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Crypto for Advisors: What Is a Bitcoin Strategic Reserve?

In today’s crypto for advisors, Alex Tapscott explains what the Bitcoin Strategic Reserve is and why it matters to investors.
Then, Bryan Courchesne from DAIM answers questions investors have about setting up a personal strategic reserve in Ask an Expert.
You’re reading Crypto for Advisors, CoinDesk’s weekly newsletter that unpacks digital assets for financial advisors. Subscribe here to get it every Thursday.
Will Trump’s Bitcoin Reserve Move the Needle?
On March 7, President Trump signed an executive order creating both a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile, the latter comprised of tokens like ETH, SOL, XRP and ADA.
The Strategic Bitcoin Reserve (SBR) and the Digital Asset Stockpile will be capitalized initially with crypto assets obtained by the Department of Treasury through criminal and civil asset forfeiture. Analysts estimate that they will capitalize the SBR with $6.9 billion in bitcoin currently in the government wallet.
The news disappointed some bitcoin bulls, who were annoyed by the inclusion of other crypto assets and by the relatively modest initial goals of the Reserve. Altcoin fans were initially euphoric following Trump’s tweet announcing the plan but soon became disillusioned as it became evident that the plan for the U.S. Digital Asset Stockpile was severely limited in scope — the government sits on only $400 million of non-BTC coins and has no intention of adding more.
So what should we make of all this?
The idea of a strategic reserve for critical assets or commodities is not new. The U.S. government maintains strategic stockpiles of gold and petroleum, and governments and central banks hold large balances of foreign currencies, for example.
Using that framework, one could argue that a strategic bitcoin reserve makes sense if you believe bitcoin will continue to mature into an important commodity and monetary asset.
By vowing never to sell any of its BTC, the government effectively removed many billions of dollars in potential selling pressure from the market forever. What’s more, they are sending a signal to other governments that this is a reasonable way to treat seized bitcoin, labeling it “strategically important.”
And this could just be the start: Treasury Secretary Scott Bessent and Commerce Secretary Howard Lutnick, both well-known bitcoin bulls, are now authorized to develop budget-neutral strategies for acquiring additional BTC, provided that those strategies impose no incremental costs on American taxpayers. Among other things, they could:
Sell unused government assets, such as defunct and empty buildings.
Revalue the government’s gold and sell a portion off to buy bitcoin.
Use surplus in the Treasury’s Exchange Stabilization Fund (ESF), a funding facility controlled by the Treasury.
Sell altcoins from the U.S. Digital Asset Stockpile (worth approximately $408 million).
Use a portion of tariff revenue, such as that affecting the import of bitcoin mining equipment.
If implemented, these programs could significantly increase the size of the SBR.
What about the Digital Asset Stockpile?
One could argue that platforms like Ethereum and Solana are becoming more strategically important to the U.S. A Digital Asset Stockpile could help future-proof the government and signal to the industry that they’re a model user of new technology, akin to the federal government in the 1990s launching its own website.
Perhaps. But so far, it looks like the government has put very little thought into the Digital Asset Stockpile and has actually said it may even sell these digital assets to bolster the SBR.
For investors, the Strategic Bitcoin Reserve is neutral short-term and potentially positive long-term if it can scale through budget-neutral mechanisms. As for the Digital Asset Stockpile, we simply do not know enough to make a judgment one way or the other. The government may grow the asset base through revenue-neutral mechanisms, like with the SBR. Crypto and AI Czar David Sacks has said they are looking at many of the largest tokens by market capitalization, suggesting purchases may come at some point. Or maybe they dump their altcoins to boost their BTC balance.
In my view, the government should tone down these flashy stunts and instead focus on collaborating with industry, civil society, regulators and lawmakers to craft the laws and regulations that can put the industry on a firm footing, encourage investment from institutions and enterprises, and catalyze more capital formation and entrepreneurship..
