Bitcoin, after rocketing through 2024, has bounced around $100,000 over the last week as traders brace for the next price bombshell.
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The bitcoin price has so far held onto its huge 2024 gains, with bets rising on an explosive 2025 as Tesla billionaire and Donald Trump advisor Elon Musk signals a return to the front lines of crypto.
Now, after the U.S. Treasury named bitcoin “digital gold,” a leak has revealed Russia lawmakers are pushing for the country to create a bitcoin strategic reserve.
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Russia’s president Vladimir Putin described bitcoin as an “unstoppable technology” and endorsed its … [+]
Russian state-owned domestic news agency RIA Novosti reported that State Duma deputy Anton Tkachev has proposed creating a Russian strategic bitcoin reserve, claiming to have obtained a copy of the document.
New People Party’s Tkachev reportedly sent the proposal to Russia’s finance minister, Anton Siluanov, to “assess the feasibility of creating a strategic reserve of bitcoin in Russia,” and comparing it to “state reserves in traditional currencies.”
“If this initiative is approved, I ask you to submit it to the government of the Russian Federation for further implementation,” the document reportedly read.
“In conditions of limited access to traditional international payment systems for countries under sanctions, cryptocurrencies are becoming virtually the only instrument for international trade. The Central Bank of Russia is already preparing to launch an experiment in cross-border settlements in cryptocurrency.”
Earlier this month, Russia’s president Vladimir Putin praised bitcoin as an alternative to foreign currency reserves following the seizure of its funds by Western governments in the aftermath of its invasion of Ukraine.
“A legitimate question: why accumulate reserves if they can be lost so easily?” Putin said in remarks at an investment conference reported by Reuters, calling bitcoin a potential solution. “For example, bitcoin, who can prohibit it? No one. Because they are new technologies. And no matter what happens to the dollar, these tools will develop one way or the other because everyone will strive to reduce costs and increase reliability.”
Russia has meanwhile taken steps to allow bitcoin and crypto to be used for transactions in the face of crippling financial sanctions while Putin also signed a new law legalizing bitcoin and cryptocurrency mining in the country.
In July, then Republican candidate Donald Trump promised to create a “strategic national bitcoin reserve” and predicted bitcoin could eclipse gold’s $16 trillion market capitalization during an appearance at the Bitcoin 2024 conference.
Republican senator Cynthia Lummis introduced a bill to congress, entitled the Boosting Innovation, Technology and Competitiveness Through Optimized Investment Nationwide (BITCOIN) Act, which proposes the U.S. buy 1 million bitcoins over five years to reduce the spiraling $35 trillion U.S. national debt.
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The bitcoin price has rocketed higher this year, helped by wild predictions the U.S. could establish … [+]
Trump’s election in November turbo-charged bets the U.S. will lean into bitcoin and crypto over the next few years, with analysts trying to predict what will happen if Trump were to follow through with his promise to create a strategic bitcoin reserve.
“Establishing a national bitcoin reserve will have an underlying impact on the U.S. dollar,” Maksym Sakharov, cofounder of bitcoin and crypto platform WeFi, said in emailed comments.
“If the reserve is set up using printed dollars, it might debase the greenback, causing a massive economic crunch for Americans. However, if the government chooses to stockpile bitcoin using its gold reserve, the projected debasement will be transferred to gold. This might offer a strong advantage as the value of bitcoin will soar, leaving other countries exposed to their devalued gold holdings. If they choose to buy bitcoin, the capital will flow back into the U.S. economy, boosting overall economic appeal. Ultimately, a U.S. national crypto stockpile might trigger a ripple effect that will see other countries trail a similar path. This will significantly drive the valuation of the assets upward.”
Meanwhile, Argentina has been named as another country that could soon explore adoption of bitcoin.
“We’re witnessing a clear shift, as nation states increasingly embrace the bitcoin standard,” analysts at bitcoin and crypto investment company 21Shares led by head of research Adrian Fritz wrote in a report.
“That being said, in 2025, we expect to see countries like Argentina adopt bitcoin as a strategic reserve asset. Argentina aims for a zero debt budget by 2025; therefore, a crypto-forward agenda and president [Javier] Milei’s collaboration with El Salvador’s president Nayib Bukele may signal broader bitcoin adoption.”
El Salvador is believed to hold almost 6,000 bitcoin worth around $600 million and has been slowly advancing plans to establish national bitcoin mines in the country using geothermic, volcano energy.
“Even in the U.S., the possibility of holding bitcoin as a strategic reserve asset has been picked up during the presidential race, given that the Department of Justice already holds 208,000 confiscated bitcoin, worth approximately $19 billion,” 21Shares analysts wrote, predicting the bitcoin price will climb in 2025.
“Escalating geopolitical tensions may pose challenges for bitcoin in the short term. However, given rising concerns about soaring U.S. government debt and a looming debt crisis in China, it’s no surprise that a growing number of institutions and nations are turning their attention to store of value assets like bitcoin and gold. Both assets are likely to reach new all-time highs in 2025.”
