President Donald Trump has formally introduced a federal bitcoin (BTC) reserve fund, marking a long-awaited win for the cryptocurrency industry and a major shift in United States crypto policy. Established through the latest in a slew of executive orders, the “Strategic Bitcoin Reserve” will include bitcoin already in possession of the federal government. The order also implemented a separate “Digital Asset Stockpile” to house cryptocurrencies other than bitcoin.
What Is the Strategic Bitcoin Reserve?
The Strategic Bitcoin Reserve will be a government-held stockpile of bitcoin seized through law enforcement actions, such as criminal and civil asset forfeitures. Established in March 2025 under President Donald Trump, the reserve aims to position the United States as a global leader in the cryptocurrency industry by formalizing the storage of these digital assets.
This move comes just days after Trump announced a “Crypto Strategic Reserve,” where the government would buy and hold a mix of cryptocurrencies — similar to traditional reserve assets like gold, oil and foreign currencies. Proponents said diversifying the government’s financial portfolio this way would be an effective hedge against inflation and economic instability, but the plan faced significant backlash from both inside and outside the crypto community. Critics pointed to various conflicts of interest for both the president and members of his administration, and warned the inherent volatility of digital assets could add billions of dollars to the national debt.
The new executive order explicitly bans the government from selling the bitcoin it holds to fund other expenditures, so it’s not clear what it’s supposed to accomplish beyond propping up the currency’s value — to the benefit of bitcoin investors. And while the order does allow for a stockpile of digital assets, it does not explicitly mention any coins by name besides bitcoin. It also emphasizes bitcoin’s stability over other cryptocurrencies, citing its “scarcity and security.”
“Because there is a fixed supply of BTC, there is a strategic advantage to being among the first nations to create a strategic bitcoin reserve,” the order said. “Just as it is in our nation’s interest to thoughtfully manage national ownership and control of any other resource, our nation must harness, not limit, the power of digital assets for our prosperity.”
The administration positions the creation of a dedicated bitcoin crypto reserve as a major step in the president’s broader ambition to position the United States as the “crypto capital of the planet.” It also represents a historic moment for bitcoin, which is widely regarded as the original cryptocurrency. After years of skepticism and criticism (even from Trump himself), the U.S. government seems to be changing its tune on bitcoin.
What Is The Strategic Bitcoin Reserve?
The Strategic Bitcoin Reserve would be a government-managed fund designed to hold bitcoin as a long-term strategic asset. Resembling traditional reserves for commodities like gold, medical supplies and petroleum, it aims to ensure the country’s financial stability by accumulating and maintaining bitcoin for future needs.
The U.S. government has never actively purchased cryptocurrency, but it is one of the largest holders of bitcoin in the world. Seized by law enforcement operations targeting illegal activities like ransomware attacks and drug trafficking, these confiscated assets are typically auctioned off through public sales conducted by the U.S. Marshals Service. But, with the creation of a bitcoin reserve, they would be retained rather than sold.
To build up the reserve, the executive order mandates that the Secretary of the Treasury establish an office to “administer and maintain control of” bitcoin the Department of Treasury has obtained as part of “criminal or civil asset forfeiture proceedings” or as payment for civil penalties imposed by any executive department or agency. All other agencies will have 30 days to transfer any bitcoin they have to the Secretary of Treasury as well.
The order also keeps the door open for the government to actually purchase bitcoin in the future, authorizing the Secretary of the Treasury and Secretary of Commerce to “develop strategies” for acquiring additional bitcoin — provided those strategies are “budget neutral” and “do not impose incremental costs on United States taxpayers.” David Sacks, the so-called “White House AI and crypto czar,” said in a press conference that this means they are only “allowed to buy more if it doesn’t add to the deficit or the debt.”
While the order may appear to be introducing significant reform, it is largely just formalizing existing policy to hold confiscated assets. But it does fulfill a promise Trump made during his presidential campaign at the 2024 Bitcoin Conference, where he also vowed to deregulate the crypto industry entirely.
How Will the Strategic Bitcoin Reserve Work?
The Strategic Bitcoin Reserve will likely work similarly to other reserves — essentially acting as a store of value to protect against economic instability and inflation, while providing the U.S. government with a valuable asset for long-term strategic purposes. As such, bitcoin deposited into the reserve “shall not be sold,” said the executive order, and should be “maintained as reserve assets” to meet “governmental objectives in accordance with applicable law.”
Beyond that, the precise framework of the bitcoin reserve has not been publicly disclosed, and is likely still being worked out by the newly formed President’s Working Group on Digital Asset Markets. Tasked with developing crypto regulations, the team is also evaluating the creation of a “national digital asset stockpile,” according to yet another executive order. Once a formal plan is in place, any new expenditures would need to be approved by Congress.
