r/CryptoCurrency Make Wine, Take Profits Jan 28 '25

GENERAL-NEWS Latest Proposal• US Gov to Buy 200,000 BTC annually for 5 years • Hold for at least 20 years • Goal: Halve the U.S. national debt in 20 years

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4.5k Upvotes

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u/jsands7 🟩 0 / 0 🦠 Jan 28 '25

and then… to actually halve the U.S. debt… they have to sell all the bitcoin to pay off the dollars they owe.

So… what would selling $18,000,000,000,000 of bitcoin at once do to the price of bitcoin?

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u/digitalmacgyver 🟦 4 / 4 🦠 Jan 29 '25

Nah...stake it and use the 6% interest they draw to pay for medicare...lol

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u/AcidUrine 🟦 0 / 0 🦠 Jan 28 '25

They don't have to sell the BTC. Balance is assets - liabilities. You don't need to switch assets from BTC to USD.

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u/MR_Weiner 🟦 0 / 0 🦠 Jan 28 '25

Eh, not exactly. If I have $6k debt and $10k cash then sure I have a $4k surplus on net, but I still owe the $4k. I could pay the debt off, but I haven’t. The creditor will still want their money.

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u/AvengerDr 🟦 0 / 795 🦠 Jan 28 '25

The US government could deposit those bitcoins on some new crypto startup that offers "yield" and use that to pay off the debt. What could go wrong?

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u/Hadleyagain 🟩 0 / 0 🦠 Jan 29 '25

Ahh yes, a good old ponzi.

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u/Yodel_And_Hodl_Mode 🟩 1K / 1K 🐢 Jan 29 '25

You jest, but I'm not convinced the Trump family won't end up getting the keys to the US Bitcoin Strategic Reserve.

And if anyone is thinking "The US govt would never let that happen..."

Trump administration offering buyouts to nearly all federal workers

The sweeping buyouts are being offered to “make sure that all federal workers are on board with the new administration’s plan to have federal employees in office and adhering to higher standards,” a senior administration official told NBC on condition of anonymity.

In reality, the sweeping buyouts are intended to push out anyone who won't do as the king demands.

I already assume that when the dollar crashes, my Bitcoin will be my life raft.

This is why I hodl.

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u/deij 🟦 1 / 48 🦠 Jan 28 '25

If you have $6k debt and $10k cash you don't repay the debt, you take out another loan so you have $10k debt.

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u/Marcob89 🟩 0 / 0 🦠 Jan 28 '25

Not really, you can ask more debt and you gi to the moon 🚀

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u/CtheKiller 🟦 658 / 659 🦑 Jan 28 '25

This exactly. Assets aren't accumulated to be sold. 90% of commenters here seem to be anti-bitcoin, what are y'all even doing in this sub?!

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u/HSuke 🟩 0 / 0 🦠 Jan 28 '25

Being more rational than the Bitcoin maxis apparently.

Bitcoin is a $2T network being protected by $20B of mining equipment. What what happens when it's much more valuable? How much is it going ro cost to secure the network? 10% of global energy? 40%?

Its security ratio of 1% is already laughably insecure. Imagine later on being able to wipe out $500T worth of value using only $50B. Easy nation-level attack

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u/Kavinsky303 🟩 0 / 0 🦠 Jan 29 '25

It’s not just about throwing $50B at some mining rigs. You also need insane energy, infrastructure, and supply chains. Good luck hiding that.

Miners have huge skin in the game and won’t just roll over. As Bitcoin’s price grows, difficulty ramps up and security gets stronger.

And all that ‘Bitcoin’s gonna use half the planet’s power’ talk is overblown. Basically, a 51% attack is way harder and more expensive than people think. It’s not just a simple ratio of network value to hardware cost.

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u/HSuke 🟩 0 / 0 🦠 Jan 29 '25

Strongly disagree. China can single handedly do it in 5-10 years. They have more chip fabs than the rest of the world.

Energy cost for a 2 day attack is under $10M. Energy cost to protect for 10 years is 7000x the cost to attack.

And attacks are intrinsically profitable due to selfish mining efficiency.

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u/HSuke 🟩 0 / 0 🦠 Jan 29 '25

Bitcoin miners are selfish. They're not going to defend if they keep losing money day after day. It's so much easier to attack PoW than to defend it

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u/Erowid2S 🟦 0 / 0 🦠 Jan 28 '25

Thank you

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u/TurielD 🟦 0 / 0 🦠 Jan 28 '25

No, the debt is in Dollars.

If we were talking the national balance sheet, there would be no debt to begin with - the US own vastly more actual stuff than the National Debt.

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u/dou8le8u88le 🟦 2K / 2K 🐢 Jan 28 '25

That’s not how it works

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u/Character_Top1019 🟦 0 / 0 🦠 Jan 28 '25

Especially when people know when they are selling and bail before they can.

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u/kdoughboy12 🟦 1K / 1K 🐢 Jan 28 '25

It would do absolutely nothing to the price because it would be sold OTC at or close to whatever the current market value is. Or the actual Bitcoin would be used to pay off the debt (instead of sending a trillion USD to whoever we owe money to, we give them a trillion worth of BTC).

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u/jsands7 🟩 0 / 0 🦠 Jan 29 '25

That is not how markets work and that is not how the laws of supply and demand work:

“The law of supply and demand states that in a market, the price of a good or service will adjust based on the relationship between how much of it is available (supply) and how much people want to buy it (demand); when demand is high and supply is low, prices tend to rise, while when supply is high and demand is low, prices fall.@

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u/kdoughboy12 🟦 1K / 1K 🐢 Jan 29 '25

Actually it's exactly how the markets work when it comes to huge buys and sells. They are done OTC (over the counter) and do not have any immediate impact on the price that is being traded on exchanges. If you want to buy $100 million worth of Bitcoin you do not go to the order book on an exchange, you go to an OTC platform and buy it in either one or multiple large sums close to market price. It is changing hands but it is not filling any sell orders on the exchange or immediately impacting the price or supply in any way.

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u/jsands7 🟩 0 / 0 🦠 Jan 29 '25

To sell the amount of bitcoin being proposed to pay down the government debt, they would have to go to the retail lit market and start filling as many orders as possible over and over and over

No one person/entity is going to want to or be able to buy trillions of dollars of bitcoin at once

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u/kdoughboy12 🟦 1K / 1K 🐢 Jan 29 '25

I highly doubt the government would be allowed to dump any asset on the retail markets like that. There's no way the sec would let that happen. Also there is no way that the government would sell all of its Bitcoin at once if it had trillions worth. It would likely hold most of it indefinitely and sell some of it slowly over time.

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u/jsands7 🟩 0 / 0 🦠 Jan 29 '25

If it is going to hold it indefinitely… then what is the point? How does that help our debt