The idea of Bitcoin becoming a reserve asset is gaining traction, with political forces on both sides of the Atlantic advocating for the inclusion of cryptocurrencies in federal finances. If the concept takes off, it could provide Bitcoin with unprecedented institutional credibility, possibly driving the asset’s price toward $150,000 or higher. After gaining momentum in the US, the proposal has sparked debate in Europe, particularly in Germany, the continent’s strongest economy.
Christian Lindner: we need to accept Bitcoin or risk getting left behind
In a recent statement for the dpa press agency, Christian Lindner, the leader of the Free Democratic Party (FDP) and a former German Finance Minister, suggested that both the European Central Bank (ECB) and the Bundesbank should consider including cryptocurrencies, particularly Bitcoin, in their financial reserves. Lindner pointed to the US, where cryptocurrencies are being discussed as a potential reserve asset on par with national currencies and gold.
– The new Trump administration is pursuing an extremely progressive policy when it comes to crypto assets such as Bitcoin – he said, stressing that the US wants to become a global leader in the crypto sector. The politician also warned that ignoring the issue entails the risk of being left behind for Germany and Europe.
German liberals suggest Bitcoin could be a reserve currency
It’s not a one-off publicity move. Lindner’s home party has recently published a manifesto for the coming 2025 election, in which it demonstrates strong support for crypto assets. FDP’s election program goes as far as to recommend the inclusion of Bitcoin and other blockchain currencies in the ECB’s and Bundesbank’s reserves.
“We welcome and advocate the development of cryptocurrencies and digital ledger technology for the approval of crypto ETFs. We are open to the European Central Bank and the Deutsche Bundesbank using cryptocurrencies such as Bitcoin as currency reserves. This can strengthen the resilience of the European monetary system,” the document states. The manifesto goes on to address cash and the use of the CBDC (the digital euro).
“We Free Democrats stand for maintaining cash. We are in favor of broad acceptance of cash alongside card payments. A digital euro that complements cash must protect user privacy and be usable both online and offline. There may be no compulsion to use the digital euro and there must be no additional risks for the financial system,” the program states.
Bitcoin has the full support of Donald Trump
The Bitcoin-as-a-federal-reserve idea has been vividly discussed in the US. Its most notable proponent has been no other than Donald Trump, who suggested stockpiling crypto as strategic assets. On December 12, the president-elect said, “We’re gonna do something great with crypto because we don’t want China, or anybody else (…), but others are embracing it, and we want to be ahead.”
After converting from crypto skepticism, Trump has consistently advocated for Bitcoin as a strategic asset, vowing to push the US ahead of key competitors in the crypto race. A rumor has it that an executive order could officially designate Bitcoin as a reserve asset soon after Trump assumes office on January 20, 2025.
The US government currently holds 212,847 BTC, worth $22.3 billion, seized through law enforcement actions. However, it’s uncertain whether Trump’s proposed reserve would include these holdings. That said, it’s too early to make any definitive conclusions. Especially since there’s little support for the idea from the Federal Reserve.
FED doesn’t support the concept but it’ll be up to Congress to decide
The institution’s chairman, Jerome Powell, recently declared that the US central bank is not involved in any government effort to stockpile large amounts of Bitcoin. He added though, that it’d be up to Congress to consider such an issue, leaving open the possibility of a shift in policy.
It’s worth emphasizing that the idea has been floated repeatedly in various forums and top political circles. Growing support for crypto and related solutions among businesses and individuals is another factor making the concept harder to dismiss. If the proposal eventually moves forward, providing Bitcoin – and potentially selected altcoins – with the highest level of institutional legitimacy, we could be seeing the BTC price soar toward $150k and even beyond. The bull case scenario suggests the top cryptocurrency could even reach $400k next year
This article was originally Posted on Coinpaper.com
