We Finally Have A Strategic Bitcoin Reserve

To investors,

President Trump signed an Executive Order last night in the Oval Office to establish a Strategic Bitcoin Reserve. This is a monumental milestone for bitcoin — the nation states have officially arrived.

There have been a few countries like El Salvador and Bhutan that previously embraced the digital currency, but America is the big dog and their entrance into the global accumulation race marks a new era.

Here is Trump signing the Executive Order, which David Sacks describes as a “digital Fort Knox for digital gold”:

The details of the Executive Order were written in a near perfect way too. First, the United States is going to use the ~ 200,000 coins already in their possession as the seed capital for the strategic reserve. This decision makes the US government one of the largest holders of bitcoin globally.

You can see in the language used that the author of the Executive Order understood bitcoin. They explicitly call out bitcoin as digital gold, they reference the fact that bitcoin has never been hacked, and they highlight the digital scarcity created by bitcoin’s 21 million coin limit.

But the Executive Order did not stop there.

The US government is also opening the door for Scott Bessent and Howard Lutnick to purchase more bitcoin over time. The specific language in the EO says “the Secretaries of Treasury and Commerce are authorized to develop budget-neutral strategies for acquiring additional bitcoin, provided that those strategies have no incremental costs on American taxpayers.”

You have to hand it to the administration — this is a perfect balancing act.

They figured out a way to buy more bitcoin without requiring more taxpayer dollars to do it. This strategy alleviates the concerns of critics who didn’t want to see the US government increasing spending to buy a digital asset. But the strategy also appeals to bitcoiners who were concerned the United States would merely put the 200,000 existing coins in the reserve, but not work to acquire more bitcoin over time.

Win-win situation.

So where do we go from here? I believe there are a few important points to keep an eye on. First, the President and his team were able to construct a plan that explicitly called out the difference between bitcoin and the altcoins. They aren’t going to be abrasive to ETH, SOL, XRP, and ADA — they will actually be supportive of them via a digital asset stockpile — but the US is not going to work to accumulate more altcoins through open market purchases.

Second, the United States has a lot of options at their disposal to find money to buy more bitcoin. The Treasury Secretary was on CNBC this morning and explained how he views buying more bitcoin. Take a listen:

It sure sounds like the United States is going to continue buying more bitcoin over time.

Third, and maybe most importantly, the US government just put the global accumulation race for bitcoin into hyperdrive. Every country in the world has now been put on notice that nation states are trying to accumulate as many of the 21 million coins as they can.

Interestingly, the price of bitcoin did not skyrocket on news of the Executive Order. We saw the price dump instead because the general public seemed disappointed that the US did not announce a monster buy of bitcoin to go with the announcement. But I view the price decline as a perfect example of how markets don’t understand nuance and this will likely be seen as a moment of arbitrage in hindsight.

If you had asked me 8 or 9 years ago what would be the most bullish development for bitcoin, the idea of the US government buying bitcoin would have been near the top of the list. Fast forward about a decade and here we are — it is almost unbelievable.

The federal government is now hoarding the hardest money ever created. US states are going to quickly follow, along with foreign countries. There have been few times in history where individuals were able to front run government for a financial asset, but that is the beauty of bitcoin.

The digital currency is available to anyone with an internet connection. It doesn’t matter how much money you have, what language you speak, or what school your parents went to. You just need the ability to think independently and act boldly.

On this historic milestone, I can’t help but think about how crazy this whole thing has been. Satoshi invented the perfect solution to one of the hardest problems in the world. That solution was met with abrasiveness and critiques from people around the world. But in a free market where the best ideas win, bitcoin continues to succeed in the face of adversity and now the United States has capitulated.

Bitcoin is winning.

Just make sure that you are gracious in victory. There are still billions of people who need to learn about bitcoin and the economic freedom it can provide. The job is not finished yet. I can’t wait to see what else we can all accomplish together.

Hope you have a great weekend. I’ll talk to everyone on Monday.

- Anthony Pompliano

Founder & CEO, Professional Capital Management

Can Bitcoin Save America? with Vivek Ramaswamy

Vivek Ramaswamy is an American Entrepreneur, New York Times Bestselling Author & Former Republican U.S. Presidential Candidate. He is also the co-founder of Strive Asset Management and running to be the governor of Ohio.

This conversation was recorded at Bitcoin Investor Week in New York. In this conversation we talk about how bitcoin is a new era for the United States, how bitcoin and leadership can drive excellence, Vivek’s plan for Ohio, DOGE, and how citizens can help.

Enjoy!

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