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[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 4912 Introduced in Senate (IS)]

<DOC>

118th CONGRESS
  2d Session
                                S. 4912

 To establish a Strategic Bitcoin Reserve and other programs to ensure 
     the transparent management of Bitcoin holdings of the Federal 
Government, to offset costs utilizing certain resources of the Federal 
                Reserve System, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                             July 31, 2024

  Ms. Lummis introduced the following bill; which was read twice and 
    referred to the Committee on Banking, Housing, and Urban Affairs

_______________________________________________________________________

                                 A BILL

 
 To establish a Strategic Bitcoin Reserve and other programs to ensure 
     the transparent management of Bitcoin holdings of the Federal 
Government, to offset costs utilizing certain resources of the Federal 
                Reserve System, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Boosting Innovation, Technology, and 
Competitiveness through Optimized Investment Nationwide Act of 2024'' 
or the ``BITCOIN Act of 2024''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) The global financial landscape is rapidly evolving, 
        with digital assets playing an increasingly significant role in 
        the world economy.
            (2) Bitcoin has demonstrated resilience, widespread 
        adoption, and served as a medium of exchange and a store of 
        value for more than a decade.
            (3) Just as gold reserves have historically served as a 
        cornerstone of national financial security, Bitcoin represents 
        a digital-age asset capable of enhancing the financial 
        leadership and security of the United States in the 21st 
        century global economy.
            (4) The acquisition and long-term storage of substantial 
        quantities of Bitcoin by the United States can strengthen the 
        financial condition of the United States, providing a hedge 
        against economic uncertainty and monetary instability.
            (5) Bitcoin, as a decentralized and finitely scarce digital 
        asset, offers unique properties that complement existing 
        national reserves, strengthening the position of the United 
        States dollar in the global financial system.
            (6) Diversification of the national assets of the United 
        States to include Bitcoin can enhance financial resilience and 
        position the United States at the forefront of global financial 
        innovation.

SEC. 3. DEFINITIONS.

    In this Act:
            (1) Airdrop.--The term ``airdrop'' means a gratuitous 
        distribution of digital assets to holders of Bitcoin in a 
        broad, equitable, and non-discretionary manner.
            (2) Bitcoin purchase program.--The term ``Bitcoin Purchase 
        Program'' means the program established under section 5(a).
            (3) Cold storage.--The term ``cold storage'' means a method 
        of storing private keys required to transact in Bitcoin, with a 
        nexus to a secure physical location, protected from 
        unauthorized access and isolated from any network connections.
            (4) Fork.--The term ``fork'' means a change to the 
        consensus mechanism of a distributed ledger that creates a 
        separate ledger, resulting in a new digital asset that shares a 
        common transaction history with Bitcoin up to the point of the 
        change.
            (5) Secretary.--The term ``Secretary'' means the Secretary 
        of the Treasury.
            (6) Strategic bitcoin reserve.--The term ``Strategic 
        Bitcoin Reserve'' means the decentralized network of secure 
        Bitcoin storage facilities established pursuant to section 
        4(a).

SEC. 4. ESTABLISHMENT OF STRATEGIC BITCOIN RESERVE.

    (a) Establishment.--The Secretary shall establish a decentralized 
network of secure Bitcoin storage facilities distributed across the 
United States, collectively to be known as the Strategic Bitcoin 
Reserve for the cold storage of Government Bitcoin holdings.
    (b) Purpose.--The Strategic Bitcoin Reserve shall be used for the 
generation, safekeeping, and management of Bitcoin private keys 
associated with Government Bitcoin holdings.
    (c) Oversight.--The Secretary shall be responsible for the ongoing 
monitoring and auditing of the holdings of the Strategic Bitcoin 
Reserve.
    (d) Decentralization.--
            (1) In general.--The Secretary shall ensure that the 
        facilities of the Strategic Bitcoin Reserve are geographically 
        dispersed throughout the United States, to minimize the risk of 
        simultaneous compromise and to enhance the resilience of the 
        Strategic Bitcoin Reserve.
            (2) Location selection.--The Secretary shall select the 
        locations for the facilities described in paragraph (1) based 
        on a comprehensive risk assessment, prioritizing geographic 
        diversity, security, and accessibility.
    (e) Security Measures.--
            (1) In general.--The Secretary shall implement state-of-
        the-art physical and digital security measures to protect the 
        Strategic Bitcoin Reserve.
            (2) Consultation.--The Secretary shall consult and 
        collaborate with the Secretary of Defense, the Secretary of 
        Homeland Security, and industry experts to ensure the highest 
        level of physical and digital security for the Strategic 
        Bitcoin Reserve.
    (f) Retention of Forks and Airdrops.--
            (1) In general.--The Secretary shall ensure that, with 
        respect to Bitcoins controlled by the Strategic Bitcoin 
        Reserve, all digital assets resulting from forks of the Bitcoin 
        distributed ledger and digital assets distributed via airdrops 
        to Bitcoin addresses are accounted for and reasonably stored in 
        the Strategic Bitcoin Reserve.
            (2) Prohibition on immediate sale.--No digital asset stored 
        in the Strategic Bitcoin Reserve that is the result of a fork 
        or airdrop may be sold or otherwise disposed of during the 5-
        year period beginning on the date of the fork or airdrop, 
        unless explicitly authorized by law.

