Title: “Why the Concept of a Strategic Bitcoin Reserve is Misunderstood”

Steve Hanke has once again expressed a flawed perspective on a Bitcoin-related matter. Specifically, he has criticized the concept of the United States establishing a Strategic Bitcoin Reserve (SBR).

In a recent video shared in a blog post, Hanke argued that converting the government’s savings into Bitcoin would be detrimental to the economy. He stated that these savings would not be invested in tangible assets that contribute to the economy. He further reinforced his argument by stating that Bitcoin doesn’t facilitate the creation of factories, the generation of jobs, or the promotion of innovation.

However, I strongly disagree with his viewpoint, as it overlooks the main purpose of creating an SBR. To be clear, the primary goal of an SBR is not to directly stimulate job creation or factory construction. Instead, it’s designed to safeguard a country’s economy, provide a buffer against risks, and ensure long-term economic stability.

Does Hanke suggest that the U.S. should liquidate its gold and oil reserves or its stores of food and weapons because they don’t “drive innovation”? That’s unlikely. These reserves are held to ensure security and stability, not to function as venture capital investments.

Similarly, an SBR wouldn’t directly generate jobs, but it would offer the U.S. a safeguard against inflation, the depreciation of the dollar, and geopolitical risks. The fact is, the dollar isn’t as robust as it once was, and having Bitcoin in reserve would provide the U.S. with a safety net as the world transitions towards decentralized money. It’s a strategy aimed at future-proofing, not maintaining outdated economic systems.

Hanke also overlooks the leverage reserves can offer. If Bitcoin becomes the most valuable asset worldwide and the U.S. has already set up an SBR, it will be well-positioned. This isn’t just a safeguard—it’s a significant geopolitical advantage that would bolster confidence in the U.S. financial system.

Hanke’s perspective reveals a misunderstanding of the purpose of reserves. They are designed for risk management and long-term planning, not immediate job creation. An SBR wouldn’t be a “drag on the economy.” On the contrary, it would be a forward-thinking, innovative measure.

The concept of an SBR is far from foolish. What is foolish is dismissing it based on outdated lines of reasoning.

The views expressed in this article are solely those of the author and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.