Lummis Unveils Bitcoin Reserve Funding Plan

The Breakdown First Five - Wednesday, July 31, 2024

Welcome back to The Breakdown First Five — the 5 most interesting and/or important stories in bitcoin, crypto, and markets to start your day.

5. Gox Creditors Not Selling

Glassnode data reveals flat exchange volume since Mt Gox coins were returned to creditors, implying that most are choosing to HODL. Around 41% of the Mt Gox estate has been distributed, around $4B worth of Bitcoin. Glassnode found a “marginal uptick in sell-side pressure following the distribution” but said it was well within day to day ranges. 

4. DMV goes Web3

The California DMV has tokenized their database of car titles, putting 42 million vehicles on the blockchain. The project was part of Gavin Newsom’s blockchain initiative and was built on top of Avalanche. This move will save trips to the DMV and cut transfer times from 15 days to minutes. 

3. Circle Valued at $5B

Private secondary trading has valued Circle at $5B ahead of an expected IPO later this year. Sources said that a small group of employees and early investors have been approved to sell their shares on a case by case basis. This is a huge markdown from the $9B valuation in 2022, when Circle was gearing up to go public via SPAC. Sources said not to be alarmed by the loss in value, citing depressed conditions for private secondaries. 

2. Russia To Legalize Crypto

The Russian Duma has passed a bill that would legalize crypto’s use in foreign trade. A second bill would require Bitcoin miners to register with the state. The laws will still need to be passed in the upper house, but Russian policymakers are keen to look at any methods that can be used to facilitate foreign trade as the sanctions noose tightens. A domestic transaction ban will remain in place, but Bitcoin for Oil seems to have state approval. 

1. Lummis Bitcoin Reserve Details

The details of the Lummis Bitcoin reserve bill have been released featuring a very interesting funding mechanism. The bill would redirect Fed profits into buying Bitcoin alongside a reduction of discretionary surplus funds held by the Fed. The spicy part is a re-pricing of gold certificates which have sat untouched since the Fed’s gold was confiscated in 1934, still at $42 per ounce. This 50x gain would be remitted back to the Treasury to pay for the million BTC buy.