{"id":4828,"date":"2025-06-11T12:00:00","date_gmt":"2025-06-11T10:00:00","guid":{"rendered":"https:\/\/djp-a9vm.1wp.site\/?p=4828"},"modified":"2026-10-19T19:05:06","modified_gmt":"2026-10-19T17:05:06","slug":"the-strategic-race-for-bitcoin","status":"publish","type":"post","link":"https:\/\/djp.pl\/en\/the-strategic-race-for-bitcoin\/","title":{"rendered":"The strategic race for Bitcoin"},"content":{"rendered":"

The US decision to establish a Strategic Bitcoin Reserve could revolutionise the global financial system, forcing other countries into the race for digital gold.<\/strong><\/p>\n

The American gambit<\/h2>\n

It is no exaggeration to say that the US President\u2019s executive order of 6 March 2025 astonished Europe\u2019s political mainstream. Trump established a national Strategic Bitcoin Reserve, ordered a budget-neutral acquisition strategy and prohibited sale of existing holdings. Yet shocking political observers is not the administration\u2019s objective. This is a calculated move to secure US leadership in a changing global economy.<\/p>\n

The order says the reserve aims to ensure America wins the race for \u201cdigital gold\u201d. What race? History shows that delay is costly with Bitcoin. Even accounting for crashes, over the past five years its price grew by more than 120% annually on average, from around $9,000 in May 2020 to over $110,000 in May 2025. The later, the more expensive.<\/p>\n

This unprecedented appreciation has a cause: limited and entirely inelastic supply. There are currently 19.85 million bitcoins, and no more than 21 million will ever exist. A race among states for existing coins could therefore produce price dynamics never before seen. Trump\u2019s order highlights this feature in its first paragraph, along with strategic advantages from being among the leading reserve-holding countries.<\/p>\n

Meanwhile, Senator Cynthia Lummis, chair of the Senate digital assets subcommittee, introduced the Bitcoin Act, establishing a reserve and transparent management programmes for federal holdings. It proposes buying one million bitcoins in five years and retaining them for at least twenty. Sales during that period would be permitted only to redeem federal Treasury debt. Individual states could join voluntarily. Interestingly, it expressly confirms Americans\u2019 right to self-custody, emphasising financial independence, privacy and personal freedom in the digital age.<\/p>\n

The US debt crisis and stablecoins<\/h2>\n

Public debt cannot be ignored indefinitely without risking systemic collapse. It is approaching $37 trillion, a world record. Repaying $1 million daily would take more than 101,000 years. That is around $323,000 per taxpayer, compared with average annual individual income below $44,000. Demand for US debt is also declining, hindering further borrowing and threatening solvency.<\/p>\n

What can be done?<\/p>\n

Based on what we know, the plan looks like this. Demand for US debt must urgently be revived. Without that lifeline, disaster approaches quickly: the US would have to buy its own debt, a direct route to hyperinflation. States\u2019 appetite for Treasury securities has fallen sharply, driving interest to a record 5%. In plain terms, America must entice buyers with high interest to borrow more. Where will new buyers come from?<\/p>\n

Dollar stablecoins are intended to provide symptomatic treatment and quick relief. These privately issued crypto-assets track the dollar through full reserves, mostly US debt securities, backing every digital dollar. Voil\u00e0: private companies become new debt buyers while expanding the dollar\u2014or private digital dollar\u2014into new markets, particularly developing countries with low banking penetration and limited access to bank-provided dollars.<\/p>\n

This can inherently be only temporary. Further dollar expansion means more dollars circulating and continuing, perhaps increasing, inflationary pressure. Stablecoin issuers may become dominant debt buyers, replacing states, but US debt will grow rather than shrink. A borrowing-dependent state receives another dose of its drug.<\/p>\n

Bitcoin as an antidote to debt<\/h2>\n

A more far-reaching solution is needed: a way to move ahead, halt debt growth and reduce it to serviceable levels without impoverishing Americans through further inflation.<\/p>\n

Bitcoin\u2019s inelastic supply enters here. Using dollars to buy bitcoin appears brilliantly simple. The US government can expand dollar supply almost at will. Bitcoin issuance cannot exceed its schedule: currently only 450 new coins daily, halving every four years. It is like owning a money printer and using the notes to buy vast quantities of gold. The effect could be dramatically larger because Bitcoin\u2019s market, just over $2.2 trillion, remains relatively small beside more than $21 trillion in US dollars, counting cash, bank deposits and money-market accounts alone. Government-scale dollar inflows could therefore affect bitcoin\u2019s price dramatically.<\/p>\n

Other countries joining would amplify this. Russia and China have already changed their tone and are watching America. A US reserve and active accumulation may prompt similar responses, creating a global race in which demand dominates and prices reach currently unimaginable levels. Models predicting $40 million per bitcoin have emerged in this context.<\/p>\n

Proponents of a new ten-year Treasury instrument, \u201cBitbonds\u201d, seek to exploit this effect. They propose $2 trillion in issuance, allocating 10%, or $200 billion, to bitcoin. At today\u2019s price above $110,000, that buys almost two million coins, nearly 10% of all that will ever exist. Bonds would pay 1% annually, plus at redemption investors would receive 50% of the purchased bitcoin\u2019s appreciation. The government retains the other half. Projections based on historical prices suggest the project alone could eliminate US debt and deliver exceptional returns to investors, including American families.<\/p>\n

Risks of the American strategy<\/h2>\n

The reserve is not risk-free. Despite spectacular long-term appreciation, bitcoin can fall by 50% or more in shorter periods. In 2022, for example, it fell from nearly $69,000 to below $17,000 within a year. Such volatility could threaten reserve stability, especially if substantial purchases occur at peaks, and unsettle investors and the public.<\/p>\n

