Author ｜ Alex Xu
Crypto and AI czar David Sacks just tweeted that President Trump has signed an executive order to establish a Strategic Bit Reserve, with the main points as follows:
1. The reserve will be based on the existing BTC controlled by the federal government, and any forfeited BTC will also be added to the reserve.
2. These BTC will not be sold (at least during Trump's term).
3. The government will not set a separate budget (i.e., "budget-neutral") to purchase BTC.
4. Trump has fulfilled his promise.
Link to the tweet:
How to understand the above news? I think the main points are as follows:
1. This "Strategic Bit Reserve" is not the same as the "Strategic Federal Reserve" bill being promoted by Senator Cythia Lummis at the federal level. The former can be directly controlled by the government, while the latter requires congressional legislation; the former also does not have a separate budget for purchasing BTC (if additional funding is needed, it requires congressional approval), while the latter will provide a separate budget for purchasing BTC, with the goal of buying 1 million BTC in 5 years, and the source of the budget may come from the revaluation of the value of the US's existing gold reserves, thereby expanding the asset count of the Federal Reserve, providing a budget for the Treasury Department to purchase BTC. David Sacks' statement that "the government will not acquire other assets for the reserve" does not mean that the widely perceived Bit strategic reserve has suddenly become something that relies solely on forfeiture and does not spend money to purchase BTC.
2. Can the above executive order be seen as Trump fulfilling his "promise"? At the executive level, yes. Because at the executive level, Trump's ability to do is limited, and what he has basically done so far, such as establishing a Bit strategic reserve (at the executive level), setting up a dedicated crypto advisory council, firing/forcing out former SEC chairman Gensler, and relaxing industry regulations, are what he promised during the campaign. But overall, the promise has not been fully fulfilled, as Trump clearly stated during the campaign that he would also build a federal strategic reserve (Strategic Federal Reserve), purchase more BTC, which is also the content of the bill being promoted by Senator Cythia Lummis in Congress.
3. Will Trump announce more positive news about the Bit reserve or other things? It's possible, as he is the keynote speaker at the White House crypto summit to be held tomorrow morning Beijing time. But as mentioned earlier, at the executive level, there is not much he can do for BTC, and the most extreme measure is to order the Treasury Department to directly use the Exchange Stabilization Fund to purchase BTC, which is an existing fund and does not require additional approval from Congress, and the fund's operating goal is to "stabilize the US dollar exchange rate". But as I mentioned in my previous article "A Brief Analysis of Trump's Promotion of SOL XRP ADA National Reserves", Trump's style is to like to play big with small moves, to create big news with low-cost small measures, and he is not willing to put in a lot of effort and break through major obstacles for things that have no big returns and only high risks. Although using the Exchange Stabilization Fund to purchase BTC is theoretically within his executive power, this real action is too extreme, and the subsequent troubles will be many, and it may also interfere with Senator Cythia Lummis' efforts to promote the bill in Congress (the two actions overlap).
4. What we need to pay attention to is that Trump's "madman persona" has become more prominent since he took office, with his external performance being reckless and hoping that foreign counterparts will see him as a madman who dares to do anything, in order to gain political benefits through coercion; internally, he is constantly trying to expand the boundaries of presidential power through various executive actions, including but not limited to mass layoffs and forced government employee shutdowns through DOGE, and withholding government budgets approved by Congress. He is putting the "unitary presidency" into practice, with a highly obedient cabinet team supporting him on one hand, and the Supreme Court's ruling in July last year that the president has "absolute immunity from criminal prosecution when exercising official executive power" giving him more confidence on the other hand. So it's also possible that Trump may change his tune and make more exaggerated positive promises in the face of a large backlash from the crypto community, but the feasibility of implementation is still doubtful.
5. The trend of Bit entering national finance is still slowly progressing, despite the obstacles. The key focus should still be on the progress of the formal Federal Reserve bill and the progress of Bit reserve bills in various states.
