With the Strategic Bitcoin Reserve (SBR) now established as an official government policy, its administrators are actively seeking methods to develop and sustain the initiative.
In light of a directive to implement budget-neutral methods for managing the reserve, Bo Hines, who serves as the Executive Director on Digital Assets under US President Donald Trump, has proposed the use of gold certificates.
Hines has introduced several innovative strategies for achieving a budget-neutral approach to acquiring more Bitcoins, identifying gold certificates as a particularly viable option. He stated that these certificates carry a lower price than actual gold, thereby allowing the US government to gain profits when utilizing them to purchase Bitcoins.
Government Pursues ‘Budget-Neutral’ Funding for SBR
The announcement of the executive order concerning the crypto reserve by Trump elicited varied reactions. While many anticipated the government’s endorsement of a BTC reserve, others were disheartened by the initial strategy, which did not involve the acquisition of new Bitcoin. Instead, the administrators are responsible for utilizing existing digital assets owned by the government or obtaining new ones through “budget-neutral strategies.”
Executive Director of the @WhiteHouse crypto working group @BoHines discusses $BTC, potential methods for expanding holdings, and the rationale for including $ETH, $XRP, $ADA and $SOL in a separate reserve. https://t.co/dBe1trxAAH pic.twitter.com/mz5Y5p4HgB
— Eleanor Terrett (@EleanorTerrett) March 21, 2025
In Hines’ view, utilizing gold certificates presents a creative and budget-friendly method to facilitate Bitcoin acquisition. During his appearance on the Crypto in America podcast, he expressed confidence in the potential benefits of using gold certificates, given their lower cost compared to actual gold. He also referenced the Lummis Act, wherein Senator Cynthia Lummis acknowledged the potential of gold certificates.
Price of Gold Certificates vs. Actual Gold Bullion
The Federal Reserve Bank of St. Louis indicates that gold certificates are valued at a statutory price of $42.22 per troy ounce, while the market price for spot gold exceeds $3k per ounce. Senator Lummis’ Bitcoin Act 2025 proposes that the Federal Reserve System’s gold certificates could potentially finance upcoming acquisitions.
Lummis’ legislation mandates that Federal Reserve banks transfer their existing gold certificates held in custody to the Treasury Secretary’s office, which will then issue new certificates that reflect the current and fair market value of gold.
Hines Welcomes Input on Enhancing SBR
Hines has expressed openness to further ideas and recommendations regarding the growth and management of the Bitcoin reserve, emphasizing that they should not impose a burden on taxpayers. This intent aligns with Trump’s crypto executive order signed on March 6. Hines aims to establish an inter-agency working group to gather input and proposals from various stakeholders.
Currently, the government possesses approximately 207,000 Bitcoins obtained through civil and criminal proceedings. With this volume, the US holds the largest Bitcoin reserves among nation-states.
Featured image credit: Pexels, chart source: TradingView
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