Former US Treasury Secretary Criticizes National Bitcoin Reserve Proposal

Former US Treasury Secretary Lawrence Summers described President-elect Donald Trump’s plan to create a strategic reserve in bitcoins as “crazy.”

“I understand why we need a national oil reserve, why we accumulated gold in Fort Knox a hundred years ago. Of all the values to maintain, why does the government choose to accumulate a barren commodity in the form of a pile of bitcoins?” he stated in an interview with Bloomberg TV.

In his view, the only reason for such a move is “to cater to Trump’s generous campaign sponsors” from the crypto industry.

At the Bitcoin 2024 conference in Nashville, the politician proposed the idea that the government should not sell confiscated bitcoins. The assets should serve as the basis for a national strategic reserve. At that time, authorities controlled 213,239 BTC. 

After Trump’s election, the initiative gained traction — Senator Cynthia Lummis introduced a bill to Congress proposing the creation of a strategic reserve of the first cryptocurrency in the country.

Summers led the Treasury from 1999 to 2001 during Bill Clinton’s presidency. 

Subsequently, he served on the board of directors of Jack Dorsey’s Square and was an advisor at the venture firm Andreessen Horowitz. Since 2016, the financier held the same role at Barry Silbert’s crypto company Digital Currency Group. In 2023, Summers severed ties with the firm. Allegedly, this was a result of a scandal following his public comparison of the collapsed FTX exchange to the most notorious corporate fraud, Enron.

Regarding cryptocurrencies, Summers noted in an interview the necessity of supporting financial innovations. He added that some of them, including digital assets, are likely subject to excessive regulation.

Earlier, Trump nominated David Sacks from the “PayPal Mafia” for the position of “crypto czar.” One of the specialist’s tasks will be working on the regulatory framework for the industry.