• Senator Cynthia Lummis believes that the Fed should sell part of its gold reserves to buy bitcoin.
• Senator Lummis believes that a Bitcoin reserve could strengthen the dollar and help reduce US debt.
• Bitcoin hit an all-time high on Thursday, closing in on the $100,000 mark.

Republican Sen. Cynthia Lummis of Wyoming said in an interview with CNBC On Thursday, the Federal Reserve is expected to sell some of its 1970s gold reserves to buy Bitcoin.

Lummis, who is a longtime bitcoin buyer and said she owned five bitcoins before putting them in a blind trust, wants the government to build up a stockpile of bitcoins and hold it for at least 20 years.

“The proposal that I have that President Trump has discussed is for a strategic reserve of Bitcoin,” Lummis said.

Lummis argued that a government stockpile of bitcoins could help the United States consolidate the dollar as the world’s reserve currency and even reduce its debt burden.

This is based on the idea that Bitcoin would continue to generate the same monster gains it has since its inception in 2009.

Bitcoin hit an all-time high of $99,121 on Thursday, well within reach of the highly anticipated $100,000 milestone.

“This is the gold standard digital asset, and a strategic bitcoin reserve is the way to integrate it,” Lummis said.

President-elect Donald Trump told a Bitcoin conference in July that it would create a “national bitcoin stockpile” and ensure that the United States is “the crypto capital of the planet and the global bitcoin superpower.”

Lummis said the government would not need to increase its already massive debt to buy more bitcoin, because the Fed could cash in some of its gold reserves and use the proceeds to buy bitcoin.

“We have reserves in our 12 Federal Reserve banks, including gold certificates that could be converted to current fair market value. They are held at their book value from the 1970s. And then sell them for bitcoins, that way we wouldn’t have to use new dollars to build that reserve,” Lummis explained.

Such a move would add to the U.S. government’s current bitcoin holdings of approximately 203,000 from asset confiscations.

Lummis also said that with the new Trump administration, there is an increased appetite for bitcoin-friendly policies, including the possibility of a statutory framework for digital assets in early 2025.

Lummis and New York Senator Kirsten Gillibrand have been working on such legislation, which would create a regulatory framework for digital assets like Bitcoin and stablecoins.