Trump’s new Bitcoin reserve, dubbed a “digital Fort Knox,” could transform how the US approaches cryptocurrency, as 200,000 bitcoins are seized for long-term security.
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| Trump’s executive order establishes a “Strategic Bitcoin Reserve,” funding it with 200,000 bitcoins seized from legal cases, raising questions about cryptocurrency’s future in US policy. Image: ChicHue |
New York, USA — March 16, 2025:
In a bold move that signifies growing US government support for cryptocurrency, President Donald Trump has signed an executive order establishing a “Strategic Bitcoin Reserve.” White House crypto chief, David Sacks, likened the new initiative to a “digital Fort Knox,” drawing comparisons to the way the US stockpiles gold at its military base for financial security. This reserve, funded by 200,000 seized bitcoins valued at approximately US$17 billion, will serve as a long-term asset storage, positioning bitcoin as a safe haven amidst financial uncertainty, reads a MFT report that cited another news channel.
The reserve is designed to be secured indefinitely, with the potential for additional bitcoins to be added, provided the action remains “budget-neutral.” This strategic move is a response to the volatile nature of cryptocurrency, with Sacks emphasizing the long-term benefits of holding bitcoin as a hedge against the extreme short-term fluctuations typically associated with digital assets. Despite this, bitcoin's price initially dropped following the announcement, with industry experts attributing the decline to a failure to purchase additional tokens immediately.
Legally, some of the bitcoins in the reserve may need to be returned to victims of prior hacks, such as the Bitfinex breach of 2016. This has raised concerns about the reserve’s future size and the potential impact on its stability. While currently, the reserve is exclusively holding bitcoin, there are indications that other prominent digital tokens—such as ether, XRP, Solana, and Cardano—could join the reserve in the future, as outlined by Trump’s executive order.
Critics of the reserve argue that cryptocurrencies, unlike gold, do not have intrinsic value and are inherently risky. However, advocates like Sacks and Stephane Ifrah, investment director at Coinhouse, counter that bitcoin’s rarity, stemming from its finite supply of 21 million tokens, mirrors gold's value. Additionally, the transparency of the bitcoin reserve, which will allow the public to track its holdings in real-time, offers an advantage over traditional gold reserves that lack such visibility.
Some analysts, such as crypto critic Molly White, view the reserve as a strategy to further drive interest in the cryptocurrency industry, raising questions about potential conflicts of interest given Trump’s past pledges to make the US the “bitcoin and cryptocurrency capital of the world.” Trump has also faced scrutiny over financial gains linked to the cryptocurrency market, including earnings from the launch of a meme coin, $TRUMP, and reports of his family considering a stake in the Binance platform, which was later denied.
On the global stage, countries like Brazil and Bhutan have begun exploring similar initiatives, with Bhutan holding significant bitcoin reserves in relation to its GDP. As more nations consider embracing digital assets, Trump’s “Strategic Bitcoin Reserve” sets a precedent for how government-backed cryptocurrency reserves could shape the future of global finance.
While opinions on the reserve vary, it undeniably marks a critical step in the evolution of cryptocurrency within US financial policy, highlighting the growing acceptance of digital assets in national economies.