A new strategic Bitcoin reserve bill in the US Congress would allow taxpayers to pay taxes in Bitcoin and exempt those payments from capital gains tax. Congressman Davidson said the measure is designed to support a government-held Bitcoin reserve and to write an existing executive order on seized digital assets into law.
Custody failures are at the center of the proposal
Davidson said the underlying problem inside the federal government was fragmented custody. Different agencies were holding seized digital assets without a single custodian. The consequence was simple and severe: if private keys were lost, access to the assets was gone as well. He compared that to losing physical cash.
According to Davidson, the strategic Bitcoin reserve was created in part because the government lacked an organized system for digital asset custody. Agencies held the assets, but there was no unified storage framework. The bill would consolidate that structure by putting the Treasury in the lead custody role for Bitcoin and other digital assets, with the aim of preventing agencies from losing track of holdings or private keys.
Treasury would act as a central vault for seized crypto
Davidson described the proposed setup as a “Fort Knox for crypto.” In his account, the bill would centralize custody of seized Bitcoin under the Treasury. The purpose is narrow but important: move digital asset management away from scattered agency practices and into a single system meant to reduce custody failures.
Lawmakers are also looking at ways to expand reserve funding without increasing the deficit. Davidson said one route would be to let Americans contribute through tax payments made in Bitcoin. In that context, Bitcoin would function as the payment asset for taxes, and the bill would remove capital gains tax tied to that use.
Brazil advances a separate reserve plan
At the same time, Brazil’s Congress has seen a separate Bitcoin reserve proposal. The bill calls for a planned and gradual accumulation over five years, targeting at least 1,000,000 BTC under a reserve framework called RESbit.
The proposal replaces and expands an earlier draft focused on a national strategic Bitcoin reserve. It still needs approval before moving ahead. If passed, Brazil would rank among the countries with the largest Bitcoin reserves.