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- Global investment management firm VanEck has outlined six key ways the US could expand its Bitcoin position without impacting the federal budget.
- One of them is to sell the 1.433 billion pounds of Cheese which is reported to be valued between $2 to $4 billion.
US President Donald Trump recently signed an Executive Order to establish a strategic reserve for Bitcoin. As previously mentioned in our report, no additional Bitcoin acquisition is intended for the stockpile beyond the assets obtained through forfeiture proceedings. This has raised several questions on the effectiveness of this initiative since the country is reported to own a little over 198,000 BTC ($17 billion).
Responding to this, the Head of digital assets research at VanEck, Matthew Sigel has shared a document on X highlighting multiple ways the US could expand its Bitcoin holdings without necessarily affecting the federal budget.
Firstly, VanEck suggests the use of the Exchange Stabilization Fund (ESF). According to our research, this exists as an emergency reserve account that can be used by the Treasury Department to offset instability in various financial sectors. VanEck estimates its net position to be around $39 billion, and it is self-funded. Fascinatingly, it could be used without Congress’ approval.
Apart from this, VanEck suggests that the US expand its Bitcoin holdings using Bitcoin bonds. Shedding more light on this, it was stated that the Bitcoin-backed bond should be issued above the face value. According to the document, a small portion of the proceeds could be used to acquire Bitcoin while the remaining goes into government operations. Meanwhile, the asset would be held as collateral and returned to bondholders in the form of In-Kind maturity. However, this may require Congress’ approval.
The third option highlighted in the document is to sell the 1.433 billion pounds of Cheese held in Missouri caves. According to VanEck, this is valued between $2 to $4 billion. Meanwhile, it could be done without the approval of the Congress.
Other Means the US Could Use to Expand its Bitcoin Holdings
The final two options are to revalue the US gold reserve and also lobby the International Monetary Fund (IMF) to include Bitcoin in Special Drawing Rights (SDR) to raise extra money to fund this operation. The last review was in 2020 and the next would be in 2027. However, this would require lobbying from lawmakers although no congressional vote is needed. For the revaluation of the gold reserve, an action would be required from the Congress.
Apart from these options, VanEck pointed out that a percentage of the Department of Government Efficiency (DOGE) savings could be used. This Department claimed to have saved $105 billion from the likes of terminations, firing federal workers, and cancellations. However, it was reported to be unclear if general savings like this could be used for this course.
Even without a clear confirmation that it would expand its Bitcoin holdings, industry experts, including Solana Labs’ co-founder Anatoly Yakovenko, have lauded the initiative. As outlined in our recent blog post, Yakovenko likened Trump’s Executive Order to a scalpel due to its precision and clarity. Meanwhile, he dismissed the idea of establishing a government-controlled reserve, which he claims undermines decentralization, as we discussed earlier.
