BITCOIN Act Proposes Buying 1 Million Bitcoin for National Strategic Reserve Over 5 Years

The "Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide Act of 2025," or BITCOIN Act, lays out a plan for the U.S. government to acquire and hold significant amounts of Bitcoin. The core proposal involves establishing a "Strategic Bitcoin Reserve" and initiating a large-scale "Bitcoin Purchase Program." Under this program, the Secretary of the Treasury would be directed to buy 200,000 Bitcoins annually for five years, aiming for a total of 1 million Bitcoins, placing them in the newly created reserve.

Building the Bitcoin Fort Knox

This bill mandates the creation of a "Strategic Bitcoin Reserve" (Sec. 4), envisioned as a decentralized network of secure storage facilities across the U.S. Think of it like a digital version of Fort Knox, but spread out geographically to minimize risk. The Treasury Secretary would oversee this network, selecting locations based on security and accessibility, and implementing advanced security measures developed in consultation with defense, homeland security, and industry experts. The Bitcoin would be kept in "cold storage," meaning the private keys needed to access the coins are stored offline, away from potential online threats. The Secretary is also tasked with regular monitoring and auditing of these holdings.

Shopping Spree: The Bitcoin Purchase Program

The heart of the bill is the "Bitcoin Purchase Program" (Sec. 5), authorizing the Treasury to buy 1 million Bitcoins over five years. These purchases are intended to be made "strategically to avoid market disruption." Once acquired, this Bitcoin, along with any Bitcoin transferred from other federal agencies (Sec. 7) or obtained through means like forfeiture, must be held in the Strategic Bitcoin Reserve for at least 20 years. During this period, selling or swapping the Bitcoin is prohibited. Two years before the 20-year mark, the Treasury Secretary is required to recommend to Congress whether to keep holding the Bitcoin or start gradually selling portions to reduce the national debt. If sales are approved after the holding period, no more than 10% of the reserve's assets can be sold every two years. The bill also amends the Exchange Stabilization Fund (Sec. 11) to explicitly allow it to hold and transact in Bitcoin, coordinating these activities with the main purchase program.

Show Me the Money (and the Bitcoin)

Funding for these substantial purchases wouldn't come from new taxes. Instead, the bill proposes (Sec. 9) redirecting funds by reducing the surplus funds Federal Reserve Banks are allowed to hold, tapping into the first $6 billion of annual net earnings remitted by the Fed to the Treasury (from 2025-2029), and requiring the Federal Reserve Banks to turn over existing gold certificates to be reissued at current market value, with the difference sent to the Treasury. These revalued gold certificate funds would be prioritized for the Bitcoin purchases. To ensure transparency, a "Proof of Reserve" system (Sec. 6) is mandated, requiring quarterly public reports detailing the reserve's holdings and transactions, verified by an independent auditor and overseen by the Comptroller General.

Forks, States, and Your Own Stash

The bill addresses the complexities of cryptocurrency, including "forks" (protocol changes creating a new asset) and "airdrops" (free distributions of new assets). Any digital assets resulting from forks or airdrops related to the reserve's Bitcoin must be accounted for and secured (Sec. 4). These can't be sold for five years. After that, the Treasury generally keeps the forked asset with the highest market value and may sell the others, unless a specific asset offers unique technological or strategic value. States are given the option to voluntarily store their own Bitcoin holdings within the federal Strategic Bitcoin Reserve, though they retain ownership and assume the risks (Sec. 8). Importantly, the Act includes a section (Sec. 10) explicitly stating it doesn't authorize the seizure of lawfully acquired private Bitcoin holdings and affirms the rights of individuals to own, use, and control their digital assets.