A Philippine lawmaker has proposed a government-run bitcoin reserve that would be locked for two decades and used only to pay down the government’s debt, a plan that would implement some of the strictest sovereign crypto storage rules seen to date.
The Strategic Bitcoin Reserve Act, introduced by Rep. Miguel Luis R. Villafuerte, directs the Bangko Sentral ng Pilipinas (BSP) to buy 2,000 BTC each year over five years, for a total of 10,000 BTC. The holdings would be held in cold storage and kept inaccessible for 20 years, with a limited exception: BTC could be sold or swapped solely to retire government debt. After the 20-year holding period, the central bank governor would be allowed to offload no more than 10% of the assets in any two-year window.
Geographically dispersed cold-storage facilities would be established across the Philippines, with quarterly audits conducted through public cryptographic attestations and verification by independent third parties. The bill also requires that forks and airdropped assets be retained for at least five years. It also states that private ownership of BTC would not be infringed and assures that ordinary citizens’ crypto holdings would not be subject to confiscation.
In assessing the policy’s context, the bill cites the country’s rising debt load. As of January, the Bureau of the Treasury reported national debt at about $285 billion, roughly 60% of GDP. Villafuerte said the inspiration comes from commodity-style reserves such as the U.S. Strategic Petroleum Reserve and Canada’s maple syrup stockpile, arguing that diversifying assets can bolster financial security and monetary stability in times of crisis.
The proposal also emphasizes that private citizens retain the right to own BTC, and that the state intends to preserve convertibility of the peso while building resilience through diversification of reserves.
What this could mean for the Philippines
– A bold shift toward digital asset diversification: If enacted, the bill would anchor a portion of the country’s official reserves in a highly liquid, globally traded digital asset, subject to strict custody and audit standards.
– Long-term debt management focus: By restricting access to the reserve for debt retirement, the plan aims to create a dedicated mechanism for reducing debt burdens over time.
– Security and governance considerations: The emphasis on geographically dispersed cold storage, independent audits, and third-party verification highlights a strong focus on security and transparency, but will also raise questions about operational costs, price volatility, and the legal framework governing sovereign crypto assets.
– Public policy implications: The proposal signals a potential path for crypto assets to play a formal role in national financial strategy, which could influence how other countries view sovereign crypto holdings.
Potential future developments and cautions
– Legislative process: The bill would need to navigate committee reviews and floor debates, with detailed provisions on custody, governance, and crisis scenarios.
– Market and price risk: Long-term holdings in BTC expose the reserve to price volatility, though a two-decade lock-in may mitigate some short-term fluctuations.
– Regulatory clarity: Implementation would require clear rules on custody, auditing, taxation, and how such assets interact with existing monetary and debt management frameworks.
Overall, the proposal presents a forward-looking approach to asset diversification and debt management, coupling sovereign finance with evolving digital assets and rigorous safeguards. It remains to be seen how lawmakers and the BSP will balance security, flexibility, and sovereignty as they consider the bill.