US Government Locks Up Bitcoin Holdings for 20 Years Amid ETF Outflows

The US government's recent proposal to lock up government-held Bitcoin for 20 years has sparked concerns among investors. The ARMA bill, which was introduced by Representatives Nick Begich and Jared Golden, requires all government BTC to be kept in a reserve for a minimum of 20 years, with no selling or disposal allowed during this period.

The bill also directs the Treasury and Commerce departments to study budget-neutral acquisition options, including converting non-Bitcoin government crypto, gold certificate revaluations, forfeiture proceeds, tariff revenues, and state partnerships. Quarterly proof-of-reserve reports and independent audits are mandatory under the new legislation.

Meanwhile, Bitcoin ETFs have been experiencing significant outflows, with $105.19M in withdrawals on May 22 alone. This is the sixth consecutive day of outflow activity, which has pushed total net assets below $100B for the first time since April.