President Trump issued an executive order for a Strategic Bitcoin Reserve as well as a U.S. Digital Asset Stockpile of other cryptocurrencies. Both will come from asset seizures. However, for bitcoin, there is a somewhat cryptic paragraph about potential future acquisitions:
“The Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies impose no incremental costs on American taxpayers.”
One could speculate that might involve borrowing money to buy Bitcoin and using some kind of staking return to pay the interest. However, ‘budget-neutral strategies’ implies no borrowing. Another alternative might be to convert seizures of other assets into Bitcoin. Arguably that will cost American taxpayers because those other asset seizures could be used for alternative government purposes. If there are two people that could conjure up some financial wizardry, the Treasury and Commerce secretaries are good candidates.
When President Trump first mentioned the potential for the reserve and stockpile in a social media post, it attracted quite a bit of pushback from the crypto community, particularly regarding which alternative assets might be included.
Prior to this announcement, S&P Global Ratings’ Andrew O’Neill observed,
“In the context of a sovereign’s investments, the narrative for allocating some portion to BTC is similar to gold, for hedging against long-term currency debasement and supporting debt sustainability.”
“In contrast, ETH (Ether) and SOL (Solana) focus on tech platform adoption, while ADA (Cardano) and XRP (Ripple) are more speculative due to lower adoption. Investing in these assets differs significantly from BTC and tech venture investment is less common for sovereigns.”
Based on the executive order, non-bitcoin assets would purely come from seizures. Crypto czar David Sacks observed on X that in the past decade the government sold bitcoin worth $17 billion today compared to $366 million proceeds.
States plan to use taxpayer money to buy bitcoin
Several US states have Bitcoin Reserve bills pending. Yesterday the Texas Senate voted to pass a bill that would involve using taxpayer money to buy bitcoin. The bill has yet to go through the House.
