Trump Creates U.S. Bitcoin Reserve Using Seized BTC: Market Impact Revealed

The US government has accumulated a large Bitcoin stash over the years, mainly through criminal seizures and civil forfeitures. Now, President Donald Trump has signed an executive order to create a Strategic Bitcoin Reserve. This reserve will be funded using seized Bitcoin, meaning taxpayers won’t have to pay for it.

Trump’s crypto policy advisor, David Sacks, compared the move to building a “digital Fort Knox,” aiming to strengthen America’s position in the global crypto economy.

How Much Bitcoin Does the US Government Own?

There is some uncertainty about how much Bitcoin the US government actually holds. David Sacks estimates the total to be around 200,000 BTC, leading to an official audit to verify the exact figure. 

Crypto analyst Conor Grogan puts the number at 198,109 BTC, worth roughly 18 billion dollars at current prices. However, another analyst, Alex Thorn, argues that only 86,000 BTC is available for use. The remaining 112,000 BTC comes from the Bitfinex hack and is expected to be returned rather than included in the reserve.

Key Points From Trump’s Executive Order

• The government will not sell Bitcoin stored in the reserve.
• An official audit has been ordered to determine the actual holdings.
• The Treasury and Commerce Departments will explore ways to grow the reserve without using taxpayer money.
• A separate Digital Asset Stockpile has been created for non-Bitcoin crypto assets seized in legal cases.

Seized vs. Forfeited: How Much Bitcoin Is Usable?

Analyst Miles Deutscher explains the difference between Bitcoin the government holds and Bitcoin it can actually use. While the US technically controls 198,000 BTC, only 88,000 BTC—about 43 percent—is available. The rest is caught up in legal disputes, mainly related to the Bitfinex hack.

This distinction between seized and forfeited assets will determine how much Bitcoin can be used for the Strategic Reserve.

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Is Bitcoin the New Gold?

Samson Mow, CEO of JAN3, says the Strategic Bitcoin Reserve is more than just a collection of seized assets. He sees it as the start of nation-state Bitcoin adoption.

Some critics point out that the US isn’t actually buying Bitcoin, but Mow suggests that alternative methods could be used to increase holdings. These could include Bitcoin-backed bonds or selling a portion of the country’s gold reserves.

Mow also highlights the competition between the US and China in Bitcoin accumulation. With China holding 194,000 BTC, he believes the US won’t want to fall behind and could look for ways to acquire more Bitcoin. This could spark a global race among nations to build their own Bitcoin reserves.

Crypto Markets React

The market reacted strongly to Trump’s announcement. Bitcoin saw a brief sell-off due to confusion over how the reserve would be funded, but altcoins like ADA, XRP, and SOL experienced price jumps.

In the past, when the US government has sold Bitcoin, it has caused market downturns. However, David Sacks has reassured investors that the government will not sell Bitcoin from the reserve. This has given traders more confidence in Bitcoin’s price stability.

The US just put Bitcoin on the same playing field as gold—now the real game begins.