Donald Trump wants to use Bitcoin to reduce the US national debt?

Yesterday, the FOX Business television channel broadcast an interview with Republican presidential candidate Donald Trump that had been recorded the day before. The interview was about the plans of the possible next US president to get the economy back on track.

When the interviewer asked Trump about cryptocurrencies, the 79-year-old automatically made the connection between Bitcoin and reducing the US national debt, which has just broken the 35 trillion US dollar mark.

The statement implies that Donald Trump can imagine paying off the United States' mountain of debt with a small Bitcoin position. As the US currently only holds around 200,000 BTC worth around 12.5 billion US dollars, this would still be a long way off.

Although the potential next US president has promised to keep all Bitcoin and has also held out the prospect of active Bitcoin purchases by the government, the US would have to make a significant commitment and the price of the asset would have to skyrocket for one Bitcoin position to be enough to reduce the national debt.

Prior to this statement, there were already indications that Donald Trump had already considered the possibility of using Bitcoin to solve the US national debt problem. David Bailey, CEO of Bitcoin Magazine and an advisor to the presidential candidate, said in an audio discussion on 𝕏 that Trump had approached him about it.

But when we met, the first thing he asked me was like: ‘ Hey, can bitcoin do anything about the 35 trillion dollar debt?’ I was like, we have some ideas, but we’re not talking about that in the first meeting.
_{David Bailey}

Unfortunately, the FOX Business interviewer neglected to ask how exactly Trump envisions this happening.

However, Republican Senator Cynthia Lummis has already presented a plan for this at the Bitcoin conference. This consists of the USA building up a Bitcoin stock of one million units over five years, which must be held for at least 20 years - Blocktrainer.de reported.

The exact text of the law has now also been published, which specifies that the Bitcoin should only be used to reduce the national debt.

During the minimum holding period [...], no Bitcoin held in the Strategic Bitcoin Reserve may be sold, swapped, auctioned, encumbered, or otherwise disposed of for any purpose other than retiring outstanding Federal debt instruments.
_{From the bill}

The market capitalization of Bitcoin is currently just 1.2 trillion US dollars. Accordingly, the Bitcoin price would have to increase 29-fold for all Bitcoin in the world to equal the 35 trillion US dollar national debt of the United States. And for one million units to be enough, a Bitcoin price of USD 35 million would be the prerequisite - on the unrealistic assumption that the national debt will remain at this level.

If Donald Trump is elected to the White House in November, it is quite conceivable that he will support "Bitcoin Senator" Lummis' plan and sign the law, provided that the House of Representatives and the Senate vote in favor of it. Whether Bitcoin can then actually make a relevant contribution to paying off the national debt is written in the stars.

It remains to be seen whether Bitcoin's potential for reducing national debt will continue to be the focus of political debate in the future - in other nations too. In any case, it is a milestone that, according to the betting markets, the likely next US president is at least considering the option of using Bitcoin to reduce the debt of the world's most relevant economy.