Bitwise’s Chief Investment Officer, Matt Hougan, believes that the United States’ Strategic Bitcoin Reserve (SBR) reduces the likelihood of a government ban on Bitcoin.
Impacts of the Strategic Bitcoin Reserve
1) Dramatically reduces the likelihood the US government will some day “ban” bitcoin;
2) Dramatically increases the likelihood that other nations will establish strategic bitcoin reserves;
3) Accelerates the speed at which other nations… https://t.co/S8LtFxq4ik
— Matt Hougan (@Matt_Hougan) March 7, 2025
According to him, the initiative will make cryptocurrency more legitimate in the eyes of investors and regulators. The reserve will prompt other countries to consider purchasing digital gold to secure it before the US begins mass acquisition, Hougan added.
On March 6, US President Donald Trump signed an order to establish the SBR. The reserve will be formed from confiscated cryptocurrencies.
The United States currently leads the list of countries by the number of bitcoins held—207,189 BTC (data from BitcoinTreasuries). China follows with 194,000 BTC, and the United Kingdom with 61,000 BTC.
El Salvador remains the only country where the first cryptocurrency is recognized as legal tender. The country’s reserve holds 6,103 BTC, according to Bitcoin Office.
Coinbase CEO Brian Armstrong is confident that many G20 member countries will follow the US example. He believes this will give new momentum to the legalization of digital gold.
Incredible execution from the Trump administration and a historic moment for Bitcoin and crypto!
I expect many of the G20 to take notice, and eventually follow America’s leadership. https://t.co/tPdltJ6GKq
— Brian Armstrong (@brian_armstrong) March 7, 2025
Bitwise’s Head of Research, Ryan Rasmussen, noted that the creation of the reserve eliminates the risk of mass Bitcoin sales by the US government. This will serve as an incentive for institutional investors, pension funds, and large organizations to use cryptocurrency.
The end game was never “the U.S. government buys all of the world’s bitcoin.”
A U.S. Strategic Bitcoin Reserve means…
— Other countries will buy bitcoin
— Wealth managers have no excuse
— Financial institutions have no excuse
— Pensions/Endowments have no excuse
— Fear of the… https://t.co/iAoyeo3PYL— Ryan Rasmussen (@RasterlyRock) March 7, 2025
John Deaton, founder of the law firm Deaton Law Firm, added that the US Treasury and Department of Commerce have been instructed to find “budget-neutral” ways to purchase Bitcoin. He noted that two years ago, no one could have imagined the government would take such a step.
Coinbase’s Director of Product, Conor Grogan, stated that the volume of the SBR could reduce market pressure by $18 billion if the government decides to hold them.
By my estimation, the US Govt owns 198.109k BTC. This executive order removes ~$18B of sell-side pressure https://t.co/XIv5SSRbBA pic.twitter.com/MN3xnITCNv
— Conor (@jconorgrogan) March 7, 2025
Alex Thorn, Head of Research at Galaxy Digital, clarified that only 88,000 BTC can be used as a reserve. According to him, about 112,000 BTC from the stockpile must be returned to the Bitfinex exchange. The expert highlighted the difference between “seized” and “confiscated” assets.
Back on March 3, Euro Pacific Capital President and Bitcoin critic Peter Schiff urged Congress to launch an investigation into Trump’s actions, which he called “the biggest crypto scam in history.”