8 Compelling Reasons Why a Strategic Crypto Reserve Is Not a Viable Solution

While many Bitcoin enthusiasts might welcome the idea of the US government acquiring and holding bitcoin as a strategic asset, this notion has several flaws. Firstly, if the reserve is established by executive order rather than Congressional approval, it can be easily reversed by a future administration, causing market instability. This lack of permanence raises concerns about the long-term value of such a reserve. Furthermore, the US, as the issuer of the global reserve currency, should not disrupt its own financial system by introducing a crypto reserve, which could lead to unease in dollar and Treasury markets. The US government already benefits from bitcoin's growth through tax revenues, making direct exposure to the asset unnecessary. Moreover, there is no strategic value in holding a crypto reserve, as bitcoin does not have an obvious use in times of emergency, unlike traditional strategic assets like oil or medical supplies. A crypto reserve would also dilute the value proposition of bitcoin by giving it an equal government endorsement alongside other, potentially rival, cryptoassets. Additionally, bitcoin has thrived without government support, and introducing a crypto reserve would subject it to political cycles and potential government interference. This policy could also turn the general public against bitcoin and its community, particularly if it is perceived as a handout to wealthy bitcoin holders. Ultimately, the proposal appears self-interested, given Trump's and his associates' ownership of various cryptoassets, which could undermine the credibility of his crypto policymaking efforts and lead to a backlash against the crypto industry as a whole.