Entrepreneur and former Wall Street quant Fred Krueger has floated a bold idea: that tariff revenue collected by the U.S. government could be used to buy Bitcoin.
Some details:
- He points out that U.S. tariffs might generate up to $50 billion per month in revenue.
- Even using a portion of that for Bitcoin purchases could mean acquiring hundreds of thousands of BTC in a single month. For example, Krueger estimates about ~400,000 BTC could be bought in the first month at current prices if all $50B were used.
- He suggests this could mark a shift in how Bitcoin is treated—not just as an investment or speculative asset, but potentially as a macroeconomic / reserve component.
Why It Matters
If such a policy were ever adopted (currently it’s still speculative), it could have wide-ranging effects:
- Demand Shock: Government buying at that scale would vastly increase demand, potentially driving up the price of Bitcoin significantly.
- Macro Status for Bitcoin: Would push Bitcoin further into conversations about national reserves, similar to gold, foreign reserves, or other strategic commodities.
- Shift in Fiscal Policy Thinking: Using tariff revenue (which is non-tax revenue) for crypto acquisition could be seen as a way to build reserves without directly increasing taxation or debt.
- Regulatory & Political Implications: Such a move would likely provoke debate in Congress, among regulators, and among those concerned about fiscal prudence, transparency, and financial risk.
Challenges & Skepticism
There are several reasons why many believe this is unlikely, or at least not imminent:
- Political Risk: Using government revenue (tariffs) to buy Bitcoin may face opposition from lawmakers who question the risk, volatility, and accountability.
- Volatility: Bitcoin’s price swings are much wider than traditional reserve assets like gold. Sudden drops could lead to large losses if the government holds large positions.
- Accounting / Legal Issues: Treating crypto assets as reserves or government holdings involves complex regulatory, tax, accounting, and auditing challenges.
- Fiscal Responsibility: Governments usually prefer safe, stable reserve assets. Bitcoin’s regulatory status, environmental concerns, and speculative aspects make it a more controversial choice.
- Budget Neutrality: Krueger suggests using tariff money, which doesn’t impact taxes directly, but even that may be challenged in terms of opportunity cost — what else could that money be used for (e.g., social programs, infrastructure)?
Is It Realistic?
As of now:
- It remains an idea / prediction rather than a policy or plan under active consideration
- Treasury officials have reportedly made “mixed signals.” Some statements hint at openness to “budget-neutral” ways to acquire more Bitcoin; others have cast doubt.
- Publicly available data does not confirm any official commitment or legislative proposal from the U.S. government to use tariff revenue in this way.
