Trump Establishes U.S. Strategic Bitcoin Reserve, But No New Purchases Planned

U.S. President Donald Trump has signed an executive order to establish a Strategic Bitcoin Reserve using bitcoin seized through criminal and civil asset forfeitures. The government will not initially purchase new bitcoin, disappointing investors who had hoped for active buying. The announcement briefly caused bitcoin’s price to drop 5% to $85,000 before recovering. However, the order allows for future acquisitions if they are budget-neutral and do not impose additional costs on taxpayers.

White House crypto czar David Sacks emphasized the symbolic significance of this move, with S&P Global’s Andrew O’Neill noting it as the first official U.S. recognition of bitcoin as a reserve asset. Despite this, some investors criticized the initiative as a mere rebranding of existing holdings rather than a proactive strategy. Trump’s previous pro-crypto stance had contributed to bitcoin’s surge to an all-time high of $109,071.86 in January. Additionally, a U.S. Digital Asset Stockpile will be created to hold other forfeited cryptocurrencies, though it will not be actively expanded. The announcement comes ahead of the first-ever White House crypto summit, set to take place on Friday.

Trump Establishes U.S. Strategic Bitcoin Reserve, But No New Purchases Planned

U.S. President Donald Trump has issued an executive order establishing a strategic cryptocurrency reserve using bitcoin already seized by the government, disappointing those who had hoped for direct purchases of new tokens. The announcement, made on Thursday ahead of a White House meeting with crypto executives, briefly caused bitcoin’s price to drop by 5% to $85,000 before recovering to $89,200 in early European trading on Friday.

According to White House crypto czar David Sacks, the “Strategic Bitcoin Reserve” will consist solely of bitcoin obtained through asset forfeiture. While the order leaves open the possibility of future acquisitions, it specifies that any new purchases must be budget-neutral and not impose additional costs on taxpayers.

Andrew O’Neill of S&P Global Ratings noted that while the move is largely symbolic, it marks the first formal recognition of bitcoin as a U.S. reserve asset. However, there is no clear timeline or indication of further acquisitions.

Trump’s earlier promises of a strategic reserve and regulatory easing had driven bitcoin to a record high of $109,071.86 in January. Some industry figures, such as Charles Edwards of Capriole Investments, criticized the announcement, calling it a rebranding of existing holdings rather than an active investment strategy.

In addition to the Strategic Bitcoin Reserve, the U.S. government will also establish a U.S. Digital Asset Stockpile to hold other cryptocurrencies seized through forfeiture. This stockpile, however, will not be actively expanded beyond assets already in government possession. The White House clarified that, similar to the bitcoin reserve, the government will not purchase additional tokens for this collection.

The purpose of this digital asset stockpile remains unclear, but analysts speculate it could be used for regulatory oversight, liquidation strategies, or as a contingency asset. Given the growing role of digital currencies in global finance, the creation of such a stockpile signals the U.S. government’s increasing recognition of crypto assets in its broader financial framework.

Critics argue that without active expansion or a clear use case, the stockpile may serve little practical function beyond housing forfeited assets. Some also worry that without clear guidelines, future administrations could shift its purpose in ways that impact the crypto market.

More details may emerge during the first-ever White House crypto summit, where industry leaders, policymakers, and financial experts will discuss the government’s evolving role in digital assets, cryptocurrency regulation, and blockchain adoption. The summit is expected to address concerns about future acquisitions, taxation policies, and regulatory clarity for the crypto industry.