Key Points
- Brazilian lawmakers have proposed dedicating 5% of the nation’s treasury to a Bitcoin strategic reserve.
- Strategic Bitcoin reserves have gained popularity among various governments recently as an economic safeguard.
Brazilian legislators in the lower house of the National Congress, the Chamber of Deputies, have suggested that 5% of the country’s $370 billion treasury should be allocated to a strategic reserve of Bitcoin (BTC).
The proposed Bitcoin (BTC) bill would limit Brazil’s reserves to approximately $18.5 billion worth of the world’s most valuable cryptocurrency, which is currently valued at $1.83 trillion.
Approval Process
The bill must pass the Chamber of Deputies before it can be moved to the Federal Senate, the upper house. If the Federal Senate supports the proposal, it will be sent to the President of Brazil for approval to become law.
The concept of strategic Bitcoin reserves has been gaining attention among various governments and jurisdictions recently, being seen as an economic safeguard and a political rallying point.
Sovereign Bitcoin Rush
Prior to the re-election of Donald Trump in the U.S., the CEO of Jan3, Samson Mow, advised Germany to invest in Bitcoin. The country liquidated its $3 billion BTC vault in July when BTC was trading below $54,000. The price of Bitcoin has since risen to over $91,000, resulting in missed profits of over $1.5 billion for the German government.
Merryn Somerset Webb, a senior opinion columnist at Bloomberg, urged the new Labor-led British administration to use its $5 billion trove to “rebuild Britain”. Similar to President Donald Trump, Polish minister and presidential candidate Sławomir Mentzen has promised to establish a BTC reserve if elected in 2025.
President Trump has utilized expertise from the crypto industry for cabinet members who are focused on digital asset policy. The potential appointment of a “Crypto Czar” and the establishment of a new crypto-focused role in the White House have added to market excitement. In the U.S. Senate, Wyoming’s Cynthia Lummis has proposed purchasing 4% of Bitcoin’s supply over a period of five years.
The rush to adopt Bitcoin shows no signs of slowing down as BTC has captured the attention of sovereign and geopolitical entities. Whether through criminal seizures in China, mining in Bhutan, or reserve proposals in the U.S. and Brazil, nations are increasingly viewing the cryptocurrency as a necessary asset.