SEC. 5. BITCOIN PURCHASE PROGRAM.

    (a) Establishment.--
            (1) In general.--The Secretary shall establish a Bitcoin 
        Purchase Program which shall--
                    (A) purchase not more than 200,000 Bitcoins per 
                year over a 5-year period, for a total acquisition of 
                1,000,000 Bitcoins;
                    (B) conduct purchases in a transparent and 
                strategic manner to minimize market disruption; and
                    (C) hold Bitcoin acquired under this section in 
                trust for the United States, as provided in this 
                section.
            (2) Flexibility relating to purchases.--The Secretary 
        shall, by rule, establish a procedure to adjust the purchase 
        schedule set forth under paragraph (1), if necessary, based on 
        prevailing market conditions.
            (3) Transfer offset.--Any Bitcoin transferred to the 
        Strategic Bitcoin Reserve under section 7 may offset the 
        purchase requirements under paragraph (1).
    (b) Deposit.--All Bitcoins purchased under the Bitcoin Purchase 
Program shall be placed in the Strategic Bitcoin Reserve.
    (c) Minimum Holding Period.--
            (1) In general.--To ensure the long-term stability and 
        security of the Strategic Bitcoin Reserve, the Secretary shall 
        hold all Bitcoin acquired through the Bitcoin Purchase Program 
        for not less than 20 years.
            (2) Retention of bitcoin.--During the minimum holding 
        period under paragraph (1), no Bitcoin held in the Strategic 
        Bitcoin Reserve may be sold, swapped, auctioned, encumbered, or 
        otherwise disposed of for any purpose other than retiring 
        outstanding Federal debt instruments.
            (3) Recommendations after holding period.--
                    (A) In general.--On the date that is 1 year before 
                the end of the minimum holding period under paragraph 
                (1), the Secretary shall submit to Congress 
                recommendations on whether to continue to voluntarily 
                hold or to allow for the gradual and controlled release 
                of a portion of the holdings of the Strategic Bitcoin 
                Reserve.
                    (B) Recommendation.--Upon the expiration of the 
                minimum holding period, the Secretary shall not 
                recommend selling more than 10 percent of the assets of 
                the Strategic Bitcoin Reserve during any 2-year period.
    (d) Public Reports.--Not later than 1 year after the date of 
enactment of this Act, and annually thereafter for a period of 20 
years, the Secretary shall publish an annual public report on the 
status of the Bitcoin Purchase Program.

SEC. 6. PROOF OF RESERVE SYSTEM.

    To ensure transparency and accountability in the management of the 
Strategic Bitcoin Reserve, the Secretary shall establish a quarterly 
Proof of Reserve system of public cryptographic attestation under 
which--
            (1) the Secretary shall--
                    (A) publish quarterly reports on the Strategic 
                Bitcoin Reserve that include detailed information on 
                the total holdings, transactions, and demonstrated 
                control of private keys relating to the Strategic 
                Bitcoin Reserve, including a public cryptographic 
                attestation;
                    (B) make the quarterly reports available to the 
                public on an official website of the Department of 
                Treasury; and
                    (C) select an independent, third-party auditor with 
                expertise in cryptographic attestations to verify the 
                accuracy and integrity of the quarterly reports; and
            (2) the Comptroller General of the United States shall, to 
        ensure compliance with this Act, conduct regular oversight of--
                    (A) the Strategic Bitcoin Reserve;
                    (B) the quarterly reports under paragraph (1)(A); 
                and
                    (C) the audits under paragraph (1)(C).

SEC. 7. CONSOLIDATION OF GOVERNMENT BITCOIN HOLDINGS.

