TLDR
- President Trump signed an executive order creating a Strategic Bitcoin Reserve and Digital Asset Stockpile
- The reserve will be funded with Bitcoin seized in criminal or civil asset forfeiture proceedings
- No new Bitcoin purchases are currently planned, disappointing some investors who hoped for government buying
- The Treasury Department will manage other seized cryptocurrencies in the Digital Asset Stockpile
- Bitcoin briefly dropped 5% to $85,000 following the announcement before recovering to around $89,200
President Donald Trump has signed an executive order creating a Strategic Bitcoin Reserve and a Digital Asset Stockpile, marking a new chapter in U.S. cryptocurrency policy.
The initiative will use digital assets already in government possession rather than purchasing new tokens.
JUST NOW!
President Trump signs an Executive Order establishing the Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile 🇺🇸 pic.twitter.com/N9p2sQknVS
— Margo Martin (@MargoMartin47) March 7, 2025
The announcement came just before the White House Crypto Summit on March 7. White House AI and Crypto Czar David Sacks shared the news on social media platform X, explaining that the reserve will be “capitalized with Bitcoin owned by the federal government that was forfeited as part of criminal or civil asset forfeiture proceedings.”
Sacks described the reserve as “a digital Fort Knox for cryptocurrency.” He stated that the U.S. would not sell any Bitcoin put in the reserve, noting it “will be kept as a store of value.”
Just a few minutes ago, President Trump signed an Executive Order to establish a Strategic Bitcoin Reserve.
The Reserve will be capitalized with Bitcoin owned by the federal government that was forfeited as part of criminal or civil asset forfeiture proceedings. This means it…
— David Sacks (@davidsacks47) March 7, 2025
The White House fact sheet explained that Bitcoin owned by the Treasury Department would initially seed the reserve. It added that other federal agencies “will evaluate their legal authority” to transfer any Bitcoin they own into the reserve.
The order keeps open the possibility of future Bitcoin purchases. The Commerce and Treasury secretaries “are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies impose no incremental costs on American taxpayers,” according to the White House fact sheet.
Bitcoin prices reacted to the news with volatility. The cryptocurrency briefly dropped around 5% to $85,000 following the announcement. It later recovered to trade at approximately $89,200.
Some investors expressed disappointment with the announcement. Charles Edwards, founder of bitcoin-focused hedge fund Capriole Investments, wrote on X: “This is the most underwhelming and disappointing outcome we could have expected for this week. No active buying means this is just a fancy title for Bitcoin holdings that already existed with the Govt.”
Days before the executive order, on March 3, Trump posted on his Truth Social platform that the crypto reserve would include XRP, Solana (SOL), and Cardano (ADA). He later added that Ethereum (ETH) and Bitcoin (BTC) would be “the heart” of the reserve.
However, the executive order creates a separate “U.S. Digital Asset Stockpile” for cryptocurrencies other than Bitcoin. Sacks clarified that the government would not buy additional cryptocurrencies for this stockpile “beyond those obtained through forfeiture proceedings.”
According to data from Arkham Intelligence, the U.S. government currently controls about $18.28 billion worth of crypto. Its largest holding is 198,109 Bitcoin, worth approximately $17.87 billion.
The government also holds Ethereum worth $119 million and Tether worth $122 million. Arkham data shows the U.S. government doesn’t currently hold any XRP, SOL, or ADA.
Sacks noted that there has never been a complete audit of the government’s cryptocurrency holdings. The new executive order “directs a full accounting of the federal government’s digital asset holdings.”
Ryan Gilbert, a fintech investor, said the move sends a strong message to institutions that Bitcoin is here to stay. He suggested the decision would further distinguish Bitcoin from other cryptocurrencies.
Gilbert added a note of caution about future management of the reserve. “What we don’t want to see is the U.S. actively trading bitcoin. A reserve should be a long-term store of value, not something that introduces market-moving speculation.”
Bitcoin advocates like Tyler Winklevoss had expressed concerns about including other cryptocurrencies in the strategic reserve. Winklevoss wrote, “I have nothing against XRP, SOL, or ADA but I do not think they are suitable for a Strategic Reserve. Only one digital asset in the world right now meets the bar and that digital asset is bitcoin.”
The Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick will oversee further policy development. Their focus will be on budget-neutral acquisition strategies for Bitcoin, according to Sacks.
Andrew O’Neill, digital assets managing director at S&P Global Ratings, said: “The importance of this executive order is mainly symbolic, as it marks the first time Bitcoin is formally recognized as a reserve asset of the United States government.”
Sacks claimed the U.S. previously lost over $17 billion in potential value by selling seized bitcoin prematurely. The new policy aims to prevent such losses in the future by keeping seized Bitcoin as a long-term store of value.
