President Donald Trump on Thursday night authorized the creation of a strategic bitcoin reserve and a separate US stockpile of other digital assets, fulfilling a campaign promise he made to an industry that is gathering at the White House Friday for a “crypto summit.“
The bitcoin reserve will be seeded with bitcoin already owned by the federal government taken as part of criminal or civil asset forfeiture proceedings, Trump’s crypto czar David Sacks said in a post on the social media platform X.
“This means it will not cost taxpayers a dime,” Sacks said. Trump in the Oval Office asked Sacks if he believed in the reserve and then before signing the executive order said “we made the promise” — referring to the pledge of a bitcoin reserve he made on the 2024 campaign trail.
Sacks said on X that the U.S. government owns an estimated 200,000 bitcoin, although he said there has never been a complete audit. An executive order signed by Trump Thursday asks for a full accounting of the federal government’s digital asset holdings.
Sacks said the U.S. will not sell any bitcoin once it is in the reserve and that it will be kept as a store of value.
The reserve, he added, “is like a digital Fort Knox for the cryptocurrency often called ‘digital gold.’”
AI and crypto Czar David Sacks speaks with President Donald J Trump as he signs executive orders in the Oval Office at the White House on Jan. 23. (Photo by Jabin Botsford/The Washington Post via Getty Images) ·The Washington Post via Getty Images
Democratic Sen. Elizabeth Warren on Friday said she sent a letter she sent to Sacks raising concerns about the reserve and any conflicts of interest “as the administration pushes policies that could directly benefit the president, administration insiders, and wealthy investors.”
Sacks said last Sunday in a social media post on X that “I sold all my cryptocurrency (including BTC, ETH, and SOL) prior to the start of the administration.” On Monday he said he sold a $74,000 position in a Bitwise ETF and does not have “large indirect holdings.”
He added that he would provide an “update at the end of the ethics process.” The FT reported that his venture capital firm retains stakes in a small number of crypto startups and that he was in the process of a government ethics review.
His boss, the president, is a participant in the cryptocurrency industry. Just before his inauguration, Trump’s team launched an official meme coin for the 47th president (TRUMP) and one for first lady Melania Trump (MELANIA) on the solana blockchain.
Trump and his sons are also backers of another crypto project called World Liberty Financial, and his namesake Trump Media & Technology Group (DJT) has said it will allocate up to $250 million of cash tied up in a venture called Truth.Fi into cryptocurrencies and other investments.
One unknown question about the reserve announced Thursday by Sacks and Trump is whether it will be used to buy more bitcoin beyond the assets already held by the US government.
Sacks said Thursday night that the secretaries of Treasury and Commerce have the authorization “to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies have no incremental costs on American taxpayers.”
Treasury Secretary Scott Bessent told CNBC Friday that seized crypto assets would go into the reserve first and “then we’ll see what the way forward is for more acquisitions for the reserve. And we’re starting with Bitcoin, but it’s an overall crypto reserve.”
Scott Bessent, secretary of the Treasury, speaks at an Economic Club of New York luncheon on Thursday. (AP Photo/Seth Wenig) ·ASSOCIATED PRESS
Sen. Cynthia Lummis has separately discussed a US government crypto-buying program that would call for the Federal Reserve to purchase more bitcoin using 1970s-era certificates for gold reserves. It would need congressional approval.
“The goal of a strategic reserve is to buy or convert current assets into bitcoin and then hold them … that way, we can remove the short-term volatility from the equation and look at this as a long-term strategic asset,” she told Yahoo Finance Live in an interview last Friday.
Lummis said there is more work to do to help people understand “the reason why we should have it” and that it can interplay with the world reserve currency status of the US dollar.
“We think they are very complimentary,” Lummis told Yahoo Finance.
When the president last weekend discussed his plans for a reserve on social media, he said it would include bitcoin as well as other digital assets: ethereum (ETH), XRP (XRP), solana (SOL), and cardano (ADA).
Sacks said Thursday that the president had also authorized a “U.S. digital asset stockpile consisting of digital assets other than bitcoin forfeited in criminal or civil proceedings” — without naming the assets.
But Sacks made it clear the government will not acquire additional assets for that stockpile beyond those obtained through forfeiture proceedings.
The new announcement at the end of this week comes after a period of extreme volatility for digital assets. The price of bitcoin has whipsawed following its worst correction since a 2022 meltdown.
It fell sharply from above $90,000 in the hour following Thursday’s presidential action before regaining much of that ground, down 1% since the order was announced.
Bitcoin is still down 18% from its all-time high above $109,000 on the day of Trump’s inauguration in January.
The crypto world is hoping a White House crypto summit today will take it one step closer to getting even more it wants from a GOP-led Washington, providing some stability to a market trying to regain the upward momentum it had in the aftermath of Donald Trump’s election victory.
The SEC has dropped several high-profile cases against prominent cryptocurrency companies since Trump took office and created a presidential working group on digital assets that is studying the possibility of moving legislation through Congress that could provide more clarity about regulatory oversight of digital assets.
The White House said in a statement that Trump is expected to host and deliver remarks at the crypto summit before prominent CEOs, founders, and investors from the industry.
The attendees are expected to include Coinbase Global (COIN) CEO Brian Armstrong, Strategy’s (MSTR) Michael Saylor, Chainlink Labs CEO Sergey Nazarov, and Exodus CEO JP Richardson.
Coinbase is one of the biggest beneficiaries of the changes in Washington, D.C. Last week, the SEC dropped a lawsuit against Coinbase that had been filed and pursued aggressively by the Biden administration.
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