Economist Peter Schiff recently called on President Joe Biden to sell the United States government’s entire Bitcoin holdings before the end of his term. Schiff argues that this action would significantly reduce the 2024 budget deficit and prevent the establishment of a “strategic” Bitcoin reserve, which he views as detrimental.
Schiff made this recommendation in a post on X (formerly Twitter), suggesting it’s the “one good thing” Biden could do before a potential Donald Trump presidency. He further posited that this move would preempt Trump from having to break a campaign promise of not selling any government-owned Bitcoin.
Schiff’s statement references the national Bitcoin reserve proposed by Trump at a Bitcoin conference earlier this year and subsequent legislation introduced by Senator Cynthia Lummis. While Trump initially advocated for selling government Bitcoin holdings, his more recent stance suggests a shift in that position.
The U.S. government currently possesses over 198,000 Bitcoin, valued at approximately $19.48 billion, according to on-chain analytics firm Arkham Intelligence.
Proponents of a Bitcoin reserve believe that potential appreciation in Bitcoin’s value could help offset the national debt, which currently surpasses $35 trillion. However, Schiff, a long-standing Bitcoin critic, warns that a strategic Bitcoin reserve could precipitate an economic crisis.
He contends that continuous government acquisition of Bitcoin to maintain the reserve could trigger a market crash as investors sell their holdings. This, in turn, could significantly devalue the dollar, leading to hyperinflation, according to Schiff.
Schiff’s recommendation underscores the ongoing debate surrounding the role of Bitcoin in national economic strategies and the potential risks and rewards associated with government involvement in cryptocurrency markets. This discussion continues to be a focal point in the broader conversation about the future of finance and the evolving landscape of global economic power. The outcome of this debate will significantly impact how governments approach digital assets and their potential implications for national economies.
