Trump Signs Order for Strategic Bitcoin Reserve

Under the new development, President Trump has given the go-ahead for the creation of a strategic cryptocurrency reserve.

The reserve will contain tokens already held by the government, sparking disappointment among users who had hoped for a government plan to buy new cryptocurrencies.

The announcement, made on Thursday ahead of Friday's planned cryptocurrency summit, started a bearish trend for Bitcoin, taking it to as low as $85.000 dollars.

The Bitcoin Reserve Begins Its Path

According to thestatement by David Sacks, the strategic reserve will be fueled by Bitcoins owned by the federal government, seized as part of criminal forfeiture proceedings.

The new executive order provides for the possibility of Bitcoin purchases in the future. The Secretaries of Commerce and the US Treasury have been given the authorisation to develop economically viable strategies to purchase additional Bitcoins, provided that such plans do not result in additional costs to American taxpayers.

Following the news, Andrew O'Neill, director of digital asset management at S&P Global Ratings, said:

"The significance of this executive order is primarily symbolic, as it marks the first time Bitcoin has been formally recognised as a reserve asset by the US government."

O'Neill added:

"The reserve will only include Bitcoins already held by the US government. There is no indication yet as to how many, if any, will be purchased nor any timeline."

Trump's promise of a strategic cryptocurrency reserve and expectations for more favourable regulations have pushed the price of tokens up to an incredible $109,071.

The news has prompted mixed reactions in the crypto community. While some consider it a "strategic approach", experts such as Charles Edwards, founder of Capriole Investments, commented:

"This is the most disappointing result we could have expected this week. No active buying means that this is just a fancy name for Bitcoin that the government already owned. It is just an illusion."

Trump also named five cryptocurrencies that will be added to the reserve. The five currencies include SOL, BTC, ETH, XRP and ADA.

Sacks pointed out that federal authorities will adopt a strategy to maximise the value of BTC in the reserve, without providing further details.

Sacks finally stated:

"The United States will not sell any Bitcoin deposited in the Reserve. It will be kept as a store of value. The Reserve is like a digital Fort Knox for cryptocurrency often called 'digital gold'."