Key Takeaways
- Bitcoin surged to an ATH of $108,262 after President-elect Trump met with Crypto.com exchange CEO Kris Marszalek to discuss plans to establish a Strategic Bitcoin Reserve and appoint crypto-friendly members to work within his administration’s financial departments and Congress.
- Crypto advocacy group Bitcoin Policy Institute has shared a draft of the executive order that Trump will sign to create the national Bitcoin stockpile. The order proposes that the reserve will be formed under the Treasury Department’s Exchange Stabilization Fund (ESF) and will incorporate the $22 billion worth of BTC seized by authorities as its foundational assets.
- The Strategic Bitcoin Reserve will allocate up to 2% of ESF’s portfolio value to acquire BTC under an 18-month pilot period. Following Trump’s lead, lawmakers in Pennsylvania, Texas, and Ohio have proposed legislation to set up a Bitcoin reserve under the treasuries of their respective states.
Bitcoin (BTC) surged to a new all-time high of $108,262 on December 17, after reports suggested that crypto research and advocacy group the Bitcoin Policy Institute has drafted an executive order for President-elect Donald Trump to establish a U.S. Strategic Bitcoin Reserve.
The flagship cryptocurrency has rallied over 159% this year, breaking its price record multiple times since Trump’s election victory on November 5, 2024.
Trump Meets With Key Crypto Figures To Discuss Creation of U.S. Strategic Bitcoin Reserve
On Monday, the 45th and soon-to-be 47th U.S. President met with Kris Marszalek, CEO of the Crypto.com exchange, at his Mar-a-Lago residence to discuss plans for a Strategic Bitcoin Reserve and appointing crypto-related individuals within his cabinet’s financial departments and Congress.
BTC experienced a surge soon after the meeting was announced, showing the market’s positive response to the incoming administration’s interest in Bitcoin. Following their discussions, crypto media outlet Bitcoin magazine published a draft executive order created by the Bitcoin Policy Institute, outlining the framework for establishing the Bitcoin reserve within the U.S. Treasury’s Exchange Stabilization Fund (ESF).
ESF is a mechanism that is typically used by Washington for foreign exchange intervention and international monetary operations.
Dennis Porter, co-founder and chairman of the crypto advocacy group Satoshi Action Fund, shared the draft document on X, confirming that Trump is indeed exploring an Executive Order to establish the government’s Bitcoin reserve. The proposed executive order includes specific requirements for implementation, like incorporating seized Bitcoin already held by the U.S. government, including assets from forfeiture cases, that would need to be consolidated under the Strategic Bitcoin Reserve within a week of the President’s order going into effect.
Under the draft order, the Treasury Department would have 60 days to create a program for acquiring and managing the government’s Bitcoin holdings. Bitcoin Policy Institute’s document also emphasized the importance of conducting strict audits and setting robust security standards for the reserve. \
The U.S. Government Will Allocate 2% of Treasury Funds To Acquire Bitcoin Over 18 months
The executive order proposes allocating up to 2% of the ESF’s portfolio value for acquiring Bitcoin during an 18-month pilot period. Subsequently, this would discontinue the auction of confiscated Bitcoins, instead using the assets as the reserve’s foundation.
The Strategic Bitcoin Reserve would mark a significant change in the U.S. government’s financial strategy, aligning BTC with traditional foreign reserve assets such as gold and silver. Crypto advocates argue that the move would allow the country to hedge against macroeconomic risks while enhancing its financial stability.
Representative Cynthia Lummis of Wyoming, a vocal proponent of Bitcoin in Congress, has been instrumental in drafting the executive order. Her earlier proposal called the “Bitcoin Act”, laid the foundation for integrating Bitcoin into the national reserve framework. While her bill awaits Congressional approval, President Trump’s executive order could fast-track the initiative.
Meanwhile, Ohio House Republican Leader Derek Merrin has introduced House Bill 703, which would allow the creation of a Bitcoin Reserve within the Buckeye State’s Treasury Department. According to an X post by the former Mayor of Waterville, the proposed legislation aims to protect Ohio’s funds against inflation by incorporating Bitcoin into its investment portfolio.
Lawmakers in Texas and Pennsylvania have already introduced legislation to establish a Strategic Bitcoin Reserve under their respective Treasury departments.
According to Statista, Ohio currently has $72.16 billion in public debt, which mainly consists of general obligation bonds and special obligation bonds used to fund infrastructure, education, and other public projects.
There has been widespread support from crypto advocates and pro-crypto lawmakers for state-level initiatives to adopt Bitcoin for their reserves, arguing that the move would enhance financial strength as more world governments will follow in the footsteps of the United States policy position under President Trump.
Matthew Sigel, head of digital assets research at asset manager VanEck, suggests that government adoption of Bitcoin could encourage more institutional investors to embrace digital assets, further cementing their role in global finance.
If things go as planned, then these federal and state-level initiatives would represent the first formal government-controlled Bitcoin reserves in the United States, setting a precedent for other states and countries to follow.
The executive order draft document specifically emphasizes the goal of maintaining the United States’ leadership in global finance and digital assets while building economic resilience.
Michael Saylor Urges U.S. Government To Buy Bitcoin To “Own The Future”
During an interview with CNBC, Michael Saylor, the co-founder and chairman of business intelligence firm MicroStrategy, reaffirmed that the incoming Trump administration is serious about establishing a national Bitcoin stockpile. He emphasized that all the capital outside of the U.S. and “all the 20th-century antiquated capital” will flow into crypto assets, particularly the Bitcoin network.
Saylor urged the U.S. government to buy Bitcoin now to “own the future”, predicting that the flagship cryptocurrency is going up by a factor of 100.
Meanwhile, President-elect Trump also reassured his commitment to crypto enthusiasts after stating that his administration will be doing “something great with crypto” because he wants the U.S. to be an industry leader.
At the time of writing, Bitcoin (BTC) is trading at $104,710 – down 2.30% over the last 24 hours.
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