Fred Krueger, a former Wall Street quant, has predicted that the US will start buying Bitcoin with tariff money.
US Commerce chief Howard Lutnick previously stated that the US could generate a staggering $50 billion per month with tariff revenue. At current prices, this would translate into 400,000 Bitcoins during the first month alone.
For comparison, roughly 19,000 new coins are being mined on a daily basis.
This is why Krueger is suggesting that this could ultimately break the power law since it assumes normal market behavior.
However, the usual supply-demand dynamic would be completely overwhelmed by extremely strong buying pressure from the US government.
Is the US government actually going to buy Bitcoin?
Of course, the idea that the US could spend such exorbitant sums of money on buying Bitcoin sounds ludicrous.
In March, the US government officially moved to create a strategic Bitcoin reserve that was compiled with the help of forfeited coins.
As reported by U.Today, Treasury Secretary Scott Bessent previously made some contradictory statements about future Bitcoin purchases.
After initially suggesting that they would be possible, he later stated that the US government would not be buying more coins.
However, he later flip-flopped once again in a social media post on X, claiming that the Treasury would be open to exploring more "budget-neutral" pathways for buying more Bitcoin.
According to Polymarket, there is only a 14% chance of a strategic Bitcoin (BTC) reserve being approved this year, which is a huge drop compared to a peak of 75% in March.
Dan Burgin
Vladislav Sopov
U.Today Editorial Team