Key Points:
- David Marcus proposes converting a very small portion of US gold reserves into Bitcoin, recommending a slow approach.
- Official purchases could be a meaningful new source of Bitcoin demand but would be volatile if executed quickly.
- Critics warn that selling large gold holdings could depress global gold prices and undermine trust in reserves.
David Marcus, former President of PayPal and co-founder of the payments firm Lightspark, has added a measured voice to the debate over whether governments should hold Bitcoin alongside traditional reserves.
Speaking to Bloomberg this week, Marcus argued that Bitcoin offers stronger long-term value protection than gold, but warned that any attempt by the U.S. government to convert gold into Bitcoin would need to be deliberately slow to avoid market and political shock.
The comments arrive as interest in sovereign Bitcoin holdings continues to surface in policy circles. While no concrete plan has been adopted, proposals to diversify reserves have attracted attention as lawmakers and regulators assess how digital assets could fit within existing frameworks for gold and foreign currency holdings.
Why a Gradual Gold-to-Bitcoin Shift Is Being Floated
Marcus said the government could consider rotating a “very, very tiny slice” of its gold reserves into Bitcoin over time, stressing that speed matters as much as size. In his view, large or sudden purchases risk distorting prices and inviting political backlash before clear rules are in place.
READ MORE: Mirae Asset Purchases 92% of Korbit to Boost Asset Push in Korea
His argument rests on Bitcoin’s fixed supply and growing acceptance as a store of value. Official buying, even at the margin, would represent a new source of structural demand in a market that remains relatively thin compared with traditional asset classes. That prospect has led some commentators to model sharp price reactions in hypothetical scenarios in which a small percentage of U.S. gold holdings is reallocated into Bitcoin.
Marcus pushed back against aggressive approaches, noting that policy decisions can change quickly and often in conflicting ways. Buying too much, too fast, could leave public institutions exposed if regulatory or fiscal priorities shift midstream.
Risks for Markets and Reserve Credibility
Critics point out that any sale of U.S. gold, even a modest one, would have implications beyond Bitcoin. The United States holds one of the world’s largest official gold stockpiles, and adjustments to that position could pressure global gold prices or raise questions about long-standing reserve practices.
Recent market performance also complicates the comparison. Gold has outperformed Bitcoin over the past year, reinforcing its role as a defensive asset during periods of economic uncertainty. Bitcoin, by contrast, has remained volatile, with price swings amplified by limited spot liquidity when large orders hit the market.
Those dynamics are central to the risk Marcus highlighted. Rapid execution could magnify volatility in Bitcoin markets while simultaneously unsettling gold investors, undermining confidence in both assets rather than strengthening reserves.
For now, the idea remains theoretical. Any move toward Bitcoin would require clear legal authority, transparent accounting rules, and agreement on funding sources. Market participants are watching for official guidance on reserve management and digital asset policy, aware that credibility will hinge less on bold statements and more on careful execution.
READ MORE: Bitcoin Price Prediction as Crypto Fear and Greed Index Slips as Risks Rise
