Bitcoin Reserve Called ‘The Dumbest Idea Ever’ By Fed

In a striking revelation on the latest episode of the Coin Stories podcast, host Nathalie Brunell interviewed The Digital Chamber founder & CEO Perianne Boring, who disclosed an unvarnished and previously unknown response from members of the United States Federal Reserve. According to Boring, when she discussed the idea of a US Strategic Bitcoin Reserve during a meeting with officials at the Board of Governors of the Federal Reserve System, one official declared it “the dumbest idea” ever.

Boring recounted the tense atmosphere in the Fed boardroom from last week. “When I brought this up I’d never seen a reaction like quite the one I saw at that boardroom table. You know the folks in the room at the FED were cussing, saying this is the dumbest idea they’ve ever heard. There’s nothing strategic about Bitcoin,” she recounted.

She added that they were nearly got “kicked out of the room because [the Board of Governors of the Federal Reserve] thought this was such a bad idea and how dare we even like to breathe this idea in the building of the Federal Reserve,” adding that Trump campaign promise to establish a national stockpile of Bitcoins “will not be without controversy” and “will not be without push backs.”

Brunell asked whether this opposition stemmed from a “knowledge and education gap” or an entrenched interest in preserving the status quo. Boring responded that it might be both, as the Fed currently has a monopoly on money issuance. Yet, she argued that incorporating BTC might actually preserve that by potentially backing the US dollar or Treasury bonds with BTC.

“I think for one, the Federal Reserve has a monopoly on money today and you know it’s in the Fed’s individual interest to protect that Monopoly although I actually think Bitcoin can preserve that by adding Bitcoin to the US balance sheet or backing the US dollar with Bitcoin or issuing bonds US Treasury bonds that are backed by Bitcoin,” Boring reasoned.

Will This Stop Trump’s Bitcoin Stockpile Plans?

Brunell pointed to recent statements by Trump and his family – in particular Eric Trump’s speech at the Bitcoin conference in Abu Dhabi – which show that the President-eclect could follow through with his words, and might even pay off some part of the national debt with a “crypto credit card” or even abolishing the capital gains tax on BTC.

Asked about Trump’s potential avenues to make good on his pro-Bitcoin rhetoric, Boring explained: “So there’s a couple different ways to achieve [this]. So what candidate Trump promised to [create] is a strategic Bitcoin stockpile.”

Trump’s campaign promise involves taking the 208,000 BTC currently in US government possession—largely controlled by agencies like the US Marshals Service or the Department of Justice—and transferring it to the Treasury’s balance sheet. This plan is intended to “move [Bitcoin] to a place where it can’t be sold or moved around for other purposes […] out of law enforcement hands [and] into the Treasury.”

Shortly after Trump unveiled the idea at the Bitcoin conference in Nashville, Senator Cynthia Lummis introduced the Bitcoin Act, which proposes an even larger Strategic Bitcoin Reserve—including the purchase of an additional 1 million BTC. Meanwhile, Robert F. Kennedy Jr. has suggested an even bolder move—4 million BTC—prompting Boring to observe: “It gets very, very bullish very, very quickly.”

In describing the legal mechanics, Boring noted that “there are significant executive authorities that the President of the United States has” to execute at least the first part of the plan—namely, consolidating the existing government-owned BTC under a new reserve. She explained that though a congressional act may generally be required to authorize large expenditures like buying additional Bitcoin, there are broad pockets of funding that the executive branch might tap into. “I think if there’s a will there’s a way,” said Boring. “President-elect Trump did promise this to our community and I don’t think anything is stopping him.”

Asked if she believed the US would own more Bitcoin in a year, Boring declined to give a direct prediction, but emphasized that the “authorities are there” and that the project mostly needs firm leadership: “This really starts with leadership […] you need someone at the highest levels that […] is willing to execute on a bold mission.”

At press time, BTC traded at $95,722.

Featured image from YouTube, chart from TradingView.com