    Beginning on the date of enactment of this Act, any Bitcoin under 
the control of any Federal agency, including the United States Marshal 
Service, shall--
            (1) not be sold, swapped, auctioned, or otherwise 
        encumbered; and
            (2) upon the acquisition of legal title to such Bitcoin 
        (including after a final, unappealable judgment is entered in a 
        criminal or civil forfeiture action in favor of the Federal 
        agency), be transferred by the head of such Federal agency to 
        the Strategic Bitcoin Reserve.

SEC. 8. VOLUNTARY STATE PARTICIPATION AND SEGREGATED ACCOUNTS.

    (a) Voluntary State Participation.--The Secretary shall establish a 
program that allows a State to voluntarily participate in storing the 
Bitcoin holdings of the State in the Strategic Bitcoin Reserve in a 
segregated account.
    (b) Participation Requirements.--A State choosing to participate in 
the program established under subsection (a) shall sign a contractual 
agreement outlining the terms and conditions of participation, which 
shall include--
            (1) the responsibilities of both the State and the 
        Strategic Bitcoin Reserve in managing and securing the Bitcoin 
        holdings of the State in the segregated account of the State;
            (2) a requirement that the State, in coordination with the 
        Secretary, develop and implement appropriate security protocols 
        and access controls to ensure the integrity and confidentiality 
        of the segregated account of the State; and
            (3) retention of title, and all attendant legal interests, 
        by the State in the Bitcoin held in the segregated account, 
        including title to any digital asset that is the result of a 
        fork or airdrop relating to such Bitcoin.
    (c) Withdraw or Transfer.--Each State participating in the program 
established under subsection (a) shall have the right to withdraw or 
transfer the contents of the segregated account of the State within the 
Strategic Bitcoin Reserve, subject to the terms and conditions in the 
signed contractual agreement under subsection (b) and any applicable 
Federal regulations.

SEC. 9. OFFSETTING THE COST OF THE STRATEGIC BITCOIN RESERVE.

    (a) Discretionary Surplus Funds of Federal Reserve Banks.--Section 
7(a)(3)(A) of the Federal Reserve Act (12 U.S.C. 289(a)(3)(A)) is 
amended by striking ``$6,825,000,000''and inserting ``$2,400,000,000''.
    (b) Use of Remittances to Treasury.--
            (1) In general.--Notwithstanding the second subsection (b) 
        of section 7 of the Federal Reserve Act (12 U.S.C. 290), for 
        fiscal years 2025 through 2029, if the Federal reserve banks 
        remit net earnings to the general fund of the Treasury during 
        that period, the first $6,000,000,000 of these remittances 
        (before repayment of any deferred asset) in a fiscal year shall 
        be utilized by the Secretary for the implementation of the 
        Bitcoin Purchase Program, pursuant to the purposes set forth 
        under section 5.
            (2) Exception.--Paragraph (1) shall not apply if the 
        Federal Reserve banks do not remit net earnings in any given 
        fiscal year during the period of fiscal years 2025 through 
        2029.
    (c) Federal Reserve System Gold Certificates.--Not later than 180 
days after the date of enactment of this Act, the Federal reserve banks 
shall tender all outstanding gold certificates in their custody to the 
Secretary. Not later than 90 days after the tender of the last such 
certificate, the Secretary shall issue new gold certificates to the 
Federal reserve banks that reflect the fair market value price of the 
gold held against such certificates by the Treasury, as of the date 
specified by the Secretary on each new gold certificate. Upon issue by 
the Secretary, each Federal reserve bank that receives a new gold 
certificate shall remit the difference in cash value between the old 
and new gold certificates to the Secretary for deposit in the general 
fund within 90 days.
    (d) Conforming Amendment.--Section 5117(b) of title 31, United 
States Code, is amended by striking ``(for the purpose of issuing those 
certificates, of 42 and two-ninths dollars a fine troy ounce)''.

SEC. 10. PROTECTION OF PRIVATE PROPERTY RIGHTS.

    (a) Rules of Construction.--Nothing in this Act shall be construed 
to--
            (1) authorize the Federal Government to seize, confiscate, 
        or otherwise impair any property right in the lawfully acquired 
        Bitcoin holdings of any person; or
            (2) infringe upon the rights of individuals, businesses, or 
        organizations to purchase, hold, transfer, or dispose of 
        Bitcoin in accordance with the law.
    (b) Affirmation of Rights.--This Act affirms and protects the 
rights of persons to maintain full lawful control over the Bitcoin and 
other digital assets of those individuals, recognizing that the ability 
to maintain self-custody of private keys is fundamental to the 
principles of financial sovereignty, privacy, and personal liberty in 
the digital age.
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