An executive order and related legislation centralizes Bitcoin and digital asset holdings across the federal government to optimize oversight and management of crypto as a US reserve asset.

By Jenny Cieplak, Zachary Fallon, Arthur S. Long, Yvette D. Valdez, Stephen P. Wink, Connor Jobes, and Deric Behar

On March 6, 2025, President Trump issued an executive order for the “Establishment of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile” (the Order). As a matter of national security, the US maintains several strategic reserves of important materials and scarce resources, including gold, petroleum, pharmaceuticals, medical supplies, and nuclear weapons.

The Order establishes separate offices within the US Department of the Treasury to administer and maintain custody of Bitcoin and other digital assets forfeited as part of criminal or civil proceedings, or in satisfaction of penalties imposed by executive agencies. The Order also directs the Secretaries of Treasury and Commerce to develop strategies for acquiring additional digital assets, so long as such strategies are budget neutral and do not impose incremental costs on US taxpayers.

The Order directs that within 30 days of the date of the Order, the head of each agency must provide the Secretary of the Treasury and the President’s Working Group on Digital Asset Markets with a full accounting of all Bitcoin and other digital assets in the agency’s possession. (It is estimated that the US government currently holds more than 207,000 Bitcoin, worth approximately $17 billion as of March 15, 2025.)

Although the Order does not explicitly say which crypto assets will constitute the alternative asset stockpile, President Trump stated that Ether, XRP, Solana, and Cardano would be included. David Sacks, the White House AI and Crypto Czar, stated that the Strategic Bitcoin Reserve would be “like a digital Fort Knox for” cryptocurrency.

Responses From Congress

The impetus of the Strategic Bitcoin Reserve precedes President Trump’s Order, with the concept first introduced via legislation in Congress in mid-2024. Although lawmakers have devoted a significant amount of time during the current session of Congress to considering various digital asset bills (for more information, see this Latham blog post), the congressional response to President Trump’s Order has been mixed.

Republicans in Congress have generally been favorable of pro-crypto legislation, including efforts to establish a Strategic Bitcoin Reserve. House Financial Services Committee Chairman French Hill stated that it is “critical we ensure proper accountability, accurate tracking, and a unified approach to managing these novel assets,” and highlighted the importance of working with Congress to determine the structure and funding related to the Strategic Bitcoin Reserve.

In the wake of the Order, Senator Cynthia Lummis, a long-time advocate of digital assets, introduced the “Boosting Innovation, Technology, and Competitiveness through Optimized Investment Nationwide (BITCOIN) Act” to establish a Strategic Bitcoin Reserve into law. A similar effort is also reportedly forthcoming from Representative Byron Donalds.

The BITCOIN Act, while establishing the Strategic Bitcoin Reserve and providing its capitalization from seized digital assets, goes even further than the Order to allow the Treasury Department to directly purchase 1 million Bitcoin and to acquire an approximate 5% of the total Bitcoin supply, “mirroring the size and scope of gold reserves” held by the federal government. A reserve comprising 5% of the total Bitcoin supply would be worth approximately $88 billion as of March 15, 2025.

Democrats on the other hand, have been less supportive of the Order. Maxine Waters, Ranking Member of the House Financial Services Committee, criticized the proposal, calling the Bitcoin reserve and digital asset stockpile “silly” and stated that crypto is not “an essential input that powers the U.S. economy and day-to-day life for American families,” which is typical of government strategic reserves. She also noted that governmental holdings of Bitcoin and other digital assets could influence regulatory policy to increase the value of such reserves.

Gerry Connolly, Ranking Member of the House Committee on Oversight and Government Reform, urged the Secretary of the Treasury to cease any attempt to create the Strategic Bitcoin Reserve, citing conflicts of interest within the administration and stating that the “reserve provides no discernible benefit to the American people.”

Conclusion

This effort by the Trump administration is the latest in a series of pro-crypto policy shifts, including the landmark the executive order on “Strengthening American Leadership in Digital Financial Technology” (for more information, see this Latham blog post) and additional regulatory actions viewed as supportive of the crypto industry (for more information, see this Latham blog post).

As the president acts on his promise to make the US the “crypto capital of the planet,” and Congress increasingly focuses on how to establish a coherent regulatory framework, the actual parameters and capacities of the Strategic Bitcoin Reserve (and the related digital asset stockpile) will be subject to much scrutiny and debate.

Many open questions and issues remain to be clarified, such as determining which digital assets the federal government will hold; whether Treasury will be able to buy and sell assets in the open market; establishment of parameters so that governmental sales and acquisitions do not unduly influence markets; ensuring that any digital assets in the government’s possession are held safely and securely; and the appropriate level of transparency of the entire process.

These points and others will surely be part of the ongoing discussion among lawmakers, regulators, and market participants as the administration seeks to “embrace digital assets to drive economic growth and technological leadership.”