VanEck Predicts a US Bitcoin Reserve Could Cover Up to 35% of the National Debt by 2050

Investment manager VanEck predicts that a US Bitcoin Reserve could cover up to 35% of the national debt by 2050. This estimate supports Senator Cynthia Lummis's BITCOIN Act, which proposes holding one million BTC by 2029.

Investment management firm VanEck has predicted that a US Bitcoin Reserve could cover up to 35% of the national debt by 2050. This estimate supports Senator Cynthia Lummis’s BITCOIN Act, which proposes the government hold one million BTC by 2029.

According to VanEck’s analysis, the reserve could be valued at $42 trillion by 2049 if Bitcoin grows at a 25% CAGR starting at $200,000 in 2025. This projection also anticipates a 5% annual increase in the US national debt, reaching $37 trillion by 2025.

Despite Bitcoin’s 50% average annual growth over the last decade, VanEck’s 25% CAGR assumption is described as conservative. However, critics suggest that consistently achieving such growth over 25 years might be challenging.

Bitcoin Reserve to Strengthen the US Dollar

Matthew Sigel, VanEck’s Head of Research, expressed his support for a US Bitcoin Reserve, addressing concerns raised by crypto investor Nic Carter. Sigel argues that the reserve would not weaken the US dollar but rather complement it.

“Bitcoin doesn’t have to undermine the dollar. As in an investor portfolio, a small position is simply a hedge against fiscal unsustainability and geopolitical uncertainty,” he said.

Sigel highlighted how Bitcoin can instill fiscal stability and discipline within the US financial system. He also noted the increasing mainstream adoption of Bitcoin, suggesting that its gradual integration could align with existing political priorities.

Gradual Process to Build US Bitcoin Reserve

VanEck estimates that acquiring one million BTC would cost around $320 billion, disputing claims that it would require over $1 trillion. The plan proposes a gradual accumulation process to avoid financial strain while capitalizing on Bitcoin’s neutral status as a reserve asset.

Sigel also noted that Bitcoin mining could contribute to US energy goals. Mining operations drive investments in domestic energy infrastructure, including renewable energy and nuclear projects, which aligns with broader objectives of energy independence and grid resilience.

It’s important to note that the Federal Reserve, led by Chair Jerome Powell, currently prohibits government Bitcoin purchases, but future administrations may reconsider this stance.