—Alex Tapscott, managing director, Ninepoint Digital Asset Group
Ask an Expert
Q. Like the government, can I set up my own bitcoin strategic reserve?
We believe the establishment of a Bitcoin Strategic Reserve (SBR) is the perfect time for investors to consider creating their own personal bitcoin reserve. If the U.S. government sees the value in holding bitcoin as a strategic asset, there’s no reason individual investors shouldn’t consider doing the same. Bitcoin is one of the scarcest assets in existence, and any significant uptick in demand could drive its price substantially higher. While its volatility is well-known, the asset’s risk/reward profile makes it a prudent addition to a diversified portfolio in reasonable amounts.
Q. What factors should I consider?
The tendency of individuals to buy and hold bitcoin benefits all investors. Bitcoin’s digital scarcity ensures that there will only ever be 21 million coins. Any time a bitcoin is lost due to an inaccessible wallet or sent to an invalid address, the supply is permanently reduced — further increasing its scarcity.
Think of owning bitcoin as like being an early investor in prime digital real estate. You may have missed the opportunity to buy land in Manhattan during its development, but you don’t have to miss out on bitcoin. And unlike traditional property, you don’t need to purchase an entire bitcoin — you can own a fraction.
Investing in bitcoin isn’t just about securing a digital stake; it’s also about participating in a technological revolution that’s been gaining momentum for over a decade. While decentralized finance (DeFi) is often associated with assets like Ethereum and Solana, DeFi applications — including lending and staking — are increasingly being built on or alongside the Bitcoin blockchain. By holding bitcoin, you’re not only owning digital real estate but also gaining early exposure to a groundbreaking financial ecosystem.
However, the decision to buy bitcoin isn’t all-or-nothing. Your investment should reflect your overall portfolio, time horizon, liquidity needs and risk tolerance.
Keep Reading
Oklahoma Bill 1203, allowing the state to invest in digital assets, was passed by its House of Representatives.
GameStop’s board of directors unanimously voted in favor of updating its investment policy to include bitcoin as a treasury reserve asset.
The “Bitcoin Rights” bill was signed into law in Kentucky, providing protections for mining and self-custody of digital assets.
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Ripple and SEC File Joint Motion to Pause Appeals

Ripple Labs and the U.S. Securities and Exchange Commission (SEC) have jointly requested a pause in their respective appeals to finalize a potential settlement, per a motion filed on Thursday.
The filing signals a possible end to a high-profile dispute that has gripped the payments upstart industry since December 2020 for its sale of XRP tokens, which the SEC alleged were unregistered securities.
The case has been a focal point for debates over the regulatory status of cryptocurrencies in the United States, with Ripple arguing that XRP is a currency, not a security, and thus outside the SEC’s jurisdiction.
Ripple and the SEC have reached an “agreement in principle” to resolve all outstanding issues, per a post shared by attorney James Filan.
This includes not only the SEC’s appeal of the district court’s final judgment but also Ripple’s cross-appeal and the claims against Ripple founders Brad Garlinghouse and Chris Larsen.
The motion requests that the court hold the appeals process in abeyance — effectively pausing it — while the parties hammer out the final terms of the settlement, which still requires formal approval from the SEC’s commissioners.
This follows a similar request from the SEC and Gemini in early April, where the two parties requested the court approve a two-month pause to finalize a deal to close their long-running legal dispute over Gemini’s Earn program.
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Senate Dems Slam DOJ’s Decision to Axe Crypto Unit as a ‘Free Pass’ For Criminals

U.S. Deputy Attorney General Todd Blanche is under fire from Senate Democrats following his recent decision to narrow the Department of Justice’s (DOJ) crypto enforcement priorities and disband its crypto enforcement squad.
In a Thursday letter to Blanche, six Senate Democrats — Sens. Mazie Hirono (D-Hawaii), Elizabeth Warren (D-Mass.), Dick Durbin (D-Ill.), Sheldon Whitehouse (D-R.I), Chris Coons (D-Del.) and Richard Blumenthal (D-Conn.) — blasted his decision to cut the National Cryptocurrency Enforcement Team (NCET) as “giv[ing] a free pass to cryptocurrency money launderers.”
