The U.S. has the potential to slash its national debt by nearly a third over the next two decades by acquiring and holding a significant reserve of Bitcoin. This strategic move, outlined in a bill proposed by Senator Cynthia Lummis and analyzed by asset management firm VanEck, suggests that holding 1 million Bitcoin could offset about $42 trillion of national liabilities. VanEck’s forecasts show Bitcoin potentially escalating to $42.3 million by 2049, as the U.S. debt continues to climb.

VanEck analysts, including the firm’s head of digital asset research Matthew Sigel, believe that this “optimistic” scenario hinges on Bitcoin appreciating at a 25% compounded annual growth rate from an initial price of $200,000 in 2025. Currently, Bitcoin trades at around $95,360, already demonstrating strong growth potential. The proposal has gained additional traction with the endorsement from the incoming Trump administration, which is considering establishing a Bitcoin reserve.

Further support for this financial innovation comes from potential policy actions by President-elect Donald Trump, who might declare Bitcoin a reserve asset on his first day in office. This bold move could pave the way for other nations to adopt similar strategies, significantly enhancing Bitcoin’s role in the global financial landscape and potentially stabilizing the U.S. financial position without increasing taxes or printing new money.

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