The US President Trump has signed an executive order last week to establish a strategic Bit reserve, but did not mention buying additional Bits with extra funds, only saying that the Bits confiscated by the US government from criminal or civil cases will be used as reserves, and prohibiting the government from selling these Bits, which has caused great disappointment among market investors.
Although the order mentioned that the Secretary of the Treasury and the Secretary of Commerce should develop a strategy to acquire more Bits without additional budgets and without increasing costs to US taxpayers, given the background of the Trump administration's massive cuts in the federal budget, it may be difficult to squeeze out new funds.
However, on the other hand, Trump also signed another executive order last week, ordering the US Treasury Department and the Department of Commerce to establish a sovereign wealth fund within the next 12 months, which has led the crypto community to speculate that the fund may also be used to establish a Bit strategic reserve.
Former senior Morgan Stanley executive to lead the fund, with funds coming from tariffs
According to a Reuters report, Michael Grimes, a well-known technology investment banker who previously worked at Morgan Stanley, left the bank last month and has taken on the role of senior advisor to the US Department of Commerce, and is expected to lead the US sovereign wealth fund. The discussions about him leading the fund are still ongoing, and the plan may be subject to changes.
However, the relevant details indicate that the plan for the sovereign wealth fund is gradually taking shape, and according to informed sources, the source of funds for the fund will be the Bureau of Foreign Affairs, as Trump recently announced the establishment of the Bureau of Foreign Affairs, which will be responsible for managing the revenue generated from tariffs on imported foreign goods. If Trump's current tariff strategy remains unchanged, the fund should be able to generate hundreds of billions to over a trillion dollars in revenue each year.
Who is Michael Grimes?
During his time at Morgan Stanley, Grimes was known for leading the IPOs of many well-known tech companies, including Meta, Uber, and Airbnb, and also served as an advisor in Musk's acquisition of Twitter. He had worked at Morgan Stanley for over 30 years, and was one of the global heads of the technology investment banking business before leaving.
Former Treasury and Commerce Department official Jim Secreto praised the decision to have someone like Michael Grimes lead the sovereign wealth fund, but pointed out that the experience with the CHIPS Act shows that for Washington to succeed, it needs both Wall Street and government experts to solve all the problems.
Jim Secreto believes that the internal power struggles and the strong figures of different factions within the Trump administration will pose huge challenges to the investment plans of the fund, especially under the close scrutiny of Congress and the public.
However, Reuters also pointed out that many countries in the Middle East and Asia have already established similar sovereign wealth funds, using government funds to invest directly, but such funds usually rely on budget surpluses to make investments, while the US has been in a long-term fiscal deficit, and the establishment of this fund may require Congressional approval.
