Bitcoin and crypto prices, after swinging wildly along with stocks, are braced for an epic showdown

This month, Bo Hines, executive director of the presidential council of advisers for digital assets, said the U.S. is exploring many ways to increase its bitcoin reserve

The price of bitcoin and other leading cryptocurrencies slid on Wednesday as the U.S. president Donald Trump administration officials began a meeting to discuss the creation of a bitcoin strategic reserve.

The bitcoin price has risen sharply this year along with the stock market, which has seen big gains thanks in part to a trade deal with China. However, the bull market has stalled in recent weeks as Trump ramped up his trade war with China.

Trump's administration is now planning to discuss a proposal to have the U.S. government begin buying bitcoin on a regular basis to build up a strategic reserve.

The move, which was first proposed by Trump at the Bitcoin 2024 conference in April, has been broadly welcomed by members of the bitcoin community.

The proposal to create a U.S. bitcoin strategic reserve is part of a broader executive order that Trump signed in December calling for the creation of a crypto stockpile.

The president also plans to meet with members of Congress to discuss passing long-awaited crypto legislation this year.

The administration is hoping to create a bipartisan majority in both the House and Senate to pass a bill that would set up a clear regulatory framework for cryptocurrencies in the U.S.

The move comes as several countries around the world have begun adopting bitcoin—something that could blow up the bitcoin price.

"We have actually received quite a number of approaches by a few governments and sovereign wealth funds on the establishment of their own crypto reserves," Richard Teng, who took over the top job at Binance after founder Changpeng "CZ" Zhao was ousted when he and the company plead guilty to failing to prevent money laundering in 2023, told the Financial Times without naming the countries.

Binance has also "been approached by quite a lot" of countries to "[help] them with formulating their regulatory framework to govern crypto," Teng added.

Trump has made passing long-awaited crypto legislation a priority for his second administration, as well as signing an executive order that calls for the creation of a bitcoin strategic reserve and crypto stockpile.

“Compared to many other jurisdictions, [the U.S. is] way ahead on that front,” Teng said, adding it’s spurred countries into action.

In March, Standard Chartered Bank’s head of crypto research Geoff Kendrick predicted the bitcoin price could surge to $500,000 per bitcoin within three years due to the creation of a U.S. bitcoin and crypto reserve.

Earlier this month, Pakistan and Kyrgyzstan revealed CZ, who still holds a majority stake in Binance, had begun advising them on developing crypto regulations and adoption of bitcoin and crypto.

“It makes sense that countries would reach out to industry players to ensure they have informed views on policy,” Anthony Pompliano, the chief executive of Professional Capital Management, said in an emailed note.

“This is the game theory that bitcoiners have been talking about for decades. Once one large nation starts to acquire bitcoin, all countries are incentivized to compete to acquire bitcoin … it is not possible to ignore the United States of America—the greatest economy ever constructed in human history. If America says bitcoin is strategically important, then other countries will start seeing the asset that way as well."

This month, Bo Hines, executive director of the presidential council of advisers for digital assets, said the U.S. is exploring many ways to increase its bitcoin reserve without using additional taxpayer dollars, including through tariff revenue and revaluing the government’s gold certificates.

The bitcoin price has dropped back from its all-time high of almost $110,000 per bitcoin but remains far higher than where it was before the November U.S. election.

“We’re looking at many creative ways, whether it be from tariffs, there’s literally countless ways in which you can do this,” Hines said in an interview with Pompliano.

“Bitcoin is experiencing unprecedented recognition at the highest levels of government, but it’s not happening in a silo," David Bailey, the chief executive of Bitcoin Magazine publisher BTC Inc, which also organises the bitcoin conference at which Trump first proposed the creation of a U.S. bitcoin strategic reserve, said in a statement teasing the upcoming Las Vegas Bitcoin 2025 conference.

"President Trump’s establishment of a strategic bitcoin reserve is one of many steps he’s taken to promote American innovation," Bailey said. In January, BlackRock chief executive Larry Fink revealed he’s had discussions with sovereign wealth funds about buying bitcoin and predicted such conversations could catapult the bitcoin price to $700,000 per bitcoin.

Last year, BlackRock’s head of bitcoin and crypto said sovereign wealth funds are showing interest in bitcoin alongside wild speculation that Qatar’s sovereign wealth fund was exploring buying bitcoin.