Alabama State Auditor pitches Bitcoin reserve

Alabama State Auditor General Andrew Sorrell has joined a growing number of voices calling for strategic Bitcoin reserves in the US

The Alabama State Auditor has proposed creating a Bitcoin (BTC) reserve after federal and state lawmakers flocked to the idea following Donald Trump’s November 6 victory. Speaking to 1819 News about his reasons for supporting BTC, Sorrell said, “The debate about whether cryptocurrency will be successful is over.”

Sorrell claimed that creating a strategic BTC reserve would help Alabama and other US states diversify their government portfolios, hedge against fiat-related risks and inflation, and position their jurisdictions as crypto-friendly businesses.

The Alabama Auditor General has advised caution, recommending that the state follow the federal bill introduced by Wyoming Sen. Cynthia Lummis and adopt a dollar-averaging plan. DCA-ing involves purchasing a predetermined amount of an asset over a specified period of time. Sorrell claimed that Alabama had built up its reserves in two years.

The framework for the government to follow will be to determine dollar-cost averaging within 2 years. Bitcoin recently broke above $100,000, so entering a bull market may not be the best timing. A better strategy is monthly purchases over a 2-year period, averaging your entry price.

Andrew Sorrell, Auditor General for the State of Alabama

Sorrell’s offer reflected growing government-backed demand for BTC reserves; This idea emerged with the promises of President-elect Donald Trump and his new administration.

Trump turned to industry leaders like Coinbase CEO Brian Armstrong for advice, tapped Silicon Valley veteran David Sacks as his first crypto czar, and nominated pro-cryptocurrency former federal regulator Paul Atkins as chairman of the Securities and Exchange Commission.

Senator Lummis moved to build on Trump’s promise to keep America’s stockpile of 207,000 BTC (about 1% of Bitcoin supply). The senator’s BITCOIN bill, if approved by the Senate, would accumulate 4% of BTC’s fixed supply of 21 million within five years.