Conor Grogan from Coinbase emphasized how Trump’s Strategic Bitcoin Reserve the reserve has lessened the tension resulting from potential widespread governmental Bitcoin sales.
Arkham Intelligence reveals that American authorities currently, the government has custody of approximately 198,109 BTC, valued near $18 billion based on today's market rates.
The directive also demands a comprehensive review of all federal digital asset inventories, a task likely complicated given the current state of affairs in the United States.
David Sacks, Trump's advisor on AI and crypto affairs, disclosed on Thursday evening that the President has commanded the institution of a Strategic Bitcoin Reserve through an executive order. This reserve will be sourced from Bitcoin confiscated in legal and civil forfeitures.
Trump and Bitcoin!
Under the new policy, the 198,109 BTC captured during the Silk Road crackdown will become a long-term treasure trove akin to a digital Fort Knox, with no intentions to sell at present.
This move is crucial since it's believed that the U.S. government occasionally offloaded parts of their Bitcoin. Data from Arkham Intelligence indicates billions of Bitcoin were shifted by the government in 2024, with the latest move in December, though it's speculative if these were meant for liquidation.
David Sacks pointed out that the U.S. has capitalized on Bitcoin sales over the past decade, transforming 195,000 BTC into $366 million. However, he criticized this strategy, noting that retaining the coins could have amassed a fortune surpassing $17 billion by now.
The freshly inked order is designed to prevent such premature sales for at least the next four years. The new strategy focuses on capitalizing on the asset's burgeoning worth, rather than quick-selling off seized Bitcoin.
The directive also requests a structured inventory of the federal government's digital currency assets. Both the Treasury and Commerce Departments have been charged with crafting strategies for acquiring more Bitcoin without burdening taxpayers.
Senator Cynthia Lummis, a staunch proponent of Bitcoin, remarked that Trump's order marks only the beginning. Previously, she tabled the BITCOIN Act, aiming for the acquisition of 1 million bitcoins over a five-year stretch to bolster the national financial standing.
The legislation was effectively shelved during the last Congressional session. By the conclusion of the 118th Congress, the proposal hadn't gained traction, and prospects seemed dim.
Nonetheless, with the political shifts in November 2024 ushering in a more crypto-congenial Congress, there's newfound enthusiasm for Lummis' concept. She might soon reintroduce the proposal or propose new legislation with a similar objective.
Lummis is dedicated to steering bipartisan dialogues to advance robust digital finance regulations, including stablecoin guidelines and amendments in financial market operations, through her leadership as Chair of the Senate Digital Asset Subcommittee.
Digital Asset Stockpile
Besides the Bitcoin reserve, Trump's directive also introduced the U.S. Digital Asset Stockpile, an innovative scheme aimed at storing forfeited digital assets like Ethereum, XRP, and Solana.
Contrary to the Bitcoin reserve, the government will not proactively procure more similar digital tokens beyond those already seized. The Treasury Secretary retains the authority to liquidate these holdings when necessary.
All agencies are mandated to register all digital currency assets they possess with both the Treasury and the President’s Working Group on Digital Asset Markets for transparency and oversight.
Recently, Trump highlighted that the U.S. crypto accumulation would cover XRP, SOL, and ADA. Nonetheless, how this concept materializes remains uncertain since the government doesn't possess any of those mentioned cryptocurrencies due to lack of seizure.
Among the $17.73 billion in crypto assets snagged in the Silk Road affair, the U.S. government's share encompasses roughly $40 million inclusive of various cryptocurrencies like ETH, WBTC, and BNB.
