**Introduction**
Amid the current global economic climate, the issue of U.S. national debt has drawn significant attention. Recently, asset management firm VanEck proposed an audacious scenario: if the United States were to establish a national reserve of 1 million Bitcoin, and assuming Bitcoin’s price grows at a compounded annual growth rate (CAGR) of 25%, the U.S. could reduce its national debt by 35% over the next 24 years. This idea is based on the Bitcoin Reserve Act proposed by U.S. Republican Senator Cynthia Lummis, and it has sparked widespread discussion.
**VanEck’s Bitcoin Reserve Assumption**
Matthew Sigel, the head of digital asset research at VanEck, and investment analyst Nathan Frankovitz stated in their latest report that, assuming a 25% CAGR for Bitcoin, by 2049, the price of a single Bitcoin could reach $42.3 million. At that point, the 1 million Bitcoins held by the U.S. government would account for 35% of the national debt, significantly reducing the country’s liabilities by approximately $42 trillion.
Specifically, VanEck predicts that starting in 2025, U.S. national debt will increase at a 5% CAGR, rising from $37 trillion in 2025 to $119.3 trillion. In this context, a reserve of 1 million Bitcoins could provide substantial financial support for the U.S., alleviating debt pressure. If Bitcoin’s price reaches $42.3 million, these Bitcoins would represent 18% of the global financial asset market, far surpassing its current market share of approximately 0.22%.
**Cynthia Lummis’ Bitcoin Reserve Proposal**
Cynthia Lummis, a staunch supporter of Bitcoin, has proposed that the United States incorporate Bitcoin into its national strategic reserves. She believes the U.S. federal government should hold a strategic Bitcoin reserve to support the U.S. dollar’s position as the global reserve currency and help address the growing national debt crisis. Her proposal has sparked considerable debate, although it has not yet been passed in Congress.
In Lummis’ vision, the U.S. could use its existing gold reserves, some seized assets, or other resources to purchase Bitcoin. This would avoid directly increasing the tax burden on citizens and provide long-term financial support to the U.S. through the appreciation of these Bitcoins.
**Bitcoin’s “Optimistic Scenario” and Future Outlook**
According to VanEck’s “optimistic scenario,” Bitcoin, starting at a price of $200,000 in 2025, is expected to reach $42.3 million per Bitcoin by 2049. To achieve this goal, Bitcoin’s price would need to at least double, breaking through the current level of $95,360.
If this prediction comes true, Bitcoin could not only help the U.S. reduce its national debt but also further solidify Bitcoin’s position in the global financial system. VanEck notes that in this scenario, Bitcoin’s market capitalization would represent 18% of the global financial asset market, which could have profound implications for global asset allocation and structural changes in financial markets.
**Bitcoin’s Global Influence and Policy Support**
In addition to internal support within the U.S., VanEck believes Bitcoin’s global influence is also expanding. Particularly, members of the BRICS countries (Brazil, Russia, India, China, and South Africa) are increasingly adopting Bitcoin as a settlement currency for international trade. These countries seek to avoid the impact of U.S. dollar sanctions, so Bitcoin’s international adoption is accelerating, potentially driving a significant increase in its price.
Moreover, the adoption of Bitcoin by U.S. state governments, institutions, and businesses is also driving the market demand for digital assets like Bitcoin and Ethereum (ETH). This will facilitate the launch of cryptocurrency exchange-traded funds (ETFs) and further promote the circulation of assets like Bitcoin in global financial markets.
**Bitcoin BTC & Ethereum ETH Latest Price**
| Cryptocurrency | Price | 24H Change | 24H Trading Volume | Market Cap | 7-Day Price Trend |
|—————-|—————|————|——————–|————–|——————-|
| BTC | $94,186.53 | -0.33% | $63.19 billion | $1.859 trillion | 
|
| ETH | $3,387.96 | +3.73% | $33.18 billion | $407.06 billion | 
|
**Potential Impact of the Bitcoin Reserve Plan on U.S. National Debt**
VanEck further suggests that if the U.S. were to follow Lummis’ proposal and establish a reserve of 1 million Bitcoins by using funds from gold reserves or other means, the appreciation of these Bitcoin assets would yield significant economic benefits over the coming decades. By 2049, this Bitcoin reserve could reduce the U.S. national debt by about $42 trillion, representing 35% of the total debt.
More importantly, VanEck’s report suggests that as Bitcoin’s popularity and acceptance grow, its attractiveness as a reserve asset will only increase. This could provide the U.S. with a stable channel for wealth growth, and may also inspire more countries globally to adopt Bitcoin as part of their national strategic reserves.
**Conclusion**
As a digital asset, Bitcoin is gradually gaining recognition from governments and institutions around the world. According to VanEck’s assumptions, Bitcoin not only has the potential for significant appreciation in the coming decades, but it could also become an effective tool for the U.S. to manage its massive national debt. Cynthia Lummis’ proposal offers a clear strategic direction for Bitcoin’s role in the U.S. financial system. If implemented, this plan could significantly alleviate the country’s debt burden and may also bring about transformative changes to global financial markets.
With the gradual development of Bitcoin and other cryptocurrencies, it is foreseeable that digital currencies will play an increasingly important role, especially in a global economy facing uncertainty and challenges to traditional financial systems. The potential of Bitcoin as a reserve asset is undoubtedly worth anticipating.
