A lawmaker in the Philippines has submitted a bill seeking to establish a strategic Bitcoin Reserve (SBR) in the country.
In June, Rep. Miguel Luis R. Villafuerte introduced House Bill 421, known as the Strategic Bitcoin Reserve Act, which proposes the establishment of a national BTC stockpile. Although the bill was introduced in June, the public only recently learned about it.
Philippines’ Bitcoin Reserve Proposal
Notably, the bill proposed that the Philippine government should direct the country’s central bank, Bangko Sentral ng Pilipinas (BSP), to establish an SBR. Under the program, the BSP governor is mandated to acquire up to 2,000 BTC per year over five years, building a total reserve of 10,000 BTC.
The bill proposes that the acquisition must be transparent and strategic to minimize any potential market disruption. According to the bill, the entire 10,000 BTC will be held in a strategic reserve for a minimum of 20 years.
If the legislation is enacted, the central bank governor shall publish an annual report highlighting the progress of the SBR program throughout the 20-year holding period.
A year before the minimum holding period ends, the BSP governor shall inform Congress on whether the country should continue with the SBR program. Upon expiration of the 20-year holding period, the governor can recommend selling the Bitcoin in the reserve. However, only 10% of the total holdings can be sold over two years to prevent large sell-offs.
Rationale Behind Establishing an SBR in the Philippines
While the Philippines currently holds gold and U.S. dollar reserves, Miguel argued that establishing an SBR is crucial to safeguard the country’s financial standing and tackle its rising debt.
In the explanatory note, Rep. Miguel presented key arguments why the Philippine government should consider creating an SBR. It mentioned Bitcoin’s remarkable growth over the years, with Jerome Powell, the U.S. Federal Reserve Chair, characterizing it as digital gold.
The explanatory note pointed out that Bitcoin has outperformed other financial instruments, boasting a 40% CAGR over the past five years. According to Miguel, Bitcoin’s remarkable performance coincides with President Trump’s endorsement of establishing a national Bitcoin stockpile in the United States.
He also pointed out that other countries, including El Salvador and Brazil, have established their Bitcoin Reserve initiatives. With the U.S. and other countries showing interest in Bitcoin, Miguel emphasized that the trend could trigger a wave of BTC acquisition globally. Hence, he suggests that the Philippines should also get involved in the strategic Bitcoin reserve initiative.
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