Summary
The U.S. Strategic Bitcoin Reserve was established by President Donald J. Trump through an executive order on March 7, 2025. This reserve will be capitalized with bitcoin seized by the Department of Treasury from criminal and civil forfeiture proceedings and shall be maintained as a store of reserve assets, with a commitment not to sell these holdings. Other federal agencies are now assessing their authority to transfer bitcoin to this reserve, and the Secretaries of Treasury and Commerce are tasked with developing budget-neutral strategies to acquire additional bitcoin without taxpayer costs.
In parallel, U.S. Senator Cynthia Lummis (R-WY) has proposed the BITCOIN Act. This legislation aims to expand the reserve by purchasing 1 million Bitcoin (approximately 5% of the total supply) over time, to be held for at least 20 years and potentially used to reduce national debt. The bill seeks to reinforce America's financial leadership and address inflation concerns.
Timeline of Events:
User "crazy_rabbit" posts on BitcoinTalk forum suggesting the US government should start a Strategic Bitcoin Reserve with seized coins from the Silk Road.
Pierre Rochard publishes an article titled "Urgent Bitcoin Legislation," proposing to halt the auctioning of seized bitcoin and suggesting that a large strategic reserve of bitcoin may be crucial for national security.
David Bailey suggests that former President Trump should advocate for a significant national investment in Bitcoin, akin to historical land acquisitions like the Louisiana Purchase. The plan involves establishing a strategic Bitcoin reserve for America, with funds time-locked for 100 years to ensure long-term preservation.
Senator Lummis announces the Strategic Bitcoin Reserve proposal at Bitcoin 2024 conference.
Senator Lummis officially introduces the Boosting Innovation, Technology and Competitiveness through Optimized Investment Nationwide (BITCOIN) Act in the U.S. Senate.
Bill read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
President Donald J. Trump signed an Executive Order to establish a Strategic Bitcoin Reserve to be capitalized with bitcoin owned by the Department of Treasury that was forfeited as part of criminal or civil asset forfeiture proceedings. Other agencies will evaluate their legal authority to transfer any bitcoin owned by those agencies to the Strategic Bitcoin Reserve. The United States will not sell bitcoin deposited into this Strategic Bitcoin Reserve, which will be maintained as a store of reserve assets. 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.
March 11, 2025
U.S. Congressman Nick Begich announces he will be introducing the BITCOIN ACT of 2025 to the House with 6 Co-sponsors
Not Yet Proposed
Vote in Senate
Proposed
Vote in House
Featured Videos
The Strategic Bitcoin Reserve
Matthew Pines (Bitcoin Policy Institute) and American HODL discuss the Strategic Bitcoin Reserve, exploring nation-state game theory behind Bitcoin accumulation and whether this signals the beginning of a global Bitcoin arms race.
Media Coverage:
Sam Lyman reports on growing discussions around Bitcoin as a strategic reserve asset, sparked by Donald Trump's pro-Bitcoin stance. The article reports that Senator Lummis "appears to be keen on the idea" of using bitcoin as a strategic reserve asset. It explores the potential benefits of leveraging Bitcoin to strengthen the U.S. fiscal health and geopolitical position, drawing parallels with MicroStrategy's corporate strategy and El Salvador's national adoption.
Wired covers Donald Trump's keynote address at the 2024 Nashville Bitcoin Conference, where he announced plans for a strategic bitcoin reserve if elected. Trump pledged to retain all government-held bitcoin as a core of the national stockpile, appoint a crypto advisory council, and create a framework for stablecoins. He also promised to halt CBDC development, fire SEC chair Gary Gensler, and make regulations friendly to U.S. crypto mining. Senator Cynthia Lummis followed up by introducing a bill to assemble 1 million bitcoin over five years, potentially using it to reduce national debt.
Forbes contributor and Director of the Bitcoin Research Institute Bradley Rettler reports on the BITCOIN Act. Following crypto PAC spending and Senator Brown's defeat, Rettler expects the bill to move forward under likely new Senate Banking Committee Chair Tim Scott. Rettler argues that the legislation has bipartisan support and may be prioritized in early 2024 amid concerns about other nations "frontrunning" the U.S. in bitcoin accumulation.
BBC reports on mixed reactions to President Trump's Strategic Bitcoin Reserve executive order. White House AI and crypto tsar David Sacks estimated the government already holds 200,000 Bitcoin worth $17.5 billion from forfeitures. The executive order authorizes Treasury and Commerce to develop "budget neutral" acquisition strategies that "do not impose incremental costs on United States taxpayers." Bitcoin prices fell over 5% following clarification that immediate government buying isn't planned.
Former Federal Reserve Bank of Atlanta Vice President Gerald Dwyer analyzes the Strategic Bitcoin Reserve Executive Order, noting that diversifying into Bitcoin offers financial benefits. Dwyer estimates the government currently holds about 207,000 bitcoins valued at $18.6 billion, representing 2.7% of its combined gold and Bitcoin portfolio. He calculates this diversification could improve returns by 2 percentage points annually with manageable increased risk, comparing Bitcoin's 75.5% annual return over the past decade to gold's 7.3%. Dwyer suggests maintaining a balanced approach and considering when to realize gains from Bitcoin appreciation.
The Atlantic questions the utility of the Strategic Bitcoin Reserve, noting it primarily involves accounting for already-owned crypto assets seized in criminal and civil proceedings, currently valued at approximately $17 billion. Journalist Ben Walsh highlights potential conflicts of interest within the administration from officials with crypto ties, including David Sacks and Commerce Secretary Howard Lutnik. He also points out that Trump's public naming of specific cryptocurrencies triggered price spikes before the actual announcement, while the limited scope of the actual executive order caused Bitcoin to "plummet immediately after the order was announced."
Skeptics' View:
Nic Carter argues against the Strategic Bitcoin Reserve concept, stating it would undermine rather than support the dollar. He contends that as the issuer of the global reserve currency, the US acquiring Bitcoin as a reserve asset would signal a loss of confidence in the dollar-based system. Carter suggests that such a move would cause market panic, spike interest rates, and trigger inflation. He also points out political challenges, noting that acquiring Bitcoin without Congressional approval would be undemocratic and likely undone by future administrations. Additionally, he argues Bitcoin has no strategic purpose comparable to other government reserves like oil or minerals, and that the initiative would be seen as a regressive wealth transfer to already wealthy Bitcoin holders.
Odell challenges the Strategic Bitcoin Reserve's foundation on seized assets as fundamentally contradicting Bitcoin's property rights principles. While proposing that seized bitcoin should be legally burned to deter government confiscation, he acknowledges a silver lining: the reserve signals Bitcoin's legitimacy and creates an aligned incentive structure benefiting both holders and the state. He warns against complacency and calls for continued vigilance in protecting the freedom to use Bitcoin without permission.