As someone who would like to see the federal government in the US shrunk dramatically, I believe a strategic bitcoin reserve accumulated via a mechanism like Bit Bonds is the only viable path to make a smaller government possible.

This may seem counterintuitive - "if the US government acquires bitcoin it makes them stronger." However, when you take a step back and think of the problem of the ever expanding federal government you realize that a large part of the problem is driven by the need to roll over debt by issuing new debt to pay it back.

This leads to a forced expansion of the federal government that can only be reversed if something new is introduced that can defease the debt without having to issue new paper. As it stands today, bitcoin is the only thing that can practically produce this defeasment.

The beauty of the bit bond idea is that it expedites the debt pay back by enabling the Tresury to issue longer-term bonds at lower rates, which works to decrease interest payments on debt that is being rolled over. An incredible kickstarting mechanism that provides immediate results. Imagine being able to point at the chart of the interest expense on the debt and show that the number is falling.

Bitcoin is for anyone, including governments, and it is a great asset that enables individuals, businesses and governments to think creatively by leveraging the benefits that come with adopting it during its monetization phase.

The path to shrinking the federal government dramatically over the next few decades only exists in a world in which the government adopts bitcoin as a strategic asset to begin paying back the debt.

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Governments by their nature will fight tooth and nail to keep their free money making scam. Bit bonds, SBR isn't going to change it.

Nice analysis, Marty. Reminds us to just stay humble and stack zaps ⚡️

Bitcoin Bonds are needed to save 🇺🇸

Still theft

The first step is understanding what your realistic fixed costs are, what your savings rate can be and what your excess discretionary spending is.

Once you do this very little debt is required because you’ve properly identified needs vs. wants and we will have prioritized needs over wants.

We got here by the irrational belief that we should be able to have all of our wants first because credit makes those available with ease.

In doing so, we ignored our needs and created a negative feedback loop of consumption above all else.

We got here by flawed principles. Those can go on, and have, for some time. Eventually they break the money, forcing everyone to look in the mirror. Only then can money can be reset to something that has sound principles and provides economic stability that encourages productivity, proper capital & resource allocation that restores growth.

Until we root out waste and destroy all of the excess spending and remove the negative feedback loop of overconsumption the problem will not be solved and will only worsen. However, it will be painful and many attempts will be made with credit like tools that will only extend the inevitable. Bonds are fine tools but can only be issued from entities that have excess capital, are productive, and encourage proper rate functions (risk/reward).

Nicely put. It’s all happening a lot earlier than many of us seemed to expect. Seems like we may be on the cusp of the “suddenly” part…

Bonds are instrumental in enslavement with your approval. Bitcoin should rather facilitate the demise of all governments and I am certain it will.

If this happens I will start a charity to buy Velcro shoes for people who buy those bonds.

Anyone stupid enough to give their hard earned dollars to a government that already steals 50% of their effort to lock in bond rates while the government gets Bitcoin return rates cannot possibly have the IQ required to follow that Bunny the whole way around that tree.

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The path to shrinking the federal government dramatically involves letting it blow itself up, the quicker the better.

I hate this take Marty. But you’re right. This is the way. And I still don’t like it (in the short term).

Bitcoin is the only way to establish self-sovereignty away from the governments, yet many people just care about getting rich in this cycle with the help of the government, shortchanging freedom for FIAT.

Fuck the government and its slaves and masters.

Americans will experience AGAIN a 1933 style seizure.

You don't need to like this concept to agree with it. No government is a great in theory, much the same way that communism is great in theory. So any way that we can reduce the size of government should be celebrated.

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Maybe there's another way. I think Trump is angling to shrink gov't right now. Tariffs & revenue from energy production on one side & tax cuts on the other side. The idea of an External Revenue Service to fund a much smaller gov't makes sense. The debt, well, with a booming growing dynamic economy, I see paying it off as it comes due. Who knows, we may as a country have enough Bitcoin to pay it off fairly quickly. Then there's DOGE. How much fraud was/is there? That debt may not even be owed by the taxpayer if it was money criminally looted from the taxpayer.

This is an interesting perspective, and I agree that Bitcoin has unique properties that could force a paradigm shift in government finance. However, I see a few key challenges with this approach:

1. Doesn’t Bitcoin Monetization Strengthen the State?

While a strategic Bitcoin reserve could help the U.S. government manage its debt more effectively, wouldn’t this just extend its ability to function as it does today? If the goal is to shrink the government, giving it a powerful asset like Bitcoin could delay the necessary reckoning that forces structural change.

2. Inflation and Control

Governments rely on inflation as an implicit tax to maintain power. If Bitcoin were to replace U.S. debt issuance as a funding mechanism, wouldn’t the government just find new ways to extract wealth, such as taxation or capital controls on Bitcoin itself?

3. Would Governments Really Stop Expanding?

Historically, governments don’t voluntarily shrink; they either collapse under their own weight or are forced to change due to external constraints. Bitcoin could be that external force, but its adoption by the state might just lead to a ‘Bitcoin Standard’ where the government still controls the rails.

I think the real path to a smaller government lies in individuals and businesses opting out of the legacy system entirely—using Bitcoin in a way that makes the state’s debt-driven expansion unsustainable. What’s your take on that?

Worthy discussion, and you make some good points. However, I will submit the reality that bitbonds still pay an interest rate. The proposed rate is much lower than current Treasury bonds at 1%, but it still leads to the expansion of the circulating currency, so while it might reduce inflation down to the stated goal of 2% or maybe even lower, that target rate still INCREASES the amount of debt, it doesn't decrease it. If the goal is to reduce the size of the US Federal Government, increasing the total debt is not going to do that. We need to combine it with other action that doesn't just reduce the rate of the increase, but actually decreases the amount of debt on the books.

The only real path forward is by balancing the budget so new bonds are not needed, in any form. We can cut spending all day long, but until the deficit is zero or the budget surplus is back, it's not going to have the impact we want to see.

I do see bitbonds as a fantastic innovation, and I would encourage their use for states, municipalities and corporations. But having the US Treasury use them would not actually solve the problem, at least not as far as i can see.

This idea is feasible and doable. My feeling is it’s dependant upon a government’s leadership going wholeheartedly down the bitcoin rabbit hole much like Michael Saylor with has MSTR.

It requires a full on governmental commitment to moving to a bitcoin standard for the long term and all that entails by way of a comprehensive revision of their approach to transforming financial systems and national economies.

It’s a big ask if government has a mixed agenda.

TLDR: An entity with enormous power and command over resources is about to become even more powerful. It can do so through further debasement-enabled theft or through saving as one of the methods.

It remains completely corrupt and evil, regardless of the next step it takes.

It will, naturally, use both.

Practise prompting before it’s too late. You are genuinely appreciated.