Late Thursday, former U.S. President Donald Trump signed an executive order to create two new government holdings: a Strategic Bitcoin Reserve and a Digital Asset Stockpile. Both will be filled with cryptocurrency the U.S. government already owns, which was seized from criminals or through legal cases. According to David Sacks, an advisor on AI and cryptocurrency, this move won’t cost taxpayers any money because the government is using assets it already controls.
What’s in the Reserve and Stockpile?
The Strategic Bitcoin Reserve will include Bitcoin the government has taken through law enforcement actions, such as seizing funds from illegal activities. The Digital Asset Stockpile will hold other cryptocurrencies that the government has acquired in similar ways. While Sacks didn’t share exact numbers, a crypto-tracking company called Arkham Intelligence estimates the U.S. government holds about $17.6 billion in cryptocurrency. Of that, roughly $2.3 billion is in altcoins like Ethereum, XRP, and others.
Reserve vs. Stockpile: What’s the Difference?
The executive order settles a debate in the crypto community. Some people argued the U.S. should only hold Bitcoin, seeing it as a reliable long-term investment. Others believed the government should also hold altcoins, which can be riskier but might grow in value. The order uses two key terms:
- “Reserve”: This suggests the government might actively manage or even buy more Bitcoin in the future.
- “Stockpile”: This implies simply holding onto the cryptocurrencies it already has.
Trump’s repeated use of the word “reserve” initially excited Bitcoin supporters, who thought it meant the government would buy more Bitcoin. However, the order clarifies that no new purchases are planned right now. Instead, the government will focus on organizing the crypto it already owns. That said, the order allows the Treasury and Commerce Departments to explore ways to buy more Bitcoin or altcoins in the future, but only if it doesn’t cost taxpayers extra money.
Why Bitcoin? What About Other Cryptos?
Bitcoin is widely seen as a stable, long-term store of value (like digital gold). Other cryptocurrencies, like Ethereum or XRP, are more debated as a US Federal reserve. Trump, however, has pushed for the U.S. to hold a mix of cryptocurrencies. On his social media platform, Truth Social, he wrote:
“A U.S. Crypto Reserve will support this important industry after years of being held back. My order directs the government to create a Crypto Strategic Reserve that includes XRP, SOL, and ADA. I will make sure the U.S. becomes the Crypto Capital of the World.”
About an hour later, he added that Bitcoin (BTC) and Ethereum (ETH) should also be part of the reserve. This aligns with his goal to promote American leadership in the crypto industry.
What Happens Next?
For now, the government will focus on managing the Bitcoin and altcoins it already holds. The next step is for the US Treasury and Commerce Departments to develop plans for potentially buying more crypto in the future. These plans must be “budget-neutral,” meaning they can’t add new costs for taxpayers. How? The government might find other creative funding methods.
Why This Matters
This move signals a major shift in how the U.S. government views cryptocurrency. Under previous administrations, regulators often focused on risks like scams or market instability. Trump’s order treats crypto as a strategic asset, similar to how the U.S. holds oil in its Strategic Petroleum Reserve. By creating official reserves, the government could:
- Boost Confidence: Holding Bitcoin might encourage businesses and investors to take crypto more seriously.
- Influence Markets: Large government purchases could impact crypto prices.
- Support Innovation: Promoting crypto could drive growth in blockchain technology and related industries.
Reactions from the Crypto Community
Many Bitcoin supporters are celebrating the decision, seeing it as a step toward mainstream acceptance. Others are cautious, warning that mixing government policies with volatile markets could backfire. Some altcoin investors are happy their favorite tokens are included, but critics argue the government shouldn’t gamble taxpayer-owned assets on risky investments.
The Bottom Line
Trump’s executive order to build Strategic Bitcoin Reserve & Digital Asset Stockpile is a bold move to position the U.S. as a global leader in cryptocurrency. By creating official reserves, the government is acknowledging the growing importance of digital assets. While there are no immediate plans to buy more crypto, the door is open for future expansion, as long as it doesn’t cost taxpayers. For now, the focus is on organizing what’s already in the vault.
Whether this strategy works depends on how crypto markets perform and how the government manages its holdings. One thing is clear: the U.S. is betting big on Bitcoin and beyond.
This article is not financial advice. Please do your own research (DYOR). You can also DYOR on blog.millionero.com. When you’re ready, you can come trade spot and perpetual futures on Millionero.