Security is another challenge. Bitcoin itself has not been hacked, but exchanges and wallets have suffered multimillion-dollar thefts. The 2014 Mt. Gox attack, involving 850,000 bitcoins, is an example. Even highly secured systems face hacking, human error and technological flaws. Losing part of the reserve could undermine confidence and trigger a political crisis.<\/p>\n

Mass US accumulation could also worsen economic inequality. Less wealthy countries may be unable to compete. China\u2019s or Russia\u2019s defensive responses are unpredictable, but attempts to resist American dominance could increase geopolitical conflict risks.<\/p>\n

A new paradigm<\/h2>\n

How will Poland and Europe respond? There is currently no visible readiness to join, while politicians\u2019 and European Central Bank officials\u2019 public comments range from patronising to hostile.<\/p>\n

That is unfortunate: much suggests events could change the global financial paradigm. The unbacked fiat-money experiment begun by Nixon just over fifty years ago appears to be ending before our eyes. It feels like watching a slow-motion car crash with Bitcoin as the deploying airbag.<\/p>\n

If America truly bases financial security on Bitcoin, opponents and then other countries are likely to follow. This would effectively give Bitcoin global reserve-currency status and make it the principal means of interstate settlement. A global Bitcoin standard would become reality.<\/p>\n

(Terminology: capitalised Bitcoin means the system and computer network; lowercase bitcoin means the currency unit.)<\/p>\n

Illustration: ChatGPT\u2014Sora.<\/p>\n

Originally published in iMagazine 6\/2025<\/a>.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The US decision to establish a Strategic Bitcoin Reserve could revolutionise the global financial system, forcing other countries into the race for digital gold.<\/p>\n","protected":false},"author":6,"featured_media":2922,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_titles_title":"","_seopress_titles_desc":"","_seopress_robots_index":"","_seopress_robots_follow":"","_seopress_robots_imageindex":"","_seopress_robots_snippet":"","_seopress_robots_primary_cat":"294","_seopress_robots_breadcrumbs":"","_seopress_robots_freeze_modified_date":"","_seopress_robots_custom_modified_date":"","_seopress_robots_canonical":"","_seopress_social_fb_title":"","_seopress_social_fb_desc":"","_seopress_social_fb_img":"","_seopress_social_fb_img_attachment_id":0,"_seopress_social_fb_img_width":0,"_seopress_social_fb_img_height":0,"_seopress_social_twitter_title":"","_seopress_social_twitter_desc":"","_seopress_social_twitter_img":"","_seopress_social_twitter_img_attachment_id":0,"_seopress_social_twitter_img_width":0,"_seopress_social_twitter_img_height":0,"_seopress_redirections_value":"","_seopress_redirections_enabled":"","_seopress_redirections_enabled_regex":"","_seopress_redirections_logged_status":"","_seopress_redirections_param":"","_seopress_redirections_type":0,"_seopress_analysis_target_kw":"","_seopress_news_disabled":"","_seopress_video_disabled":"","_seopress_video":[],"_seopress_pro_schemas_manual":[],"_seopress_pro_rich_snippets_disable_all":"","_seopress_pro_rich_snippets_disable":[],"_seopress_pro_schemas":[],"iawp_total_views":0,"_djp_featured_image_mode":"full","footnotes":""},"categories":[{"term_id":294,"name":"Articles","slug":"articles-en","term_group":0,"term_taxonomy_id":294,"taxonomy":"category","description":"","parent":0,"count":100,"filter":"raw","cat_ID":294,"category_count":100,"category_description":"","cat_name":"Articles","category_nicename":"articles-en","category_parent":0},{"term_id":295,"name":"Bitcoin","slug":"bitcoin-en","term_group":0,"term_taxonomy_id":295,"taxonomy":"category","description":"","parent":0,"count":16,"filter":"raw","cat_ID":295,"category_count":16,"category_description":"","cat_name":"Bitcoin","category_nicename":"bitcoin-en","category_parent":0},{"term_id":291,"name":"General","slug":"general-en","term_group":0,"term_taxonomy_id":291,"taxonomy":"category","description":"","parent":0,"count":153,"filter":"raw","cat_ID":291,"category_count":153,"category_description":"","cat_name":"General","category_nicename":"general-en","category_parent":0}],"tags":[327],"djp_center":[289],"coauthors":[240],"class_list":["post-4828","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles-en","category-bitcoin-en","category-general-en","tag-bitcoin-en","djp_center-bitcoin-en"],"acf":{"djp_promote_now":false,"djp_promotion_days":7},"images":{"thumbnail":"https:\/\/djp.pl\/wp-content\/uploads\/2025\/05\/SBR-Trump-cartoon-150x150.jpg","medium":"https:\/\/djp.pl\/wp-content\/uploads\/2025\/05\/SBR-Trump-cartoon-300x200.jpg","medium_large":"https:\/\/djp.pl\/wp-content\/uploads\/2025\/05\/SBR-Trump-cartoon-768x512.jpg","large":"https:\/\/djp.pl\/wp-content\/uploads\/2025\/05\/SBR-Trump-cartoon-1024x683.jpg","full":"https:\/\/djp.pl\/wp-content\/uploads\/2025\/05\/SBR-Trump-cartoon-djp-web.webp"},"_links":{"self":[{"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/posts\/4828","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/comments?post=4828"}],"version-history":[{"count":2,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/posts\/4828\/revisions"}],"predecessor-version":[{"id":5476,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/posts\/4828\/revisions\/5476"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/media\/2922"}],"wp:attachment":[{"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/media?parent=4828"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/categories?post=4828"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/tags?post=4828"},{"taxonomy":"djp_center","embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/djp_center?post=4828"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/djp.pl\/en\/wp-json\/wp\/v2\/coauthors?post=4828"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}