Luckily Eli Nagar was at hand to debunk misinformation dished out by one of the oldest and most established traditional finance publications. But we are used to this. For over a decade, critics from traditional finance have dismissed Bitcoin with comparisons ranging from tulips to Beanie Babies. The latest iteration, courtesy of a Financial Times article titled “The Delusions Behind a Bitcoin Strategic Reserve”, claims Bitcoin is a mere “hodler fantasy,” unsuitable for serious national reserves. But history has shown us how wrong Bitcoin sceptics have been. Take Peter Schiff as an example.
From $0 to a market capitalisation nearing $2 trillion, Bitcoin has grown without the support of any state, thriving amidst regulatory hostility and persistent doubt. As countries and institutions quietly embrace Bitcoin, dismissing its role as a strategic reserve asset could be a monumental mistake.
The article, which resembles an old man shouting at the internet, penned by Brendan Greeley, makes bold claims. Many of which reveal fundamental misunderstandings about Bitcoin. It equates Bitcoin to Andy Warhol paintings, suggesting it offers no practical economic function. “Sure, both are scarce”, counters Bitcoin miner Eli Nagar. “But Bitcoin isn’t art. It’s money. Money is foundational to every economy and Bitcoin is the apex monetary asset.” Unlike art, Bitcoin provides liquidity, fungibility and security, making it more comparable to gold or other reserve assets. Comparing it to an artwork highlights a lack of understanding of Bitcoin’s foundational role in reshaping modern finance.
The FT article goes on to suggest that Bitcoin would require state support to have any meaningful impact. This assertion, however, is entirely backward. Bitcoin has flourished precisely because it operates independently of government or central bank backing. “Bitcoin grew from $0 to a nearly $2 trillion asset without state support. Actually, it thrived amidst significant hostility,” Nagar points out. “It’s the state that benefits from Bitcoin, not the other way around.” In fact, some estimates suggest Bitcoin could reduce U.S. national debt by $16 trillion if used effectively as part of its reserves.
The criticism of Bitcoin’s “storage costs” also falls flat. Securing Bitcoin is far cheaper than maintaining gold reserves, with costs primarily limited to energy and digital security infrastructure. If gold reserves are deemed resilient despite not being regularly sold, why hold Bitcoin to a different standard? Nagar argues that Bitcoin offers unparalleled resilience, especially in a world grappling with rising debt and currency devaluation. Unlike fiat reserves that can be inflated at will, Bitcoin’s fixed supply ensures its value is immune to monetary manipulation. “Bitcoin diversifies America’s reserves, securing the world’s best-performing asset in its arsenal,” he adds.
The Dollar, Inflation & Bitcoin’s Role
Another misconception in the article claims that Bitcoin only serves “broken financial systems.” This tired argument ignores Bitcoin’s adoption in countries with robust banking infrastructure, including the U.S. Bitcoin spot ETFs have broken records for inflows, even outperforming gold ETFs, showcasing strong demand from investors in functional economies. Bitcoin isn’t a bet on financial collapse. It’s a hedge against monetary excess.
The U.S. dollar, while dominant, faces undeniable pressure from inflation and overreliance on money printing. Nagar highlights this critical dynamic: “The dollar isn’t held up by magic; it’s losing value as governments print trillions to cover deficits. Bitcoin doesn’t challenge the dollar. It protects against its debasement.” In this light, Bitcoin complements existing reserve strategies by hedging against the erosion of purchasing power.
The Financial Times frames a Bitcoin strategic reserve as a fantasy of “hodlers,” but this mischaracterisation misses the point entirely. The aim isn’t to cater to Bitcoin enthusiasts but to safeguard national wealth with an asset immune to inflation, political interference and systemic collapse. Gold has long played this role, but Bitcoin represents a more agile, 21st-century alternative. As Nagar notes, “A Bitcoin strategic reserve will mean the U.S. owns the world’s best-performing asset, diversifying its holdings and future-proofing its finances.”
Dismissing Bitcoin’s role in national reserves is not just short-sighted but risky. While the U.S. debates, nations like El Salvador and institutional investors are already accumulating Bitcoin. Even China, which officially bans cryptocurrency, has been linked to significant Bitcoin mining operations. Meanwhile, countries with functional financial systems like Switzerland and Singapore are warming to Bitcoin as part of their economic strategies.
A Missed Opportunity for Leadership?
The Financial Times may label a Bitcoin strategic reserve as “delusional,” but the broader evidence suggests otherwise. Bitcoin offers unmatched resilience, liquidity and performance compared to traditional reserve assets. In an era where major economies are drowning in debt, adding Bitcoin to reserves could strengthen fiscal stability. Failure to act could see the U.S. fall behind as other nations quietly embrace this apex monetary asset.
Bitcoin isn’t here to destroy the financial system; it’s here to rebuild trust in an era of fiat devaluation and monetary instability. As Nagar aptly concludes, “History will likely prove them wrong. Bitcoin belongs in America’s reserves.”
Author Profile
- Lucy Walker covers finance, health and beauty since 2014. She has been writing for various online publications.
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