It remains unclear how exactly a bitcoin reserve will benefit average Americans in the long run, but Sacks posted on X that it would “not cost taxpayers a dime.” In the meantime, Sacks has ordered a full accounting of the federal government’s existing crypto reserves, which is estimated at 200,000 bitcoin alone (worth some $17 billion).
What Is the Digital Asset Stockpile?
The Digital Asset Stockpile is designed to house every cryptocurrency besides bitcoin. Managed by the Treasury Department, it will serve as a “secure account for orderly and strategic management” of the country’s “other digital asset holdings,” according to the executive order. No coins were mentioned by name, but it will likely include Ethereum (ETH), Solana (SOL), XRP and ADA — assets Trump mentioned previously in his initial announcement of a “Crypto Strategic Reserve.”
Similar to the Strategic Bitcoin Reserve, this stockpile will include digital assets that were seized as part of “criminal or civil asset forfeiture proceedings,” or that are “not needed to satisfy requirements” under 31 U.S.C. 9705, which is the Treasury Department’s own forfeiture fund. And all agencies have 30 days to hand over any confiscated digital assets they have in their possession to the Secretary of the Treasury, who will then determine “responsible stewardship” of the stockpile “in accordance with applicable law,” the order explained.
From there, the government is not allowed to acquire any additional digital assets, besides those gathered in connection to a criminal or civil forfeiture — unless otherwise stated by further executive or legislative action.
Unlike the bitcoin reserve, which explicitly prohibits the government from selling its holdings, the order made no mention of whether or not the government can sell the cryptocurrency in the Digital Asset Stockpile. As a result, the stockpile may eventually function as a more flexible repository of confiscated cryptocurrencies, potentially allowing for future liquidations if needed.
Reactions to the Strategic Bitcoin Reserve
The announcement of the Strategic Bitcoin Reserve has drawn mixed reactions.
Bitcoin enthusiasts have largely praised the decision to include only bitcoin in the reserve, particularly after Trump’s earlier proposal to include Ethereum, Solana, XRP and ADA in a Crypto Strategic Reserve. Critics argued that these assets were too volatile to be reliable reserve options.
“A bitcoin-only reserve would ratify bitcoin as a global asset of consequence, somewhere in the realm of gold,” Nic Carter, founding partner at blockchain investor Castle Island Ventures, told CNBC. “The U.S. is clearly the most important nation in the world, and so their stamp of approval really does a lot for bitcoin.”
However, other leaders in the industry seem frustrated by the government’s decision to not actively buy bitcoin.
“This is the most underwhelming and disappointing outcome we could have expected for this week,” Charles Edwards, founder of bitcoin and digital assets hedge fund Capriole Investments, posted on X. “No active buying means this is just a fancy title for Bitcoin holdings that already existed with the Govt. This is a pig in lipstick.”
Indeed, news that the U.S. would not buy bitcoin to fill its reserve sent its prices tumbling more than 6 percent in the days following Trump’s announcement.
More broadly, the decision to establish a bitcoin-only reserve has also puzzled several traditional economists, who say the idea relies on two questionable assumptions: 1) The price of bitcoin is guaranteed to rise, and 2) the government could eventually sell bitcoin back into U.S. dollars without tanking the entire market. Choosing to hoard instead of sell bitcoin seized by law enforcement also comes with opportunity cost — unlike assets like stocks or bonds, bitcoin generates no income, making it expensive to hold onto.
“The question comes down to what the government would get out of the hoards of bitcoin it would be holding,” George Selgin, director emeritus for the Center of Monetary and Financial Alternatives at the Cat Institute, told Wired. “Governments are not particularly astute investors,” he continued. “Having the government act on behalf of citizens as some kind of investment trust or mutual fund doesn’t make much sense.”
Still, Trump’s formation of a bitcoin reserve already seems to be influencing policymakers around the world. In the United States, members of Congress in states like New Hampshire, Texas and Ohio have introduced bills authorizing their respective state treasuries to purchase bitcoin. And politicians in countries like Brazil, Hong Kong and the Czech Republic are working to do the same.
Frequently Asked Questions
Doe the U.S. government hold bitcoin?
Yes. While the U.S. government does not actively purchase any cryptocurrency, it has become one of the world’s largest bitcoin holders through criminal and civil asset forfeitures by law enforcement.
What is a strategic reserve?
A strategic reserve is a stockpile of resources and assets maintained by a government to ensure national security and economic stability in times of need. These reserves are typically intended for long-term storage, and are not actively sold off or traded unless it is to address a specific emergency or market disruption. Common examples of U.S. reserves include oil, gold, foreign currencies and medical supplies.
