Pennsylvania Lawmakers Want a Strategic Bitcoin Reserve

House representatives in Pennsylvania have introduced a bill that would introduce a strategic Bitcoin reserve at the state level. This comes after the noise around a potential national Bitcoin reserve intensified after Donald Trump secured his re-election as President of the United States.

The bill would allow the state treasurer to invest “up to 10%” of the State General Fund, Rainy Day Fund and the State Investment Fund in Bitcoin. This is a measure to protect Pennsylvania’s funds from inflation, the Legislature said memo saidwhich has eroded the state’s purchasing power in recent years.

For the General Fund This alone would allow Pennsylvania to purchase $970 million worth of Bitcoin.

“Inflation has impacted Pennsylvania’s purchasing power by nearly 20 percent over the past four years, and we need solutions that can provide stability in uncertain economic times,” the memo said. “Bitcoin, which has increased significantly in value over the years, can help Pennsylvania keep pace with inflation and economic changes.”

In recent years, inflation peaked at 9.1% in June 2022 and has since fallen to 2.4% in September, it said US inflation calculator. This means that the dollars held by the state during this period have technically decreased in value. During the same period, Bitcoin (BTC) has risen from about $22,900 to $89,150 – a 289% increase.

For now, the bill has been business as usual presented to the House with support from Pennsylvania Republican Representatives Mike Cabell and Aaron Kaufer. Before the bill can be passed, it must go through eight more phases, including reviews by the House of Representatives, introduction and reviews by the Senate, and finally an executive action.

This state-specific Bitcoin move comes as talks around a national strategic Bitcoin reserve have heated up following Trump’s re-election.

The Nationwide Act for Boosting Innovation, Technology and Competitiveness through Optimized Investments, simply referred to as the Bitcoin law– was put forward by several US politicians in July and early August, but lost steam after the Bitcoin price drop.

The bill is supported by Trump and led by Senator Cynthia Lummis (R-WY). If implemented in its current form, the Treasury Department would purchase 1 million BTC over five years. This would amount to almost 5% of Bitcoin’s total supply and, at current prices, would cost approximately $89 billion.

Once Trump’s next term was secured, Lummis boasted on Twitter that the reverse was in store again. She told me Declutter“We are better positioned than ever before to build a better economic future by creating a strategic Bitcoin reserve.”

Lummis claims the new strategic Bitcoin reserve would hold the leading cryptocurrency for 20 years before considering whether the US should sell. Still, the bill, like Pennsylvania’s Bitcoin reserve bill, has yet to advance past Senate introduction.

Skeptics think it will take a long time to convince enough senators and representatives that this is a good idea, while Lummis saw the next Congress as the perfect time to get this over the line.

Edited by Stacy Elliott.