Crypto and AI czar David Sacks just tweeted that President Trump has signed an executive order to establish a Strategic Bit Reserve, with the main points as follows:
1. The reserve will be based on the existing BTC controlled by the federal government, and any forfeited BTC will also be added to the reserve.
2. These BTC will not be sold (at least during Trump's term).
3. The government will not set a separate budget (i.e., "budget-neutral") to purchase BTC.
4. Trump has fulfilled his promise.
Link to the tweet:
How to understand the above news? I think the main points are as follows:
1. This "Strategic Bit Reserve" is not the same as the "Strategic Federal Reserve" bill being promoted by Senator Cythia Lummis at the federal level. The former can be directly controlled by the government, while the latter requires congressional legislation; the former also does not have a separate budget for purchasing BTC (if additional funding is needed, it requires congressional approval), while the latter will provide a separate budget for purchasing BTC, with the goal of buying 1 million BTC in 5 years, and the source of the budget may come from the revaluation of the value of the US's existing gold reserves, thereby expanding the asset count of the Federal Reserve, providing a budget for the Treasury Department to purchase BTC. David Sacks' statement that "the government will not acquire other assets for the reserve" does not mean that the widely perceived Bit strategic reserve has suddenly become something that relies solely on forfeiture and does not spend money to purchase BTC.
2. Can the above executive order be seen as Trump fulfilling his "promise"? At the executive level, yes. Because at the executive level, Trump's ability to do is limited, and what he has basically done so far, such as establishing a Bit strategic reserve (at the executive level), setting up a dedicated crypto advisory council, firing/forcing out former SEC chairman Gensler, and relaxing industry regulations, are what he promised during the campaign. But overall, the promise has not been fully fulfilled, as Trump clearly stated during the campaign that he would also build a federal strategic reserve (Strategic Federal Reserve), purchase more BTC, which is also the content of the bill being promoted by Senator Cythia Lummis in Congress.
3. Will Trump announce more positive news about the Bit reserve or other things? It's possible, as he is the keynote speaker at the White House crypto summit to be held tomorrow morning Beijing time. But as mentioned earlier, at the executive level, there is not much he can do for BTC, and the most extreme measure is to order the Treasury Department to directly use the Exchange Stabilization Fund to purchase BTC, which is an existing fund and does not require additional approval from Congress, and the fund's operating goal is to "stabilize the US dollar exchange rate". But as I mentioned in my previous article "A Brief Analysis of Trump's Promotion of SOL XRP ADA National Reserves", Trump's style is to like to play big with small moves, to create big news with low-cost small measures, and he is not willing to put in a lot of effort and break through major obstacles for things that have no big returns and only high risks. Although using the Exchange Stabilization Fund to purchase BTC is theoretically within his executive power, this real action is too extreme, and the subsequent troubles will be many, and it may also interfere with Senator Cythia Lummis' efforts to promote the bill in Congress (the two actions overlap).
4. What we need to pay attention to is that Trump's "madman persona" has become more prominent since he took office, with his external performance being reckless and hoping that foreign counterparts will see him as a madman who dares to do anything, in order to gain political benefits through coercion; internally, he is constantly trying to expand the boundaries of presidential power through various executive actions, including but not limited to mass layoffs and forced government employee shutdowns through DOGE, and withholding government budgets approved by Congress. He is putting the "unitary presidency" into practice, with a highly obedient cabinet team supporting him on one hand, and the Supreme Court's ruling in July last year that the president has "absolute immunity from criminal prosecution when exercising official executive power" giving him more confidence on the other hand. So it's also possible that Trump may change his tune and make more exaggerated positive promises in the face of a large backlash from the crypto community, but the feasibility of implementation is still doubtful.
5. The trend of Bit entering national finance is still slowly progressing, despite the obstacles. The key focus should still be on the progress of the formal Federal Reserve bill and the progress of Bit reserve bills in various states.
