Key Points
- 20 U.S. state-led Bitcoin Reserves could generate a demand of over $23 billion for Bitcoin.
- Utah and Arizona are leading in the progress of their respective Bitcoin Reserve bills.
Mathew Sigel, the Head of Research at VanEck, has suggested that the adoption of Bitcoin Reserves by 20 U.S. states could result in a demand of more than $23 billion for Bitcoin (BTC). This projection comes as anticipation builds around the potential establishment of a U.S. national Bitcoin Reserve.
State-led Bitcoin Reserves
The concept of state-led Bitcoin Reserves has gained momentum recently. If enacted, Sigel believes these reserves could drive substantial demand for Bitcoin, separate from any pension fund allocations. This demand would likely increase if further legislative action is taken.
Pierre Rochard, VP of Research at BTC miner Riot Platforms, added that some states, like Texas, have not set a cap on the amount of Bitcoin that can be allocated to their reserves. This could potentially result in the demand for Bitcoin surpassing VanEck’s $23 billion estimate.
Impact on Bitcoin Supply
Andre Dragosch, Bitwise Europe’s Head of Research, suggested that such a demand could equate to 2.5 times the annual supply of Bitcoin. This would mean that the combined demand from the 20+ U.S. states could be as high as that of the federal government.
Currently, Utah and Arizona are leading the pack with their Bitcoin Reserve bills, having advanced to the second reading and first chambers, respectively. However, bills in three states, including Wyoming, have not made any progress. The potential impact on Bitcoin’s demand dynamics remains uncertain, as it is yet to be seen if Utah will be the first state to legally establish a Bitcoin Reserve.
