The U.S. House Financial Services Committee is scheduled to review the "American Reserve Modernization Act" ( ARMA ) on the morning of September 16th. The act proposes to establish a national Bitcoin reserve and sets clearer restrictions on the government's holding, disposal, and additional allocation of digital assets.

20-year lock-up period written into the legislation

According to the content of the bill, Bitcoin that is included in the national reserve will be subject to a 20-year lock-up period. During this lock-up period, in principle, the government shall not trade or sell this portion of Bitcoin.

There is only one exception: the government may proceed with the disposition only if the proceeds from the sale are directly used to repay federal outstanding debts. This means that the bill attempts to classify Bitcoin reserves as long-term holding assets, rather than a conventional fiscal tool.

Confiscate the obtained bitcoins and include them in reserves.

The bill also requires that bitcoins obtained by the government through criminal confiscation or forfeiture no longer go through an open auction process, but are directly allocated to the national bitcoin reserve.

In addition to Bitcoin, the bill also proposes the establishment of a "digital asset reserve" for holding other tokens that are recognized as assets. The government may sell such assets or exchange them for Bitcoin; the proceeds from these transactions can also be used to repay national debt.

Prohibition on using new debt to purchase Bitcoin

The bill proposes the principle of "budget neutrality," which means that establishing a Bitcoin reserve should not increase the fiscal burden. According to the text, the Ministry of Finance and the Ministry of Commerce will study ways to accumulate 1 million BTC within 5 years.

• Reserve goal: Accumulate 1 million BTC coins within 5 years.
• Funding restrictions: It is not allowed to rely on additional debt, tax increases, or deficit spending.
• Audit Arrangements: Third-party institutions conduct quarterly audits of reserves.

Sources of funds that can be used to purchase Bitcoin include fiscal surplus funds, or a portion of the net earnings of the Federal Reserve Banks. The bill also requires the establishment of decentralized physical security storage facilities within the United States to enhance the transparency of reserves.

If the committee votes in favor, the bill will next be submitted to the full House of Representatives for voting, and then to the Senate for review. After passing both houses, the bill still requires the President's signature to officially take effect.