of the market, increasing the value of the coins left in circulation. However, at some point the US government could start to liquidate a large position, causing a downward pressure on prices.

I wonder how large this stockpile is compared to the total number of coins in circulation.

So basically nothing is changing, because in theory any of those agencies could have sold those in the past and some did. Now it’s just centralizing control… kind of ironic for a decentralized currency.

How long until the keys are lost?

that's nice, but the US digital asset stockpile is not the strategic bitcoin reserve. The sentence that controls acquisition in the strategic bitcoin reserve is the one before it:

'The Secretary of the Treasury and the Secretary of Commerce shall develop strategies for acquiring additional Government BTC provided that such strategies are budget neutral and do not impose incremental costs on United States taxpayers.'

I wonder what budget neutral means. Does it mean that they have to find spending cuts in other areas in order to acquire additional BTC?

Does that last bit about "any civil money penalty" mean you can pay your fines with your own meme coin at face value, without having to sell them and thereby tank the value?

Is it normal that the background section reads like a random Reddit post?

Some thoughts:

The Strategic Crypto Swindle

https://news.ycombinator.com/item?id=43270398

Trump's 'Crypto Reserve' Is Such Brazen Corruption

https://news.ycombinator.com/item?id=43261899

The “strategic reserve” exposes crypto as the scam it always was

https://news.ycombinator.com/item?id=43236752

Reply on news.ycombinator.com