Bernstein: U.S. Cryptocurrency Working Group to Focus on Building a National Bitcoin Reserve

BlockBeats News, 17 February - The U.S. Cryptocurrency Working Group will focus on creating a national bitcoin (BTC) reserve, a move that could inspire similar efforts around the world, Bernstein said in a research note on Monday, according to CoinDesk.

‘If the U.S. establishes a Bitcoin reserve, it could lead to a race by governments around the world to buy Bitcoin as one of their reserve assets,’ wrote a team of analysts led by Gautam Chhugani.

According to the report, the creation of a strategic Bitcoin reserve would create a number of structural problems.

‘Will the U.S. Federal Reserve Bank (Fed) or the Treasury Department purchase bitcoin?’ The report states that in the case of the Federal Reserve Bank, this would require legislative approval.

The report also says, ‘How will the Federal Reserve Bank fund cryptocurrency purchases?’ Bernstein said the Fed could do so by issuing debt or selling some of its gold reserves.

The report added that the US government could also add $20 billion in bitcoin confiscated from criminal organisations to the national reserve.

The brokerage noted that the Trump administration also announced the creation of a sovereign wealth fund (SWF).

‘Such a fund would hold key U.S. cryptocurrency companies/market leaders as strategic assets,’ Bernstein said. ‘Investors should prepare for the next bull market by focusing on Bitcoin and Bitcoin-related stocks.’