Donald Trump’s plan to establish a US Bitcoin reserve through a Trump executive order could start a global crypto arms race.
Upon returning to the presidency in January 2025, Donald Trump has been anticipated to significantly influence Bitcoin and crypto in general through a series of executive orders.
Trump himself is anticipated to be the first US “crypto president.” A popular promise among the crypto community has been Trump’s pledge to dismiss Gary Gensler, the current SEC Chair, on his first day in office, especially given the crypto community’s discontent with Gensler’s regulatory approach.
Trump’s promise of a crypto regulatory overhaul will cement the US’s role as a global leader in digital assets. The MAGA man’s promises have driven the prices of
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, XRP, and Solana to a bullish trajectory.
People in crypto now predict this could trigger a global Bitcoin arms race.
(BTCUSD)
Donald Trump’s Plans to Establish a US Bitcoin Reserve Through an Executive Order Could Start a Global Crypto Arms Race
One of the most talked-about initiatives is the creation of a “Strategic Bitcoin Reserve.” This concept would see the Trump-led US government amass a national stockpile of Bitcoin, designating it as a strategic reserve asset.
The Bitcoin Policy Institute has even drafted an executive order for this purpose, and the Treasury Department could invest up to $21 billion per year over five years to accumulate Bitcoin. This Trump movement positions Bitcoin as a hedge against inflation and geopolitical risks, much like gold reserves.
Before all of Trump’s driven bullishness, the US government already had a considerable amount of Bitcoin, mostly from criminal seizures. This existing stash could serve as the foundation for the new reserve.
Trump’s order will legitimize Bitcoin in the eyes of old-school finance. It will lead to an increase in Bitcoin value, with governments worldwide to follow.
This is especially true for El Salvador and Argentina, which are standing as Bitcoin crypto nations. Countries like China and Russia will probably increase their Bitcoin reserves, leading to a bidding war for Bitcoin on the open market.
NEW:
US Government currently owns $15B worth of #Bitcoin and President Trump vows to HODL if elected
pic.twitter.com/Uy59tHrBzx
— Thomas | heyapollo.com (@thomas_fahrer) July 27, 2024
This council would advise the government on matters related to digital assets, aiming to formalize the relationship between the US government and the crypto sector.
Moreover, the council would include industry leaders from various digital asset companies. Among these leaders could be figures like the rumored David Sacks, who has been mentioned as a potential “AI and Crypto Czar” for this initiative.
Trump’s new council would advocate for the industry’s policy priorities, influencing regulations, taxation, and financial integration of crypto into mainstream retail.
The Trump administration says they’re anti-DEI, but it’s hard to see the David Sacks appointment as crypto/AI czar as anything more than shameless pandering to America’s disembrained.
— Quantіan (@quantian1) December 6, 2024
Meanwhile, US Senator Cynthia Lummis has endorsed this initiative. She has been a proponent of clearer regulations for crypto, which might help navigate the legislation needed to support such a reserve.
Lummis has explicitly backed Trump’s proposal for establishing a strategic Bitcoin reserve. She has suggested that the US acquire 1 million BTC over five years, representing approximately 5% of Bitcoin’s total supply, and hold it for at least 20 years.
To tackle “de-banking,” where crypto firms struggle with banks due to regulation, Trump proposes an executive order. These orders guide regulators to rethink their crypto approach. This aims to ease regulatory pressures on banks.
Thus, it seeks to make finance more welcoming for crypto businesses. Historically, these regulations caused banks to distance themselves from crypto. This Initiative will open more doors for crypto companies in the US.
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Donald Trump’s strategy for crypto involves significantly revising the regulatory framework. This includes potentially dismantling or amending regulations, such as the SEC’s Staff Accounting Bulletin (SAB) 121, which mandates that banks holding crypto for clients must account for these assets as liabilities.
By altering such rules, Trump aims to make it more attractive for financial institutions to engage with digital assets, freeing them from the constraints of unfavorable accounting practices.
JUST IN: As of January 15, the U.S. government holds 198,109 BTC worth $19.21 billion, making it one of the largest Bitcoin holders globally.
Source: Arkham Intelligence
— All In Bitcoin (@Allinbtc0x) January 15, 2025
Moreover, through executive orders, Trump plans to direct agencies like the SEC and the CFTC to foster a more friendly regulation for crypto. These changes could significantly shift how financial institutions interact with digital assets.
The goal is to promote a more welcoming environment for the crypto industry. Ultimately, this could lead to more supportive regulation of Bitcoin and crypto.
The crypto community has seen this development as a bullish sentiment on the crypto market. Following the announcement, the response has been immediate. Bitcoin
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pumps to $103,000 this morning, and some major crypto like XRP and Solana show the same bullish sentiment.
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