US Bitcoin Reserve Stalls
The US government's proposed strategic Bitcoin reserve has languished for a year with no congressional action, despite initial excitement from Trump's executive order announcement. Only one idea remains for 2026 implementation. The lack of progress underscores ongoing policy uncertainty around cryptocurrency integration at the national level, disappointing digital asset advocates who expected faster government adoption.
The executive order establishing the reserve, signed on March 6, 2025, prevents the government from selling its Bitcoin holdings and tasks departments with exploring budget-neutral ways to acquire more. This marked a significant policy shift, as the previous practice was to liquidate cryptocurrencies seized in criminal cases. The order also created a separate "Digital Asset Stockpile" for other seized cryptocurrencies like Ethereum, which may be sold at the Treasury's discretion. The United States is the largest known state holder of Bitcoin, with estimates of its holdings ranging from approximately 198,000 to over 328,000 BTC. This entire amount was acquired through law enforcement seizures and criminal forfeitures from cases involving entities like the Silk Road and the Bitfinex hack, not through direct purchases. A single 2025 forfeiture from the "Prince Group" criminal organization added over 127,000 BTC, the largest crypto seizure in Department of Justice history. Proponents argue a strategic reserve could act as a hedge against inflation and dollar devaluation, similar to the role of gold reserves, due to Bitcoin's fixed supply of 21 million coins. Others see it as a way to diversify treasury holdings and reduce overall risk while positioning the U.S. as a leader in the digital economy. Conversely, critics point to Bitcoin's extreme price volatility as a major risk for a national reserve asset. They also argue it is an unnecessary risk since the U.S. dollar is already strong and that, unlike the Strategic Petroleum Reserve, the public does not rely on Bitcoin for daily use. Legislative efforts to codify and expand the reserve have been introduced, including the "BITCOIN Act" proposed by Senator Cynthia Lummis. This bill went further than the executive order, suggesting the Treasury could purchase up to 1 million BTC. Despite some bipartisan support, such legislative proposals have not advanced. While the federal initiative has stalled, several U.S. states, including Ohio, Texas, and Pennsylvania, have started exploring the creation of their own Bitcoin reserves to hedge against inflation. This mirrors actions by countries like El Salvador, which was the first nation to create a national Bitcoin reserve in 2021.
