Market experts analyze Trump's strategic bitcoin reserve, which excludes $17 billion from possible BTC sales.
David Sacks, the White House's chief of cryptocurrency and artificial intelligence, told Channel X that the reserve would also include other cryptocurrencies seized through court or civil proceedings.
Author: Omkar Godbole, Shaurya Malwa | Edited by : Parikshit Mishra Updated: Mar 7, 2025 7:33 AM UTC Published: Mar 7, 2025 5:31 AM UTC
Key facts:
- US President Donald Trump has signed an executive order to create a strategic bitcoin reserve that will include BTC confiscated by the US government as a result of law enforcement actions.
- The US government currently holds 198,000 bitcoins, which is worth approximately $17.3 billion, and this move effectively removes pressure on the market worth over $17 billion.
- Opinions on the creation of the reserve are divided: some see it as a symbolic step, while others see it as a clear positive signal.
US President Donald Trump on Thursday signed an executive order to create a Bitcoin (BTC) Strategic Reserve, which will consist of BTC confiscated by the US government as a result of law enforcement actions.
David Sacks, who heads the White House's Cryptocurrency and Artificial Intelligence Sector, told Channel X that the reserve will also include other cryptocurrencies seized in criminal or civil cases, adding that taxpayer funds will not be used to purchase BTC or other coins.
According to Arkham Intelligence, the US government currently holds 198,000 bitcoins, worth about $17.3 billion. If you count them as reserves, that pretty much eliminates more than $17 billion in selling pressure from the market.
However, Bitcoin prices continued to fall, hitting a low of around $84,700, reflecting investor frustration over the lack of new BTC purchases for the U.S. government. However, prices have recovered to $87,600 at press time in anticipation of Trump announcing favorable tax policies for cryptocurrencies at the White House crypto summit on Friday.
Here's what market experts say about the strategic reserve.
Valentin Fournier, analyst at BRN
“The order has disappointed some investors because it clearly states that the government does not intend to purchase additional assets beyond those obtained through confiscation. The lack of a clear purchase plan has led to confusion, affected market sentiment, and caused the prices of Bitcoin, Ethereum, and Solana to decline by 4% daily.”
“Commerce Secretary Howard Lutnick has been authorized to develop a budget-neutral strategy to acquire additional bitcoin. Given his close ties to bitcoin through his involvement with MicroStrategy, this could indicate a hidden accumulation strategy by the U.S. government that could trigger a price rally.”
Dick Lo, CEO of TDX Strategies
“The initial disappointment was due to high expectations before the announcement. However, the news is generally positive: it would be unreasonable to expect new purchases without a clear funding plan; an important distinction was made between Bitcoin and other cryptocurrencies, i.e., there is no reason to buy altcoins
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