The US Treasury will establish a strategic reserve of cryptocurrency, including Bitcoin

US President Donald Trump has launched two new management mechanisms for cryptocurrency assets possessed by the federal government. The policy change stops short of active buying of cryptocurrencies, which some industry figures were hoping for.

Trump's executive order on Thursday establishes a Strategic Bitcoin Reserve and a US Digital Asset Stockpile, overseen by the Treasury and dedicated to Bitcoin and other cryptocurrencies. The administration considers these digital assets, particularly Bitcoin, as stable stores of value that are likely to appreciate over time due to inherent scarcity.

"The reserve is like a digital Fort Knox for the cryptocurrency often called 'digital gold'," White House crypto tsar David Sacks explained, estimating that the government currently owns roughly 200,000 bitcoins worth over $17 billion. Sachs added that in the past the US sold some 195,000 bitcoins for just $366 million, representing a significant financial loss for taxpayers.

The primary source of the US government's cryptocurrency holdings is derived from criminal or civil asset forfeiture. Trump has instructed the Treasury secretary to explore "budget neutral" strategies for acquiring more bitcoins, although this directive does not extend to other digital assets.

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Charles Edwards, founder of Bitcoin-focused hedge fund Capriole Investments, criticized the decision as "the most underwhelming and disappointing outcome we could have expected," arguing that the lack of active purchasing policy merely rebrands existing government holdings.

Sacks contended that Trump's actions align with his campaign promise to establish the US as the "crypto capital of the world" through the support of innovative digital financial instruments.

(RT.com)