President Donald Trump Signs Executive Order Establishing a Strategic Bitcoin Reserve and Digital Asset Stockpile

President Donald Trump signed an executive order Thursday establishing a Strategic Bitcoin Reserve and Digital Asset Stockpile, continuing his administration's embrace of the cryptocurrency industry.

President Donald Trump is poised to host a Crypto Summit at the White House on Friday, marking a significant step in his administration's engagement with the cryptocurrency industry.

Ahead of the summit, Trump signed an executive order on Thursday establishing a Strategic Bitcoin Reserve and Digital Asset Stockpile.

The announcement comes as no surprise, considering Trump's previous statements and actions regarding cryptocurrencies.

Earlier this year, Trump signed an executive order forming the President's Working Group on Digital Asset Markets and tasked it with examining the creation of the Stockpile.

Moreover, Trump's interest in cryptocurrencies is not new. During his campaign rallies last year, he spoke favorably of cryptocurrencies and expressed his intent to make the U.S. the "crypto capital of the planet and bitcoin superpower of the world."

The administration's focus on cryptocurrency regulation stands in contrast to the Biden administration's approach, which has seen clashes with the volatile industry and the initiation of enforcement actions against crypto companies.

In contrast, Trump's administration is introducing a more amicable approach, aiming to keep the U.S. at the forefront of cryptocurrency development.

The executive order directs the Treasury and Commerce secretaries to work on "strategies" for acquiring additional bitcoin that are "budget neutral and do not impose incremental costs on United States taxpayers."

The bitcoin in the reserve will come from assets held by the U.S. Department of Treasury that were seized in court proceedings or paid in civil penalties to executive agencies.

The order also directs the Treasury secretary to report on the total value of bitcoin seized by the Department of Justice over the past five years.

The administration will begin the Strategic Bitcoin Reserve with 500 coins and increase it over time to a goal of 1 million bitcoin, according to the order. At current prices, 500 bitcoin is valued at about $16 million.

The Digital Asset Stockpile also will come from assets seized in court proceedings.

The executive order names five different cryptocurrencies that will be included in the Stockpile: bitcoin, ether, litecoin, chainlink and cosmos.

The order states that the administration will "work with Congress to adjust the legal and regulatory framework to best facilitate the development and use of digital assets in a safe, sound and stable manner."

It adds that the administration will monitor the macroeconomic impact of the initiative and provide Congress with a report on the initiative's effectiveness.

Sen. Cynthia Lummis, R-Wyo., has introduced legislation that would create a bitcoin reserve. While acknowledging concerns about its volatility, Lummis said it could help pay down the national debt and boost the U.S. dollar.

“While there may be short-term volatility, over the long term a bitcoin reserve like this will serve as an important and stable store of value,” Lummis wrote in a letter published in The Wall Street Journal.