by Jude Ayua

United States President Donald Trump, on 6 March 2025, issued an executive order to establish a Strategic Bitcoin Reserve and a US Digital Asset Stockpile. The USDAS would serve as an account for the strategic management of the US’ digital asset holdings other than bitcoin (BTC). 

The order empowers the Secretary of the Treasury to establish an office for the administration and control of “custodial accounts,” collectively, the Reserve and the Stockpile. Both accounts would be funded with all BTC and other assets under the Department of the Treasury’s custody that were forfeited as part of criminal or civil asset forfeiture proceedings or from settlements of civil money penalty imposed by any executive department or agency.

The order requires all agencies to review any BTC and other assets (Government Digital Assets) they hold and transfer them to the Treasury within 30 days of the date of the order. The agencies must also submit a report of their review to the Secretary of the Treasury.

The Strategic Bitcoin Reserve

The order acknowledged that “the US government currently holds a significant amount of BTC, but has not implemented a policy to maximize BTC’s strategic position as a unique store of value in the global financial system.” It further emphasized that it is in the country’s interest to not limit the power of digital assets for its prosperity. 

By establishing the Bitcoin Reserve, the US government took advantage of BTC’s market dominance. As observed in the executive order, “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.”

Read also: Trump establishes President‘s Working Group on Digital Asset Markets.

Also, the government leveraged BTC holdings, instead of buying it at a higher cost or selling it at a potential loss. “It is estimated that the U.S. government owns about 200,000 bitcoin; however, there has never been a complete audit,” shared David Sacks, Trump’s crypto and AI czar, in a post on X. “Premature sales of bitcoin have already cost U.S. taxpayers over $17 billion in lost value,” he added.

The Digital Assets Stockpile

Trump announced a few days before signing the executive order via his social media that the Stockpile would include the following digital assets: Ether (ETH), Ripple (XRP), Solana (SOL), and Cardano (ADA). He also said other “valuable assets” would be included subsequently.

Sacks hinted that “[t]he purpose of the Stockpile is responsible stewardship of the government’s digital assets under the Treasury Department.”

No buying, no selling

The government may buy more BTC with stipulated conditions, but shall not buy other assets.

The executive order mandates the Secretaries of the Treasury and Commerce to “develop strategies for acquiring additional Government BTC provided that such strategies are budget neutral and do not impose incremental costs on United States taxpayers.”

The government may acquire additional assets for the Stockpile only “in connection with criminal or civil asset forfeiture proceedings or in satisfaction of any civil money penalty imposed by any agency…”

These provisions imply that the government does not intend to spend “taxpayer money” on a digital assets reserve and stockpile. Perhaps, the decision is informed by market volatility and other risks associated with the digital assets sector that may result in financial losses and negatively impact the economy. It may also be because the government wants to maintain public trust and create more confidence in the digital assets sector without risking taxpayer money.

Another key provision is that no agency shall sell or dispose of any Government Digital Assets, except with the Secretary of the Treasury’s approval.

Read also: Banks can accept cryptocurrencies, says US Federal Reserve Chair.

Industry reactions and market prospects

While Sacks praised the proposed establishment of the Reserve and Stockpile as Trump’s “PROMISES MADE, PROMISES KEPT,” not all stakeholders welcomed it warmly.

Solana Labs Co-founder Anatoly Yakovenko criticized the government’s plan for a strategic bitcoin reserve. Yakovenko argued it could undermine and threaten decentralization, by giving the government control over crypto. He suggested that if a reserve were necessary, it should follow clear, objective criteria, noting that Solana’s ecosystem would meet fair standards.

Peter Schiff, a strong critic of the Trump Administration and its crypto policies, has ridiculed the idea of a BTC reserve and digital assets stockpile. Schiff posted on X on 8 March:

“I’ve decided to create my own Strategic Bitcoin Reserve. Just like the U.S. government, I’m developing a budget-neutral strategy for acquiring my bitcoin at no incremental cost… I’m developing a Digital Asset Stockpile too.”

Crypto market performance has experienced a slight decline since the signing of the executive order. BTC, which rose from $85k to $94k on the day Trump announced the establishment of the Reserve, reverted to $84k the next day. Since the signing of the order, BTC has remained below $90k. The Stockpile Assets, XRP, SOL, ADA, and ETH, have also dipped significantly.

Perhaps, the poor market performance is because the proposed strategy for acquiring the Government Digital Assets, which excludes buying new assets, does not meet market participant’s expectations. 

Trump’s digital asset policies since his inauguration prove his promise of a friendly regulatory approach to the industry. Key agencies including the Securities and Exchange Commission and the Commodity Futures Trading Commission, are working to align their policies with the goals of the administration. While the new policy reforms have not yet reflected on market stability, they have the prospects of driving a safe, secure, and thriving industry.

Read also: The US Government harnesses stablecoins to bolster Dollar’s global dominance  

 

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Jude Ayua is a policy analyst at CAB. A lawyer, Jude is an associate at Infusion Lawyers where he is a member of the Blockchain & Virtual Assets Group. He is also a member of the Policy & Regulations Committee of the Stakeholders in Blockchain Technology Association of Nigeria (SiBAN). Jude reports and writes on crypto policy and regulations. jude@infusionlawyers.com