President Donald Trump has enacted an executive order to form a strategic reserve for Bitcoin, positioning the United States among the few nations globally to develop a national stockpile of blockchain assets.
This reserve will encompass cryptocurrencies forfeited to the federal government during criminal or civil proceedings, as explained by White House AI and crypto advisor David Sacks in a post on X.
According to Sacks, the US will not liquidate any Bitcoin held in the reserve; rather, it will retain it as an asset.
In 2021, El Salvador set a precedent as the first country to create a Bitcoin reserve, with Brazil, Japan, and Switzerland also considering similar initiatives.
Trump, who previously labeled Bitcoin as “seems like a scam” just four years prior, unveiled plans earlier this week to transform the US into “the Crypto Capital of the World”.
More information is anticipated when the president hosts the inaugural crypto summit at the White House this Friday.
It remains uncertain if the proposed reserve may encounter legal challenges or if it necessitates Congressional approval.
Sacks mentioned that this stockpile would function as “a digital Fort Knox for cryptocurrency,” drawing parallels to a military facility in Kentucky that safeguards a significant portion of the US gold reserves.
Additionally, Trump’s order establishes a digital assets reserve for cryptocurrencies other than Bitcoin that have been forfeited.
It mandates a comprehensive assessment of the federal government’s crypto holdings, which Sacks estimates to be around 200,000 Bitcoin, valued at approximately $17.5 billion (£13.6 billion) at current market rates.
While the benefits of this new stockpile for Americans remain unclear, Sacks assured it “will not cost taxpayers a dime”.
His suggestion that the US government would refrain from acquiring Bitcoin contributed to a more than 5% drop in the price of the world’s leading cryptocurrency.
Several countries maintain strategic reserves of national assets to diversify their portfolios and hedge against financial uncertainties.
The US maintains a petroleum reserve, and Canada boasts a maple syrup reserve.
Earlier this week, Trump disclosed five cryptocurrencies that he wishes to include in the strategic reserve.
Following his announcement, the market prices of the mentioned coins—Bitcoin, Ethereum, XRP, Solana, and Cardano—experienced a notable increase.
Trump actively engaged with the crypto community during his presidential campaign, while former President Joe Biden initiated a crackdown on cryptocurrencies over fraud concerns.
