United States President Donald Trump Announces National Crypto Reserve, Aims to Make US the Crypto Capital of the World
On Sunday, United States President Donald Trump announced that his administration would create a national strategic crypto reserve, which would include five cryptocurrencies. In a statement on his Truth Social network, Trump declared his intention to make the US "the crypto capital of the world."
Trump revealed that a crypto working group, established after his inauguration in January, is actively progressing with the creation of the reserve. This move fulfills promises he made to crypto lobbyists during his election campaign. Following the announcement, the values of the named cryptocurrencies, including Bitcoin, surged after weeks of decline.
The announcement precedes the first-ever White House Crypto Summit, scheduled for Friday, and marks a significant shift in US crypto policy. The previous administration under President Joe Biden had cracked down on the crypto industry due to concerns about fraudulent transactions. Trump himself had been a crypto skeptic during his first term, famously calling Bitcoin a "scam." However, in his Sunday statement, he criticized Biden-era policies as "corrupt."
Trump stated, "A crypto reserve will elevate this critical industry after years of corrupt attacks by the Biden administration… I will make sure the US is the crypto capital of the world. We are making America great again."
What Will the US Crypto Reserve Include?
In his Sunday posts, Trump initially mentioned that smaller cryptocurrencies—XRP, Cardano, and Solana—would be part of the national crypto reserve. About an hour later, he added that "obviously, BTC and ETH… will be at the heart of the Reserve," referring to Bitcoin and Ethereum, the two largest cryptocurrencies by market value.
Markets responded positively to the announcement. Cardano surged by approximately 60% to $1.25, up from $0.65, before settling at around $0.97 by Monday. Solana rose from $150 to $170, and XRP jumped from $2.25 to $3, with increases of about 12% and 20%, respectively. Bitcoin and Ethereum both gained over 10%, with Bitcoin reaching $94,000 from $86,000.
During his campaign, Trump had actively courted the crypto industry, promising aggressive measures to support cryptocurrencies once in office. His election victory in November 2024 led to significant surges in the crypto market, with Bitcoin reaching an all-time high of $109,000. However, the market experienced a slowdown in the following weeks.
In January, Trump and First Lady Melania Trump launched their own meme coins—digital currencies inspired by viral trends but lacking the financial or technological backing of traditional cryptocurrencies. Elon Musk, who leads Trump’s government efficiency initiatives, has also frequently promoted cryptocurrencies on his social media platform X (formerly Twitter).
What Could Be the Aim Behind a Crypto Reserve?
Governments increasingly view cryptocurrencies like Bitcoin as alternative stores of value, similar to gold, and as a hedge against inflation. However, experts caution that the crypto market’s volatility makes it a risky alternative compared to gold.
Countries that hold cryptocurrencies seized in criminal investigations could use them as legal tender. Switzerland is considering crypto reserves following a public referendum, while Brazil, Germany, Hong Kong, Poland, and Russia are also exploring the idea.
The US government currently holds the largest cryptocurrency reserves globally, with 200,000 Bitcoin. Trump’s pro-crypto stance is expected to lend further credibility to various cryptocurrencies. If the US establishes a crypto reserve, other nations may follow suit, given the US’s significant influence as the world’s largest economy.
Trump’s push for a crypto reserve is expected to position the US as a leader in the field, giving it considerable influence over future international crypto regulations. Additionally, if the US government holds a substantial portion of global crypto tokens, it could help reduce the price volatility currently associated with these digital currencies.
In July 2024, Republican Senator Cynthia Lummis introduced the Bitcoin Act, which proposed transferring all government-held Bitcoin to the US Treasury and establishing a crypto reserve. Lummis argued that such a reserve would help the US manage its Bitcoin holdings transparently and maintain its leadership in financial innovation. The bill is still under consideration.
What Other Strategic Reserves Does the US Hold?
The US currently maintains only one other strategic reserve: the Strategic Petroleum Reserve (SPR), which consists of vast oil stocks stored in Louisiana and Texas. The SPR is described as "the world’s largest supply of emergency crude oil," with up to 714 million barrels stored in underground salt caverns along the Gulf of Mexico. Managed by the US Department of Energy, the SPR was last accessed in June 2011 when President Barack Obama released 30 million barrels to address supply disruptions caused by the Libyan conflict.
Do Other Countries Have Crypto Reserves?
Only three countries currently treat cryptocurrencies as legal tender:
- El Salvador: In 2021, El Salvador became the first country to adopt Bitcoin as legal tender under President Nayib Bukele. However, a Yale study in January 2024 found limited usage of Bitcoin. The country currently holds about 6,088 Bitcoin, valued at $558 million.
- Central African Republic: CAR adopted Bitcoin as legal tender in 2022, though the size of its reserves is unclear.
- Bhutan: In January 2024, Bhutan’s Gelephu Mindfulness City began holding Bitcoin and Ethereum in strategic reserves. The country mines and owns about 11,000 Bitcoin, valued at $1.1 billion.
Several other countries hold cryptocurrencies, often seized during law enforcement actions. For example:
- United States: Holds about 200,000 Bitcoin, valued at $16.7 billion.
- China: Despite banning crypto transactions, China holds about 194,000 Bitcoin, valued at $16.2 billion, seized from Ponzi schemes.
- United Kingdom: Holds 61 Bitcoin, worth $5 million, seized from money laundering networks.
- Ukraine: Holds 1,200 Bitcoin, valued at $100 million, from public donations amid the war with Russia.
- Finland: Holds 890 Bitcoin, worth $74 million, seized during narcotics investigations.
- India: Holds 450 Bitcoin, valued at $37 million, seized during crypto fraud investigations.
Trump’s announcement marks a significant development in the global crypto landscape, with the US poised to take a leading role in the industry’s future.
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