The Senators called Blanche’s directive that DOJ staff no longer pursue cases against crypto exchanges, mixers or offline wallets “for the acts of their end users” or bring criminal charges for regulatory violations in cases involving crypto, including violations of the Bank Secrecy Act (BSA), “nonsensical.”
“By abdicating DOJ’s responsibility to enforce federal criminal law when violations involve digital assets, you are suggesting that virtual currency exchanges, mixers, and other entities dealing in digital assets need not fulfill their [anti-money laundering/countering the financing of terrorism] obligations, creating a systemic vulnerability in the digital assets sector,” the lawmakers wrote. “Drug traffickers, terrorists, fraudsters, and adversaries will exploit this vulnerability on a large scale.”
In his memo to DOJ staff on Monday evening, Blanche cited U.S. President Donald Trump’s January executive order on crypto, which promised to bring regulatory clarity to the crypto industry, as the reason for his decision.
“The Department of Justice is not a digital assets regulator,” Blanche wrote, adding that the agency will “no longer pursue litigation or enforcement actions that have the effect of superimposing regulatory frameworks on digital assets while President Trump’s actual regulators do this work outside the punitive criminal justice framework.”
Instead, Blanche urged DOJ staff to focus their enforcement efforts on prosecuting criminals who use “victimize digital asset investors” or those who use crypto in the furtherance of other criminal schemes, like organized crime, gang financing, and terrorism.
Read more: DOJ Axes Crypto Unit As Trump’s Regulatory Pullback Continues
For the Senate Democrats, however, Blanche’s claim doesn’t quite cut the mustard.
“You claim in your memo that DOJ will continue to prosecute those who use cryptocurrencies to perpetrate crimes. But allowing the entities that enable these crimes — such as cryptocurrency kiosk operators — to operate outside the federal regulatory framework without fear of prosecution will only result in more Americans being exploited,” the lawmakers wrote.
The lawmakers urged Blanche to reconsider his decision to dismantle NCET, calling it a “critical resource for state and local law enforcement who often lack the technical knowledge and skill to investigate cryptocurrency related crimes.”
New York Attorney General Letitia James raised similar concerns in her own letter to Congress on Thursday, urging lawmakers to pass federal legislation to regulate the crypto markets. Though her letter itself made no mention of Blanche’s memo or the shuttering of NCET, a press release from her office highlighted that her letter “comes after the [DOJ] announced the dismantling of federal criminal cryptocurrency fraud enforcement, making a robust regulatory framework all the more critical.”
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President Trump Signs Resolution Erasing IRS Crypto Rule Targeting DeFi

With a signature from President Donald Trump, the decentralized financial (DeFi) corner of the crypto sector is now freed from U.S. Internal Revenue Service demands that such platforms be treated as brokers and required to track and report user activity.
That narrowly focused IRS rule, approved in the final days of former President Joe Biden’s administration, has been formally struck down, according to Representative Mike Carey, an Ohio Republican who backed the effort. And the agency is prevented from pursuing anything like it, according to the Congressional Review Act power used by lawmakers to get rid of the tax regulation.
Though the issue was relatively limited, its completion marks the first time a pro-crypto effort has cleared the U.S. Congress.
Both the Senate and House of Representatives agreed to reverse the IRS action with strong bipartisan showings, further underlining the crypto sector’s strength in this Congress. That could bode well for the industry’s chances with other more wide-ranging matters, including legislation to regulate stablecoin issuers and to set market rules for crypto transactions.
Trump’s signature on the DeFi tax resolution puts that concern for DeFi in the rearview. The next crypto priority in Congress has been stablecoin legislation. Similar bills have passed relevant committees in both the House and Senate and are awaiting floor votes in each chamber. Approvals would start a process to meld the two efforts into one compromise version.
The president has called for a bill to arrive on his desk by August, and the lawmakers behind the legislation have said such a timeline is still possible.
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